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Audit uncovers over N61bn payment breaches in NNPCL

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The Office of the Auditor-General for the Federation has uncovered 28 major financial irregularities linked to the Nigerian National Petroleum Company Limited (NNPCL), involving N30.1bn $51.6m, £14.3m, and €5.17m in questionable payments, undocumented expenditures, and breaches of financial regulations. When converted to naira, the total amount is about N61.1bn

The red flags, contained in the Auditor-General’s 2022 Annual Report on Non-Compliance (Volume II), detail transactions carried out during the 2021 financial year across the NNPCL and its subsidiaries. The document was obtained by our correspondent on Sunday.

The report, which has been transmitted to the National Assembly, accuses NNPCL of weak internal controls, unauthorised virements, tax infractions, irregular procurement, abandoned projects, and unsubstantiated settlements.

“These findings highlight systemic weaknesses that continue to expose public funds to avoidable risk. Where documents were not provided, payments were unjustified. Where approvals were absent, expenditure breached the law. Recovery and sanctions must follow,” the Auditor-General’s office said.

The latest audit revelations come against the backdrop of earlier reports by The PUNCH this year, which exposed long-running financial discrepancies involving the Nigerian National Petroleum Company Limited. The Auditor-General’s annual reports for 2017 to 2021 showed that the national oil company was previously indicted for the diversion of N2.68tn and $19.77m within a four-year period.

The breakdown includes N1.33tn flagged in 2017, N681.02bn in 2019, N151.12bn and $19.77m in 2020, and N514bn in 2021, signalling a persistent pattern of unremitted funds, unsupported transfers, and irregular withdrawals that have raised concerns about governance and accountability in the petroleum sector.

Among the most striking revelations in the new report is Issue 2, which concerns the expenditure of £14,322,426.59 at NNPC’s London Office without documentation. Auditors said the corporation failed to provide utilisation details or supporting schedules for the amount.

According to the auditor-general, Financial Regulations (2009) place strict responsibilities on all accounting officers, including ensuring adequate internal controls and proper documentation for public expenditure. Paragraph 112 mandates officers to provide clear rules and procedures to safeguard revenue.

In the same vein, Paragraph 603(1) requires every payment voucher to contain full particulars, dates, quantities, rates, and to be supported with invoices, purchase orders, letters of authority, and other relevant documents to enable verification without recourse to additional files.

However, the Auditor-General reported that these statutory provisions were breached in the operation of the Nigerian National Petroleum Company Limited’s London Office in the 2021 financial year.

According to the audit, a total of £14,322,426.59 was spent by the Foreign Office during the period under review, covering personnel costs, fixed contract expenses, and other operational needs.

A breakdown of the expenditure showed personnel costs amounting to £5,943,124.74, fixed contract and essential expenses totalling £1,436,177.11, while other operational costs stood at £6,943,124.74, bringing the total to £14,322,426.59.

Despite the magnitude of the spending, the audit team noted that it was not provided with supporting documents or given access to verify how the funds were utilised. The report stated that the auditors were unable to ascertain whether the expenditure complied with due process and other requirements of the Financial Regulations.

The Auditor-General warned that the failure to provide documentation points to “weaknesses in the internal control system” of NNPC Ltd, exposing the organisation to the risks of diversion and misappropriation of public funds.

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In its response, NNPC management said the London Office operates as a service unit with an approved annual budget and that the £14.32m allocated for 2021 was implemented in line with operational and financial requirements. It stated that the office maintains detailed records of all transactions, including personnel and contract-related expenses, and expressed willingness to provide the documents upon request.

Management, however, argued that the audit query did not specify which transactions or line items were being questioned, making it difficult to provide targeted explanations. It added that the company remains committed to improving internal controls and ensuring compliance across all its units.

But the Auditor-General rejected the explanation, describing it as unsatisfactory. The report insisted that the query remains valid until NNPC provides full accountability for the funds and implements the prescribed corrective actions.

The audit recommended that the Group Chief Executive Officer of NNPC Ltd appear before the Public Accounts Committees of the National Assembly to explain the utilisation of the £14,322,426.59 spent by the London Office in 2021.

It also directed the recovery and remittance of the entire amount to the Treasury. Failing this, the Auditor-General said sanctions for irregular payments and failure to account for public funds, as outlined in paragraphs 3106 and 3115 of the Financial Regulations, should be applied to the responsible officers.

The report read, “Audit observed that the sum of £14,322,426.59 (Fourteen million, three hundred and twenty two thousand, four hundred and twenty six pounds and fifty nine pence) was expended for the London Office during the 2021 financial year.

“Audit was not availed the necessary documents and the opportunity to confirm the utilisation of the funds that were managed by the London Office and to ascertain that the expenditure was made following due process and economy as required by the extant regulations. The above anomalies could be attributed to weaknesses in the internal control system at the NNPC, now NNPC Ltd.”

In a similar vein, auditors flagged €5,165,426.26 paid to a contractor under Issue 12, warning that no evidence of engagement existed to justify the payment.

Dollar-denominated transactions also raised red flags. The audit highlighted $22,842,938.28 in unsubstantiated Direct Sales Direct Payment settlements (Issue 4); $12,444,313.22 for delayed generator procurement at the Mosimi depot (Issue 24); and $1,801,500 paid under an irregular contract extension for a bunkering vessel (Issue 7).

Additional queries include $2,006,293.20 in provisional payments without invoices (Issue 10) and $1,035,132.81 paid to a company without power of attorney (Issue 13). In total, $51,674,020.15 was flagged as irregular.

On the naira side, the auditor general accused NNPCL of authorising payments without approvals or documentation, executing budgets outside approved limits, and failing to remit statutory surpluses.

A major query, Issue 21, involved the non-remittance of N12.721bn into the corporation’s General Reserve Fund, contrary to the corporation’s obligations.

The report also cited: N3.445bn paid by the Chief Financial Officer without the General Managing Director’s approval (Issue 6), N2.379bn irregularly paid as status-car cash options to staff (Issue 5), N1.212bn paid to contractors without interim payment certificates or invoices (Issue 26), N474.46m spent through unauthorised virement (Issue 9), N355.43m in demurrage and brokerage payments on abandoned refinery cargoes (Issue 8), N292.6m for an Accident and Emergency hospital project abandoned after mobilisation (Issue 1)

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The report further identified N82.6m in undocumented reimbursables, N152m irregular procurement for the Nigeria Police Force, N145.9m in serial consultancy renewals, and N25m paid as additional consultancy fees without evidence of fresh deliverables.

NNPCL also paid N246.19m for a contract with no proof of execution (Issue 18), while N46.2m in under-deducted withholding tax was left unremitted (Issue 19). A high-risk cross-MDA audit item, Issue 27, includes N6.246bn in payments made without supporting documents, of which NNPCL accounted for the largest share. Another audit issue involves the payment of N1.365bn processed through unauthorised virements. In total, domestic infractions amounted to N30,115,474,850.85.

The audit also spotlighted NNPC’s failure to apply statutory deductions across several transactions. Under Issue 3, auditors identified N247.18m and $529,863.24 in non-deduction of VAT, WHT, and Stamp Duty. Another transaction, Issue 16, involved $8,355.18 paid without statutory tax deductions.

“These breaches affect government revenue and contravene Financial Regulations,” the report noted. “Entities must ensure that all statutory deductions are remitted promptly and accurately.” A significant portion of the 28 queries relates to procurement violations. Auditors flagged NNPCL for Inflated variations amounting to $1.926m in one contract (Issue 14).

Auditors queried an irregular vessel substitution under a time-charter agreement for the movement of petroleum products. The report noted that Article 5.2 of the original 2017 contract stated that once a vessel was inspected and accepted by NNPC, the contractor was required to “deliver the coastal vessel at the Lagos Port” for commencement of operations, while Article 5.3 mandated that any vessel failing to meet contract specifications “shall result in rejection” and immediate replacement at the contractor’s expense.

However, the audit observed that although the two-year charter, effective June 1, 2017, at a daily rate of $19,532, was signed for MT Breeze Stavanger, the contractor notified NNPCL that MT Breeze Stavanger was unavailable and unilaterally replaced it with MT Alizea from January 1, 2018. The substitute vessel was billed at a higher daily charter rate of $21,643.23, creating an inflated variance of $2,111.23 per day, or $770,598.95 for the 12-month period.

“There was no justification provided for the sudden unavailability of MT Breeze Stavanger after only six months,” the audit stated, adding that the 12 months was in violation of clear provisions in the original contract. The contractor was obligated to replace the vessel at its sole expense, not impose higher rates on NNPC.”

Auditors further disclosed that the inadvertent substitution continued for 30 months, significantly increasing costs and breaching agreed terms.

“The total cost incurred as a result of this inadvertent substitution for thirty months, equivalent to two years and six months, with effect from 1st January, 2018, to 31st May, 2020, as indicated in the Extension Agreement executed on 16th December, 2019, is US$1,926,497.38.

“This action amounted to an irregular adjustment of contract conditions and exposed public funds to unnecessary financial risk. The above anomalies could be attributed to weaknesses in the internal control system at the NNPC, now NNPC Ltd.”

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Similarly, an “emergency procurement” of custody transfer meters costing $8.238m without justification (Issue 11) was flagged, Payment of $156,000 to a consultant without evidence of engagement (Issue 15), Regular renewal of consultancy contracts instead of fresh bidding (Issue 25), Paying a “legacy debt” to the wrong company (Issue 13) These issues indicate a pattern of circumventing procurement controls,” the report said.

The Auditor-General’s office recommended immediate recovery of all unsupported payments, remittance of withheld statutory surpluses, and sanctions for officers responsible for what it called “widespread violation of extant financial regulations.”

It added, “Where officers fail to provide the required documents, the sums shall be recovered from them directly.” The outcome of the audit comes at a time when the national oil company is positioning itself as a fully commercial entity under the Petroleum Industry Act.

The report underscores how far the company must go to achieve transparency and efficiency. Commenting in an earlier interview, the Centre for Anti-Corruption and Open Leadership described the NNPCL as a hub of institutional corruption, alleging that powerful interests within and outside the government had shielded the organisation from accountability.

CACOL’s Executive Director, Debo Adeniran, lamented that despite the enactment of the Petroleum Industry Act aimed at decentralising and unbundling the NNPCL, the company’s operations remained opaque and rife with allegations of corruption.

According to Adeniran, the NNPCL has always been a source of liquid enrichment for government officials, even before it was converted into a limited liability company.

“The operations of the NNPCL have always been shrouded in secrecy. Even the Petroleum Industry Act has not helped. Despite all the noise about decentralisation and unbundling of the NNPCL, nothing has materialised. It is the strongest cabal in Nigeria. All the powerful elements in government and MDAs work in concert with those managing the NNPCL’s accounts, perhaps due to gratification.

“Even the anti-corruption agencies find it difficult to probe the NNPCL. A couple of attempts were made by the ICPC and EFCC in the past, but they have not been able to uncover anything. There must be something shielding the NNPCL from exposure for its corruption crimes,” Adeniran said.

Similarly, the Executive Director of the Civil Society Legislative Advocacy Centre, Musa Rafsanjani, criticised the NNPCL for its lack of accountability and attributed it not only to the corporation but also to President Bola Tinubu, the National Assembly, and security agencies.

Rafsanjani asserted that the president, as the leader of the nation, bore the primary responsibility for ensuring that the NNPCL operated transparently and remained accountable to Nigerians.

He called on the government and other stakeholders to adopt a firmer stance against the alleged cartel operating within the NNPCL, emphasising the need for a stronger commitment to addressing corruption in the oil sector.

The PUNCH reports that the infractions occurred under the tenure of Mele Kyari, who served as GCEO from 2019 until he was removed earlier this year and succeeded by Bayo Ojulari.

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Nigerians spend N50bn on US visa applications

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Nigerians spent more than N50bn on US visa applications between 2023 and 2024, despite a sharp decline in approvals as Washington tightened immigration controls and increased scrutiny of applicants.

An analysis of the Intelpoint report, using data from the US Department of State, shows that 201,200 non-immigrant visas were issued to Nigerians between 2023 and 2024. At a standard application fee of $185 per applicant, Nigerians spent approximately $37.2m, equivalent to N50.7bn at an average exchange rate of N1,360 to the dollar.

Visa issuances declined by about 23 per cent, falling to 87,300 in 2024 from 113,900 in 2023, a reduction of 26,600 visas. The PUNCH could not obtain comparable figures for 2025 at the time of reporting.

Business and tourism travel dominated approvals in 2024, with B1/B2 visas accounting for 83 per cent of total issuances, while student visas (F1) represented about seven per cent. Exchange visitor visas (J1) and other temporary categories made up the remainder.

Africa’s most populous nation remained a significant source market for the United States, accounting for about 0.8 per cent of global non-immigrant visa issuances in 2024, the data showed.

Former President of the National Association of Nigeria Travel Agencies, Susan Akporiaye, said Nigerians’ travel behaviour is driven by more than economic conditions, noting a strong cultural inclination toward mobility.

“People would say it’s because of the economy, but I share a different view. Nigerians are generally migrants; they love travelling.

We are like the Chinese of Africa,” Akporiaye told The PUNCH.

The executive argued that most Nigerians who travel abroad return home, and only a small proportion remain outside the country permanently. “There is so much noise of Nigerians staying back. The ones who travel and return are far more than those who stay back. It’s not up to 10 per cent that don’t return,” she stated.

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The decline in visa issuances comes amid a series of policy changes introduced after Donald Trump returned to the White House in January 2025, which have gradually tightened requirements for Nigerian applicants.

In July 2025, the US Department of State announced that most non-immigrant and non-diplomatic visas issued to Nigerian citizens would be restricted to single-entry permits valid for three months, with existing visas unaffected.

In August, applicants were required to disclose all social media usernames used over the previous five years on DS-160 forms, with officials warning that omissions could lead to visa denial or ineligibility.

Akporiaye also noted that travel demand cuts across income levels, from affluent individuals to ordinary citizens travelling for social events. “Nigerians like to explore. We travel for birthdays, weddings, and other ceremonies. I’m not talking about people like Dangote or Otedola, but ordinary Nigerians you don’t even know,” she said.

The expert, however, acknowledged that demand for US travel has softened relative to other destinations, citing operational and policy-related constraints.

“The demand has reduced for some destinations like the US, and it’s becoming worse now. Conditional requirements and operational changes at the US Embassy in Abuja have made access more difficult, including the consolidation of services in Lagos,” she stated.

“There are stories about visas being cancelled or Nigerians getting deported, and that makes people a bit sceptical. But other destinations are still booming.”

Further tightening followed in December 2025, when the US Mission in Nigeria said Washington expanded travel restrictions to include partial limitations on Nigeria and five other countries, effective January 1, 2026.

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An executive at Travel and Tours Limited, Maureen Chimaobi, said securing a US visa has become increasingly difficult over the past year, with many first-time applicants facing steep odds despite completing all required procedures.

“Last year, getting a US visa drastically reduced, especially if you are a first-time traveller or first-time applicant. It’s almost a no-go area,” Chimaobi told our correspondent.

She noted that applicants continue to pay visa fees, schedule appointments and attend interviews, but approvals have become far less predictable. “You pay your visa fee, book your appointment and go for submission. Most of the time, they don’t give it,” the agent said.

The trend reflects growing concerns among travel operators about declining approval rates for Nigerian applicants, even as demand for overseas travel remains strong. Chimaobi said rejection levels have remained high throughout the period under review, particularly for individuals with limited international travel history.

The tougher environment is also influencing destination choices. More Nigerians are turning to countries where visa approvals are perceived to be more attainable, provided applicants can demonstrate sufficient financial capacity and present strong documentation.

“I think most countries still offer a 70 to 80 per cent chance of getting a visa, depending on the quality of your documents and your financial status,” Chimaobi revealed.

She identified the United Kingdom as one of the destinations with relatively stronger approval prospects, although she cautioned that British authorities have also hardened their assessment processes in recent months.

France and other countries within the Schengen area, once considered more accessible to Nigerian travellers, have become increasingly selective, especially toward first-time applicants, she added.

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“Before now, France used to issue visas more easily, but most Schengen countries have become difficult over time, particularly for first-time travellers,” Chimaobi said.

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Petrol imports crash by N2tn to N87bn; see why

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Nigeria’s spending on the importation of Premium Motor Spirit, popularly known as petrol, plunged by over 96 per cent in the first quarter of 2026, marking a dramatic shift in the country’s fuel supply landscape and signaling the growing impact of local refining capacity.

Latest foreign trade statistics released by the National Bureau of Statistics on Monday showed that only N87.401bn was spent on the importation of Motor Spirit Ordinary, the official trade classification for petrol, between January and March 2026.

The figure represents a sharp decline of N2.184tn, or 96.15 per cent, compared to the N2.271tn spent on petrol imports during the corresponding period of 2025. The development is particularly significant as petrol, which had consistently ranked among Nigeria’s most imported commodities for years, was completely absent from the list of the country’s top traded products in the first quarter of 2026.

An analysis of the NBS data by our correspondent showed that petrol did not feature among the top 19 traded products with the rest of the world, Africa, or West Africa during the review period.

Instead, the leading traded products included crude petroleum oils and oils obtained from bituminous minerals, gas oil, durum wheat, machines for reception, conversion and transmission of data, used vehicles, motorcycles, agricultural seeders, medicaments, aircraft parts, butanes, petroleum bitumen, sugar cane, herbicides and fuel additives.

The report read, “The value of total imports stood at N13,619.33bn in the first quarter of 2026, representing a 18.17 per cent decrease from the value recorded in the corresponding quarter of 2025 (N16,644.42bn) and a 21.05 per cent decrease compared to the value recorded in Q4 2025 (N17,250.93bn).

“Analysis of Nigeria’s import trade reveals that China remained the leading source of imports in the first quarter of 2026, followed by the United States of America, India, Germany, and the United Arab Emirates. The most imported commodities during the quarter were petroleum oils and oils obtained from bituminous minerals (crude), gas oil, durum wheat, machines for the reception, conversion, and transmission of voice, images, or data, and used vehicles with diesel or semi-diesel engines.

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“The value of other oil products imported in Q1 2026 stood at N748.10bn, reflecting an 85.05 per cent decrease from N5,005.22bn in Q1 2025 and an 81.38 per cent decrease from N4,018.31bn recorded in Q4 2025.”

The latest import figure is also the lowest quarterly amount spent on petrol imports since at least 2022, according to available trade records reviewed by our correspondent.

Data from previous years showed that Nigeria spent N2.694tn on petrol imports in the first quarter of 2022. The import bill declined by N661bn, or 24.5 per cent, to N2.033tn in the corresponding period of 2023.

However, petrol import spending surged by N1.780tn in 2024 to N3.813tn, representing an increase of 87.6 per cent year-on-year. The figure later dropped by N1.542tn, or 40.4 per cent, to N2.271tn in the first quarter of 2025 before plunging by a massive N2.184tn, or 96.15 per cent, to N87.401bn in the first quarter of 2026.

The latest figure means that for every N100 spent on petrol imports in the first quarter of 2025, only about N4 was spent during the same period in 2026. The NBS data also highlighted the changing structure of Nigeria’s petrol import trade profile over the years.

According to the report, the total trade value involving the petroleum product stood at N7.705tn in 2022. This declined marginally by N194bn, or 2.5 per cent, to N7.511tn in 2023.

Trade value, however, more than doubled in 2024, rising by N7.907tn, or 105.3 per cent, to N15.418tn, the highest level during the period under review. The figure subsequently fell by N5.045tn, or 32.7 per cent, to N10.373tn in 2025, reflecting changing trade dynamics in Nigeria’s downstream petroleum sector.

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The PUNCH reports that the sharp reduction in petrol imports reflects the increasing contribution of domestic refining facilities to fuel supply, reducing Nigeria’s dependence on foreign suppliers and helping conserve foreign exchange.

For decades, Nigeria relied heavily on imported petrol despite being Africa’s largest crude oil producer, owing largely to the poor performance of state-owned refineries and inadequate domestic refining capacity.

The trend began to change following investments in local refining and the gradual increase in output from domestic refineries, which have reduced the need for large-scale fuel imports.

The sharp decline in petrol imports in the first quarter of 2026 comes amid growing domestic refining capacity, particularly from the operations of the Dangote Petroleum Refinery, which began supplying petrol to the Nigerian market in 2024.

For decades, Nigeria relied heavily on imported Premium Motor Spirit despite being Africa’s largest crude oil producer. The country’s state-owned refineries operated far below capacity for years, forcing marketers and the Nigerian National Petroleum Company to spend trillions of naira annually importing fuel to meet domestic demand.

The commissioning of the 650,000 barrels-per-day refinery in Lekki, Lagos, marked a turning point in the downstream petroleum sector. Since commencing petrol production, the refinery has steadily increased output, supplying marketers, industrial users and fuel distributors across the country.

In January, the Nigerian Midstream Downstream Petroleum Regulatory Authority reported that Dangote refinery supplied an average of 40.1 million litres of petrol daily, accounting for 61.78 per cent of Nigeria’s petrol supply. Imported fuel contributed 24.8 million litres per day during the month.

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It increased significantly in February as imports collapsed. The refinery supplied about 36.5 million litres per day, while imports dropped to roughly 3.1 million litres per day, meaning locally refined fuel accounted for more than 92 per cent of national supply.

According to the NMDPRA March fact sheet, Dangote remained the sole domestic supplier of petrol, supplying 34.2 million litres per day. Imports rose slightly to 5.9 million litres daily, bringing total supply to about 40.1 million litres per day.

Supply rebounded strongly in April. Dangote supplied 40.7 million litres per day to the domestic market, while imports declined further to 3.7 million litres daily. Total petrol supply stood at 44.4 million litres per day, giving the refinery a market share of approximately 92 per cent of locally consumed fuel and about 80–92 per cent of overall supply, depending on the methodology used.

The disappearance of petrol from the list of top imported products is expected to strengthen arguments that local refining is beginning to alter Nigeria’s trade patterns, lower import dependence and reshape the country’s foreign exchange requirements.

The sustained reductions in fuel imports could improve Nigeria’s trade balance, reduce pressure on the naira and retain more value within the domestic economy, provided local production continues to meet demand.

The first-quarter data therefore represents one of the clearest indications yet of a major shift in Nigeria’s downstream petroleum sector, with petrol imports falling to levels not seen in more than four years.

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Nigerian workers deserve a living wage; read details

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THIS is a debate that never goes away for too long: what is due to Nigerian workers? The renewed agitation over workers’ wages, triggered by a fresh Nigeria Governors’ Forum proposal to raise the national minimum wage to N100,000 per month, only confirms that the country is trapped in an endless cycle of wage adjustments that inflation quickly renders meaningless.

This means that the issue is not just about the size of the minimum wage. Rather, it is about whether Nigerian workers can afford to live with dignity.

That is why the conversation must shift from a statutory minimum wage to a genuine living-wage regime – and a stable economy.

The proposal by the Chairman of the NGF, Governor AbdulRahman AbdulRazaq, has already been rejected by organised labour.

The Nigeria Labour Congress, through its spokesman, Benson Upah, dismissed N100,000 as grossly inadequate and argued that, given current realities, a realistic wage would be closer to N1 million per month!

The Federal Workers Forum also condemned the proposal as a “Greek gift,” insisting that it bears little relationship to prevailing economic conditions.

While the NLC’s N1 million demand may appear excessive to many, the underlying argument deserves serious attention.

The current N70,000 minimum wage approved in July 2024 has already been overtaken by inflation. Like every previous wage increase in Nigeria’s history, its real value has been rapidly eroded.

The country’s minimum wage trajectory elucidates this. It rose from N18,000 in 2011 to N30,000 in 2019 and then to N70,000 in 2024. Yet each increase was followed by soaring inflation that wiped out most of the gains.

It is alleged that some states have yet to implement the minimum wage for grassroots workers, local government employees and primary school teachers.

Dataphyte estimates that the real value of the previous N30,000 wage had collapsed to barely N11,708 by mid-2024. The current N70,000 wage is clearly following the same path.

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The CBN reported that workers lost N2.79 trillion in purchasing power in 2024 alone due to inflation. That explains why workers who celebrated the 133 per cent wage increase in 2024 now find themselves struggling to survive less than two years later.

Nothing illustrates the crisis more vividly than the National Bureau of Statistics and Global Alliance for Improved Nutrition Cost of a Healthy Diet data.

According to an analysis by The Whistler, a healthy diet for one adult now costs an average of N1,541 per day or N46,230 per month, excluding meal preparation costs.

This means that a worker earning N70,000 is left with just N23,770 after feeding only himself.

For an average Nigerian household of 5.06 persons, the monthly cost of a healthy diet rises to N233,923 — equivalent to 334 per cent of the current minimum wage.

In other words, the average worker cannot afford the minimum nutritional requirements recommended by global health standards.

Even the governors’ proposed N100,000 wage would still leave most families far below the subsistence level. It is therefore difficult to dispute labour’s argument that Nigeria’s wage structure has become detached from economic reality.

However, raising wages alone cannot solve the problem.

The organised private sector has raised legitimate concerns about its ability to pay across the board.

The president of the Lagos Chamber of Commerce and Industry, Leye Kupoluyi, said the private sector should not be compelled to pay the same wage level as the government if businesses could not afford it.

The Director-General of the Nigeria Employers’ Consultative Association, Adewale Oyerinde, points out that the process for arriving at a National Minimum Wage is “rooted in widely acclaimed tripartite negotiations and consultation and not just political statements, without any empirical data to back up the quantum of increase.”

The Centre for the Promotion of Private Enterprise warned that many businesses are already struggling under crushing energy costs, logistics bottlenecks, foreign exchange challenges, multiple taxation and weak consumer demand. All this needs to be addressed.

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Indeed, any wage increase that is unsupported by productivity growth and economic reforms risks fuelling another inflationary spiral. Businesses facing higher wage bills often pass costs to consumers, thereby worsening the very inflation the wage increase seeks to offset.

Nigeria must therefore avoid the false choice between workers’ welfare and business survival.

The real objective should be a living-wage framework tied to measurable economic indicators and supported by aggressive cost-of-living reduction policies.

This is the model increasingly adopted across many countries. In South Africa, the national minimum wage is approximately 28.79 rand per hour, translating to well over N250,000 monthly at prevailing exchange rates.

Algeria’s minimum wage is around 20,000 dinars (N204,000) monthly, while Egypt recently increased its public-sector minimum wage to 7,000 Egyptian pounds (N184,000).

Kenya’s minimum wage varies by sector and location, but the average of 16,113 Kenyan Shillings (N169,500) remains significantly higher in purchasing power terms than Nigeria’s.

Nigeria should not be setting wage policy as though inflation were a temporary inconvenience.

Food inflation remains the principal driver of household hardship, standing at 16.06 per cent YoY and higher than headline inflation of 15.69 per cent as of April.

Massive investments in agricultural productivity, rural roads, storage infrastructure and security in farming communities are urgently needed.

The absurd situation where healthy diets are more expensive in some rural communities than in urban centres because of poor roads must end.

The government must also address transport costs through investments in rail, inland waterways and public transportation systems.

Electricity tariffs remain a major burden on both households and businesses. Lowering energy costs would immediately improve living standards while enhancing business competitiveness.

Investments in health by ramping up health insurance enrolment and better access to quality care, and in education, via massive infrastructure improvements and teacher recruitment, will reduce household expenditure on these essentials.

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Furthermore, labour’s argument regarding improved government revenues deserves scrutiny.

Since the outbreak of conflict in the Middle East, higher oil prices have boosted Nigeria’s earnings. It is estimated that the windfall has added more than N5 trillion to government coffers.

Whether that figure is an exaggeration or not, governments are receiving historically high FAAC allocations, averaging over a 50 per cent surge for states in 2025 and all tiers sharing up to N2 trillion in 2026.

Nigerians deserve to see some direct benefit from these gains through targeted subsidies for food production and transportation, public transit and essential services.

More fundamentally, wage determination should no longer depend on sporadic political negotiations every few years.

The National Minimum Wage Act should be amended to provide for automatic annual adjustments linked to inflation, productivity and cost-of-living indicators. Such a mechanism would prevent workers from suffering prolonged erosion of purchasing power before the government responds.

Above all, policymakers must remember that they are insulated from the hardships confronting ordinary citizens.

Governors, legislators, political appointees and senior public officials enjoy humongous allowances, subsidised accommodation, official vehicles, security details and generous expense accounts.

They do not queue for transport. They do not worry about school fees after buying food. They do not feel inflation in the same way as the average worker.

That disconnect explains why debates over N70,000, N100,000 or even N1 million often miss the central issue.

The goal of wage policy is not simply to keep workers alive so that the job is done. It is to ensure that honest labour can provide a decent standard of living.

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