National Telescope national telescope newspaper
Governor Godwin Obaseki has explained that he raised the minimum wage of workers in Edo State to cushion the effect of the economic hardship.
Obaseki had earlier announced the minimum wage increase from N40,000 to N70,000.
Recall that the Federal Government Committee had been meeting to agree on a new minimum wage as the Nigeria Labour Congress demanded for over N600,000 as the new minimum wage
Speaking in an interview on Channels TV on Monday, the governor said the decision to increase was conceived in view of various economic challenges, including currency devaluation, rising food prices, and inflation.
Obaseki emphasised the government’s commitment to improving the well-being of workers amidst challenging economic conditions, stating that it was imperative to address their plight.
He underscored the importance of prioritising the welfare of citizens, affirming that governance is ultimately about the people’s prosperity and happiness.
“In 2011, when minimum wage was 18,000, the exchange rate was N150/$. So, by calculations, workers in Edo State were taking home $120 home monthly. When we increased the minimum wage to N40,000 in 2022, the exchange rate at that time was N415. So, workers were getting about $96, which was a discount on what they were earning in 2011.
“Even as of today, with the N70,000 minimum wage, the current exchange rate with over N1,000 pegged their take home at $55 which is less than what they were earning two years ago.
“For us in Edo State, we believe that the issue is about productivity. Paying people well so that they can produce more. Not pretending that you are paying them a salary when you know that it can not motivate them to produce more.
“We are never a flippant state; we look at our numbers carefully, and because we understood that this was going to happen, we took measures to mitigate the situations we found ourselves in today. So, we undertook fundamental reforms in our public services. Cutting our IPP so I don’t buy diesel at the rate people are buying diesel to run power in the state and government facilities. We moved our operations to a digital platform. So we don’t spend money on stationery and other costs that we will use to run the governance.
“By the time we harness all our savings, we will have a lot of money to pay the workers.”
While reacting on the implications of the new policy on the 2024 budget, the governor said that he would present the revised budget to the state assembly to accommodate the new development.
He said, “My overhead budget this year is about N89 billion, whereas my personal costs are about N65 billion. So I want to move more money from overhead to paying more salaries to the people and the taxes generated from the state.”
He however stated that there is fund to sustain the increase. Adding that if the Federal Government imposes something higher, we would look at what at the economic realities in the state and make the necessary adjustments.”
