Increase in Minimum Wage; A Good Thing or Another Trouble?

The People’s Court

Increase in Minimum Wage; A Good Thing or Another Trouble?

 

Greetings great people of this great nation, my lords we have come to the People’s Court with a contentious question; but it is important to lay down the premise precisely to help our understanding of the question.

It has now been years since the Federal Government approved 18,000naira as minimum wage, and since then till today most states have followed suit albeit with huge salary debts.

The private sector has no official compulsion to follow in this trend, and therefore salary curves have been determined by other factors, which we are not presently concerned with.

While there has been sustained calls for an increase of the minimum wage under President Buhari, the call has gained momentum, and the organized labour has fronted 56,000naira as the benchmark. On May 1 workers day celebration, of this year, the Federal Government made concrete promise to look into the issue of minimum wage and certainly increase it.

The question my lords, is whether this is a good thing or another trouble for the future.

It is a good thing

Adedamola Kunle

My lords, on the 5th of March in this year, 2017, I was in a banking hall in Abuja, Area 3, Garki District to be precise, when I saw a woman crying and begging the cashiers at the bank to allow her withdraw some money. The cashiers retorted that her salary has been used to offset the last two overdrafts she requested, and in fact she was still in debt. When I drew rapt attention to the scene, I discovered that the woman had trekked all the way to the bank, some 5 kilometres distance.

Frustrated and dejected, the woman narrated how she has been borrowing to afford the transport to her office at one of the federal ministries. Out of pity, we contributed some money and gave to her. The reality is that she is not alone. With inflation biting hard, transportation cost spiralling, cost of food jumping and debt mounting, how can  a person with conscience suggest that 18,000 should remain the benchmark for payment of workers. I humbly beg to disagree.

The reality of the situation of the Nigerian worker is that of a human being at subsistence level—with enough money only for survival. The economy of the Nigerian state makes it difficult for people to survive, and the only way government can help workers is to increase their pay.

My lords, the issue at hand does not require much words, it requires an answer to the question; do we allow our workers to continue in suffering while our political class feeds fat on the people’s treasury?

I move my lords to adopt my submissions.

 

It is a bad thing

Emeka Ezekwesiri Chigozie

A man whose house is on fire, does not go about chasing rats.

My lords, the country, Nigeria, is on fire; insecurity, economic recession, corruption, and now my lords, it is being suggested to add fuel to the fire as a way of extinguishing it. My lords that will be most irrational.

The question may be asked, what would be the effect of raising salaries in an economy experiencing negative inflation? Your lordships, the answer is obvious, it will lead to hyperinflation. While it is easy to be emotional towards workers, government workers to be precise, one may venture to ask, what would happen to those workers in the private sector, the artisans, business people etc? Who will increase their own salaries and income? Yet they would be required to operate in the same economy, with those whose increase in salary has caused an upsurge in prices of everything. They would in fact suffer most in an economy experiencing hyperinflation and high rate of unemployment, because their income is not necessarily going to increase.

My lords, raising the salaries of workers, will be like a dying man taking poison to sure himself, because even at the current rate, most states, without the aid of Federal Government handouts, cannot pay salaries. How then is it a solution to the lingering salary crisis of owing workers, to increase their pay?

My lords, we seem to forget that oil prices have continued to fluctuate and slump, as the world edges closer to clean energy. With relatively low export base, how can Nigeria generate enough revenue to meet the extra burden of increasing salaries? This, my lords defy logic. No wonder, my fathers would say, that he who brings an infested wood into his house, should expect the visitation of ants.

My lords, before I end, I want to draw the attention of my lords, to the fact that Nigeria has an imbalanced capital-recurrent expenditure, leaving little for capital expenditure. Without capital expenditure, economic development will be farfetched, and majority of Nigerians who don’t work for government will suffer.

I move my lords to adopt my submissions.