The Federal Government’s proposed six-month transport allowance for public servants could cost an estimated ₦465.7bn, but the Trade Union Congress of Nigeria (TUC) has rejected the arrangement, insisting that workers need permanent salary increases rather than temporary financial relief.
The government approved a monthly allowance of ₦70,000 for public servants beginning in November 2026 following negotiations with the Nigeria Labour Congress (NLC) in Abuja on October 27.
An analysis based on 1,108,800 employee records on the Integrated Personnel and Payroll Information System as of July 2026 estimated that the payment could cost ₦77.6bn monthly and ₦465.7bn over six months, assuming all the records represent eligible beneficiaries.
However, the actual expenditure will depend on the number of workers verified as eligible and the final payment arrangements.
Economists Call for Lasting Solutions
Economists have welcomed the proposed allowance as a temporary intervention but urged the government to address the underlying causes of rising transportation costs and household expenses.
Dr Muda Yusuf, former Director-General of the Lagos Chamber of Commerce and Industry, said financial support would provide some relief to low-income workers struggling with the rising cost of living.
He also recommended subsidised mass transit, including buses powered by compressed natural gas or diesel, as well as free staff buses provided by government agencies and private employers.
Yusuf further suggested that organisations should consider remote working arrangements for employees whose duties can be performed from home, reducing the frequency and cost of daily commuting.
Ayodeji Ebo, Chief Executive Officer and Partner at MDU Capital Limited, also described the allowance as a positive intervention but called for transparency regarding its funding.
He argued that the government should prioritise sustainable revenue and savings over additional borrowing to finance the programme.
Economist Illias Ali, however, questioned whether temporary payments would adequately address the broader economic challenges confronting Nigerians, urging the government to focus on energy security, food production and other structural reforms.
TUC Rejects Temporary Allowance
The TUC, led by its President, Festus Osifo, has insisted that the government should increase workers’ salaries instead of introducing another temporary wage award.
The congress proposed raising the salary of the lowest-paid federal worker to ₦300,000 monthly, with corresponding adjustments for other salary grades.
It argued that the government does not need to wait for negotiations on a new national minimum wage before increasing salaries, noting that there is no legal maximum wage.
The TUC also accused the Federal Government of failing to implement the 2023 wage award fully, claiming that some workers remained unpaid while others received their allowances irregularly.
According to the congress, more than 80 per cent of states and workers in the informal sector had not benefited from any form of wage award.
The union maintained that another temporary arrangement would not adequately address workers’ financial difficulties if previous commitments remained outstanding.
Health Workers’ Allowances Add to Dispute
The TUC also criticised the government over the alleged failure to implement an agreement concerning the Consolidated Health Salary Structure (CONHESS) for health workers under the Joint Health Sector Unions (JOHESU).
The congress said the agreement followed negotiations aimed at resolving an industrial dispute and accused the government of failing to fulfil its obligations despite the suspension of industrial action.
It demanded the immediate implementation of the salary adjustment, a clear timetable for payment and the necessary budgetary provisions.
The TUC warned that continued delays could weaken trust between the government and organised labour.
Government Faces Pressure Over Workers’ Welfare
The disagreement highlights the growing divide between the NLC and TUC over how best to protect workers from rising transportation, food, healthcare and other living expenses.
While the NLC negotiated the six-month transport allowance with the government, the TUC maintains that a permanent salary increase would provide more dependable relief.
The government has agreed to begin paying the allowance in November, alongside arrangements to clear outstanding peculiar allowance arrears in three equal monthly instalments.
It has also agreed to establish a committee to begin negotiations on a new national minimum wage arrangement.
The TUC said it would determine its next course of action after receiving the outcome of its engagement with the Federal Government.
