”Solution is Here” , ”Tomorrow is here” are some of the slogan being used by Anambra and Enugu State Government(s). We can actually use effective wage system to achieve societal solutions and ensure that we enjoy the dividends of tomorrow today. But not less than 80% of our populace understand what to expect from Government non understand the concept of solution is here. To an average economist , solution in public sector means using public wealth to lift millions out of poverty while ensuring that creativity and productivity are encouraged.Luckily ,Anambra State has a Governor who understands the concept of equitable distribution of resources,a renowned Professor of Economics. Anambra people were excited that the Governor would bring solutions to address the rising income inequality, food insecurity , and high cost of housing among others . Indeed , we have witnessed the Solution Government for the past forty three months and can rightly confirm if Anambra State government has provided solutions that would address widening economic inequalities among citizenry .
One of the ways to narrow the gap between the poor and the rich is effective wage system and deliberate injection of public funds into households and business unit pockets.
The issue of equitable distribution of resources remains a central concern of every government.
In the pursuit of reducing income inequality and poverty, an effective wage system plays a vital and central role. A well-designed wage structure can contribute significantly to social equity by ensuring that labor is fairly compensated, thus narrowing the income gap between various socioeconomic groups and increasing productivity. Many observers claim that the economic realities and low remuneration under Prof. Chukwuma Soludo’s administration have left some civil servants in Anambra State surviving through handouts and questionable dealings as well as side hustling. It takes a miracle for a civil servant receiving N100,000 per month to survive the high cost of house rent ,food stuffs ,drugs ,school fees etc .
An effective wage system is one that ensures fair remuneration based on skill, effort, responsibility, and working conditions. It accounts not only for minimum living standards but also incentivizes productivity and social contribution . Such systems often incorporate minimum wage policies, collective bargaining mechanisms, and performance-based pay structures.
In Anambra State, income derived from wages constitutes the primary source of livelihood for the majority of the population. When such wage structures are inequitable or stagnant, the distribution of wealth becomes skewed, often favoring capital over labor . A just wage system, therefore, can act as a corrective mechanism by redistributing income more evenly, enabling workers to access better education, healthcare, and housing. Under Prof Chukwuma Soludo administration,there is no incentive for civil servants to build a modest home , no incentive to buy a decent car unless one is into fraudulent activities or side hustling. Where is the solution when Soludo Government has no policy document or road map for food security!
Efforts by the Federal Government to increase minimum wage from N30,000 to N70,000 yielded negative outcomes as a result of the double policies of floating naira and fuel subsidy removal . In a rational society, Government actions/ reforms address the living standard of the people but Nigeria Government has become a capitalist entity.
Back to Anambra State , effective wage should be used to evenly distribute available resources among the people living within the State . Again, effective wage system could be used as a tool to encourage savings , consumption and production.
Empirical studies suggest that reasonable increases in real wage can reduce wage disparity without significantly affecting employment.It is the public sector that determines the flow of money in the economy.
In Nigeria, wage administration is managed from the central government but there are creative ways a State Government like Anambra can creatively stand out to motivate her workforces . One of such ways is introduction of performance bonus . I will always advocate for per hour wage system . That is , worker’s wage is measured and assessed base on the number of hours per day . And in that case, there should be a minimum and maximum number of hours a worker is expected to work per day ,say 8 hours and per week say 50 hours . An hour pay could be N3000. Lets assume that a worker makes an average of N24,000 per day , that could be an incentive to achieve a productive society. However ,in view of the current minimum wage law in Nigeria , a visionary Governor can adopt performance bonus approach to encourage productivity as well as equitable distribution of resources.
Challenges and Considerations
Despite the potential benefits, implementing an effective wage system faces several challenges. Performance Bonus approach may be undermined by official corruption as the case with most Government activities . However ,the advantages of performance Bonus approach to encourage productivity far outweigh its disadvantages . However , zero tolerance to corruption and competitive wage will surely achieve desired results .In practice , higher wage increases spending , consumption as well as investment. Traders , artisans and other market players will record appreciable economic activities if a competitive wage system is introduced.
Right wage for labour in the private sector should also be structured . Cost of household items/ building materials should be published by Anambra State Marketing Board on daily basis for effective monitoring .
Conclusion
An effective wage system is a fundamental tool for achieving equitable distribution of resources. By ensuring fair compensation for labor, it supports a more inclusive economic model and promotes social justice. Anambra State Government must pay special attention to wage regulation in order to achieve economic sustainability, investing in skill development and labor market reforms to ensure long-term economic development and growth.
Ndubuisi Anaenugwu is an economist with GGM