The Nigerian Federal Government is set to allocate a substantial sum of at least N2 trillion directly towards the implementation of an agreement reached with organized labor on Monday. The primary objective of this agreement is to alleviate the adverse effects of the removal of petrol subsidies on federal workers and various segments of the population.
Key points from the Memorandum of Understanding (MoU) signed between the government and labor include:
Federal workers will receive a monthly wage award of N35,000 for a period of six months.
An allocation of N100 billion will be directed towards procuring high-capacity Compressed Natural Gas (CNG) buses.
Approximately 55,000 CNG conversion kits and CNG stations will be established nationwide.
A grant of N75,000 will be provided to 15 million households, distributed at a rate of N25,000 per month for three months.
To fund the N75,000 grant for 15 million households over three months, the government will need approximately N1.125 trillion. The monthly wage award of N35,000 for about 1.5 million federal workers will cost the government N315 billion over six months. Additionally, N100 billion will be allocated for high-capacity CNG buses, and around N400 billion will be invested in the procurement of 55,000 CNG conversion kits and the construction of 84 CNG stations nationwide. These stations will be distributed across states and major economic centers.
Various experts, social advocates, and stakeholders have applauded the agreement and the suspension of the strike, emphasizing that the tangible palliatives outlined in the agreement will directly contribute to economic growth. The suspension of the strike is estimated to prevent daily economic losses of at least N50 billion.
The House of Representatives also expressed support for the decision to suspend the strike, stating that it is in the best interest of the country. Deputy Speaker Benjamin Kalu commended the government's commitment to funding CNG-powered buses and kits.
The Nigeria Employers Consultative Association (NECA) stressed the importance of both the government fulfilling the terms of the resolution and organized labor enhancing productivity to stimulate economic production. NECA's Director-General, Mr. Adewale-Smatt Oyerinde, emphasized the detrimental impact of strikes on the private sector and called for a peaceful industrial environment to support economic and national renewal.
However, it's worth noting that around 89,100 federal workers may not benefit from the N35,000 wage award due to their exclusion from the Integrated Payroll and Personnel Information System (IPPIS). The government is prioritizing compliance with IPPIS to eliminate "ghost" workers from its payroll. Discussions regarding workers' salaries in the 2024 fiscal year are also underway, with key stakeholders expected to be involved in the negotiations.
President Bola Tinubu announced this provisional wage increase for federal workers as part of efforts to mitigate the impact of petrol subsidy removal.
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