Minimum Wage: Reflect economic realities before arriving at New wage,LCCI urges all parties

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The Lagos Chamber of Commerce and Industry has urged all parties involved in the ongoing negotiation on new national minimum wage to consider a pay that reflects a good balance of economic realities, affordability, and sustainability.

This is contained in a press statement, signed by the LCCI Director General, Dr Chinyere Almona, on Monday.

Almona reasoned that the organised labour could avoid a situation where “we force a wage on government and businesses, which will eventually lead to job losses, worsen poverty levels, and so much money chasing few goods.

She therefore called on labour to be more flexible, reconsider the government’s offerings, and be concerned about how private businesses can afford to pay the set wage without considering shutting down operations or cutting jobs.

Beyond the new minimum wage, the Chamber is more concerned about having a more productive economy with a robust infrastructural base supporting the economy.

Following this, LCCI urged the government to “Implement special non-cash interventions that will see businesses spend less on production.

 

“Remove the import duties on food imports and critical raw materials and drastically reduce the import duty exchange rate on agricultural input and other imports that have multiplier effects on prices.

“Implement an aggressive metering programme on power supply, and more investment and regulation in the sector to boost power supply through more contractual discipline and gas supply guarantees.

“Build infrastructure to support local production of essential medicines and more spending to upgrade our public health facilities”.

Almona noted that with the government’s commitment to providing these support systems to Nigerians, low-income earners will spend less on these expenditure heads and have a better living standard in the long run, restating labour unions to consider labour productivity supported by infrastructure rather than high wages with weak productivity.

“The government needs to spend more on providing the infrastructural base required for a productive workforce and a conducive business environment.

“The federal government’s proposals represent a significant increase aimed at improving the livelihood of workers across Nigeria. However, it is imperative to acknowledge the fiscal constraints and economic challenges various state governments face.

“Some governors under the Nigerian Governors’ Forum have already indicated their inability to meet the initially proposed higher minimum wage, citing budgetary limitations and the potential risk to essential public services” LCCI boss recalled.

To this end, the Chamber urged all parties to consider a wage that is within the financial capacity of both federal and state governments, helps to maintain economic stability, and prevents potential layoffs or cuts in essential services.

Similarly, it stressed that it is pertinent to adopt a wage that supports long-term economic sustainability, adding that over-extending financial commitments could increase borrowing and debt, adversely affecting the nation’s economy.

Almona advised that all states could uniformly implement the new minimum wage by agreeing to a realistic and achievable wage, ensuring that workers nationwide benefit without significant delays or discrepancies.

“A wage demand exceeding state governments’ capacity could lead to industrial actions, strikes, and widespread disruptions, further hindering economic recovery and growth,” the LCCI Director maintained.

“The government needs to show more seriousness about cutting down the cost of governance and be committed to investing more in layers of infrastructure that support productivity and revenue generation.

“With more transparency in government spending, future negotiations will become easier as all parties are well aware of the realities. We also call on the government to commit to having the national minimum wage reviewed every five years. The government can show concern about personnel welfare by enhancing their allowances beyond the minimum wage, which is only calculated based on basic salaries” she added.

LCCI called on the organised labour to consider the interests of the broader business community in their demands and be more flexible in negotiations, urging all parties to work towards a new national minimum wage that promotes a fair deal to all concerned and for the overall interest of society.

Recall that the organised labour first proposed over N600,000 as the minimum wage, an offer government replied with N60,000.

As the negotiation thrived, the government has shifted to N62,000, as against over N250,000, being demanded by the organised labour.

The labour unions staged an indefinite nationwide strike last week, but it lasted for two days, after which it was suspended for a week. This was after a lengthy discussion and engagement with the government representatives.

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