With the signing of the minimum wage by President Buhari, the question on every lip is the ability of the government to pay. While it is believed that the federal government can possibly pay even with our liquidity crisis, the main concern is with the states. As many of them are unable to pay the current N18,000 and most of the governors behaving more like prodigal sons than CEOs of their states, there is increasing fear that many states will not be able to pay. If this is the case, labour should then get ready for more industrial actions.
But the question is if the states can really pay given the human and natural resources and potentials that each and every state in Nigeria is endowed with. To this question, the answer is a resounding ‘yes’. Every state in Nigeria can pay and can even pay N50, 000 once governed by innovative and strategic leaders.
The problem with most of our states and Nigeria in general is that we lack deep and strategic thinking for medium and long term growth. With the easy oil money shared every month as federal allocation, most of our governors are unable and unwilling to think deeply on how to effectively galvanize the resources of their respective states for sustainable growth and development.
Not only are they unwilling to strategically think and govern their states, a significant amount of what the states receive from Abuja and what is internally generated as revenue is expropriated through unaccountable and opaque reason called security votes by the governors. Imagine the obscene situation where many of our governors seize over N500 million naira every month from their respective states as security votes. N500 million can pay over 16,000 people N30,000 every month.
This implies that outside states like Lagos, Kano and Rivers with a high number of civil servants, almost every state can comfortably pay the N30,000 wage if the governors can agree or forced to reduce the unbelievable and outrageous security votes. Moreover, even the much that remains after the monthly confiscation of the security votes is most of the times imprudently expended.
I know of a certain governor who, on assumption of office in 2015, purchased 48 brand new Prado jeeps to share with his commissioners and members of the state’s House of Assembly. Interestingly as most of the beneficiaries could not afford a 2002 Toyota Camry before their appointments and elections, some of them covered the jeeps and left them unused for months as they reconciled their new unrealistic and unsustainable status. With such wastefulness which is common across Nigeria, the governor will complain that he will not be able to pay the N30, 000 monthly minimum wage.
Given the protracted process and industrial actions that normally characterize demands for wage increases, I think that it is time to properly and constitutionally agree that wages must increase at agreed periods with an enforceable clause that any leader (president, governor or chairman) unable to abide with the rule must resign. The benefits of this suggestion are many. Not only will it make our leaders think more strategically especially on how to harness the abundant resources we have, it will also make them to be interested in having a more productive civil service. If Kebbi state can generate over N150 billion in 2017 from rice alone while maintaining their leading position in the production of onion and pepper, it suggests that other states in the North West and Nigeria can do so or even better if governed by committed and business oriented governors. With Kebbi’s impressive achievements under Governor Abubakar Bagudu, it means that the state’s annual wage bill of about N20 billion every year for about 20, 000 civil servants in the states can comfortably be paid mainly from rice, onion and pepper. Interestingly, as the results of Kebbi state’s ingenuity and hard work are obvious, in Enugu state equally blessed with favorable lands for the cultivation of rice and pepper, the required commitment and seriousness are yet to be observed.
While Denmark a country of about 5.8 million people exported pork meat valued at about N972 billion ($2.7bn) in 2017, the five South-East states with a population of about 20 million people using 2006 census only managed to achieve a total combined internally generated revenue of about N58 billion in 2018. In the same vein, while Kenya exported cut flowers valued at about N360 billion ($1 billion) selling in over 60 countries in the world, there is no single agricultural produce from Nigeria that generates beyond $50 million in exports in a year or sold in many countries of the world. In 2017, while Netherlands, a country of about 17 million people, exported potatoes worth about N792 billion ($2.2billion), Plateau state with the best comparative advantage to produce potato in Nigeria is struggling. With average global price of about $200 dollars per metric ton, it means that Plateau state can generate over $100 million from potato alone every year if it can produce up to 500,000 metric tons which is achievable. While $100 million is about N36 billion, the total internal generated revenue of all the six North Central states in 2018 was about N53billion. As Plateau state’s total internally generated revenue in 2018 was about N10.8 billion, we can only imagine what they can generate if they get very serious with potato and tomatoes not to mention other products.
The above analysis shows two things. First is how unserious we are as a people and how unfocused many of our governors are. Second is that every governor can comfortably pay over N50, 000 minimum wage if they are committed, focused and business inclined. According to Proverbs 29: 2 “When the righteous are in authority, the people rejoice but when the wicked rules, the people groan”
Franklin Ngwu
Dr. Ngwu is a Senior Lecturer in Strategy, Finance and Risk Management, Lagos Business School and a Member, Expert Network, World Economic Forum.
