The Nigeria Labour Congress (NLC) has cautioned that the federal government’s plan to eliminate electricity subsidies could exacerbate poverty and further strain households and businesses already grappling with rising costs.

Acting General Secretary of the NLC, Comrade Benson Upah, told Leadership Weekend that higher electricity tariffs would have far-reaching effects on citizens and the business community. “Millions of workers and their families could face increased hardship, while companies may struggle with higher production costs, layoffs, and reduced patronage,” he said.

The federal government, under mounting fiscal pressures, has proposed reforms in the energy sector, including the phasing out of electricity subsidies. Minister of Finance Wale Edun recently announced a plan to implement a pay-as-you-go electricity model and targeted tariff increases for large consumers, a move expected to save over ₦1 trillion annually.

Upah criticized both the government and power companies for inefficiencies and alleged collusion, questioning the effectiveness of previous privatization efforts. He highlighted that despite substantial government allocations, electricity supply remains unreliable, and subsidy funds have not translated into improved service.

The NLC vowed to continue mobilizing its members and taking necessary actions when the subsidy removal takes effect. Upah stressed that Congress has consistently engaged the government, including organizing protests, to ensure citizens’ concerns are heard.

Labour also cited a recent U.S. Department of State report noting that Nigeria’s minimum wage of ₦70,000 ($47.90) is insufficient to lift workers out of poverty, with weak enforcement and currency devaluation worsening the situation.