There are strong indications that as President Muhammadu Buhari appears ready to assent to a new national minimum wage, following its recent passage by the National Assembly, he may be compelled to reduce the bogus salaries earned by some classes of Civil Servants in the country.
According to Independent, those to be a be affected are the staff of the Central Bank of Nigeria (CBN), Nigerian National Petroleum Corporation (NNPC), the Federal Inland Revenue Service (FIRS), among other Agencies.
This much became glaring when the President received the report of the Presidential Technical Advisory Committee on Implementation of National Minimum Wage, which was headed by Bismarck Rewane, at the Presidential Villa, on Monday.
Although the National Assembly was yet to transmit the new wage Bill which it passed, to the President for assent, Buhari had on January 9, 2019, inaugurated the Committee, with a clear mandate that it should advise the government on how best to fund, in a sustained manner, the additional costs of implementing the imminent increase in the national minimum wage.
Part of the terms of reference which he gave the Committee, was that after the new minimum wage has been passed into law, the government would go into negotiations for salary review for all the workers, who were already earning above the new minimum wage.
The President had underscored in his remarks, that it was important to properly prepare the minds of those public servants involved, so that they would not be taken unawares, when it is time for implementation.
There are indications that the Federal Government is also mulling an increase in Value Added Tax, VAT, from five percent to about fifteen percent, so as to enable it meet the envisaged wage increase. Buhari said:
“However, we anticipate that after the new minimum wage has been passed into law, we will be going into negotiations for salary review for all the workers who are already earning above the new minimum wage. It is therefore, important that we are properly prepared to meet these demands.
“We must therefore, look at ways of implementing these consequential wage adjustments, in a manner that does not have adverse effects on our national development plans, as laid out in the Economic Recovery and Growth Plan, ERGP.
“The ERGP sets appropriate targets for levels of capital expenditure, public debt, inflation, employment. It is absolutely important that the implementation of a new minimum wage does not adversely affect these targets, and thereby, erode the envisaged gains for the workers.
“It is against this background that I have set up a Technical Committee, to advise government on how best to fund, in a sustained manner, the additional costs that will arise from the implementation of the consequential increases in salaries and allowances, for workers currently earning above the new minimum wage.”