Govs Reject Proposed N60,000 Minimum Wage, Cite Sustainability Concerns


NGF Minimum Wage

The Nigeria Governors’ Forum (NGF) has thrown a wrench into the ongoing minimum wage debate, rejecting the proposed N60,000 ($133) monthly salary as unsustainable for many states.

In a statement released on Friday, the NGF expressed concern that adopting the N60,000 minimum wage would force states to allocate their entire Federal Account Allocation Committee (FAAC) funds solely to salary payments, leaving no resources for crucial development projects in infrastructure, healthcare, and education. The statement further warned that some states might even be pushed to borrow to meet their payroll obligations.

“All things considered, the NGF holds that the N60,000 minimum wage proposal is not sustainable and can not fly. It will simply mean that many states will spend all their FAAC allocations on just paying salaries with nothing left for development purposes.

“In fact, a few states will end up borrowing to pay workers every month. We do not think this will be in the collective interest of the country, including workers,” the statement read.

The NGF emphasized the need for a balanced approach, urging all parties involved, particularly labor unions, to consider the broader socio-economic context. They advocate for a minimum wage that is “sustainable, durable, and fair to all other segments of the society who have legitimate claim to public resources.”

Financial Strain on State Governments:

The NGF’s stance highlights the financial strain faced by many Nigerian state governments. With dwindling oil revenues and competing priorities for public spending, a significant increase in minimum wage could severely impact their ability to deliver essential services and invest in development projects.

Labor Unions vs. Economic Reality:

The NGF’s statement represents a pushback against the demands of labor unions who are advocating for a higher minimum wage to address rising inflation and improve living standards for Nigerian workers. However, the concerns regarding state finances cannot be ignored. Finding a compromise that addresses the needs of both workers and the broader economy will be critical in reaching a sustainable agreement.

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