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Hardship Persists in Nigeria Despite 23% Increase In FAAC Allocation To States, LGs In 5 Months

The NLC has said new minimum wage negotiations will be completed by March.

The amount the Federation Account Allocation Committee (FAAC) has disbursed to the States and Local Governments (LGs) increased by 23 per cent, from the total sum of N2.272 trillion they got between February and June 2023, to a total of N2.805 trillion both tiers of governments were allocated between July and November 2023.

Data from FAAC compiled by THISDAY showed that States and LGs received a combined amount of N5.078 trillion as allocation for the 10-month period which was between February and November, 2023, even as economic hardship and pressure persists at both tiers of government respectively.

Workers and labour leaders, including some Chairmen of the Nigeria Labour Congress (NLC) and the Trade Union Congress (TUC) that spoke with THISDAY, lamented that despite the increased allocation, some governors have not done enough to cushion the impact of the fuel subsidy removal on their citizens. They decried the cost of living crisis occasioned by the fuel subsidy removal, just as they said they said they were looking forward to a minimum wage review.

However, the National President of the NLC, Joe Ajaero, has expressed confidence that the negotiation of a new minimum wage between the federal government and the organised labour would be concluded before March this year.

According to the Minimum Wage law, the present national minimum wage of N30,000 would expire by March, 2024.

Ajaero said, “The federal government had through a letter asked the organised labour to release our names to the new minimum wage committee to be constituted.

“Since last year, the list was submitted to the government and it is only when the committee is constituted that we now go into negotiation with the government as a union to agree on it.

“The existing minimum wage will be expiring by March this year, so it is hoped we may conclude the negotiation for a new minimum wage before March.”

Under the current revenue sharing formula, the federal government gets 52.68 per cent of the revenue shared, States get 26.72 per cent while the LG gets 20.60 per cent. The fund is to ensure development at different levels of government and also to enable States and LGs meet their obligations. Unfortunately, most of the LGs are not autonomous and the utilisation of their allocations are determined by the governors.

Besides, oil producing States also get 13 percent derivation and there is also the revenue from Value Added Tax (VAT) that is shared among the three tiers of government.

It is also worthy to note that the aforementioned amount allocated to the States and LGs exclude intervention from the federal government through cash and other edible items that were distributed to the States to cushion the impact of the fuel subsidy removal.

The data showed that in the 10-month period (February to November, 2023), a total of N12.731 trillion was shared among the three tiers of government. While the federal government got N3.366 trillion within the review period, the 36 States were allocated a total of N2.915.63 trillion and the LGs got a total of N2.154 trillion within the same period.

Commenting on the higher revenue allocation, the organised labour under the umbrella of the TUC said Nigerians have continued to suffer economic hardship despite the expected gains in revenue from removal of fuel subsidy by the Bola Tinubu’s administration.

General Secretary of the Trade Union Congress (TUC), Nuhu Toro, who spoke on telephone with THISDAY, on Friday, said : “The gains from the removal of fuel subsidy has not impacted positively on the economy and well-being of Nigerians. In this regard, all the promises made by government so far, we have not seen the implementation. We in the organised labour, we are tired of failed promises.”

For the states, Toro said the federal government had promised to allocate N5 billion to each state for provision of palliative to the citizens.

“As we speak, I am aware that federal government has released about N3 billion to the states. I also know that some states have added additional amounts to this fund to cushion the effects of the removal of fuel subsidy,” he added.

According to him, limited progress has been made by states in disbursement of the palliative fund through purchase and distribution of grains to the people, disclosing that so far some States have distributed rice, beans, garri, maize, among other foodstuff.

When asked to assess the economic situation especially as it affects workers in the states, the TUC scribe said:” The workers and indeed the masses has been worst of because of the removal of the fuel subsidy poor implementation of palliative by the respective governments at federal, state and local governments.”

He accused the federal government of engaging in what he called policy somersault. For instance, he said the federal government went ahead and announced a 50 percent discount on road and railway transportation cost on the eve of the Christmas festivities without even paying workers the N35,000 Wage award as agreed.

“Do they think that people will travel to their villages to go and die of hunger? This is pure policy somersault”.

On what labour intends to do going forward, Toro said that:” We will expect the federal government and respective states to show understanding and put the necessary measures in motion to start negotiation of the new minimum wage.

“As soon the minimum wage committee is set up, we hope to put all the issues on the table and whatever we agree as the new minimum wage must be implemented by the states,” he said.

For his part, the Chairman of the Nigeria Labour Congress in Ondo State, Victor Amoko, hopes that the negotiation of a new minimum wage between the federal government and the organised labour would be finalised as soon as possible.

“Hard times don’t last forever, we believe that we are going to overcome it. For the N35,000 wage award as agreed during a meeting that was held following the removal of fuel subsidy, Ondo State government has commenced the payment in across board in the State. We appreciate the state government for that.

“In Ondo, the government is owing us only one areas of 2017 and our new governor, Lucky Aiyedatiwa has promised soonest, sooner than what we expect, the money will be paid. We are looking forward to have that balance any moment from now.”, Amoko said.

In Oyo State, the State Chairman of the Nigeria Labour Congress (NLC), Kayode Martins, admitted that the economic reality has indeed had a toll on the workers.

However, Martins, while speaking with THISDAY said workers in the state have so far received the wage award of N25,000 for three months while pensioners also received N15,000 for three months.

He added that workers in the state also received 13th month salaries in December.

Similarly, workers in Sokoto and Kebbi States lamented that they were facing difficult times, notwithstanding the higher FAAC allocations to the States.

Speaking with THISDAY, a member of Sokoto State Chapter of NLC accused the State executive of compromise, saying the exco failed to engage the State government on new minimum wage or award wage in view of economic reality.

“Look at neighbouring State of Zamfara, the Governor paid them 13-month salary, this will go a long way in ameliorating their plight,” the source who pleaded to remain anonymous said.

In Kebbi State, a worker who also spoke on condition of anonymity said the government abandoned them in the State.

However, in Taraba, the Chairman of the TUC, Sule Abasu, told THISDAY that the state government was doing its best to cater for the plight of workers in the state despite the meagre resources at its disposal.

Speaking in the same vein, Chairman of Judiciary Staff Union of Nigerian (JUSUN), Taraba State Chapter, Comrade Mohammed Usman commended the present administration in the state for improving the salaries of workers which according to him has gone a long way to cushion the effect of the biting economic situation in the country.

Also speaking, Chairman of Nigeria Labour Congress (NLC) in Taraba state, Comrade Peter Jediel told THISDAY that workers in Taraba state were happy and adjusting to the cost of living crisis.

Onyebuchi Ezigbo in Abuja, Fidelis David in Akure, Kemi Olaitan in Ibadan, Onuminya Innocent in Sokoto and Wole Ayodele in Jalingo