By Salihu
Moh. Lukman
The
response to the piece on NLC and Minimum Wage: The Task Ahead by Dr. Peter
Ozo-Eson is to say the least a confirmation that NLC positions are “driven by
large dose of intellectual and organisational indolence” as argued in my
article of July 3, 2013. All that Dr. Ozo-Eson laboured to state was that “Mr. Lukman went on his usual tirade of seeking to run down the
leadership of the Congress”.
The evidences are: First “on a
number of occasions in the past, he had embarked on this same limelight seeking
and self serving mission, but Congress had decided to ignore him as he was not
really anybody of consequence”. Secondly, “in the process leading to the fuel
price increase in 2011, he played all manner of behind the scene games of
trying to undermine the NLC’s opposition to the planned increase”. Thirdly, “in
the course of hearings on the issues proposed for constitutional amendment,
flaunting his new credentials as consultant to the Governors Forum, he made
puerile arguments as to why some states cannot pay the minimum wage.” Fourthly,
“he also had, shortly after the end of Comrade Adams Oshiomhole’s tenure as
President of the Congress, issued a statement in which he berated the comrade
and sought to run him down.”
The
judgement passed by Dr. Ozo-Eson after examining all the evidences was that the
article NLC and Minimum
Wage: The Task Ahead “clearly demonstrates that he lacks knowledge and understanding
of the theoretical underpinnings of national minimum wages and even the
empirical information of the process and mechanisms for the setting of the
minimum wage in Nigeria”. To confirm that, Dr. Ozo-Eson asserts that “while he
was a staff of the Congress, he was not involved in the formulation of
positions on this matter and the negotiations which preceded the setting of the
minimum wage. Unfortunately, illusions of grandeur would not allow him seek
available information and knowledge on the subject matter.”
It is
important to start by submitting that I make no claims to being an authority
either with reference to educational qualifications or experience in every
respect. The article under reference makes no such claims. All that was done
was to highlight realities supported by indices from authoritative sources,
which should guide the process of minimum wage fixing in Nigeria. The central
issue in the article was the argument that the process of passage of the 2010
Minimum Wage Act was dictated by the capacity of the Federal Government to pay
the N18,000.
It is
gladdening to read from Dr. Ozo-Eson’s response that “the process involved the setting up of an ad hoc Committee,
which made recommendations to the Federal Government. The committee was
composed of equal representatives of the tripartite partners of government
(including the State Governments), Employers’ representatives and Workers’
representatives and was chaired by Justice Alfa Belgore.” This should mean that
there was some evaluation of capacity to pay based on indices. This is where
one would expect some demonstration of good scholarship. Unfortunately, beyond
the personalised attacks and name-calling, there was none.
Being the Research Director of
NLC, it is well below expectation to reduce the debate to simple demonstration
of loyalty to the leadership of Congress. I am pretty conversant of the
schedules of Dr. Peter Ozi-Eson as the Research Director and would expect that
he played the role of a leading guide to the NLC leadership during the process
of negotiating the passage of the 2010 Minimum Wage Act. Given that he is an
economists who rose to the position of an associate professor, he should be
regarded an authority on issues of wage fixing. The sad thing is that reading
through his response, one cannot but be worried about the fact that he has
collapsed to elementary reasoning. If what he wrote was credited to some of our
political leaders in NLC who flaunt commercialised Doctoral or self-professed
“Professorial’ credentials, one would understand. But coming from a seasoned
academician with good research capability, this is simply scandalous.
This much said, I will try and
highlight the issues so that we don’t reduce the debate to personality
assessments. My article of July 3, 2013 was prompted by a media report where
Comrade Abdulwaheed Omar, the NLC President argued that amending Part I, item 34 of Second Schedule of
the 1999 Constitution “will unnecessarily expose Nigerian workers, especially
those in the low-income bracket with grave implications for security,
productivity and national well-being, as most state governments if given the
latitude, will pay wages as low as one thousand Naira per month in spite of the
relative enormous resources available to them.”
What is
very clear from the position expressed by Comrade Omar was that state
governments would pay low wages “in spite of the relative enormous resources
available to them”. I argued that this position is weak and erroneous and
supported my position with facts as provided by CBN. The facts are:
No doubt,
with reference to our recent past as a nation whereby the total annual revenue
of government was in the region of N2 trn, current levels of N8 trn is
relatively “enormous”. The critical reality however is that this increase in
revenue is not shared proportionately. On account of what can we regard states
like Ebonyi and Nasarawa as enjoying “enormous resources” with less than N4
billion monthly from the Federation Account, while states like Akwa Ibom and
Rivers receive more than N20 billion monthly. Perhaps with reference to a
personnel cost of approximately N500 million for Ebonyi and Nasarawa, the
argument for “enormous resources” may be sustained.
This
financial profile is almost re-enforced by IGR profile of these states. Based
on CBN 2010 Report, Akwa Ibom is reported with more than N1 billion monthly IGR
and Rivers close to N5 billion monthly. Contrastingly, Nasarawa and Ebonyi were
reported with less than N200 million monthly IGR. Now what will be the logic of
equating the pay of workers in Akwa Ibom and Rivers with that of Nasarawa and
Ebonyi?
With
monthly personnel cost of approximately N500 million and monthly IGR of under
N200 million, a situation where FAAC receipt crashed can be better imagined.
How then can anyone be making a case for wages based on such a loose
foundation?
I want to
go a step further by inviting the NLC to consider the case of Edo with monthly
personnel cost of about N1.42 billion. This is pre 2010 minimum wage. Current
levels will be somewhere in the region of N1.7 billion. In June 2013, Edo State
got N1.9 billion as its FAAC share. Based on CBN 2010 report, Edo has IGR of
slightly above N1 billion. This means that Edo has total revenue of about N3
billion monthly based on which nearly 60% goes to settling personnel cost. Edo
state reality represents virtually the situation of all our states with the
possible exception of Lagos and Rivers.
It could
be tempting to argue that this reality does not exist. This will be suicidal.
Should there be any adverse situation in the international oil market affecting
oil revenue and the share to states, many states will not be able to meet their
personnel cost. One of the issues that Dr. Ozo-Eson knows very well but avoided
it completely in his response was the issue of wage fixing. All that appear to
be appealing to Dr. Ozo-Eson and NLC was the historical evolution of minimum
wage. For clarity, I never contested the existence of minimum wage.
My
argument is that revenue capacity of employers should be the guiding
consideration and not some pedestrian and unscholarly analysis of countries
that are implementing minimum wages. The logic of minimum wage cannot be
faulted. The main problem in our case in Nigeria is that once the federal
government, with reference to its revenue of over N8 trn annually can pay the
N18,000 minimum wage, we imagine that the remaining task is to harass state
governments and all other employers in the country to pay.
For the
federal government, the minimum wage of N18,000 only represented an increase of
1.15% in its personnel cost. This represent an absolute increase of N11,054,309,926 on personnel cost of federal government, which
means an increase from N961,118,726,036 to N972,173,035,962.
Increase of 1.15% was made possible because at the time of negotiations, the
lowest paid federal government worker was earning around N17,000.
Unfortunately, the lowest paid worker in most of our states and other sectors
were still earning the then legislated N5,500 minimum wage. For whatever
reasons, largely political coinciding with the buzz of the 2011 electioneering
period, the reference for a new minimum wage legislation in the country became
federal government.
The
question I expected Dr. Ozo-Eson to answer will be how does a minimum wage of
N18,000 relate with wage determining variables such as the value of marginal
product of labour for state governments and other private employers. For an
economists with the knowledge, experience and if I may venture to add level of
pay of Dr. Ozo-Eson missed such an important component in his analysis would
appear to be deliberate aimed at misleading NLC leadership and Nigerian
workers. Such an approach can only produce false expectations and consequently
result in dashed hopes.
There is
the attempt to resort to cheap blackmail and presenting my position as if I am
opposed to minimum wage. To the contrary, I am for minimum wage fixing.
Desirably, this should happen at federal level but given a reality whereby
combination of authoritarian and rent-seeking factors have dominate the process
of governance in Nigeria, one of the best ways of injecting rational
consideration is to decentralise the framework for minimum wage fixing. There
is nothing wrong with that and it will be consistent with ILO framework.
In fact,
the legislated N5,500 that was reviewed upward to N18,000 with the passage of
the 2010 Minimum Wage Act, had a provision that stipulated federal government
minimum wage at N7,500. This was not a secret. It was a mark of intellectual
laziness on the part of NLC leadership to miss this convention.
Dr.
Ozo-Eson may wish to explore other deeper intellectual debate around issues of
how higher minimum wage can facilitate employment or produce unemployment.
Issues of labour market structure, competition, etc. may help highlight all our
options. Certainly, the varied nature of the labour markets across the country
does not support a high minimum wage of N18,000. Given high levels of poverty,
low minimum wage would also be counterproductive. There is therefore the need
for a good balance taking into account issues of labour market structure,
capacity to pay and the challenge of tackling incidences of high unemployment
in the country. They are all interconnected and poor handling could create
disequilibrium with adverse consequences.
The other
issues are the personalised attacks and sincerely, I have no apology for my
position and it is unfortunate that Dr. Ozo-Eson think the debate about minimum
wage in Nigeria based on the challenges of today can be reduced to
name-calling. I am grateful to Nigerian trade union leadership for giving me
the opportunity to serve and I did so with the full conviction that Nigerian
workers represent a progressive category. With a rich tradition embodied by
organisations such as Nigeria Labour Congress, I was proud to be part of the
community of progressive Nigerians.
In all
these, Comrade Adams will always have a special acknowledgement. One thing that
was very unique was the fact that our relationship with Comrade Adams up to the
end of his tenure, and for me till today, was not sycophantic. It is a
relationship of respect based on capacity to speak the truth. In line with that
tradition, in March 2007, I wrote an article, which for the avoidance of doubt,
I will reproduce below. After the article, I have had further engagement with
Comrade Adams, but at no time did he accuse me of attempting to run him down,
as Dr. Ozo-Eson is alleging. I am ready any day, anytime to defend myself, but
I need details of the charges.
I will kindly appeal that the
charges should specify details of the “number of occasions in the past”, I
“embarked on this same limelight seeking and self serving mission”, which
Congress decided to ignore me. Being “not really anybody of consequence” and one
that respect the NLC and its leadership, I will try and defend myself. Dr.
Ozo-Eson made claims that “in the process leading to the fuel price increase in
2011”, I played all manner of behind the scene games of trying to undermine the
NLC’s opposition to the planned increase”. This is weighty.
To the best of my knowledge,
sometime around September 2011 when the issue of removal of subsidy became
public, together with Comrade Salisu N. Muhammed and Dr. Timi Agary, we
developed engagement template to facilitate consultations across all the
stakeholders including labour. Our strategic thinking was that what is required
is consultation which should lead to negotiating the whole downstream situation
that is producing a cycle of policy
announcement – opposition protest – negotiations. In our reasoning, we
felt the need to produce a new reality of policy
negotiation – agreement – announcement – implementation.
In order to achieve that we came
up with some activities and approached NLC, TUC, NUPENG, PENGASSAN, NARTO,
NURTWN, NECA, PPPRA, NNPC, the Presidency, some civil society organisations to
agree to participate in some preliminary activities. The interesting thing was
that almost all the nongovernmental stakeholders participated in the activities
but none of the government organisations participated. As a result, the
initiative collapsed. However, the leadership of NLC, just like all the other
organisations were fully briefed about our line of thought, based on which they
subscribed and participated. It was an open process and everything was made
public. I will challenge Dr. Ozo-Eson to come forward with all the evidences he
has about “behind the scene games of trying to undermine the NLC’s opposition
to the planned increase”.
The last issue is that “in the
course of hearings on the issues proposed for constitutional amendment,” I
flaunted my “new credentials as consultant to the Governors Forum” and “made
puerile arguments as to why some states cannot pay the minimum wage.” Since
they are puerile, why should it be the pre-occupation of the almighty NLC
Director of Research? Why not ask a clerk to respond to expose how childish
they are? Where did I flaunt my so-called credentials as consultant to the
Governors Forum? To the best of my recollection, it was at the parley between
civil society leaders and President Goodluck Jonathan and Comrade Omar was
there representing the NLC. It was not a matter that was secret and I canvassed
my position as a Nigerian citizen with privileged information, which I shared.
Does anyone in NLC expect that our views on matters of national policy must be
the same?
This is the trouble when
organisations choose to be passive in national policy debate and the only thing
they are able to do is to organise strikes against government and employers.
Matters of policies and engagement to influence them are not prioritised. This
makes strikes the only objective of why organisations like NLC and trade unions
exist. With such disposition, NLC need no Research Director with Professorial
credentials except if the Research Director is a shop floor activist. This is
the sad reality facing Dr. Ozo-Eson and our dear NLC. I never expected
compliments from NLC leaders, especially people like Dr, Ozo-Eson who know
better.
By the way, sincerely, I want to
congratulate Dr. Ozo-Eson for producing his first public statement as NLC
Director of Research after about 12 years. I remember, when we were consulting
and trying to gather supporting information for his employment as NLC Director
of Research, one of the criticism against him was that he has no publication
credited to him and as the researcher for the Port Harcourt based Centre for
Advanced Social Sciences (CASS), he did not produce any research report
throughout his tenure at CASS. This was dismissed and our Comrade was given the
benefit of the doubt. Twelve years after, his research competence is well
outlined and his response is an authoritative confirmation.
I make no claims to anything when
I was in NLC. I left as Senior Assistant General Secretary and was told if I
wait I will be promoted to Deputy General Secretary. That was in October 2006.
While in NLC, I had the rare privilege of serving as Acting General Secretary.
I left behind programmes and resources. Although, since I was “not really
anybody of consequence”, I will argue that whatever anyone in NLC will say
about my person today, there is a standard and I challenge Dr. Ozo-Eson to dispute
that.
The NLC that we were all
attracted to serve was NLC driven by knowledge, openness and democratic debate.
It was an organisation with a world of difference. It was an organisation that
nurtures the young ones and challenges all functionaries to develop their
competence and capacity. This is completely missing in the NLC of today as a
result of which its moral authority is weak. The decay in government and
society is finding higher levels of expression in our unions and NLC today. On
account of which, a top NLC functionary, converted from being part-time
President of his union to full-time General Secretary, just so as to continue
to remain as NLC official. Another one has recently postponed the conference of
his union just so that perhaps hopefully by the next conference of NLC he can
return as possibly President.
There is no need to criticise
PDP, government or any employer if at the end of the day we have lost our moral
credentials. Let no one deceive Nigerian workers about services if the reference
point is the same repressive and authoritarian orientation. The truth is that
if Comrade Omar and all our leaders in NLC are unable to lead based on the
tradition NLC is known for, I have every responsibility as a Nigerian and as
someone who has served the movement to be critical so that they can retrace
their steps. I have no apology for that. It will be unfortunate if Dr. Ozo-Eson
will collapse and join the crowd of cheer leaders at this late hour.
Finally, what is the issue about
consulting for Governors? Doesn’t consulting for Governors also imply
consulting for Comrade Adams? Yes, I have consulted for Governors and till
today, I can happily say that I enjoy the recognition of some of our Governors.
It is a relationship that is value driven based on purely my ability to be
relevant to the process of strengthening the capacity of governors to deliver
services. It is a privilege and I can only continue to enjoy it with good
intellectual services. I have no doubt that the day I fall short of their expectations,
all relationship shall end. It is true, it is a choice but it is a choice with
subsidiary powers unlike the relationship between many of our leaders in NLC on
the one hand and government and employers on the other. I will argue that with
our relationship with governors, we may be closer to workers than many of our
functionaries in NLC and the unions. Calling me names will not change that
reality!