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Agony of Nigerians over soaring cooking gas price

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Many Nigerians have in recent times embraced the use of Liquefied Petroleum Gas (LPG), popularly known as cooking gas, encouraged by its speed in cooking and low health risk.

However, a persistent increase in the cost of cooking gas is now threatening to force average Nigerians to return to charcoal and firewood, with all their well known health hazards.

Indeed, since the beginning of the year, the price of gas has soared beyond the reach of the common man.

It now costs an average of N12,000 to refill a 12.5kg LPG in some parts of Lagos, while the cost of refilling a 5kg cylinder has also increased to N4,750 on average.

Some consumers are now lamenting the continuous increase in the price of cooking gas.

Mr Mike Samson, a businessman who went to Dikram gas depot in Surulere, Lagos, to purchase the product on Friday, said the price hike had become frustrating to consumers.

Samson said, “At this point, we are quite frustrated at the rate at which the price of every commodity in the market keeps surging every single day.

“Imagine the increase from last month to this month, and with every possibility that it might increase again in the next few weeks.

“The development forced some LPG users to shift to charcoal or firewood, as consumers of the commodity raised the alarm over the persistent hike in its price.

“The product has increased by 240 per cent for 12.5kg, moving up from N3,000 to N10,200 within the first 10 months of 2021.”

Mrs Alice Bamidele, a housewife, arrived at her usual gas depot in the Somolu area of Lagos, last week, to refill her 12.5kg gas cylinder but was surprised that what she bought about a month ago at N10,200 had increased to 11, 800.

She lamented that the increase would affect her family’s monthly budget, particularly because her husband, a civil servant, had fixed income.

Another Lagos housewife, Mrs Toun Philips, who resides in Ilupeju, Lagos, expressed her frustration thus, “I bought 12.5kg cylinder at this same depot last month for N10,000, only to be told today that it is now N12,200. This really destabilises my budget.

“What if I didn’t come with extra money, that would have meant that I would have gone back home and not purchased gas and definitely would not be able to cook food at home.

“The government doesn’t seem to be doing anything about the constant increase in the price of cooking gas.

“They (the government) have been encouraging us to use gas instead of charcoal, but with the way things are going, gas may no longer be within the reach of the common man,” she said.

Mrs Juliana Matthew, a restaurant owner, said the increase in the price of gas along with the hike in food prices, automatically increased the cost of production for her business.

“When I consider that I have to pay more for gas and the food items I buy from the market, I cannot help but reduce the quantity or quality of the food or maybe increase the price to make a substantial profit,” she said.

Similarly, the manager of a depot in Lagos, who declined to be mentioned, stated that the selling price at the depot was determined by how much the product was bought from the marketers.

“The increase is not really our fault. We also buy the product to sell to consumers. If there is an increase in price by the marketers, we also have to increase from our end to avoid losses.

“The problem is really from the top of the chain,” he claimed.

Mr Peter Chima, a retailer in the Ikotun area, Lagos, said one of the factors responsible for the high cost of cooking gas was the rising foreign exchange rate of the Naira to the dollar.

“Aside from being a dealer, I’m also a gas consumer, so I understand how our customers are feeling. Gas is not the only thing that keeps increasing in price in Nigeria.

“A great percentage of locally consumed gas is being imported and you cannot rule out the factor of rising dollar and Naira depreciation,” he said.

Mr Afolabi George an Energy Consultant, attributed the high cost of cooking gas to supply not matching the increase in demand.

He said the trend of switching to cleaner energy from local alternatives in the last one decade highlighted the interplay of the forces of demand and supply in the increase in the price of cooking gas.

“More than a decade ago, the demand was just about 60,000 metric tonnes per year as cooking gas was largely unpopular compared to kerosene.

“Today, we consume over one million metric tonnes per year. To meet up with the demand, we have to import.

“It is at this point that importers have to deal with the bottlenecks of scarcity of dollars, government’s recent introduction of 7.5 per cent value-added tax (VAT) and others,” he said.

George said the Russian-Ukraine war also led to shortage of supply of gas in the face of rising demand around the world.

“Russia is the world’s largest natural gas exporter. Due to the imposition of an embargo on its gas, countries like Nigeria that depend on the eastern European country for imports will feel the brunt.

“The price of cooking gas has more than doubled in the last one year.

“The rising LPG prices are a part of a general escalation of other daily living costs.

“Gasoline pump prices, electricity tariffs, basic prescription drug prices and urban mass transportation, form part of the determinants of the escalating living costs and declining living standards,” he added.

He explained that to establish the fundamentals that led to the increase in the price of cooking gas, there was need to understand the micro and macroeconomics of LPG in Nigeria and global trends that impacted the sector.

“First, Nigeria gets a little over 450,000 metric tonnes of LPG from its liquefaction company, the NLNG, co-owned by the Federal Government and three international oil companies, while the actual domestic demand stands at 1.3 million metric tonnes, a shortfall of 850,000 metric tonnes.

“These 450,000 metric tonnes of LPG represent about 100 per cent of its Butane production (Butane gas is less volatile and is suitable for cooking).

“And by committing 100 per cent of its Butane production, NLNG posits that it has prioritised the domestic market, thus meeting its domestic supply target,” he said.

in the sector,” he said.

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FEATURE

Minimum Wage: Addressing poor implementation by states

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Minimum Wage  – the minimum amount of remuneration that an employer is required to pay wage earners for the work performed during a given period – remains a  sensitive matter.

The purpose of establishing a minimum wage is to protect workers against exploitation, reduce income inequality, alleviate poverty and promote social and economic well-being.

In Nigeria,  minimum wage is based on monthly income with an average working period of eight hours daily and five days weekly.

It is expected to be reviewed every five years. The last review was in 2019, from N18, 000 to N30,000.

As Nigerian workers expect  a new minimum wage in 2024,  President Bola Tinubu has promised that it will take effect from April.

Workers’ expectations on the minimum wage have been high through their two major labour centres, the Nigeria Labour Congress (NLC) and Trade Union Congress (TUC).

Workers cross the country are optimistic that the Tripartite Committee on the National Minimum Wage, which was set up by the Federal Government on Jan. 30 to determine the new minimum wage, will be realistic  in determining the new wage amount.

They expect the committee to put into consideration the high inflation rate of 31.7 per cent in February from 29.9 per cent reported by the National Bureau of Statistics in January, among other factors.

The President of the NLC, Mr Joe Ajaero, had stated that if the inflation would continue,  organised labour might push for a new minimum wage of up to one million Naira for Nigerian workers.

Proposals by TUC and NLC at recent public hearings in the six geopolitical zones and Abuja, indicate that the organised labour may slash the demand from one million Naira but still expects the wage to be able to absorb financial pressures faced by the Nigerian worker today.

During the zonal public hearings in Lagos, Kano, Enugu, Akwa Ibom, Adamawa and Abuja, workers in the North-West requested for N485,000, North-East, N560,000; North-Central, N709,000 (NLC), and N447,000 (TUC); South-West, N794,000; South-South, N850,000; and South-East, N540,000 by  NLC and N447,000 by TUC.

According to the Chairman of Enugu State Chapter of the NLC, Mr Fabian Nwigbo, the value of N30,000 minimum wage approved in 2019 had been battered by inflation and worsening economic hardship.

Nwigbo argues that Nigerian workers remain the least paid in the entire West Africa.

“We are asking our leaders to consider the plight of Nigerians. It should be N540,000 per month,” he recommends.

The Secretary of the Nigeria Labour Congress, Mr Chris Onyeka, regrets that many workers can no longer afford their rents or pay their children’s school fees.

He is also worried that with increase in the cost of transport by almost 300 per cent, many civil servants are trekking to work.

Onyeka says every worker  wants to earn a favourable income.

‘’We expect that the minimum wage will take care of the basic needs of the average  Nigerian family.

“How much will that be? A loaf of bread that used to cost N600 is now almost N2,000.

‘’For a family of six, will a loaf of bread be enough for them  in a whole day? Will they not also, at least, take water to eat that bread?

‘’An average family will not spend anything less than N15,000 everyday to take care of themselves; we are talking about a salary that will meet those needs,” he emphasises.

The Lagos State Chairman of Radio, Television, Theatre and Arts Workers’ Union of Nigeria, Mr Ismail Adejumo, is looking forward to a holistic review of the minimum wage.

Adejumo, who is also the Public Relations Officer, NLC, Lagos State Chapter, says:  “There are parameters to be considered, and  expectations from the workforce in terms of productivity too can be measured side-by-side with what government will do in terms of fixing minimum wage.

“As for the parameters, the cost of commodities is a key factor, and the issue of transportation is a key factor.

“We should also be looking at the issue of housing, we have shortage of housing in Lagos vis-a-vis the population; it is really affecting most working class.”

While expectations on the new minimum wage remain high, analysts argue that the challenge about minimum wage in Nigeria is not approval but implementation especially by state governments and some  private employers.

They argue that since inception, minimum wage in Nigeria has suffered non-compliance by some state governments and private employers due to inability to pay and reluctance to pay.

Thus, they believe that ability to pay is very crucial when considering review of minimum wage.

At the recent public hearing organised by the Tripartite Committee on National Minimum Wage across the six geo-political zones of the country, Osun State Gov. Ademola Adeleke, who represented the governors in the South-West Zone, said that states lacked equal ability to pay.

‘’While it will be desirable to see that a uniform minimum wage is agreed to on a national basis, it will amount to self-deceit to assume that states have equal ability to pay.

‘’To this effect, I will humbly advise that individual states will have to negotiate with their workers and agree to a realistic and sustainable minimum wage in line with available resources, ‘’ Adeleke said.

However,  the Assistant General Secretary of NLC, Onyeka, argues that  state governments are not complying because there are no consequences for their non-complaince.

‘`If there were, I believe, many will be complying.

‘’The Federal Ministry of Labour and Employment, which is empowered by law to check abuses and violations of the extant law, does not have the capacity to monitor or enforce.

‘’When we look at the mechanism put in place by the Act to check non-compliance, reporting and enforcement, is the mechanism effective? It has to be strengthened, so that it will become effective,” he argues.

Prof. Kemi Okuwa, a Research Professor at the Nigerian Institute of Social and Economic Research, notes that Nigeria is number 44 in minimum wage cadre in Africa.

Okuwa made a presentation at the recent South-West Zonal public hearing, which took place in Lagos

According to her, the current N30,000 minimum wage is equivalent to $20 per month.

For the Director-General, Nigeria Employers’ Consultative Association, Mr Adewale-Smatt Oyerinde, there must be critical review  of the current minimum wage by all stakeholders.

Oyerinde also urges appropriate recommendations, approval and implementation.

Meanwhile, the Nigeria Governors’ Forum (NGF) wants the tripartite committee to take into account the present circumstances, unique characteristics of individual states, and their effects on the abilities of both governments and private sector employers to pay, when determining the  new wage amount.

In a communiqué issued after its virtual meeting, and signed by its Chairman and Kwara  governor. AbdulRahman AbdulRasaq, and made available to journalists on Thursday, the NGF said: “Members reviewed the progress of the National Minimum Wage Committee and ongoing multi-stakeholder engagements towards agreeing on a fair minimum wage.

“Members urged the National Minimum Wage Committee to consider the current realities, individual states’ peculiarities, and consequential impact on the capacity of  government as well as private sector employers to pay.

“Members also emphasised the need for proposals to be data-driven and evidence-based,” he said. Analysts urge the 37-member  tripartite committee, comprising government representatives, the organised labour, and employers association, to ensure that the new minimum wage reflects the evolving economic landscape.

They advise that the minimum wage should  meet the needs of the Nigerian  worker, urging also that it should be implementable and sustainable.

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FEATURE

Minimum Wage: Addressing poor implementation by states

Published

on

Minimum Wage  – the minimum amount of remuneration that an employer is required to pay wage earners for the work performed during a given period – remains a  sensitive matter.

The purpose of establishing a minimum wage is to protect workers against exploitation, reduce income inequality, alleviate poverty and promote social and economic well-being.

In Nigeria,  minimum wage is based on monthly income with an average working period of eight hours daily and five days weekly.

It is expected to be reviewed every five years. The last review was in 2019, from N18,000 to N30,000.

As Nigerian workers expect  a new minimum wage in 2024,  President Bola Tinubu has promised that it will take effect from April.

Workers’ expectations on the minimum wage have been high through their two major labour centres, the Nigeria Labour Congress (NLC) and Trade Union Congress (TUC).

Workers across the country are optimistic that the Tripartite Committee on the National Minimum Wage, which was set up by the Federal Government on Jan. 30 to determine the new minimum wage, will be realistic  in determining the new wage amount.

They expect the committee to put into consideration the high inflation rate of 31.7 per cent in February from 29.9 percent reported by the National Bureau of Statistics in January, among other factors.

The President of the NLC, Mr Joe Ajaero, had stated that if the inflation would continue,  organised labour might push for a new minimum wage of up to one million Naira for Nigerian workers.

Proposals by TUC and NLC at recent public hearings in the six geopolitical zones and Abuja, indicate that the organised labour may slash the demand from one million Naira but still expects the wage to be able to absorb financial pressures faced by the Nigerian worker today.

During the zonal public hearings in Lagos, Kano, Enugu, Akwa Ibom, Adamawa and Abuja, workers in the North-West requested for N485,000, North-East, N560,000; North-Central, N709,000 (NLC), and N447,000 (TUC); South-West, N794,000; South-South, N850,000; and South-East, N540,000 by  NLC and N447,000 by TUC.

According to the Chairman of Enugu State Chapter of the NLC, Mr Fabian Nwigbo, the value of N30,000 minimum wage approved in 2019 had been battered by inflation and worsening economic hardship.

Nwigbo argues that Nigerian workers remain the least paid in the entire West Africa.

“We are asking our leaders to consider the plight of Nigerians. It should be N540,000 per month,” he recommends.

The Secretary of the Nigeria Labour Congress, Mr Chris Onyeka, regrets that many workers can no longer afford their rents or pay their children’s school fees.

He is also worried that with an increase in the cost of transport by almost 300 per cent, many civil servants are trekking to work.

Onyeka says every worker wants to earn a favourable income.

‘’We expect that the minimum wage will take care of the basic needs of the average Nigerian family.

“How much will that be? A loaf of bread that used to cost N600 is now almost N2,000.

‘’For a family of six, will a loaf of bread be enough for them for a whole day? Will they not also, at least, take water to eat that bread?

“An average family will not spend anything less than N15,000 everyday to take care of themselves; we are talking about a salary that will meet those needs,” he emphasises.

The Lagos State Chairman of Radio, Television, Theatre and Arts Workers’ Union of Nigeria, Mr Ismail Adejumo, is looking forward to a holistic review of the minimum wage.

Adejumo, who is also the Public Relations Officer, NLC, Lagos State Chapter, says, “There are parameters to be considered, and  expectations from the workforce in terms of productivity too can be measured side-by-side with what the government will do in terms of fixing minimum wage.

“As for the parameters, the cost of commodities is a key factor, and the issue of transportation is a key factor.

“We should also be looking at the issue of housing, we have a shortage of housing in Lagos vis-a-vis the population; it is really affecting most working class.”

While expectations on the new minimum wage remain high, analysts argue that the challenge about minimum wage in Nigeria is not approval but implementation especially by state governments and some  private employers.

They argue that since inception, minimum wage in Nigeria has suffered non-compliance by somestate governments and private employers due to inability to pay and reluctance to pay.

Thus, they believe that ability to pay is very crucial when considering the review of minimum wage.

At the recent public hearing organised by the Tripartite Committee on National Minimum Wage across the six geo-political zones of the country, Osun State Gov. Ademola Adeleke, who represented the governors in the South-West Zone, said that states lacked equal ability to pay.

“While it will be desirable to see that a uniform minimum wage is agreed to on a national basis, it will amount to self-deceit to assume that states have equal ability to pay.

“To this effect, I will humbly advise that individual states will have to negotiate with their workers and agree to a realistic and sustainable minimum wage in line with available resources,” Adeleke said.

However,  the Assistant General Secretary of NLC, Onyeka, argues that  state governments are not complying because there are no consequences for their non-compliance.

“If there were, I believe, many will be complying.

“The Federal Ministry of Labour and Employment, which is empowered by law to check abuses and violations of the extant law, does not have the capacity to monitor or enforce.

“When we look at the mechanism put in place by the Act to check non-compliance, reporting and enforcement, is the mechanism effective? It has to be strengthened, so that it will become effective,” he argues.

Prof. Kemi Okuwa, a Research Professor at the Nigerian Institute of Social and Economic Research, notes that Nigeria is number 44 in minimum wage cadre in Africa.

Okuwa made a presentation at the recent South-West Zonal public hearing, which took place in Lagos

According to her, the current N30,000 minimum wage is equivalent to $20 per month.

For the Director-General, Nigeria Employers’ Consultative Association, Mr Adewale-Smatt Oyerinde, there must be a critical review  of the current minimum wage by all stakeholders.

Oyerinde also urges appropriate recommendations, approval and implementation.

Meanwhile, the Nigeria Governors’ Forum (NGF) wants the tripartite committee to take into account the present circumstances, unique characteristics of individual states, and their effects on the abilities of both governments and private sector employers to pay, when determining the  new wage amount.

In a communiqué issued after its virtual meeting, and signed by its Chairman and Kwara  governor. AbdulRahman AbdulRasaq, and made available to journalists on Thursday, the NGF said, “Members reviewed the progress of the National Minimum Wage Committee and ongoing multi-stakeholder engagements towards agreeing on a fair minimum wage.

“Members urged the National Minimum Wage Committee to consider the current realities, individual states’ peculiarities, and consequential impact on the capacity of  government as well as private sector employers to pay.

“Members also emphasised the need for proposals to be data-driven and evidence-based,” he said.

Analysts urge the 37-member  tripartite committee, comprising government representatives, the organised labour, and employers association, to ensure that the new minimum wage reflects the evolving economic landscape.

They advise that the minimum wage should meet the needs of the Nigerian  worker, urging also that it should be implementable and sustainable.

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FEATURE

Insecurity: Any role for ex-servicemen?

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Insecurity in Nigeria is not only a threat to the safety of humans. It also has wide reaching implications for food security and the economy.

It is safe to argue that since the nation gained political independence in 1960, apart from the civil war period, the country has not faced a more security challenge as it has in the past decade.

Thousands of lives have been lost, farmers are being displaced from their farmlands while kidnappers that once prowled the highways now lurk around their prey in the cities while Boko Haram menace has not stopped.

Mitigating the factors that make the security challenge fester as well as stopping it has become Nigeria’s number one priority because no nation thrives under a security crisis.

Doing so will make Nigerians feel safe in their country once more, restore foreign investors’ confidence and put less pressure on the nation’s security structure.

Parts of the country that seemed to be safe from the challenge such as the Federal Capital Territory (FCT) and Kwara now also feel the heat.

According to data curated by the Armed Conflict Location & Event Data Project (ACLED), in 2023 more than 8,119 people were killed in more than 4,326 violent events across Nigeria.

ACLED is a US.-based disaggregated data collection, analysis, and crisis mapping project that uses real-time data and analysis sources on political violence and protests worldwide.

Security experts have suggested different approaches to solving the problem include the now famous ‘carrot and stick’ method, as well as outright onslaught against the criminals.

However, other experts say the nation’s security chiefs could harness the experience and knowledge of ex-servicemen as they seek to end the challenge.

In 2023 the immediate past Chief of Defence Staff (CDS), retired Gen. Lucky Irabor, once mooted the idea of incorporating retired military personnel to help in the fight against insecurity.

According to him, retirees can combine their experience of living with civilians as retirees and their military background to provide intelligence that can help in efforts to secure the country.

“To make a significant impact in ensuring that peace takes pre-eminence in the country, we need to fall back on the retired military officers.

“This is because they also live among the people, thereby having a lot to offer regarding security issues.

“Once a military officer, you remain a military officer for life, whether serving or retired. The motto of the country, which is ‘Unity, Peace and Faith,’ is what we swore to defend, and we are committed to it,” he had said.

However, Chief Akpodiogaga Emeyese, one time member representing Ethiope East Federal Constituency in the House of Representative, thinks otherwise.

According to him, having retired at 60 years, age is no longer on the side of the retirees to execute assignments such as engaging in rigorous security activities.

He added that young people tend to take up more risky responsibilities than persons above the age of 60 years even though they may still be strong and willing to carry out such assignments.

“Thus, using retired military personnel to resolve our security challenges may not be the best of ideas,” he said.

Similarly, retired Capt. John Ojikutu, an Aviation/Security expert, said that bringing back ex-servicemen was not the solution to fighting insecurity in the country.

Ojikutu said that there was the need for Nigeria to return to the drawing board and begin to do things the way they were done before.

He also faulted the idea of changing the Nigerian Police to the Nigerian Police Force as well as all security agencies trying to carry out the same responsibility,

He opined that such tactics would not yield any positive result, and argued that each security agency ought to work within a specific role, though they must all share intelligence to achieve a common feat.

He said that intelligence must only be shared among the security agencies, adding that not all intelligence should be shared with members of the public.

“I don’t believe in this idea of everybody carrying guns. The police, army and even the NDLEA and Civil Defence.

“As a country, we cannot continue that way at all because we cannot get results.

“Can we go back to how we were doing it? I think what should be done is to look for people that were doing it before and we were getting results.

“Let’s talk to these people and ask them how they were handling internal security before.

“If security is going to be on one agency, then you have intelligence following behind, then you get the information, and they do the analysis,” explained.

Secretary General, Armed Forces Veterans Federation of Nigeria, Dr Awwal Abdullahi, also thinks that the veterans have a role to play in securing the country.

Abdullahi, who is also the spokesperson of the Ministry of Defence Ministerial Committee on Armed Forces, Veterans Welfare said that ex-servicemen could be re-engaged into the fold of the armed forces.

He agrees with Irabor that ex-servicemen may not necessarily be engaged in physical combat but could be useful in intelligence gathering and information dissemination.

He said that having served in the military and now residing among civilians has given them “double experience which will be very useful in what we call technological intelligence gathering warfare.”

He explained that technological in that context meant intelligence gathering using the latest technology, while warfare involves the use of humans to get technical intelligence.

“This is one aspect that can be very, very useful and the federal government can decide to engage us back into the services or provide service of intelligence, technological intelligence and warfare intelligence.

“When I say warfare intelligence it doesn’t mean we have to carry guns to go and start fighting.

“No, we can be reengaged to provide the necessary credible intelligence, timely intelligence, useful intelligence that will mitigate the challenging situation that Nigeria is having in terms of security,” he said.

Another veteran, a retired captain who preferred to be anonymous said that the insecurity in the country was not something unexpected.

He, however, urged the government to find a way of involving retired army generals as think tanks to profile pieces of advice.

“Veterans can help. Let the government call on them. Let them give them a task to do. Let them commission them to do this or do that.

“We have handled arms before and we can still handle them,” he said.

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