The Nigerian Labour Congress (NLC) and the Trade Union Congress (TUC) have suspended the planned nationwide strike and protest that was to commence on Monday, September 28, 2020, over the recent hike in electricity tariff and petrol pump price.

This follows the agreement reached between the Federal Government and the organized labour during the meeting held by both parties which started on Sunday night and dragged on till the early hours of Monday morning.

The disclosure was made by the Minister of State for Labour and Employment, Festus Keyamo, through a tweet post on his twitter handle.

In the agreement between the Federal Government and organized labour, the hike in electricity tariff is to be suspended for a period of 2 weeks, while the new pump price of petrol is to remain unchanged.

According to the agreement, which was seen by Nairametrics, both parties agreed to set up a technical committee on Electricity Tariff reforms, comprising Ministries, Agencies, Departments, NLC and TUC, which will work for a duration of 2 weeks with effect from Monday, September 28, 2020, to examine the justification of the new policy in view of the need for the validation of the basis for the new cost-reflective tariff.

This is due to the conflicting field reports which appear different from the data presented to justify the new policy by NERC, metering deployment, challenges, timelines for massive rollout.

The technical committee is to be headed by the Minister of State for Labour and Labour, Festus Keyamo.

Other members of the committee include the Minister of State Power, Godwin Jedy-Agba, Executive Chairman, National Electricity Regulatory Commission (NERC), James Momoh, Special Assistant to the President on Infrastructure, Ahmad Zakari as the Secretary.

Also in the committee are Onoho’Omhen Ebhohimhen, Joe Ajaero (NLC), Chris Okonkwo (TUC) and a representative of electricity distribution companies.

The terms of reference for the technical committee include;

• To examine the justification for the new policy on cost-reflective electricity tariff adjustments.
• To look at the different Electricity Distribution Companies (DISCOs) and their different electricity vis-à-vis NERC order and mandate.
• Examine and advice government on the issues that have hindered the deployment of the 6 million meters.
• To look into the NERC act under review with a view to expanding its representation to include organized labour.

FG & LABOUR reach agreement at 2:53am. Deregulation to stay as Govt rolls out palliatives for labour (details in 2 weeks); Electricity tariffs suspended by Govt for 2 weeks with a joint Committee headed by @fkeyamo to examine the justification for the new policy. Strike suspended pic.twitter.com/9tOTlJ9o1l

— Festus Keyamo, SAN (@fkeyamo) September 28, 2020

Despite the fact that the Central Bank of Nigeria (CBN) declared last Wednesday that the nation’s Manufacturing Purchasing Managers’ Index (PMI) contracted at 46.9 index points, some industries still drove business activities in September.

The industries are Electrical equipment, up from 33.3 index points in August to 66.7 index points; Transportation equipment from 53.8 to 58.1; and Paper products from 44.4 to 50 within the same period.

Though, the Cement industry and non-metalic mineral products dropped from 64.4 to 58.1 and 66.0 to 50.6 index points respectively, the sub-sectors still contributed to the business activities recorded in September.

This was disclosed by the apex bank in its September PMI report released on Wednesday.

Nairametrics had earlier reported that manufacturing PMI for August stood at 48.5 index points, indicating contraction in the sector for the fourth consecutive month.

Also, out of the 14 surveyed subsectors, 5 sub-sectors reported expansion (above 50 index points thresholds), while the others contracted.

Meanwhile, the production level index for the manufacturing sector indicated contraction in September 2020 for the fifth consecutive month, as well as Employment level and Raw material inventories.

However, the manufacturing supplier delivery time index stood at 53.5 points in September 2020, indicating faster supplier delivery time for the fifth time.

(READ  MORE: Manufacturing: Momentum in activities slows in January)

Is the nation coming out of the woods?

Though CBN revealed that only 4 sub-sectors reported expansion in September, contrary to the 6 sub-sectors recorded in August, it is imperative to note that this is an improvement when compared to manufacturing activities in May and June, or the performance in July which saw 12 sub-sectors decline, with one reporting no change, while one expanded.

The impressive performance of cement and other sub-sectors, according to the manufacturing PMI report, is attributable to the expansion in production, new orders, employment, and raw materials’ inventories.

A cursory look at the financials of key players in the industrial goods sector showed that despite the increased cost of higher energy pricing and adverse COVID-19 impacts on transport and naira devaluation, key cement manufacturers still recorded increased topline, driven by demand surge from domestic cement sales.

Back story: Nairametrics had reported on Wednesday that 9 subsectors reported contraction (below 50% threshold) in the reviewed month in the following order:

• Petroleum & coal products
• Primary metal
• Furniture & related products
• Printing & related support activities
• Food, beverage & tobacco products
• Textile, apparel, leather & footwear
• Chemical & pharmaceutical products
• Fabricated metal products and
• Plastics & rubber products

The Non-manufacturing sector PMI stood at 41.9 points in September 2020, indicating contraction in nonmanufacturing PMI, for the sixth consecutive month.

In all, the development indicates recovery as manufacturers continue to benefit from the ease of the lockdown.

However, conditions within the domestic economy remain relatively tight, reflecting continued uncertainties as investors remain cautious of the lingering risk of the pandemic.

The House of Representatives has asked the Nigeria Labour Congress (NLC) to suspend the strike planned to commence on Monday, as it offered the organised labour some palliatives.

This was disclosed by the Speaker of the House of Representatives, Femi Gbajabiamila, at a negotiation meeting with labour on Sunday in Abuja, according to NAN.

The palliatives, according to the Speaker, would be included in the proposed 2021 budget, which he said would soon be presented to the National Assembly.

READ: DisCos ask FG to reduce cost of gas in power generation

The speaker explained that some palliatives were being considered to cushion the effects of increase in electricity tariff and fuel price hike.

Some of the palliatives are the distribution of food items, reduction of taxes on minimum wage and payment of some special allowances.

Others are involvement in ownership of housing programmes through mortgage and distribution of special buses to public institutions, which run on autogas.

READ: Only customers with minimum of 12 hours electricity can have tariff increase – FG

Back story: Nairametrics had reported when labour insisted on going ahead with its earlier planned strike and protest, with effect from September 28, 2020, following the failure of the Federal Government to reverse the increases in electricity tariff and fuel price.

The disclosure was made by the NLC President, Ayuba Wabba, after the National Executive Council meeting of the labour organization in Abuja.

Gbajabiamila said that the palliatives would go a long way to assuage the suffering of Nigerians.

READ: NNPC gives condition for relocation of tank farms and depots from residential areas 

According to him, the lawmakers would also make provision in the budget to tackle the eight million deficit of meters to enable Nigerians to access them.

He said, “I have never heard it anywhere in the world, so if we may have to provide for the deficit, we will have to do that.”

He appealed to labour to suspend the planned strike, saying embarking on industrial action at this critical time would not augur well for the citizenry.

READ: Tariff hike: Unmetered customers will be exploited by DisCos, FCCPC alleges

“You know, you cannot go on strike at this time, if you go on strike, the people you think you are protecting will be at the receiving end, we share your philosophy regarding workers’ rights. We know what Nigerians are going through, our position on electricity billing is obvious, the only thing now is to continue to talk, I am concerned about the people out there. Shutting down the markets, banks and other places of work is my worry, I am concerned about the people,” he said.

Gbajabiamila said that there was the need for every Nigerian to be properly metered in order to capture the true cost, adding that the lawmakers would consider metering in the 2021 budget.

Explore Economic and Financial Data on the Nairametrics Research Website

NLC’s response

Wabba, insisted that the organised labour would go ahead with the strike if its demands were not met by the Federal Government before the expiration of the ultimatum.

He said that the increase in electricity tariff and hike in fuel price had eroded the purchasing power of Nigerian workers.

According to him, the initial plan was that there would not be increase in electricity tariff until meters were provided for Nigerians.

Wabba commended the speaker for the intervention, adding that he had consistently represented the interest of Nigerians.

The NLC president said there was a valid court judgment nullifying the electricity tariff, adding that the judgment of the National Industrial Court asking NLC to stop its planned strike could not be sustained.