5th June, 2024
By Taiwo Okanlawon
A former deputy Governor of the Central Bank of Nigeria, CBN, Kingsley Moghalu, has revealed that if the country has an active production economy, Nigerian Government can pay N500,000 as minimum wage.
Moghalu, however, said the government can only pay between N75,000 to N100,000 as new minimum wage due to the lack of a production economy.
This comes amid continued negotiations between organized labour and the Nigerian Government over the need to increase the minimum wage.
Organized Labour had called off its nationwide strike after a productive meeting with the Nigerian Government on an increase in the pay of workers.
The Nigerian Government had proposed N60,000 with the possibility of an increase, while organized labour demanded N494,000; but a middle ground is believed to have been reached as negotiations continue.
Following the agreement reached, President Bola Tinubu directed the Minister of Finance, Wale Edun, to work out the financial implications of the new minimum wage within the next 48 hours.
However, the former CBN deputy governor said the level of production in Nigeria can only support between N75,000 to N100,000 minimum wage.
“In the debates on the national wage in Nigeria we miss the fundamental point: there is little or no productivity in the economy. If we had a truly productive economy, there is no reason we can’t have the kind of minimum wage of 400 or 500K that labour wants. But we can’t, because the level of productivity in the economy cannot support it,” Moghalu wrote on his X handle.
“Remember, the minimum wage is not just about government salaries. There are not more than 2, at most 3 million civil servants in Nigeria. It is even more about what is paid in the private sector, to household staff, etc.
“All of this is why, all things considered, including avoiding a minimum wage that multiplies already ravaging inflation (assuming such a wage can even be paid), I recommend a minimum wage of between N75,000 and N100,000.”