Ajaero: Electricity tariff hike has worsened inflation

Joe Ajaero, president of the Nigeria Labour Congress (NLC), says the recent hike in electricity tariff has exacerbated inflation. 

Ajaero said this on Tuesday while speaking on ‘Morning Brief’, a Channels Television programme.

Nigeria’s inflation rate rose to 33.20 percent in Mach 2024 — up from 31.70 percent in February.

Food inflation also surged to 40.01 percent in the month under review.

Nigerians have been battling spiralling inflation since President Bola Tinubu ended the petrol subsidy regime and unified the exchange rate in 2023.

On Monday, the NLC, Trade Union Congress (TUC), and other affiliate unions picketed offices of the Nigerian Electricity Regulatory Commission (NERC) nationwide, while demanding for a reversal in the recent hike in electricity tariff.

On April 3, NERC approved an increase in electricity tariff for customers in the Band A classification — from N66 to N225 per kwh.

“Unknown to people, this issue of tariff increase is determined by inflation and the value of the currency,” Ajaero said.

“NERC takes these two major variables to determine tariff increase. Unknown to the same NERC, each time you increase tariff, it leads to another inflation which within few months, they would still demand for another tariff increase.

“This is happening on and on and there is no control over it.”

He added that the privatisation of the power sector in 2013 was an example of how not to deregulate.

“The investors they brought in the first instance, and I say this without apologies, are not the people that were the right investors with the technical competence, with managerial ability to attract foreign direct investments into the sector,” he said.

“You can see that after 12 years of privatising the sector, no direct investment is coming into the sector.”

Ajaero said all over the world, governments drive the process of developing sectors before handing them over to private investors.

He maintained that Nigerians cannot be subjected to more hardship through electricity tariff hike given the prevailing economic woes.

Ajaero also insisted that the Tinubu administration should approve N615,000 as the new living wage, describing the current minimum wage of N30,000 as “grossly insufficient”.