Why govs are against publication of monthly allocation – Ex-TUC president

Former president of the Trade Union Congress, Peter Esele, speaks to IMOLEAYO OYEDEYI on the new minimum wage demands by organised labour, how governors can pay state workers the same salaries as Federal Government employees, among other issues

Ahead of the 2024 Workers’ Day, which comes up on May 1, organised labour has called on the Federal Government to announce the new minimum wage on this day. Do you think it is feasible?

Firstly, I will be surprised if organised labour says the Federal Government should announce the minimum wage. Probably the unions are hoping that by then, they would have concluded negotiations with the government. But for me, if the negotiation is not concluded by that time and the Federal Government goes ahead to announce the new national minimum wage, it is also possible that the organised labour will dispute it. Then, what we are going to have is another round of protests and strikes. So, my expectation for the labour unions is to put what they want on the table, while the Federal Government also puts theirs on the table.

Then, they both agree. But supposing the Federal Government goes ahead and unilaterally announces a new national minimum wage, in that case, labour would oppose it, which, as I said, will lead to another round of industrial actions. So, for me, it will be strange if the Federal Government announces the new minimum wage on Workers’ Day, though I believe governments are also smart enough not to make such a move unless they reach an informal agreement with the organised labour and the Nigeria Employers’ Consultative Association.

The current national minimum wage expires in a few days; if the Federal Government does not announce the new minimum wage on May 1, what do you think will be the reaction from the labour unions?

Well, it depends on what the Federal Government announces. For example, if the Federal Government should come out and say that the national minimum wage, which is N30,000 now will be N60,000 from May, while organised labour is asking for much more than that, there will be rounds of protests and strikes. So, that may also be another option. The best option is for the Federal Government and labour to agree. But it is possible that both the government and labour submit their proposals, but still don’t have a common ground. Let me give you an instance. During one of our past negotiations with the government when the minimum wage moved from N7,500 to N18,000; then, what we wanted was N57,000. But what the Federal Government proposed was N10,000. So, we moved back and forth on the issue. In the end, we both agreed on N18,000.

That time, our N18,000 was equivalent to $150 by our computation. But if you want to base minimum wage on the dollar to naira rate now, the inflation that will come on it will be too much. That is why I am saying that both parties should come to the roundtable and reach a reasonable agreement for the sake of the workers and also for the good of the Nigerian economy.

But should the Federal Government and labour fail to reach a concrete agreement on the new minimum wage, and the current one expires at the end of this month, what can both parties do as a new minimum wage must be operational from May?

The fact again remains that if both parties are still on the negotiation table by next month, it does not prevent the proposed new minimum wage from taking effect that month. What it simply implies is that whenever the agreement comes, the government will pay arrears. Even in the organised private sector, that is what we do. You can go on negotiation for even six months, but once an agreement is finally reached, and the last collective bargaining has expired, whatever is agreed whether in six months or a year later, the arrears will be paid by the employers, which is the government in this case. So, if the agreement is in place, it doesn’t matter whether they announce it on May 1 or not, the salary arrears must be paid.

Recently, organised labour said it has submitted its report to the Federal Government, which includes a fresh minimum wage demand of N615,000. What are your thoughts on this? Do you believe paying such a wage is realistic in the country?

Well, when you ask for N615,000 minimum wage, it is a negotiation part you are bringing to the table. So, if your employer accepts that, fine, but there is nothing wrong in asking for even N10m from your employer. But is it doable? Can you get the N10m? Meanwhile, the other party, which is your employer, should also have a right to say this is what we can pay. Negotiation such as this is not just to bandy figures; it has to be driven by data, cost of living index, and all.

You have to factor in all these things before coming out to say this is what we are paying. It is a negotiation. I just told you our own experience that from N7,500, we demanded N57,000, which was more than a 400 per cent increment. So, you can ask for anything you want to ask, but at the end of the day, it will still be subjected to certain reductions. Demanding a certain amount as minimum wage is just like giving something a trial, but this doesn’t mean it will be approved by the other party, which also has the right to accept or reject the demand based on its capacity to pay.

The state governors recently warned against unrealistic demands from organised labour concerning the new minimum wage, but looking at labour’s latest demand, will you say it is bloated?

That is also one of the challenges that we face. This is a negotiation process. For instance, you work for Punch Nigeria Limited, and you can tell your employers that you feel you deserve N10m monthly. But your employer won’t say you are making an extraordinary demand. No. What they will simply tell you is that this is what we can pay. You and your employers will then come to a middle point, which in the end will be to do two things. The first thing will be not to kill your organisation, because without the newspaper, you have no salary, and secondly, to ensure that the organisation gives you a wage that can help you survive and take care of your family.

That is why we always use the words ‘a symbiotic relationship’ to describe the relationship between the employer and its employees because whatever both of you are doing must be for the survival of both parties. It is not a winner-takes-all situation. If the employees demand too much, there will be less hiring and unemployment will increase. But if the employer is also not ready to pay the right wage, it will not get quality employees. So, it is to find that balance. I think the organised labour is trained for that and I hope our government also realises it too.

As of March 24, 2024, about 31 states of the federation owe the Central Bank of Nigeria a total of N339bn obtained to pay workers’ salaries between 2015 and 2023. The CBN has since stopped the salary bailout facility to the states. How do you think the governors can successfully pay the new minimum wage that will be announced without plunging their states into more debts?

Nobody is plunging the states into more debt. In the first place, I don’t even know why the CBN, during the last administration, was involved in getting funds to pay salaries. What a lot of people don’t know is that the governors are also responsible for a lot of these challenges. Let’s take for example; there are statutory positions in governments that are filled, but what now happens is that the governors come up with a retinue of aides, such as Personal Assistants, Senior Assistants, Senior Special Assistants, Technical Assistants, and political stalwarts that are fed and paid heavily from the state’s treasury. As such, the civil and political staff strengths of the states often become bloated.

The second aspect of it is that there is too much waste in the governments. Look at what is happening between the Economic and Financial Crimes Commission and the former Kogi State governor, Yahaya Bello, who is being accused of N84bn misappropriation. That is an allegation, but if you go across the country, these issues are everywhere. There is just too much waste in the system. The truth is the governors can pay the workers’ salaries. Recall that during either the Olusegun Obasanjo or Goodluck Jonathan administrations when the monthly allocations to the states were openly published, but the governors later resisted and fought against the move. Assuming they did not have any agenda, why would they have been afraid of making their states’ monthly allocation and transaction public? After all, it is a property of the state. So the reason some of the governors have not been able to pay the current minimum wage is because there are huge wastages in the system.

Now, look at what is happening in Kaduna. The Kaduna State Government took over a $350 million loan. What for? Has the loan been able to gross the businesses in the state to generate that revenue? I am not even saying that governments should be making profits. But the government can create that enabling environment for businesses to thrive and then collect taxes. But when you have so much waste across the country, there can’t be meaningful development. If you look at the total debts of the states, you will be shocked at where the entire loans collected went. All our attention has always been drawn towards the Federal Government, which to me, is more transparent than the state governments.

You can still see disagreements in the National Assembly between the executive and the legislature. But there is nothing like that in any of the 36 states of the Federation. Someone once said that in a democracy, if the executive and the legislature are not fighting, then the people are being shortchanged. In some of these states, there is no difference between the opposition and those in power. In virtually all the states, the annual budget will be sent to the state Houses of Assemblies on let’s say Monday, but by Wednesday, the budget will be passed. How is that possible? So the reasons why the state governments are finding it difficult to pay workers’ salaries include corruption, too much wastage in the system, and over-bloated staff structure.

So, in essence, you fully support the CBN stopping the Salary Bailout Facility to the state governors?

Absolutely! How can the CBN be paying salaries for the state governments, which is what it implies to me? If you know you cannot stand the heat in the kitchen, then, get out of the kitchen. Nobody begs anybody to come and be a governor or a president. You applied for the job and the people hired you by voting for you. You have to deliver on your promises to the people. What the CBN has decided is very correct in my assessment.

As of October 2023, no fewer than 15 states of the federation had not implemented the N30,000 minimum wage almost five years after it was signed into law in 2009….

That is where the Organised Labour should play their roles. There are two things you can do. Protests and strikes can force compliance. However, the issue of minimum wage is legal. So, you should go to court and allow the National Industrial Court to make a pronouncement, while you then, take any action to back the order. There are some issues in life that require muscle and there are also some that require intelligence. For anything justifiable, you should go to court and get an injunction to support your position. I know the capacity that the labour has to enforce any court order in their favour. I don’t want to talk about it here, but I know that organised labour has huge capacity to enforce any injunction.

Meanwhile, don’t you think what happened to the current N30,000 minimum wage will also happen to the new minimum wage, such that after six months or a year, only a few governments implemented it in their states?

I am happy that you earlier mentioned 15 out of 36 states of the federation. I would like to use the word: it is better to have a half-full glass than to have a half-empty glass. I always believe that every society is a work in progress. So, as long as we can get 15, or 21 states complying, I believe we can also get 36. So, let’s do something as it is better to move a step forward than to remain where you are.

But peradventure a similar fate befalls the new minimum wage, what do you think organised labour can do to force the state governors to implement it early in their states?

The first thing is to make the governors to be part of the negotiation process from the beginning. I could recall that our N18,000 minimum wage then was highly successful because a lot of the governors were part of it from the beginning. Before the Federal Government made the N18,000 announcement, Lagos State and Edo State started paying because both states were part of the negotiation process from the beginning. Even Lagos went beyond the N18,000 that time. So, if you are now talking after the fact, then, you are being reactive. It is at the beginning that you make the governors part of the process. Once they are part of the process, it makes the job easier for everybody.

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