morganABLE Politics/Governance
The TUC, which rejected the proposed intervention, insisted that a temporary transport allowance would not adequately address the economic challenges confronting Nigerian workers.
KaNo—
The Trade Union Congress of Nigeria has rejected the Federal Government’s proposed N70,000 monthly transport allowance for public servants, demanding an immediate salary increase and the implementation of outstanding agreements with health workers.
The rejection comes amid projections that the six-month intervention could cost the Federal Government approximately N465.7bn if all 1.1 million employee records captured under its payroll system qualify for the payment.
The government had approved the monthly transport allowance following a conciliation meeting with the Nigeria Labour Congress in Abuja on Tuesday, as part of efforts to cushion the impact of rising transportation costs and worsening economic hardship.
The payment, scheduled to commence in November, will run for six months and cover eligible federal workers across different levels of the public service.
However, the agreement did not specify the total number of beneficiaries or the amount budgeted for the intervention.
An analysis based on the 1,108,800 employee records captured under the Integrated Personnel and Payroll Information System as of July 2026 indicated that the proposed allowance could cost approximately N77.6bn monthly.
Over the six-month period, the estimated expenditure would rise to N465.7bn, assuming every employee captured under the payroll system qualifies for the payment.
The actual financial commitment will, however, depend on the number of verified beneficiaries and the final arrangements adopted by the government.
The TUC, which rejected the proposed intervention, insisted that a temporary transport allowance would not adequately address the economic challenges confronting Nigerian workers.
The union instead demanded an immediate upward review of workers’ salaries and the implementation of outstanding agreements involving health workers under the Joint Health Sector Unions.
The development comes amid mounting concerns over the rising cost of living, particularly transportation, food and other essential household expenses.
Petrol prices at Nigerian National Petroleum Company Limited retail outlets have increased to N1,369 per litre, placing additional financial pressure on commuters and businesses.
Despite the recent moderation in inflation, many households continue to struggle with the cost of essential commodities.
According to the National Bureau of Statistics, Nigeria’s headline inflation declined to 14.63 per cent in September from 15.39 per cent recorded in August, while food inflation stood at 19.59 per cent year on year.
Economists who assessed the proposed allowance on Wednesday acknowledged its potential to provide immediate financial relief but warned that temporary payments would not address the structural challenges responsible for rising transportation costs.
The Chief Executive Officer of the Centre for the Promotion of Private Enterprise and former Director-General of the Lagos Chamber of Commerce and Industry, Dr Muda Yusuf, described the intervention as a welcome development, particularly for low-income earners.
“Every relief that we get for the people, the citizens need a lot of support at this time. So whatever support we get, I think we must welcome it,” Yusuf said.
He expressed optimism that the six-month duration could provide temporary relief while economic conditions improved.
However, he stressed the importance of introducing sustainable measures to reduce the cost of commuting and improve workers’ purchasing power.
Yusuf recommended increased government investment in subsidised mass transportation, including buses powered by Compressed Natural Gas and diesel.
He also encouraged ministries, departments and agencies to introduce free transportation arrangements for their employees, while urging large private-sector organisations to consider similar initiatives.
According to him, employers should embrace flexible working arrangements where possible to reduce the financial burden of daily commuting.
“If there are things you can do from home, you can reduce the number of days that people come to work,” he said.
He maintained that greater adoption of technology and remote working arrangements could significantly reduce transportation expenses, particularly in major cities.
Yusuf’s expectation of improved energy prices, however, comes against projections by the World Bank that global energy prices could rise by 32 per cent in 2026 before moderating in 2027.
The bank, in its latest Commodity Markets Outlook, warned that geopolitical tensions and potential supply disruptions could further complicate the global energy market.
Similarly, the Chief Executive Officer and Partner at MDU Capital Limited, Ayodeji Ebo, described the transport allowance as a positive intervention capable of easing the financial burden on eligible workers.
He explained that transportation constituted a significant proportion of household expenditure, alongside food and other basic necessities.
Ebo, however, raised concerns about the financial implications of the programme and the government’s capacity to sustain the payments throughout the approved period.
“For illustration, covering one million workers would cost N70bn monthly, or N420bn over six months. The actual bill depends on the verified number covered,” he said.
He urged the Federal Government to provide clarity on the source of funding, stressing that approving the allowance did not automatically guarantee the availability of sufficient resources.
The economist advised the government to prioritise sustainable revenue sources and savings rather than additional borrowing to finance the intervention.
He also advocated investment in affordable public transportation systems, including urban rail networks and mass transit buses, which would benefit a broader segment of the population.
Another economist, Illias Ali, questioned the effectiveness of the proposed allowance in addressing Nigeria’s wider economic challenges.
Ali argued that government interventions should prioritise tackling the fundamental causes of rising living costs rather than providing temporary financial assistance.
“It’s better we solve the rudiments rather than actually doing this,” he said.
He identified energy security and food security as critical areas requiring urgent government attention.
Ali also questioned the limited coverage of the intervention, noting that state and local government employees, private-sector workers and millions of self-employed Nigerians were equally affected by increasing transportation costs.
He warned that the economic pressures facing households could persist after the expiration of the six-month payment period unless broader reforms were implemented.
Meanwhile, negotiations between the Federal Government and organised labour remain ongoing over unresolved workers’ welfare issues.
Under the October 27 agreement, the government also approved the payment of outstanding peculiar allowance arrears, effective from May 1, 2026.
The arrears are expected to be settled in three equal monthly instalments beginning in November.
However, both parties failed to reach an agreement on the effective date for implementing the national minimum wage arrangements under discussion.
They subsequently agreed to establish a minimum wage negotiation committee and commence discussions immediately, as organised labour continues to press for improved remuneration and sustainable measures to protect workers against rising living costs.
