The National Council of State has approved a new national minimum wage of ₦27,000 for states and the private sector, while ₦30,000 was agreed upon for federal workers. The council also paved way for President Muhammadu Buhari to transmit the new National Minimum Wage Bill to the National Assembly for consideration and approval. Labour minister, Chris Ngige, speaking at the end of the NCS meeting said that in addition, the council approved a frequency review of five years for the minimum wage. It also approved exemptions for establishments that are not employing up to 25 persons. In a swift reaction, however, the Nigeria Labour Congress has rejected the proposal. Peter Ozo-Eson, the NLC General Secretary, said that the NCS has no jurisdiction determining another amount after a Tripartite Committee had submitted its report, and said that the NLC had called an emergency National Executive Council meeting for Friday to weigh on the deadline given to government within which to submit an executive bill to the National Assembly. Ozo-Eson added that the FG was only projecting a shutdown of the economy with its latest action.

South Africa’s MTN has paid $53 million to settle a money transfer dispute with the CBN, and the matter has been withdrawn from court according to Godwin Emefiele. The regulator had ordered MTN and its lenders to bring back a total of $8.1 billion it alleged the company had illegally repatriated using improperly issued paperwork between 2007 and 2008. Speaking at the MPC meeting, Emefiele said the money paid by MTN was a notional sum and that the company has been absolved from any wrongdoing.

After a succession of attacks by Boko Haram, humanitarian organisations have pulled out of Rann, in Borno state, leaving 76,000 refugees to an uncertain fate. The latest attack by ISWAP on January 14, led to the destruction of an estimated 100 structures in west and south of the town, including facilities of Medicines Sans Frontieres. Within 72 hours of the attack, more than 8,000 refugees and a number of aid workers fled to Rodo, a Cameroonian border town seven kilometres away. There, officials allegedly instructed security agents to turn back Nigerian refugees. Others have moved to Ngala, 75km away from Rann. However, with the security situation in northern Borno worsening, the Borno State Emergency Management Agency is unable to resupply the town, leaving the people there to an uncertain fate.

The Acting Inspector General of Police, Mohammed Adamu, during a conference with senior police officers, announced the disbandment of the Federal Special Anti-Robbery Squad (FSARS), Special Investigative Panel and Special Tactical Squad. Adamu’s directive creates a Special Anti-Robbery Squad domiciled in each of the 36 states. Police spokesman, ACP Frank Mba explained that the FSARS was decentralised to correct abnormalities and part of a series of reforms to reposition the police. The police unit had been accused of high handedness and extra-judicial killings. An #EndSARS campaign on social media snowballed into street protests in different parts of Nigeria. The Vice President Yemi Osinbajo subsequently ordered the former IGP in August 2018 to overhaul the management of the unit.

Commentary

  • Nothing illustrates Nigeria’s dysfunction as much as the minimum wage palaver. The ₦27,000 ($75) or even ₦30,000 ($83) is not much – those that earn it will hover around the poverty line. The issue is that even such a wage is beyond the capacity of the Nigerian state to pay, and for many small businesses as well, this will represent a massive upswing in cost. There is a disconnect between value creation by the workforce, and how much they earn. On their part, the labour unions are in a tough spot. The FG has, to an extent, acceded to their demands so ideally they should take the fight to the states, but history shows that it is far easier to fight the centre, and they have only one trump card – a general strike. Pulling it off requires a sustained effort and the cooperation of the population, which is notoriously difficult to get from populations in 36 states that have very diverse interests and needs. Unfortunately for the unions as well, Nigerians now have as little faith in them as in the the government itself so a strike will likely fail and this could render the final blow to organised labour in Nigeria. It is also logistically difficult to sustain a long strike in a country where the vast majority earn their income each day. Nigeria desperately needs to fix the wage problem so that earnings are tied to value created and productivity, measured as objectively as possible, otherwise we will continue to have this dance between government and the unions which benefits few people.
  • On the settlement reached between the CBN and MTN, the regulator’s behaviour during the entire duration of the matter left a lot to be desired. The public humiliation of one of the country’s largest employers (it supports about 500,000 jobs directly and indirectly) in a sector of the economy that helped prop middling GDP growth (the industry grew by 6.6% last year, according to the Nigeria Communications Commission) was needless, irresponsible and put a damper on investor sentiment towards the country. It is hard to escape the glaring fact that the final settlement sum that absolved MTN from any wrongdoing is 0.65% of the original claim by the CBN, at the cost of almost 20 percent of the company’s market value. When we do the opportunity cost – lost tax revenue compared to this paltry sum the government eventually got, we get a fuller sense of how pointless the government’s actions were. More importantly, the entire saga wrecked wider economic damage – a Business Day report in September said at least three big deals involving foreign investors were put on hold, with a few Nigerian companies encountering difficulty raising foreign capital in the wake of MTN’s travails. To the company’s credit, it remains committed to Nigeria, its biggest market, and is aggressively planning to expand into mobile financial services. The government, cash strapped as it is, cannot do much directly to provide the millions of job this dire economy needs. What it can do is create the best possible environment for private businesses to thrive. When the head of the financial regulator triumphantly speak about one of its biggest faux pas of 2018, investors, money managers and entrepreneurs in Lagos, London and Johannesburg hear a different message – this place is not ready to do business.
  • The Rann crisis is a continuing effect of increasing ISWAP activity in the northern part of Borno State, worsening an already precarious humanitarian emergency. As of this moment, Northern Borno continues to be neither in the full control of the government or territory that either ISWAP, or Boko Haram, can claim to control. However, its status as no-man’s-land plays more to the benefit of the insurgents, as it will enable them to keep pushing towards Maiduguri which has been their target for years. As more locals move towards the state capital, the increased population will put more strain on the city’s resources, and further the risk of the insurgents sending in fifth columnists to attack the city from within.
  • And finally on the reorganisation of SARS, let us forget the framing. The real news is this: the new IGP decentralises FSARS, returns it to the states commands. Far from an effort to “correct abnormalities” as the police’s talking points imply, what the IGP has really done by decentralising FSARS is to simply turn back the hands of the clock. It was the unruly conduct of SARS officers under the direct control of state police commissioners that made places like Rumukpo in Rivers, Awkuzu in Anambra and Iyanganku in Oyo, the infamous dens of police brutality, torture and in some cases, extrajudicial killings that birthed the #EndSARS movements. While the effort at police reform stalled under Adamu’s predecessor, he caved to pressure and subsumed all the units under federal control in order to provide some oversight, a development which led to a decline in SARS atrocities. The latest move represents a giant step in the wrong direction and yet another example of authorities offering placeholders in place of concrete change in order to satiate an angry public.