TDRI: Wage hike needs subsidy

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TDRI: Wage hike needs subsidy
Published: 12/07/2011 at 04:41 PM
Bangkok Post: Online news: News  

No matter how the new Pheu Thai Party-led government implements its policy to quickly increase the minimum wage to 300 baht per day, it could not be done without adequate subsidies from the government, a leading academic said on Tuesday.

Assoc Prof Yongyuth Chalamwong of the Thailand Development Research Institute (TDRI) said government subsidies would be crucial because the current minimum wage varies by province.

Phuket, at 221 baht, and Bangkok and neighbouring provinces, at 215 baht, were the highest. Other provinces were lower.

To bring the minimum wage to the same rate of 300 baht per day everywhere would mean those provinces currently paying a considerably lower rate would face a surge in production costs which they might not be able to cope with without sufficient subsidies, said Assoc Prof Yongyuth.

Bangkok would face an increase of only about 40 per cent, while the other provinces would face a rise of more than 80 per cent in some cases, he said.

He did not think it would be possible to abruptly raise the minimum wage to 300 baht nationwide because it would meet with strong objections in the tripartite central wage committee. The committee comprises representatives of the government, employers and labour groups.

The academic said that he totally favoured a gradual increase in minimum wages, because it was more practicable.

Prime minister-in-waiting Yingluck Shinawatra said her party's policy to increase the daily minimum wage to 300 baht would  be implemented from January next year.

During the remainder of this year the government would lay the groundwork for the implementation of this policy with the Labour Ministry, the Budget Bureau and the private sector.

Ms Yingluck also said all of the party's policies announced during the election campaign would also definitely be implemented.

The Pheu Thai Party was today continuing discussions on implementation of policies after having talked to representatives of the private and business sectors, she said.