Godwin Obaseki, the governor of Edo State, has revealed the reasons for raising the state’s minimum wage from N40,000 to N70,000.
Obaseki attributed it to the recent exchange rate devaluation, economic reality, high food prices, inflation, and a desire to motivate people to work harder.
Speaking on Channels Television’s Politics Today on Monday, the governor stated that his administration felt the agony of the state’s workers and took action to improve their lives.
He went on to say that while the current national economic realities were beyond his control, he could not continue to watch workers suffer in misery and poverty.
Justifying the increment, Obaseki said, “The government and governance are about our people. You cannot claim to be doing well as a government if your people are in penury and unhappy.
“In 2011, when minimum wage was 18,000, the exchange rate was N150/$. So, by calculations, workers in Edo State were taking home $120 home monthly. When we increased the minimum wage to N40,000 in 2022, the exchange rate at that time was N415. So, workers were getting about $96, which was a discount on what they were earning in 2011.
“Even as of today, with the N70,000 minimum wage, the current exchange rate with over N1,000 pegged their take home at $55 which is less than what they were earning two years ago.
“For us in Edo State, we believe that the issue is about productivity. Paying people well so that they can produce more. Not pretending that you are paying them a salary when you know that it can not motivate them to produce more.
“We are never a flippant state; we look at our numbers carefully, and because we understood that this was going to happen, we took measures to mitigate the situations we found ourselves in today. So, we undertook fundamental reforms in our public services. Cutting our IPP so I don’t buy diesel at the rate people are buying diesel to run power in the state and government facilities. We moved our operations to a digital platform. So we don’t spend money on stationery and other costs that we will use to run the governance.
“By the time we harness all our savings, we will have a lot of money to pay the workers,” he added.
Fielding questions on the possible increase in overhead, pension and gratuities in the 2024 budget, the Edo governor stressed that he was going to the state assembly with the revised budget to accommodate the new development.
He said, “My overhead budget this year is about N89 billion, whereas my personal costs are about N65 billion. So I want to move more money from overhead to paying more salaries to the people and the taxes generated from the state.”
He further maintained that the new development would be sustained because the money was in the budget, adding, “If the Federal Government imposes something higher, we would look at what at the economic realities in the state and make the necessary adjustments.”
Earlier today, Obaseki announced that workers will now begin to earn N70,000 at the inauguration of the newly built ultra-modern Labour House secretariat complex for labour unions in the state, along Temboga Road, Ikpoba-Hill, Benin City.
