President Muhamamdu Buhari has inaugurated a Technical Advisory Committee on implementation of the new National Minimum Wage and reiterated his commitment to ensure payment.
Inaugurating the committee shortly before the Federal Executive Council (FEC) meeting on Wednesday, President Buhari restated his commitment to an upward review of the minimum wage “as it is time to do so’’.
The President had on Dec. 19, 2018, while presenting the 2019 Appropriation Bill at the joint session of the National Assembly, announced his intention to constitute the committee.
He said the committee would recommend “modalities for the implementation of the new minimum wage in such a manner as to minimise its inflationary impact, as well as ensure that its introduction does not lead to job losses’’.
“The work of this Technical Committee will be the basis of a Finance Bill which will be submitted to the National Assembly, alongside the Minimum Wage Bill.’’
He explained that the Federal Government had engaged state governments with a view to involving them in determining any upward review of the new minimum wage for workers.
“I want to make it clear that there is no question about whether the National Minimum Wage will be reviewed upwards. I am committed to a review of the Minimum Wage.
“Also, it is important to explain that even though the subject of a National Minimum Wage is in the Exclusive Legislative List, we have been meeting with the state governors.
“(This is) because it is imperative that the federal government carries the state governments along in determining any upward review of the minimum wage for workers.
“This is especially necessary considering the prevailing public sector revenue challenges, which have made it extremely difficult for some of the governors to pay workers as and when due.’’
He said that the federal government, for its part, had made adequate provision for the increase in minimum wage in its 2019 Budget proposals which was submitted to the National Assembly on Dec. 19, 2018.
According to the president, the federal government will be able to meet the additional costs incurred in moving up all personnel who are currently earning below the new minimum wage.
“We anticipate that, after the new minimum wage has been passed into law, we will be going into negotiations for salary review for all the workers who are already earning above the new minimum wage.
“It is therefore important that we are properly prepared to meet these demands.
“We must therefore look at ways of implementing these consequential wage adjustments in a manner that does not have adverse effects on our national development plans, as laid out in the Economic Recovery and Growth Plan (ERGP).
“ERGP sets appropriate targets for levels of capital expenditure, public debt, inflation, employment, etc.”
President Buhari expressed the hope that “the implementation of a new minimum wage does not adversely affect these targets, and thereby erode the envisaged gains for workers.
According to the president, the committee, which will be chaired by an economist and financial expert, Mr Bismarck Rewane, is expected to complete its deliberations and submit its report and recommendations within one month from January 9.
He explained that the terms of reference of the committee include:
A. To develop, and advise government on how to successfully bring about a smooth implementation of impending wage increases;
B. Identify new revenue sources, as well as areas of existing expenditure from where some savings could be made in order to fund the wage increases without adversely impacting the nation’s development goals as set out in the ERGP;
C. Propose a work plan and modalities for the implementation of the salary increases; and
D. Any other suggestions that will assist in the implementation of this and future wage increases.