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TUC Threatens Showdown As NERC Denies 50% Hike, Blames Inflation

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The Federal Government has again increased the electricity tariff payable by power consumers across the country.

Approval for the hike in tariff was given by the Nigerian Electricity Regulatory Commission, as the increase which varies, based on different consumer classes, took effect from January 1, 2021.

A few hours after the news of the tariff hike broke, the NERC issued a statement, denying a 50 percent hike as had been reported in some circles.

The regulatory agency blamed N2 to N4 adjustment in tariff on inflation and movement in foreign exchange rates.

However, the Trade Union Congress issued a stern warning, asking the Federal Government to revert to the old electricity tariff or face the consequences of its action.

The NERC had announced the tariff hike in its December 2020 minor review of the Multi-Year Tariff Order and Minimum Remittance Order obtained by our correspondent in Abuja on Tuesday.

The tariff increase is taking effect just two months after the government through NERC implemented a hike in November 2020, which saw widespread opposition.

The MYTO order containing the latest tariff hike, Order NERC/225/2020, was signed by the new Chairman of NERC, Sanusi Garba, and it supersedes the previous Order NERC/2028/2020.

Providing reasons for the latest tariff hike, the commission said it considered the 14.9 percent inflation rate rise in November 2020 and foreign exchange of N379.4/$1 as of December 29, 2020.

Others were available generation capacity, the United States inflation rate of 1.22 percent, and the Capital Expenditure of the power firms before the tariff was raised.

The commission also stated that the new tariff would be effective till June 2021 while a Cost Reflective Tariff would be activated from July to December 2021.

The commission had stated last month that it was carrying out a review for another tariff, hence the latest order announcing an increase in the rates payable by consumers.

In September last year, the commission raised the electricity tariff but this faced stiff opposition from the organized labour, as the unions threatened to embark on a nationwide strike.

After a series of negotiations, the tariff was reduced based on consumer classes and the hours of power supply received by an electricity user.

On November 1, 2020, power distribution companies commenced the implementation of the revised electricity tariff that was jointly agreed upon by organized labour and the Federal Government.

Findings showed that in the latest MYTO review, some power users would pay as much as N12 extra as electricity tariff.

Ibadan Disco, for instance, had an end-user allowed tariff of N34.1 per kilowatt-hour in 2020, but this was increased to N46.5 for the period of January to June 2021.

It was further hiked to N57.1/kWh for July to December 2021, meaning that Ibadan Disco is allowed to collect this much from customers under its franchise areas

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Minimum Wage: We Are Deliberating On What We Can Sustainably Pay Workers — Governors Forum

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The Nigeria Governors’ Forum says it is yet to conclude work on what the states can sustainably pay.

Chairman of the Governor’s forum, governor Abdukrazaq of Kwara State, noted that as members of the 37-member tripartite committee for the national minimum wage which is yet to conclude its work, “the governors are reviewing their fiscal space to see the consequential impact of the various recommendations.”

“While we acknowledge various initiatives adopted of recent by way of wage awards and partial wage adjustments, it is imperative to state that the 37-member tripartite committee inaugurated on the national minimum wage, is still in consultation and yet to conclude its work.

“As members of the committee, we are reviewing our individual fiscal space as state governments and the consequential impact of various recommendations, to arrive at an improved minimum wage we can pay sustainably,” the statement read in part.

However, the governors said they remain committed to the process and promised that better wages will be the invariable outcome of ongoing negotiations.

“We remain committed to the process and promise that better wages will be the invariable outcome of ongoing negotiations”.

Meanwhile, organised labour has submitted a proposal of N615,000 monthly minimum wage for workers, urging the federal government to approve same.

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Fuel Crisis: We Don’t Know About NNPCL’s Logistics Challenges — Oil Marketers

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Oil marketers have stated that they are unaware of the specific logistical issues that the Nigerian National Petroleum Company Limited (NNPCL) indicated were to blame for the country’s present low product supply.

Last Wednesday saw the return of a fresh petrol shortage, which has since gotten worse, leaving Nigerians to deal with the fallout.

Due to the scarcity, prices have since increased in Lagos to ₦1,200 per litre on the black market and as much as ₦800 per litre in some filling stations owned by the Independent Petroleum Marketers Association of Nigeria (IPMAN).

Prior to the shortage, fuel was sold at stations run by the Major Energy Marketers Association of Nigeria (MEMAN) for around 610 per litre.

Some filling stations sell petrol for as high as N850 to ₦900 per litre in locations such as Maryland, Ikeja, Agege, Iyana Ipaja, and other outskirts of Lagos. In some states, the product sells for more than ₦1,000 per litre at filling stations. Even at that rate, most filling stations have since shut their doors due to a lack of products.

The NNPCL blamed the development on logistics challenges. The spokesperson for the company Olufemi Soneye said last week that the challenges have been resolved.

But almost a week later, oil marketers have said they are in the dark about the nature of those challenges. They also dismissed claims that they were hoarding the products.

“Do you blame oil marketers for the current situation? If NNPCL gives us products, we will sell them because we are businessmen. We are in this business to make money, so we won’t keep products in our tanks if we have,” the Chairman of IPMAN Satellite Depot, Lagos, Akin Akinrinade told Channels Television.

“They said they have a logistics problem and have 240 million litres in store to distribute. But that was what they told us since last weekend. They said the logistics challenges have been resolved but they didn’t tell us the type of logistics problem they have.

“For now, NNPCL stations are mostly the ones selling with just a few others getting supply. But you know our members have the largest number of stations nationwide. If they give IPMAN stations products, you will see that the queues will disappear immediately.”

Currently, IPMAN has over 30, 000 filling stations nationwide.

According to Channels Television, a top source among the oil marketers said  that there is not much product in circulation.

“We don’t have much products as we speak. According to them, they don’t have smaller vessels to take the fuel from the larger vessels. Others are saying it’s because of bridging claims. As I speak, I don’t have fuel in my depot. I am going around begging for fuel,” he said.

“If you tell NNPCL you need say like 80, 000 tons of product now, they will give you 10, 000 tons. So, you will sell small, and then everything goes dry again.

“If they claim they have fuel, and no products in our tanks, then, it still translates to a no-fuel situation. Again, NNPCL is selling to us at around N600 per litre, and as of today, the landing cost of gasoline at the international market is ₦847 per litre.

“So, if I buy at ₦847/litre and add other costs, the pump price will be about ₦1400 per litre. So, if I sell at that price in my station, who will buy it? Even we marketers can’t buy much at that price. So, we continue to manage the situation.

“And if we make noise too much, they will tell us to go and import too. How will we import with the high exchange rate? If we import on our own, who will buy from us at that high price?

“Those currently selling at low prices know how they go about it because, during scarcity, everybody will be doing whatever they like.”

Chinedu Ukadike, the Public Relations Officer of IPMAN, had on Sunday, said that the prevailing scarcity of petrol could persist for an additional two weeks.

Ukadike told journalists that the product was not available in the country, because most refineries in Europe were undergoing turnaround maintenance.

“I also have it on good authority that most of the refineries in Europe are undergoing turnaround maintenance, so sourcing petroleum products has become a bit difficult.

“NNPC Group CEO has assured us that there will be improvement in the supply chain because their vessels are arriving.

“Once that is done, normalcy will return. This is because once the 30-day supply sufficiency is disrupted, it takes two to three months to restore it”, he said.

Unconfirmed speculations doing the rounds have also woven the current scarcity around an imminent increase in the price of PMS, which according to them, led to excessive hoarding, and panic buying, among other things.

While the public was still hoping for an improvement as promised by the NNPCL, IPMAN had threatened to withdraw services over non-payment of ₦200bn bridging claims.

The association’s unit chairman and spokesperson, Aba Depot, Mazi Oliver Okolo who made the threat, said it was with the backing of the IPMAN’s national leadership.

He claimed that the debt is being owed by the Nigerian Midstream and Downstream Petroleum Regulatory Commission (NMDPRA).

In a communique released after a press conference on Tuesday, Okolo said NMDPRA failed to pay the ₦200bn debt despite a directive for payment from the Petroleum Minister (Oil) Heineken Lokpobiri.

The IPMAN deport chairman claimed that since the directive by the minister in February 2024, only ₦13bn had been paid to their members, saying that the unpaid claim had crippled their businesses.

“We are extremely distressed and depressed by the laidback attitude of the leadership of the Nigerian Midstream Downstream Petroleum Regulatory Authority (NMDPRA), towards the survival of our member’s businesses, arising from NMDPRA’s deliberate delay and refusal to offset the debt of over ₦200 Billion owed our members, which has consequently led to the deaths of many of our members and the unfortunate collapse of their businesses.”

He blamed the Nigerian National Petroleum Company Limited (NNPCL), the sole importer of petroleum products, for the current nationwide petrol scarcity, adding that some of its members have “completely” shut down their businesses, and retrenched their employees.

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Governors Can Pay N615,000 Minimum Wage If They Get Priorities Right — NLC

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The President of the Nigeria Labour Congress (NLC), Joe Ajaero, says state governors can afford to pay the proposed N615,000 minimum wage if their priorities are right.

Ajaero made this known on Thursday during an interview with Channels Television.

Organised labour recently declared that N615,000 should be the new minimum wage.

The idea was made in the midst of continuous discussions about the minimum wage between organised labour and the federal, state, and local governments.

The national minimum wage was set at N30,000 by the former president Muhammadu Buhari’s administration in 2019. Some states took an extremely long time to enact the increase in the minimum wage when it was announced at the time.

When asked during the interview if the N615,000 offered by organised labour is reasonable, Ajaero responded that, considering the nation’s rapidly rising inflation, it is the “most realistic” sum.

The NLC president said organised labour considered factors like transportation, housing, and feeding before arriving at the sum.

“If you are talking about being realistic, the N615,000 demand is the most realistic. Being realistic is not about slave wage,” Ajaero said.

“However, N30,000 is big money if inflation is brought down, and at a single digit.

“Look at the indices that create inflation. If you check them, you can talk about being realistic. All other factors in the country are going high and wages remain constant.”

Asked if states can afford the N615,000 proposal, the NLC president averred that it is not about ability to pay but the priorities of states.

“I think we need to understand the issues of ability to pay and not getting the priority right,” he added.

“Most of the states that have shown willingness to pay the current minimum wage are not among those getting the highest revenue.

“During the time of Muhammadu Buhari, some states were declared not having enough money to pay and he released funds for them to pay.

“Those states still refused to pay. It is not the question of either the quantum of money that they have or not, it is what they decide to do with such money.

“If they get their priorities right, then a lot can happen.”

Organised labour has also threatened to embark on a strike if a new minimum wage is not announced before May 31, 2024.

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