A report has claimed that only nine states in Nigeria may be able to effectively pay a new minimum wage of ₦62,000 without sacking workers or getting indebted.
The source, which was quoted in a report by ThisDay, submitted that if the proposed ₦62,000 as recommended by the tripartite committee is eventually adopted as the new minimum wage for Nigerian workers, many governors may need to retrench up to 40 percent of workers in their states to be able to pay the new wage bill.
However, the committee’s recommendation to the president at its meeting on Friday night was rejected by organised labour, which insisted on ₦250,000 as an acceptable national minimum wage.
The source noted that already, most state governments are heavily indebted due to loans taken by their predecessors and may not be able to afford the new minimum wage. He said only some states could afford the new minimum wage.
The states that could afford the new minimum wage without affecting the overall strength and development of the states were identified as Lagos, Delta, Akwa Ibom, Bayelsa, Cross River, Rivers, Ogun, Kano, and Kaduna.
The source said, “Kano State is listed in the states that can pay the new minimum wage because it does not have any huge debt burden. This is quite like some states across the federation.
“You see, over 24 drivers attending to only four or five vehicles in the fleet. What do you want such state governments to do? Sack them? But where the states are forced or coerced to pay, there could be consequences of up to 40 per cent retrenchment. States cannot be forced to pay the minimum wage because Nigeria is operating a federal system of government, which is based on the ability to pay.
“In the United States, which we are emulating, take, for instance, the salaries of the governors of Vermont, New York and California are different with some rural states of Mississippi and others. The governor of Vermont and his counterpart in California earn over $200,000 per year, but the governor of Mississippi earns less. This is operation of the federal constitution in place.”
