N70,000 transport allowance: Why Nigerian workers need more than wage increases

For millions of Nigerian workers, payday increasingly feels less like relief than a brief pause before the next financial struggle. Now, a ₦70,000 monthly transport allowance for six months has sharpened the question: can a country keep adjusting minimum wages without confronting the cost of living? Christian APPOLOS reports on the unfolding crisis

The Federal Government’s announcement of a ₦70,000 monthly transportation allowance for eligible public servants, payable for six months, has brought into sharp focus the widening gap between workers’ earnings and the cost of maintaining a decent standard of living.

The striking irony is difficult to ignore: the proposed monthly transport support is equivalent to Nigeria’s current national minimum wage of ₦70,000. For workers already struggling to meet basic household expenses, the comparison raises a fundamental question about the adequacy of their earnings. If an entire month’s minimum wage can be matched by a temporary transport allowance, what does that say about the purchasing power of the wage itself?

Beyond the immediate relief the allowance may provide, the development has reopened a larger debate about the direction of Nigeria’s wage policy, the sustainability of periodic minimum-wage increases and whether the country should move beyond the traditional minimum-wage framework towards a living wage.

For labour and policy experts, the problem is not simply that workers earn too little. It is that wages are being negotiated and adjusted in an economy where the prices of essential goods and services continue to rise, while the public infrastructure and social services that could reduce household expenditure remain inadequate.

Their positions differ on the amount that should constitute a reasonable wage, but they converge on one central argument: Nigeria cannot achieve meaningful improvements in workers’ welfare through nominal wage increases alone. It must address the economic conditions that determine what those wages can actually buy.

Chief Emenike Ikedichi Ubani, a labour analyst and lecturer at the Department of Mass Communication, Abia State University, argues that the country’s wage history demonstrates how successive increases have struggled to keep pace with the rising cost of living.

 Nigeria’s national minimum wage has moved from ₦125 in 1981 to ₦18,000 in 2011, ₦30,000 in 2019 and ₦70,000 in 2024. While each adjustment represented an increase in nominal earnings, the real value of those wages has been eroded by inflation and the rising cost of essential commodities.

According to Ubani, the problem has become more pronounced following the removal of fuel subsidy, exchange-rate fluctuations and the consequent increases in the prices of food, transportation, housing, healthcare and other necessities.

The result, he argues, is that workers may receive higher figures on their payslips without experiencing a corresponding improvement in their living conditions.

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This is why he considers the proposed transport allowance particularly revealing. Although the intervention may offer temporary support, he questions the logic of a situation in which the government has to provide a monthly allowance equivalent to the national minimum wage to help workers meet transportation costs.

For him, the allowance should not be mistaken for a sustainable solution to the wage crisis. He believes Nigeria should begin a more deliberate transition from minimum wage to living wage, one that reflects the actual cost of maintaining a decent standard of living.

A living wage, in his assessment, should take account of decent accommodation, nutritious food, transportation, healthcare, education, utilities and the ability of workers to save or respond to emergencies.

Ubani proposes ₦200,000 monthly as a reasonable negotiating target, while emphasising that the figure should be considered alongside an independent assessment of the cost of living, productivity, inflation and the capacity of employers to pay.

His argument is that wage determination should no longer be reduced to negotiations over a figure that may quickly lose its value. Rather, it should be guided by evidence of what workers and their families need to live with dignity.

For Dr Tommy Etim Okon, former Deputy President of the Trade Union Congress of Nigeria (TUC) and former National President of the Association of Senior Civil Servants of Nigeria (ASCSN), the recurring minimum-wage negotiations have become an increasingly familiar national drama.

A new wage review generates excitement and expectations among workers, but the eventual outcome frequently falls short of what they consider adequate to meet their needs.

Okon, a policy and labour expert who is also a critical stakeholder, argues that Nigeria must move beyond this cycle of periodic adjustments and confront the broader economic questions that determine whether workers can enjoy decent living conditions.

In his view, the country should be discussing a living wage within the context of holistic economic development rather than concentrating almost exclusively on the amount the government and employers can add to monthly salaries.

He argues that the debate should extend beyond the organised workforce to include informal-sector workers and other vulnerable Nigerians who have little or no bargaining power.

For him, a wage policy that focuses only on workers covered by formal employment arrangements risks excluding a large segment of the population whose livelihoods are equally affected by inflation and the rising cost of living.

Okon proposes ₦300,000 as a starting point for the living-wage conversation, although he acknowledges that any wage arrangement must be considered against economic realities and the capacity of employers to sustain it.

He does not, however, regard the figure as a substitute for the structural changes required for decent and sustainable wages.

His argument is that the government must reduce the cost of living by providing essential public goods and services that workers currently struggle to afford.

Affordable mass housing, accessible healthcare, basic education, efficient public transportation and other essential services, he maintains, would reduce the financial burden on households and make workers’ earnings go further.

Rather than leaving individuals to shoulder virtually every cost of survival, the government should create conditions in which public services provide some of the support required to maintain a decent standard of living.

Okon also questions the capacity of the Nigerian economy to sustain substantially higher wages without addressing its underlying weaknesses.

He acknowledges that the government has room to streamline the cost of governance, reduce wastage and redirect public resources towards productive activities. However, he argues that the challenge is more fundamental, pointing to an economy that imports much of what it consumes and has not developed sufficient productive capacity.

In such circumstances, wage increases may provide immediate relief but could become difficult to sustain if domestic production, investment and productivity do not improve.

His position, therefore, places economic restructuring at the centre of the living-wage debate. For him, the country must build an economy capable of generating the resources required to support its workforce rather than repeatedly relying on wage adjustments to compensate for deteriorating living conditions.

Dr Edmund Onwuliri, immediate past Acting Director General of the National Directorate of Employment (NDE), approaches the question from the standpoint of evidence-based wage determination.

He argues that the minimum-wage debate should be guided by a proper assessment of household expenditure rather than the selection of figures without a clear understanding of what workers actually need.

In his view, the starting point should be to determine the cost of maintaining a household, taking into account food, accommodation, education, healthcare, transportation, electricity, water, clothing and other essential expenses.

He believes relevant government institutions, including the National Bureau of Statistics and appropriate ministries, should provide credible data to support such an assessment.

For instance, he suggests that the cost of feeding a family of five, paying annual rent, meeting school expenses and accessing healthcare should be calculated before negotiators arrive at a wage proposal.

The objective, he explains, should be to establish the actual financial requirements of a household and use the findings as the basis for negotiations between organised labour, government and employers.

To illustrate his point, Onwuliri gives a hypothetical example in which a household requires ₦1 million monthly to meet its essential needs. Negotiators could then use that assessment as a basis for determining a figure that employers and the economy can reasonably sustain. He mentions ₦500,000 as a possible negotiated outcome in that illustration, not as a formal wage demand.

For him, the critical issue is that wage negotiations must be informed by measurable living costs rather than arbitrary figures or political considerations.

Onwuliri also challenges the perception that workers’ welfare should be treated merely as an expenditure burden on government and employers. He argues that adequate remuneration is an investment in productivity, efficiency and national development.

According to him, a worker who spends much of the day worrying about how to feed the family, pay transport fares or meet basic household expenses may find it difficult to give the job the attention and commitment required. Conversely, workers who enjoy reasonable financial security are more likely to be motivated, productive and committed to their responsibilities.

He, therefore, believes employers should recognise the relationship between workers’ welfare and organisational performance instead of focusing exclusively on reducing labour costs.

While acknowledging that employers must consider profitability and business sustainability, he argues that this should not become an excuse for keeping wages disconnected from the cost of living.

Onwuliri also calls for the early constitution of the minimum-wage negotiation committee to allow sufficient time for consultation, research and engagement before the next statutory review. He is particularly critical of temporary interventions such as the six-month transport allowance, arguing that transportation is only one component of workers’ financial burden.

Even if the allowance provides some relief, he says, “it does not address the cost of rent, food, education, healthcare, electricity and other household necessities.”

The wider implication of the three labour experts’ arguments is that Nigeria’s wage challenge cannot be resolved by treating salary increases as an isolated labour issue.

The debate must also confront the economic environment in which wages are earned and spent. For instance, a worker whose salary increases may still experience declining living standards if food prices, rent, transport fares and healthcare costs rise faster than the additional income.

This means that the value of a wage is determined not only by the amount paid but also by the purchasing power it commands.

A living-wage framework would, therefore, require a more comprehensive approach to wage determination, including regular monitoring of inflation, household expenditure and changes in the cost of essential goods and services.

It would also require a credible mechanism for protecting workers’ purchasing power between statutory wage reviews.

However, the proposals raise important questions about affordability and the capacity of employers, particularly small and medium-sized enterprises, to meet substantially higher wage obligations.

For the private sector, wage increases that are not matched by improved productivity, access to finance, reliable electricity and a supportive business environment could place additional pressure on businesses, especially those already struggling with high operating costs.

This concern does not invalidate the demand for better wages. Rather, it reinforces the need for a wage policy that is connected to a broader economic strategy.

The government must address the structural conditions that make production expensive, discourage investment and limit the capacity of businesses to employ and remunerate workers adequately.

Improved electricity supply, efficient transportation networks, affordable credit, support for agriculture, accessible healthcare and investment in education and skills development would help strengthen productivity and reduce the cost of doing business.

Affordable housing and functional public transport would also reduce the proportion of workers’ earnings consumed by basic survival expenses.

There is equally a need to strengthen social protection so that workers outside formal employment are not excluded from efforts to improve living standards.

The informal economy accounts for a substantial part of Nigeria’s workforce, yet many of its workers have no guaranteed minimum earnings, organised bargaining arrangements or access to employment-related protections.

A living-wage conversation that ignores them would, therefore, remain incomplete.

Another important consideration is the relationship between wages and productivity. Although workers’ remuneration should reflect their contribution and the cost of living, productivity cannot improve sustainably when workers are unable to meet basic needs.

The three labour experts, from different perspectives, point towards the same policy contradiction: government and employers expect workers to deliver higher productivity, but the economic conditions confronting many workers make that expectation increasingly difficult to meet.

The challenge is, therefore, to create a system in which decent wages, productivity, business sustainability and economic growth reinforce one another.

For organised labour, this also calls for a broader negotiating strategy. Beyond demanding higher figures, unions may need to press for transparent household-cost assessments, stronger enforcement of existing wage agreements, improved social protection and regular engagement with government on the factors driving inflation.

For the government, the responsibility extends beyond announcing wage increases or temporary allowances. It includes creating an economy in which workers can afford the necessities of life without depending on periodic emergency interventions.

The proposed ₦70,000 transport allowance may offer some temporary relief to eligible public servants, but its significance goes beyond the immediate financial support. It has exposed the inadequacy of a wage structure in which the cost of one essential need can consume an amount equivalent to the national minimum wage.

Ultimately, the question confronting Nigeria is not simply whether workers should earn ₦200,000, ₦300,000 or another figure. It is whether the country is prepared to build an economic and social system in which wages can provide more than bare survival.

Ubani’s ₦200,000 negotiating target, Okon’s ₦300,000 starting point and Onwuliri’s insistence on a data-driven assessment offer different entry points into that conversation. Their positions underline the need to move away from arbitrary wage bargaining towards a framework informed by household needs, economic realities and the capacity to sustain decent employment.

Until that happens, every new minimum-wage agreement risks becoming another temporary reprieve, followed by another struggle as prices rise and purchasing power falls.

For Nigerian workers, the ultimate measure of a wage increase is not the announcement made at the negotiating table or the figure printed on a payslip. It is whether, at the end of the month, they can feed their families, pay their rent, access healthcare, educate their children and retain enough to live with dignity.