Legislators’ Allocations and Minimum Wage Palaver

While civil servants were clamouring for an increase in their salaries, the federal lawmakers were as well demanding an increment in their quarterly allocations by 40%. The legislators’ argument is reportedly borne out of their desire to have more money for the 2011 campaigns.

In the recently published details of remuneration of lawmakers by the Economic Confidential magazine, some of their entitlements are meant to take care of their constituency offices, purchase of journals, periodicals, as well as domestic staff welfare. It emerges that many of the lawmakers convert the funds for personal uses, while some of them had never approved money for staff expenses as contained in the packages. Apart from this, their budgetary allocations for running, the office, oversight functions, medications and travelling are also abused and recklessly spend for frivolities. Could there be any reason for any increase in remuneration of lawmakers when Nigerians are going through harsh economic condition?

It is claimed that quarterly allocation to an individual senator has risen from about N16 million in 2003 to the current N45 million. A report claims that Senate President, David Mark gets N250 million quarterly allowance (or N83.33 million monthly), his deputy Ike Ekweremadu receives N150million quarterly (or N50 million monthly), and 10 principal officers known collectively as the Senate leadership share N1.02billion as quarterly allowance. Another 8 principal officers take home N78 million quarterly (or N26 million monthly). Besides, for this year, the Senate has voted N2.6 billion (local travel), N2.45 billion (foreign travel), N1.25 million (security), N2.28 billion (contingency), N750 million (guest houses for Mark and Ekweremadu), and N500 million (establishment of radio and television stations).

The shocker is that with those stupendous quarterly allocations are separate from their official monthly allowances. According to a report from the Economic Confidential, their approved official remuneration from the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) each Senator is entitled to a gross annual salary of N22.6mn while their accommodation is 200% of basic annual salary, vehicle maintenance 75%, and entertainment 30%, and utility 30%. Others are personal assistants 25%, wardrobe 25%, domestic staff 75%, recess 10%, newspapers 15%, and constituency 250%. There are also furniture 300%, payable only once in tenure, vehicle loan 400%, repayable in six years, and gratuity 300%.

So, the real question people should ask is: With the huge expenditure going into maintaining federal legislators, what has been their contribution to national development and the development of their local constituencies? Why should so-called constituency projects pass through federal legislators when executives in local governments, states and the Federal Government perform these same tasks?

In some countries if that kind of sum is given to just the national assembly, the economy will go broke immediately but this shows that Nigeria is rich yet still living in poverty and penury.

The Nigeria Labour Congress (NLC) may continue to fight endlessly to have government to raise the minimum wage above N7, 500 per month, the comfortable legislators would never be bothered. But this is the time to call on the government to address the plight of career officers who contribute to the growth of our Nation with high qualifications and experiences are not well paid realistic wage. The technocrats, entrepreneurs and creative graduates who have brilliant ideas could be supported with soft loan to establish their SMEs.

It is obvious that increasing wage of employees/workforce is a tongue rolling offer that cannot be discarded but on the other hand it might be at the detriment of the economy and if not properly coordinated can lead to inflation: increase in the amount of money in circulation and rise in the general level of prices of goods and services in an economy.

Even though increase in wages will go a long way to boost the earnings of an employee, the question still remains does that have to affect other businesses outside government? There could be a problem for small business employers if forced to adhere to minimum wage. Labor is the most expensive cost in running any business. In order to cut cost, business owners may reduce their workforces creating unemployment in the system. The business owners could still raise prices on their goods and service for profit. If prices end up increasing which they probably will, people at the bottom will make more money, but the cost of consumable goods will also go up because it’s usually low wage employees that are working at restaurants and stores that most of us buy groceries and everyday items from. Whether the increase in prices is equivalent to the increase in pay is unknown, but it won’t be exactly as if you got that extra =N=3,000 in your pocket and everything works fine afterward.

It is unfortunate that our legislators are more concerned about themselves to generality of citizens going by their expenses, the government should ensure it provides realistic salaries to its workers to guard them against temptation of corrupt practices. Minimum wage plays an important role in Nigeria, but increasing minimum wage can cause increase in unemployment if it is not well planned with logistic and foresight.

By the way when will Nigeria provide welfare to the unemployed through social security system that have been adopted in several countries?

Toyeen Ojo
Finance Estate, Abuja


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