Consultant cautions against over 40% increase

A former deputy Minister of Employment and Social Welfare, Austin Gamey, now a labour consultant, has cautioned the Tripartite Committee against any attempt to adjust the new minimum wage to more than 40 per cent. According to him, such a decision would lead the economy into catastrophe.

Mr Gamey was speaking to The Ghanaian Times in Accra at the weekend. “The ideal thing to do is for the Tripartitie Committee to fix the minimal wage between 35 and 40 per cent,” he suggested and cautioned the government not to be swayed by the people’s outburst over the recent increase in fuel prices.

The consultant said that even though he was not happy with the astronomical increase of over 90 per cent in petroleum prices, it was a “necessary evil” that Ghanaians should accept. That, according to him, was the only way the government could move the country forward in terms of development and national progress.

He explained that to hold inflation and exchange rates in check, a 20 per cent increase in the minimum wage would have been preferable for the Tripartite Committee to fix. But he conceded that would reduce the purchasing power of workers and further reduce everyone to a subsistence level of living.

According to Gamey, the government in 2002 paid ?31 trillion as emoluments or salaries for its 300,000 employees alone pointing out that any percentage increase would therefore mean ?31 trillion multiplied by that percentage increase. “Should this happen, we would have an inflationary economy that would not be able to sustain our Gross Domestic Products (GDP),” he emphasised.

In that case, the government and businesses would be forced to down size their labour forces thereby, creating further unemployment problems which the government was trying to prevent.

One major problem confronting the country was ignorance about the level of national productivity, he said, and suggested the setting up of a national productivity council to determine it to assist in planning.

The former deputy minister of labour praised President Kufuor and his administration for taking such bold economic decisions despite the outcry by a section of the citizenry adding that this will make us competitive.

He implored all Ghanaians to support the government no matter their political and partisan lineage since that was the surest way to move the nation forward. “It is time to support this administration and stop harping on one another’s mistakes as it is our duty as Ghanaians to rebuild this economy for growth and progress.”

Giving his assessment of the New Patriotic Party (NPP) administration over the past two years, he said the new government had made some mistakes in terms of policies and decisions over the period. But he attributed that to the fact that the party had been out of power for a long time for which Ghanaians should hear with the NPP. – The Ghanaian Times