Minimum wage and devolution of power

 STATE governors have put forward a difficult condition in their reaction to the N30,000 minimum wage demanded by the nation’s organized labour. In the communiqué issued after a meeting in Abuja last Wednesday, they said paying the amount proposed by the National Minimum Wage Committee set up by President Muhammadu Buhari would render states bankrupt, stressing that if the labour movement insisted on the amount, state governors would have to let go of a sizeable number of workers to ensure payment.

Alhaji Abdulaziz Yari, Chairman of the Governors’ Forum, who is also Zamfara State governor, while speaking on behalf of the governors after the meeting, hinged the inability of state governors to pay the suggested amount on the paltry revenue generated by the states, adding that only Lagos State would be able to cope with the minimum wage the labour unions were pushing for. He, therefore, suggested to the federal government to consider a review of the revenue sharing formula in a way that would increase allocation to states.

Unfortunately, by their shortsightedness, the governors are about to bungle an opportunity to right a fundamental wrong that has impeded the development of the country. I do not think this is a time to agitate for a review of the allocation formula, rather it is the time to push for the restructuring of the country. Why would the federal government be the one to negotiate on behalf of states on how much they should pay their workers? This is an abnormality and it should be corrected. Would Cadbury negotiate with Nestlé’s staff on how much they should be paid? Can Julius Berger legislate on how much China Civil Engineering Construction Company (CCECC) should pay its Nigerian workers? Rather than asking for the review of the revenue sharing formula, the governors should be pushing for the amendment of the part of the constitution which puts the issue of minimum wage on the Exclusive List so that state governments would be in a position to negotiate wages with labour based on their own ability to pay. The way the constitution is currently structured, once the federal government legislates on wage matters, the states do not have any choice but to comply. Why should the states concede to the federal government the power to negotiate with their own employees on their behalf? That definitely is not in tandem with the spirit of federalism.

Instead of being myopic and looking for a short cut to wriggle out of the corner the N30,000 minimum wage threatens to box them into, the governors should seize the opportunity offered by the current situation to sort out the issue once and for all. They should ask for the powers to handle issues that have to do with their own workforce instead of being at the mercy of the federal government. If they ask for that power, they will no longer be in a situation where a party that does not have access to their purse will be the one to determine how they disburse their funds. State governors should advocate for the tinkering of the constitution to empower them to negotiate with labour at the state level and whatever they agree on would be binding on both parties. This will lead to each of the states coming up with its own minimum wage because once the national minimum wage of N30,000 is signed into law, refusal to pay it will be illegal.

I am all for the devolution of powers from the centre to the states. I believe if the states have more powers and control their own resources, the country will have a better chance of getting better. But I must confess that I do not see that happening soon because I do not believe anyone will willingly let go of power. No president wants to be a figure head, presiding over little or nothing. The thinking at the federal level is that the more power the president has, the better it is for him. I do not see that thinking changing even if any of the opposition parties takes over at the centre tomorrow. It is my considered opinion that powers could only be devolved from the centre to the states gradually by tackling an issue at a time.

Thus it is of utmost importance that the state governors should not botch the opportunity to take away the powers to legislate on wage matters from the federal government now that the opportunity presents itself. If they will seize the chance now, the country will be a step closer to running a real federal constitution.