Project – The Impact of National Union of Road Transport Workers (NURTW) on the Cost of Transport Fare in Lagos

CHAPTER ONE

INTRODUCTION

1.1 Background of the Study

Transportation is a fundamental component of urban life, particularly in Lagos, Nigeria — one of Africa’s most densely populated and economically active cities. Efficient, affordable, and reliable transport systems are essential for economic productivity, social mobility, and access to opportunities (Lagos Urban Development Initiative [LUDI], 2022). The city’s transport sector includes diverse modes: yellow buses (“danfo”), tricycles (“keke”), motorbikes (“okada”), ferries, and the more regulated Bus Rapid Transit (BRT) systems.

Within this system, the National Union of Road Transport Workers (NURTW) plays a central role. The NURTW serves as a regulatory and administrative body for commercial transport operators, controlling a large share of road transport operations in Lagos (Economic Confidential, 2021). It collects levies, mediates disputes, organizes drivers, and exerts significant influence over fare pricing and operational standards. However, there is growing debate over how these union activities—especially daily ticket collections, park dues, and other levies—affect overall transport fares (Independent Newspaper Nigeria, 2023).

Studies and reports show that several factors drive transport costs in Lagos: fuel price fluctuations, vehicle maintenance, spare parts costs, and inflation. Yet, informal fees and multiple levies imposed by NURTW agents (“agberos”) are often cited by drivers as a major burden contributing to fare increases (LUDI, 2022). For instance, a 2021 report estimated that the Lagos NURTW generates about ₦123.08 billion annually from various levies on buses, tricycles, and motorcycles (Economic Confidential, 2021). Drivers argue that such charges—sometimes collected multiple times daily—are transferred to passengers through higher fares.

Moreover, fare adjustments in Lagos do not always align with economic logic. When fuel prices fall, fares often remain high, suggesting that non-fuel factors, including union influence, play a persistent role (Independent Newspaper Nigeria, 2023). Analysts have criticized NURTW for failing to ensure fare reductions when government interventions, such as fare subsidies or fuel price adjustments, are implemented (Onuesoke, 2024).

Government initiatives, including partial fare reductions on state-run BRT and ferry systems, have attempted to mitigate commuters’ burden (Nairametrics, 2025). Nonetheless, the informal transport sector—still largely under NURTW’s control—remains dominant, and fare volatility continues to impact millions of daily commuters. Understanding the economic implications of NURTW’s actions is therefore essential for urban transport policy and fare regulation.

1.2 Problem Statement

Despite the widespread perception that Lagos transport fares are high, the specific impact of NURTW levies on fare determination remains under-researched. Many commuters and operators claim that union fees significantly inflate costs, yet there is little quantitative evidence to substantiate this (LUDI, 2022). The complexity arises from the informal and often unrecorded nature of many NURTW charges—ranging from ticket levies to payments made to park managers or route officials (Tori.ng, 2020).

As a result, policymakers and researchers struggle to assess how much of the fare structure reflects legitimate operating costs (fuel, maintenance, depreciation) versus informal payments. This opacity has also contributed to public distrust and perceptions of extortion within the sector (Independent Newspaper Nigeria, 2023).

Therefore, there is a need for an empirical study that isolates and measures the impact of NURTW activities on transport fare levels in Lagos. Such research will help determine whether fare increases are economically justified or institutionally driven by union practices.

1.3 Objectives of the Study

The main objective of this study is to evaluate the impact of NURTW on the cost of transport fares in Lagos State.

The specific objectives are to:

1. Identify and categorize the formal and informal levies imposed by NURTW on transport operators in Lagos.

2. Determine the extent to which these levies influence transport fare levels.

3. Examine how NURTW levies interact with other cost factors such as fuel price, maintenance cost, and inflation.

4. Assess commuters’ perceptions of NURTW’s role in determining transport fares.

5. Recommend appropriate policy measures for fair and transparent fare regulation.

1.4 Research Questions

1. What types of levies and charges are imposed by NURTW on transport operators in Lagos?

2. How do these charges influence the final transport fare paid by commuters?

3. To what extent are fare levels sensitive to changes in NURTW fees compared with fuel or maintenance costs?

4. How do commuters perceive NURTW’s influence on fare pricing?

5. What policy frameworks can reduce unfair fare escalation while ensuring sustainable transport operations?

1.5 Significance of the Study

This research will contribute both practically and academically.

From a policy perspective, findings will assist Lagos State regulators and transport authorities in designing equitable fare structures that account for both formal and informal cost drivers. It may also guide reforms within NURTW, improving transparency and accountability in its financial dealings (Economic Confidential, 2021).

From an academic standpoint, the study expands literature on informal institutions and their economic influence in developing cities. It offers insights into how trade unions can shape urban economic outcomes in contexts where formal regulation is weak (LUDI, 2022).

Socially, understanding fare determinants helps protect low-income commuters who bear the greatest burden of transport cost inflation in Lagos (Independent Newspaper Nigeria, 2023).

1.6 Scope of the Study

• Geographical Scope: The study focuses on Lagos State, with emphasis on major transport corridors where NURTW operations are most active.

• Temporal Scope: The study will review developments between 2020 and 2025, covering recent fare changes and union policy shifts.

• Operational Scope: It concentrates on road transport operators—especially commercial buses (danfo) and tricycles (keke)—under the NURTW’s control.

1.7 Definition of Terms

• NURTW: A national trade union representing road transport workers in Nigeria, especially commercial vehicle drivers.

• Union Levy: A fee or charge imposed by NURTW for tickets, park usage, or route operation.

• Transport Fare: The payment required from passengers for transportation from one location to another.

• Informal Charges: Unofficial or unrecorded payments made to union agents, park managers, or touts (“agberos”).

• Pass-through Effect: The extent to which increased operating costs are transferred to consumers via higher fares.

1.8 Hypothesis

H₀ (Null Hypothesis): NURTW levies and fees have no significant effect on the cost of transport fares in Lagos, after accounting for other variables such as fuel price and maintenance costs.
H₁ (Alternative Hypothesis): NURTW levies and fees have a significant positive effect on the cost of transport fares in Lagos, independent of other cost factors.

1.9 Organization of the Study

This study is structured into five chapters.

• Chapter One introduces the study, its background, objectives, and hypothesis.

• Chapter Two reviews existing literature on transport fare determinants and union economics.

• Chapter Three presents the methodology.

• Chapter Four analyzes and discusses findings.

• Chapter Five concludes with policy recommendations.

Project – The Impact of National Union of Road Transport Workers (NURTW) on the Cost of Transport Fare in Lagos