A chieftain of the Peoples Democratic Party, PDP in Delta State, Sunny Onuesoke has said the solution to Nigeria’s economic problem is not an increase in minimum wage but deflation of the economy.
He made the assertion in a phone interview with our correspondent in his reaction to the imbroglio between the federal government and labour unions in the country.
Onuesoke said the increment of wages will not solve the economic problem in the country but it will rather increase it.
“Nigerians are getting it wrong. What Nigeria want is deflation. If you increase the salary to one million Naira today, the prices of goods and services will keep increasing.
“The more you increase the minimum wage, the more it goes ‘pari pasu’ with the increase of goods and services. The average person who is not in the civil service but produces food items like pepper, tomatoes, yam, garri etc will increase his produce.”
According to Chief Onuesoke, ”Wage increase cannot resolve the inflation rate because as there is more salary increase, there is more currency circulating in the system. When there is more currency flow in the system, the prices of goods and services will keep increasing. It is a simple economic theory. The more increases in workers’ salaries, the more you will build up the high inflation rate.
“The country is not being controlled by only civil servants alone. The civil servant is just 14% of those providing services in Nigeria. They are an insignificant margin. When you are thinking of civil servants, the private sectors are not addressed as civil servants. There is no private sector that will be able to pay that amount of money as salary monthly.”
He said what Nigerians need right now is the reduction of the inflation rate to the extent that even if a worker is receiving N20,000 thousand as minimum wage, he should be able to pay his rent and take care of other responsibilities comfortably.
He also urged the federal government to intensify building low-cost houses for the common man, subsidise them and mortgage the same for the period of their lifetime as a way to reduce the inflation rate.
“The people need social infrastructure that will downsize, that will deflate, that will reduce the hard side of their hardship. What I am saying is that the Federal Government and state governors should intensify massive agricultural and housing programmes. They should subsidise and reduce the cost of education. Health insurance should be all-embracing.
“Our problem is that we are giving projections without knowing the database of Nigerians. If you ask our leaders how many acres of land will produce a certain quantity of cassava, they don’t know it. But they go on air to produce certain figures borrowed from armchair economists.
“Each local government should be able to have 80,000 acres of cassava farmland. Yam, maize, rice etc. They should fix the refineries. What stops the country from fixing the four refineries till tomorrow? Is it a problem to fix the refineries? Why are we importing refined products and we are the number six oil-producing country in the world”.
The increase in the minimum wage is an addition of two thousand naira which the Federal Government said is above their initial offer of sixty thousand naira.
The labour union had stepped down their demands from four hundred and ninety-four thousand Naira ₦494,000 to ₦250,000 per month.
Both parties have not arrived at any conclusion on the matter.
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