BUDGET: Commitment to payment of meaningful wages
Accra, Nov. 10, GNA - Finance Minister, Mr Kwadwo Baah-Wiredu on Thursday stressed the commitment of government to pay a meaningful wage as one of the major yardsticks for measuring the country's economic success.
In line with this, the government has made strenuous efforts to achieve progressive and substantial increases in the level of minimum wage.
Over the past five years, he said, the minimum wage had risen to =A213,000 (equivalent of US$1.48) from the abysmal figure of A22,900 per day (equivalent to 41 US cents) of 2000.
"Our record on wages speaks for itself. Nevertheless, we believe that more can and must be done to improve wages to levels which can, at least meet the basic essentials of daily life, afford a little leisure and also put a bit aside for he twilight years," the Minister said when he presented the 2006 budget statement to Parliament.
The Minister said the annual consultations with tripartite partners were on course and indications following from the meeting so far showed that the minimum wage would be increased by "another substantial percentage" in the coming year, and that this would move further towards a minimum wage of US $2.00 equivalent by the end of 2008.
"But even before we get to the laudable target we have set for ourselves, Government is taking concrete measures to improve the weight of the money in our people's pockets today, by reducing the tax burden on pay at all levels," the Minister said.
In this direction, Mr. Baah-Wiredu said from next year, income tax on the minimum wage would be abolished altogether.
Based on the projected adjustments to the minimum wage, the proposed measure will mean that persons earning less than A24.4 million a year will keep all of that money to themselves. Besides the income tax threshold levels of other incomes are also to be revised to allow people to keep more of their hard earned wages in their pockets.
Mr Baah-Wiredu said Government would also raise the qualifying levels of additional earnings from overtime, which attract income tax to encourage people who work overtime and had often complaint that the benefits from giving up leisure time to work overtime are almost all taken away by the burden of excessive taxation.
Turning to the issue of a living wage, the Minister said the reality of workers earning a living wage lay in the country's abilities to generate the revenues from taxes and surcharges from wages and other economic activities.
He said private employers could also only continue to stay in business, employ more people and pay living wages from the earnings that come from their enterprise.
However, Mr Baah-Wiredu stressed that aspiration to higher wages must be backed by the need to improve productivity and giving out of absolute best.
"We cannot expect two people to do the job that is done by one person elsewhere and then expect money to be found to pay two living wages. Therefore, if we are to achieve our common goal of a gainfully employed nation earning living wages, we must all commit ourselves resolutely to doing things better and achieving higher standards of output."
He said the country would not succeed until there was increased level of productivity, saying that higher productivity will lead to lower operating costs and increased competitiveness for the country in the Global market place.
This in turn would translate into bigger sales and higher profits for our companies and the greater wealth of our country through increased GDP; which in turn will be able to support better wages for those at work and create new opportunities for those waiting to work, he said.