Editorial
CBN And Nigeria’s Cash Crunch
Nigerians have, again, been thrust into desperation as they grapple with cash shortage that has cast a dark shadow over their daily lives. Months after the Supreme Court’s ruling permitting the coexistence of the old and new naira notes, the crisis persists, leaving countless individuals struggling to secure basic necessities.
The scarcity of naira notes has partially crippled commerce throughout the country, especially in the informal sector. Businesses are incapacitated, unable to complete transactions efficiently, resulting in a slowdown of economic activities. Some people are left in dire straits, desperate for cash to meet essential expenses such as food, transportation, and healthcare, among others.
The cash crisis has created a fertile ground for unscrupulous elements and businesses to engage in predatory tactics. Retailers are exploiting the despair of consumers by overcharging for goods, while others hoard cash to sell at inflated prices. This rampant profiteering has further burdened the already strained financial resources of many Nigerians.
It is deeply concerning that while the citizens are still contending with the fallout of a failed disastrous currency redesign policy last year, the Central Bank of Nigeria (CBN) has initiated another misguided scheme that has exacerbated the scarcity of the legal tender. This ill-conceived move is implemented at a time when Nigerians are already struggling with inflation, rising unemployment, and declining living standards. The CBN’s actions have only served to compound their plight.
The timing of the plan is particularly cruel and demonstrates a fundamental lack of consideration for the well-being of ordinary Nigerians. The Central Bank has failed to adequately assess the severe consequences of its policies on the lives of citizens, who are now compelled to endure an atmosphere of uncertainty and hardship.
Despite the apex bank’s assurances of sufficient naira notes in circulation, the cash dilemma continues to torment Nigerians. The situation has worsened following introduction of withdrawal limits by the nation’s financial authorities, leading to an increased reliance on Point-of-Sale (POS) terminals. However, this dependence has come at a steep cost.
POS service providers have taken undue advantage of the shortage by imposing exorbitant charges, further burdening consumers. The surge in charges has negated the convenience of POS transactions, driving up the overall cost of obtaining cash. The CBN’s claims of adequate cash supply ring hollow in light of the predatory practices of POS operators.
Currently, naira scarcity has gripped major cities across the country, with Automated Teller Machines (ATMs) running dry and commercial banks introducing withdrawal limits. Consequently, POS operators have compassed the moment to exploit the situation. Investigations have revealed that some bank officials who own POS businesses, channel cash meant for the public to these outfits. This is economic sabotage. These unpatriotic Nigerians must be identified and punished appropriately.
The Acting Director of Corporate Communications at the CBN, Mrs Hakama Sidi Ali, has acknowledged that there has been a rise in the amount of money in circulation. However, she claims that the scarcity of cash is due to individuals hoarding it. This explanation contradicts the actual situation on the ground, as numerous banks have been unable to fulfil the daily requests for cash withdrawals.
This is why it is required for the Federal Government to promptly intervene and resolve the difference between what the Central Bank asserts and the actual availability of cash. They should contemplate raising the limits for cash withdrawals, improving access to banking services in areas that lack sufficient coverage, and partnering with mobile money platforms to offer alternative payment options.
To restore confidence in the banking system and help Nigerians affected by the current liquidity crisis, it is necessary to make coordinated attempts to increase the amount of cash in circulation. This can be achieved by taking strict actions against unfair point of sale charges and implementing measures to safeguard consumers from excessive profit-making. The Central Bank can address the liquidity crisis by implementing these steps, and provide relief to the suffering population.
While we promote alternative modes of payment, including electronic channels, to reduce pressure on cash, the authorities must recognise that resolving the cash crunch is not merely an economic issue. It is a matter of social justice. Every Nigerian deserves easy access to their hard-earned money without being subjected to inordinate drudgery. The government has a moral responsibility to address this crisis swiftly and effectively to restore financial stability and ensure the well-being of all its citizens.
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A New Dawn For Rivers’ Workers
Workers in the Rivers State civil service have been eulogising Governor Siminalayi Fubara for delivering on his promise to implement a new minimum wage of N85,000, which was reflected in the salaries paid for November. This increase is N15,000 higher than the national minimum wage of N70,000. This represents not only an enhancement in the financial welfare of civil servants but also a recognition of their hard work and dedication to public service. The raise has been met with widespread jubilation among the workforce, who have long advocated for a better wage to cope with rising living costs and economic challenges.
As the news spread, offices filled with laughter and sigh of relief, as employees exchanged stories of how this financial boost would positively impact their families and dependants. The new minimum wage is not just a number; it symbolises the government’s commitment to improving the standards of living for civil servants and fostering a more equitable workforce. Many workers expressed their gratitude for the governor’s timely intervention, highlighting how important it is for public servants to feel valued and adequately renumerated.
Governor Fubara’s decision is expected to reinforce morale within the civil service, fostering greater productivity and dedication among employees who contribute significantly to the state’s development. With the new wage in place, there is a renewed sense of optimism among civil servants, who now feel more empowered to serve the government and the citizens with greater enthusiasm and commitment.
The Governor had declared an increase in salaries for state workers, emphasising that this adjustment is not only a reflection of the government’s commitment to improving the welfare of its employees but also a strategic move fueled by the state’s enhanced Internally Generated Revenue (IGR). He assured workers that the financial backing for this increment is sustainable, stemming from the state’s focused efforts to bolster revenue through various initiatives, including tax reforms and enhanced efficiency in public service delivery.
Furthermore, the governor’s promise of funding the increment solely through increased IGR signifies a commitment to fiscal responsibility and transparency. It reassures the people that the government is proactively managing resources while investing in their future. As the state continues to explore opportunities for revenue enhancement, Fubara’s administration remains focused on ensuring that these initiatives translate into tangible benefits for the workforce, ultimately fostering a more motivated and dedicated public sector.
The decision by Fubara to be the first in Nigeria to implement the new national minimum wage is a commendable step that reflects a proactive approach to governance and an understanding of the pressing needs of the workforce. In an economy where many families struggle to make ends meet, especially in the face of rising living costs, this enterprise will improve the quality of life for workers and also set a precedent for other states to follow.
In recognising the various drives and support provided by Fubara’s government, it is necessary that the workers reciprocate by embodying a spirit of productivity and commitment to the current administration’s goals. They should align their daily operations with the administration’s objectives to enhance effectiveness and foster an environment of collaboration and trust. This reciprocal relationship can lead to innovative solutions and efficient service delivery, ultimately benefiting the state and strengthening public trust in government institutions.
Surprisingly, despite the political challenges the government has been navigating, alongside the myriad of ambitious projects it is embarking on, it has managed to raise funds to implement a minimum wage of N85,000 This achievement reflects a commendable level of resilience and resourcefulness within the government’s fiscal strategies. In a nation often marred by economic volatility and political discord, finding a way to sustain and even elevate the livelihoods of its employees is no small feat.
Workers in the state have truly found themselves in a remarkably advantageous position under this administration, especially when compared to the previous regime. The immediate past government’s blatant refusal to implement the minimum wage of N30,000 left many employees disheartened and struggling to meet their basic needs. What was even more disconcerting was the absence of meaningful negotiations with labour representatives, leaving workers feeling unheard and undervalued. In contrast, the present administration has prioritised dialogue and engagement with labour unions, recognising the importance of fair wage for workers’ contributions to the state’s economy.
With the current government’s commitment to improving wages and working conditions, it is clear that a major shift has taken place. This renewed focus on the welfare of workers empowers them and instils a sense of hope and optimism for the future, as they can now look forward to a more equitable and supportive work environment. Ultimately, the ongoing trajectory suggests a promising era for labour relations in the state, one where workers are valued and their rights upheld.
Siminalayi Fubara has consistently demonstrated his dedication to workers’ welfare since taking office in May last year. Unlike his predecessor, who left many employees feeling overlooked and unsupported, Fubara wasted no time in addressing the longstanding stagnation of promotions that had plagued the workforce for eight years. He took further steps towards financial justice by initiating the long-overdue payment of gratuities that were neglected during the last administration.
Similarly, we urge the governor to take another step forward by reviewing the stipends received by pensioners. The current pension amounts have become woefully inadequate, leaving many of them who dedicated their lives to public service struggling to make ends meet. These dedicated individuals who have contributed to the development of our dear state now find themselves in a precarious financial situation, receiving stipends that are alarmingly low and insufficient to cover basic living expenses. The rising cost of living has rendered their pensions nearly meaningless. Therefore, a comprehensive reevaluation of these stipends is a required measure to ensure that those who have served our state with honour can live their remaining years with dignity and security.