Joel Osaigbovo Aluge, Reporting
The Association of Local Governments of Nigeria (ALGON) has announced that the 774 local government councils across the country cannot afford to pay the proposed new minimum wage of N62,000. ALGON’s National President, Aminu Muazu-Maifata, highlighted that the councils receive about 18% of the monthly allocation from the Federation Account, which is insufficient to cover the increased wage. Even if they allocated their entire budget to salaries, it still wouldn’t be enough due to other essential responsibilities like healthcare, education, security, and infrastructure
ALGON has called for an increase in the allocations to local governments to help meet the proposed wage and has also advocated for constitutional amendments to standardize the tenure of local government officials across Nigeria to ensure better governance and service delivery.
The Federal Government urged organized labor to take into account the wider economic consequences of their demand for a significantly higher national minimum wage. The government emphasized the need for balance and sustainability in wage adjustments to avoid potential negative impacts on the economy, such as inflation and budgetary constraints.
The Minister of Information and National Orientation, Mohammed Idris, delivered the admonition, indicating that the N250,000 minimum wage demanded by labor could undermine the economy. He warned that such a significant increase could lead to mass retrenchment of workers and jeopardize the welfare of Nigerians.
However, the labor unions refuted President Bola Tinubu’s claims during his Democracy Day broadcast on Wednesday, asserting that no agreement had been reached on the new national minimum wage.
According to him, some of the 774 LGAs in the country are still struggling to pay the N30,000 minimum wage approved in 2019.
“With the present allocation from FAAC, no local government council anywhere in Nigeria can be able to pay N62,000,” the ALGON president said.
He added, “Presently, 90% of our inflow from the Federation Account goes into salaries and pensions. Without an upward review of the percentage of allocation to local government councils, it will be extremely difficult or even impossible for them to pay N62,000 minimum wage.”
“The 774 local government councils received slightly above 18 per cent of the total FAAC of the federation, while the federal government received above 52 percent.