Utomi calls for reforms in Nigeria’s minimum wage negotiation

By Innocent Raphael 

Renowned political economist, Prof. Pat Utomi has urged Organised Labour and the Federal Government to seize the opportunity presented by the new minimum wage negotiation to steer Nigeria towards greater thrift and production by adopting a suitable reform to settle their difference.

Speaking on the need for reform, Utomi called on Labour to demand a significant reduction in the cost of governance and for the Federal Government to enforce accountability among workers. 

He emphasized the importance of establishing strict consequences for corruption to maintain discipline within the workforce.

“Labour must insist on a dramatic slash in the cost of government and investment of the savings made in production programmes and infrastructure,” Utomi stated. 

He highlighted the necessity of utilizing Nigeria’s latent comparative advantage and strong factor endowments to enhance the value chain of output.

Utomi also stressed the importance of the government understanding the purpose of its expenditures. “Is it paying as welfare for people who just show up?” he questioned, urging the establishment of output targets and severe penalties for corruption and other abuses.

He proposed the creation of a benchmark for civil society to monitor both parties, with clearly defined consequences for any breaches. 

Drawing on historical precedents, Utomi suggested the government introduce bold initiatives similar to the Operation Feed the Nation (OFN) program of the mid-1970s to drive the transition to a production-based economy.

He concluded by linking future adjustments to the minimum wage with productivity improvements. 

“Once a proper framework is established now, the template to plug in productivity gains should be activated. It should not be a matter of sentiment or mood of the leaders on both sides,” he added.