Incomes policy and the minimum wage palaver


There is an undoubted necessity for a national incomes policy. By this is meant that the government of the day ought to have some idea what level of income ought to be, after tax, for different types of work. This may not necessarily involve any form of statutory control. However, incomes policy may not be achieved without the direction of labour. In one sense or another, the requirement of an income policy has constantly cropped up as a desideratum; it cannot be wished away. But it has been tepidly attempted at one time or another, has regularly failed, and its vigorous proponents vilified or perceived as melo-dramatists or as people simply seeking to curry the favour of the poor or under-privileged.

The theoretical arguments against an incomes policy regime are overwhelming even as right-wing and left-wing critics have fallen over each other to condemn it. Free bargains, as freely arrived at, are as much part of the established ideology of the unions as they are of the tribe of the Christopher Kolades of this world. The pressure for a wages policy has usually come from the Civil Service. The pressure against it has understandably been from the grassroots. Under the compulsion of economic crisis, government after government have adopted an incomes policy but regularly abandoned it when they pass from power to opposition. Declaration of intent, guidelines, boards inaugurated for prices and incomes, etc. have dogged our pursuit of an agreeable incomes policy. There have been differences of phraseology and detail but there are fundamental points of resemblance. We have fought shy of calling a spade a spade and not an implement resembling a huge fork. Many recommendations have adopted the pretence of voluntarism, and the reality of compulsion.

The reason for failure is not far-fetched. The constant pressure of prices and the necessity for differential rewards corresponding to differences in enterprise, diligence and skill and to the ever-changing demand for particular types of labour have stood between us and the achievement of our desire. Wage demands have inexorably led to inflation. Inflation on its part has led to a demand for a price freeze or both. The vicious circle has never ceased to revolve. Even when the demand has been met either way, the result has proved intolerable and unsustainable. The underlying cause of our dilemma is the unreasonable human illusion that it is possible to swim in a pool of water without getting wet. Many will not believe that you cannot freeze prices particularly in times of peace without creating bankruptcies, shortage, unemployment and black market.

They will not believe that unless it is coupled with improved efficiency, you cannot raise wages in one sector without creating unemployment or inadequate expansion in another; and that inadequate expansion allied with increased demand will lead inevitably to an excess of imports and currency depreciation. As it has not been possible to control imports physically, it has thereby resulted in the “export” of the resultant unemployment as in the extant case of our teeming young population seeking greener pastures for their skill and enterprise on far-flung lands.

Government’s veiled stratagem for buying time and for assuaging the taut nerves of labour which has expectedly screamed out loud for an upward review of the miserly N18,000 per month minimum wage has manifested in the usual “holding talks” schemata involving the setting up of an unwieldly 30-man National Minimum Wage Committee. It is a sheer display of the Nigerian character that a matter that has inflamed so much passion and that has bitterly pitted the concerned publics against one another is to await the outcome of the deliberation of a committee charged by President Buhari’s admonition to achieve a consensual and generally acceptable formula. Labour, for instance, is insisting on N56,000 per month as the minimum irreducible option available to the committee.

The paymasters in the public sector, namely the governors, are not likely to recognise or concede to labour’s benchmark. So the achievement of a consensual position or stand is a forlorn hope. There is no doubt that the present minimum wage payable to the worker is not “a living wage.” It has merely confirmed the average worker’s mendacity or beggarly status. The proper approach to the issue of what is proper to pay as minimum wage should be a cerebral consideration of the nexus of several social, economic, moral and cultural imperatives. It is immoral to give to a worker wages or a take-home package which may not take him home in a contrasting situation of a pervasive official recklessness in spending, of general fiscal obtuseness, and of bare-faced thieving of our common patrimony.

Going by the necessity to continually improve our processes, we should expect that whatever is agreed upon to pay the average worker can only be time-bound even as inflation is waiting to stultify or consume its essence. A better way of ensuring a more rewarding recognition of a worker’s output is to create an ambient socio-economic environment. It is necessary to optimally provide from the resources of the state for the education of the children of the worker, to liberally attend to his health issues through the provision of accessible medical facilities, to strategically provide for his old or infirm age, and to generally see and treat him as a net contributor to our sense of material or physical well-being.

The worker is to be courted not vilified or scorned, he is to be loved, not spurned or harried; he is to be celebrated, not tagged or demonised as a perennially disturbing spirit. This one must be recognised as forever pointing in the direction of our future prosperity and well-being. We must not delay or contrive tardy ploys for dealing with matters that properly situate him in the role.
Rotimi-John, a lawyer and public affairs commentator, wrote from Abuja.

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Minimum Wage
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