Nigeria's government agreed on Wednesday to pay federal government workers a 70 000 naira monthly transport allowance for six months as part of a deal with the main labour union, the Nigeria Labour Congress, to ease soaring living costs, officials said.

The deal highlights the political sensitivity of rising prices ahead of President Bola Tinubu's re-election bid in January. His reforms have been credited with improving public finances but have left millions of Nigerians reeling from the worst cost-of-living crisis in a generation.  

Ministry of Labour spokesperson Annah Daniel said federal government workers would receive the payout from next month

The government also pledged to clear outstanding worker benefits, including arrears of a special allowance dating back to May 2026, which it will pay in three monthly instalments starting in November

The agreement revives talks on a new national minimum wage, with both sides agreeing to immediately set up a wage negotiation committee, though they remain divided over when any increase should take effect

Health workers will receive 19 months of unpaid allowance arrears, with the government pledging to clear the backlog within three months from December 2026, meeting a long-standing union demand

Additional measures, including tax relief for workers, will be referred to the National Economic Council for consideration, while proposed hazard allowances for agricultural workers are undergoing verification and cost assessments

Both sides agreed to reconvene in a month to review progress on implementing the measures, Daniel said