Governors in the country have warned that state governments would go bankrupt if they are forced to pay the proposed N30,000 new minimum wage because the financial capacity of states cannot sustain the payment of the figure which labour is demanding.
The state governors were said to have made the statement when representatives of Nigeria Governors’ Forum (NGF) met with President Muhammadu Buhari to discuss the lingering issue of national minimum wage on Monday, November 19, in Abuja.
This Day, citing unnamed sources aware of the meeting, reports that the governor argued that even states like Lagos and Rivers that seem to have the capacity to pay the N30,000 will be unable to sustain such huge wage bill.
Citing an instance, they reportedly said that if the N30,000 wage is implemented, Lagos state which currently has N7billion wage and N2billion pension bills would shift from N9billion to N15billion per month.
The governors said the new N30,000 minimum wage could be afforded through two ways option – by retrenchment or increase in federal allocation to states through the alteration of revenue allocation formula in their favour.
But they warned that the retrenchment option could harm the president’s promise of creating three million jobs annually. They reportedly told him that such a scenario could have consequences in an election season.
Sources said the governors pointed out that the federal government too is barely able to pay the prevailing N18,000 pay cheque.
They reportedly said the federal government had been paying the N18,000 wage through loans and bonds. The president was said to have told the governor that he would study their case and get back to them.
