The Nigeria Labour Congress (NLC) has postponed its protest scheduled for the 1st of March 2025 following an agreement with the Federal Government to increase telecom tariffs by only 35 per cent.
The NLC claimed that it made this decision to provide a suitable relief measure of operation for the telecom companies. And, this was well accepted by the National Association of Telecommunications Subscribers.
Recall that the Nigerian Communications Commission (NCC) recently announced a 50% hike in telecommunications tariffs. Due to inflation, increasing cost of operations and currency depreciation, telecom operators clamoured to increase the tariff cost with an initial proposal of a 100% increase.
The intervention of the government and associated bodies made it the first official price hike in the sector in over a decade.
Before the reduction in the proposed hike percentage, major telecom companies have hinted that they have been providing services at an average rate of 50%. Subsequently, leading service providers, MTN Nigeria and Airtel raised the prices of internet plans.
Announcing its price increase to its customers, the telco stated, “Y’ello! Thanks for stopping by. We apologise for any inconvenience and delayed response. A price increase has been implemented to enhance our services and serve you better, which is why you are seeing the updated amount.” Thereafter, the new tariff rate was implemented.
The price adjustments, which took effect on February 10, sparked widespread concern among subscribers, many of whom were already grappling with Nigeria’s rising cost of living.
Telecoms price increase: the political intervention
Intervening in the matter, the House of Representatives directed the NCC and the Minister of Communications, Innovation, and Digital Economy to suspend the tariff increase
The intervention followed a motion of urgent public importance titled “Need for the Nigerian Communications Commission not to approve the impending hike in the telecommunications tariffs,” which was raised by Oboku Oforji, a member of the People’s Democratic Party from Bayelsa State.
During the plenary session, lawmakers argued that the tariff hike by the communications regulator would place a higher burden on Nigerians in the wake of rising inflation, economic hardship, and the removal of fuel subsidies.
Speaking on NLC’s decision and the new rate, the President of the National Association of Telecommunications Subscribers, NATCOMS, Adeolu Ogunbanjo, stated that “NATCOMS was not invited to be part of the committee that reviewed the rates. We fought, and at least a 15 per cent reduction is something.”
Economic impact and future outlook
The telecommunications sector has been a major contributor to Nigeria’s economy. In recent reports, the digital industry sector, which comprises the Information and Communications sector (I&C) and the Finance and Insurance sector (F&I), saw a contribution of 17 per cent and 6.09 per cent, respectively, during the fourth quarter.
This reflects the significant force of how the sector drives the Nigerian economy.
The National Bureau of Statistics, in its statement, noted that in the fourth quarter of 2024, the sector was mainly driven by financial and insurance institutions and information and communication (telecom). These industries played a key role in supporting economic activity during the period.
More specifically, the I&C sector contributed N3.8 trillion in the quarter under review, up from N3.6 trillion in Q4 2023. Telecommunications accounted for a significant 84.2 per cent of this total, while the remaining portion was shared among other industries, including broadcasting, publishing, and music production.
The resolution between the Nigeria Labour Congress and the Federal Government marks a significant development in the telecommunications industry, reflecting the delicate balance between sustaining business operations and protecting consumer interests. With the agreed tariff increase, subscribers are likely to experience some relief compared to the initially proposed hike.
However, concerns over the rising cost of living and the potential impact on digital accessibility remain.
The compromise demonstrates the government’s commitment to supporting telecom operators amid operational challenges while addressing public outcry. As the industry continues to evolve, stakeholders will be closely monitoring how telecom providers implement the new rates and whether service quality improves as promised.
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