NLC: Strike or sabotage (I)

In a deliberate act that would leave over a hundred million Nigerians in the dark, struggling to comprehend the sudden and inexplicable loss of grid-supplied power in over 35 states, the national grid was shut down not by the inexplicable equipment failure that has happened fairly regularly over the last few years but by brutal tactics that were deliberately employed.

As the clock struck 0115 hours, operators in the Benin Transmission Operator, under the Independent System Operations unit, were forcibly driven away from the control room, and those who resisted were met with violence. Some were beaten, while others were wounded in the course of being forced out of the control room without any form of supervision or control. The Benin Area Control Centre was subsequently shut down.

Other transmission substations, including Ganmo, Benin, Ayede, Olorunsogo, Akangba, and Osogbo, were also shut down. At 0323 hours, the authorities attempted to recover the grid using the Shiroro Substation to feed the transmission lines supplying bulk electricity to the Katampe Transmission Substation. However, the recovery efforts were met with resistance, leaving the country in the dark.

It was only when the dust settled that the true extent of the sabotage became clear to the general public. The perpetrators were none other than the Nigeria Labour Congress (NLC). Their actions were a blatant disregard for the well-being of the country and a clear demonstration of their willingness to use violence and intimidation to achieve their goals. The NLC’s demands for an unreasonable wage increase had been met with resistance from the government, and they decided that the best way to force a pay rise for their members was to violently shut down the country’s economy to force the government to accede to their demands.

The NLC did not stop at shutting down the national grid. They also went to the seaports and the airports. The ports were shut down, with cargo-laden trucks and trucks returning empty containers unable to access and exit. Demurrage and storage charges are piling up, leaving businesses counting losses. The aviation sector has also been severely affected, with flights grounded and passengers stranded at airports. The NLC also sealed the main gate of the National Ear Care Centre in Kaduna, chased out workers and prevented outpatients from accessing the hospital.

The NLC must have chosen this path because it felt that a simple, peaceful withdrawal of their services would have been insufficient to show the importance of their input to the workplace. Instead, the NLC has chosen to resort to tactics that have brought the country to its knees, leaving over a hundred million Nigerians in the dark and struggling to cope with the consequences of their actions.

Some Nigerians have acted under the impression that the NLC is fighting for all Nigerians, but the NLC’s demands are primarily focused on securing higher wages for federal civil servants, who represent less than 1% of the workforce. While their success may provide short-term relief for this less than 1%, it is unclear how this would benefit the broader population or address the underlying economic challenges facing the country.

The NLC’s approach focuses on securing gains for a small workforce segment rather than pursuing comprehensive economic reforms that could lead to sustainable growth and lower inflation. Let us recalculate the new national wage bill for civil servants if the minimum wage is set to the ₦600,000 figure that has been demanded. Making this ₦600,000 the minimum wage for the 720,000 civil service workers leaves Nigeria with a monthly wage bill of ₦4,320,000,000 (four hundred and thirty-two billion Naira). This comes to ₦5,184,000,000,000.00 (five trillion, one hundred eighty-four billion Naira) annually.

For context, in 2022 and 2023, the Federal Inland Revenue Service (FIRS) collected record amounts of ₦10.1 trillion and ₦12.4 trillion as tax revenue for the entire federation. Given that the Nigerian budget for 2024 is ₦27 trillion, allocating nearly 20% of the budget to a group that constitutes less than 1% of the workforce raises concerns about the efficiency and impact of such expenditures.

When a significant portion of the budget is devoted to increasing public sector wages, it can lead to a rise in aggregate demand without a corresponding increase in supply. The likelihood that this wage increase would not be matched by a corresponding increase in economic productivity is high due to several factors:

First, structural issues: Nigeria faces significant structural economic challenges, including infrastructure deficits, energy supply issues, and a high unemployment rate, particularly among recent graduates. These issues can hinder productivity growth.

Second, limited scope for efficiency gains: The Nigerian Civil Service has been criticised for inefficiency and corruption. Without substantial reforms, increased wages are unlikely to translate into higher productivity.

Third, there is a mismatch with workforce needs: Investing heavily in a small segment of the workforce (1% of the total workforce) does not address broader economic needs, such as improving skills and job opportunities for the larger unemployed population.

In an environment where the prices of household items have literally doubled over the last year, the general public should consider the potential impact of the wage increase on inflation and poverty rates for most Nigerians before supporting the NLC’s cause and methods.

Nwanze is a partner at SBM Intelligence.