Govt sticks to 9,000 cedis daily minimum offer

Government said it could only manage a 9,000 cedis daily minimum wage considering the impact that a higher figure would have on the national economy.

This follows almost one month of negotiations with its social partners - employers and labour - at which no agreement could be reached.

Briefing journalists in Accra, Mr. Yaw Osafo-Maafo, Minister of Finance, said the increase takes effect from February.

Although the TUC boss, Kwasi Adu-Amankwah insists that government acted arbitrary in announcing the minimum wage because negotiations have not been concluded, Mr. Osafo-Maafo said as much as the government was sensitive to the plight of workers and would have wished to give in to demands for certain percentages of wages and salaries, "these increases need to be situated in a macroeconomic framework."

"Unfortunately our economy, as it currently exists, is incapable of handling these demands."

Mr. Osafo-Maafo said government could not accept a higher figure because of the likely reduction in labour force within small and medium enterprises, which would have to shed their workforce in order to pay a higher level of increase.

The increase would also stifle their growth into bigger industrial establishments. Besides any increases in wages and salaries that would put undue pressure on expenditure and cause it to outstrip revenue would spark off inflation and erode the gains that might accompany the higher wages, the Minister said.

"Unbudgeted expenditure by Government in favour of personal emoluments in 2002 amounted to about 1,200 billion cedis. This increase in the volume of expenditure helped to fuel inflation, which began to rise from October through to December 2002 after a steady decline that started from April 2001.

"It is clear that any increases in wages and salaries ... would spark off inflation that will eventually erode the gains that may accompany an increase in wages."

The Minister said in line with government's commitment to raise the living standards of persons it would not relent in its efforts to improve the working conditions and salaries of its workers.

There are already negotiations in place with the Forum comprising the Civil Servants Association, Ghana Registered Nurses Association, Judicial Service Workers Association of Ghana and the Ghana National Association of Teachers.

Mr. Osafo-Maafo said additionally there would be no increases in salaries and allowances of the President, the Vice President, Ministers of State, Deputy Ministers, Metropolitan, Municipal and District Chief Executives and Special Assistants.

"Other measures which will be announced later include reductions in fuel allocations to government officials, review of procurement procedures and cost of construction to minimise waste."

The decision not to increase the salaries of persons in these categories, he noted, is to demonstrate the government's preparedness to take the lead in the national effort to share the cost of ensuring a better tomorrow.