Subsidy Removal: NEC Considers Paying Civil Servants N702 Bn To Cushion Impact

The National Economic Council (NEC) disclosed that it was considering the National Salaries Income and Wages Commission's recommendation to pay N702 billion to civil servants as a cost of living allowance, following fuel subsidy removal.

The governor of Bauchi State, Bala Mohammed, talked about the impending decision while addressing the State House correspondents at the Aso Rock Presidential Villa after the inaugural NEC meeting on Thursday.

Governor Mohammed noted that the NEC has received recommendations "on the various ways and means that the country can use whatever increases that we have in the revenue to mitigate the impact that this is going to make on the lives of our workers," Punch reported.

"And so they recommended that there should be a consequential adjustment, estimated at N702.92bn as part of the allowances that should be given as petroleum allowance to all workers and as well as an N23bn or N25bn monthly offer to cushion the effect on workers," he added.

Aside from the cost of living allowance, NEC said that the government looked into all "the issues, challenges, and problems holistically and set up a small committee of the council to review and come up with a term of reference to organize areas specifically where this palliative can come from and how it will be dispensed to alleviate the problem of workers and other vulnerable groups."

The governor went on to share that the N702 billion was a suggested amount for the labour category to "cushion the effect on workers on a new allowance that will be tagged cost of living adjustment allowance."

He said the committee will come up with a recommendation to NEC within two weeks, so that a holistic decision will be taken immediately to ensure that the problem raised following subsidy removal is properly encountered.

The members of the committee include the governor of Kebbi State, Nasir Idris; the governor of Benue, Hyacinth Alia; the governor of Kaduna, Uba Sani; the governor of Cross River, Bassey Otu; and the Bauchi state governor.

Alongside governors, the committee also includes relevant agencies like the Budget Office, representatives of the Central Bank of Nigeria, the Office of the Attorney-General of the Federation, Nigerian National Petroleum Company Limited, the Trade Union Congress of Nigeria, and the Nigeria Labour Congress.

The Abia State governor, Alex Otti, who also attended the meeting, said the inaugural national economic council meeting's major focus was on the removal of petroleum subsidy and implied removal of subsidy on foreign exchange.

"The impact of these two actions definitely is increased prices," Otti said. "And as a way to solve the problem and reduce the shock, a presentation was made by the National Automotive Design and Development Council on the great things that are happening in the automotive industry."

The fuel subsidy removal announcement was made by the new president of Nigeria, Bola Ahmed Tinubu, on May 29.