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National Assembly to postpone wage increase

The Government is likely to delay its increase of the minimum wage planned for May, 2013, due to shrinking State budget revenues.
The Government is likely to delay its increase of the minimum wageplanned for May, 2013, due to shrinking State budget revenues.

Despite planning to increase the minimum wage from 1.05 million VND(50.5 USD) per month to 1.3 million VND (62.5 USD) in May next year,deputies at the on-going National Assembly meeting proposed delaying therise.

The move will affect seven million people on the State payroll, as well as retired people.

Finance Minister Vuong Dinh Hue said that because of a decrease inState budget revenue, it was difficult to secure the funds needed toraise the minimum wage, a move which will cost the State 60 trillion VND(3.12 billion USD).

He said the Government will report on a possible wage rise at a National Assembly meeting scheduled for May, 2013.

Meanwhile, speaking on the e-Government Portal on the sidelines of themeeting, Deputy Prime Minister Vu Van Ninh said the delay will onlyaffect people who are paid by the State, such as civil servants, as wellas retired people, whose pension payments are calculated based partlyon the minimum wage.

Wage increases in the private sector will be implemented as planned, he said.

Deputy Minister of Labour, Invalids and Social Affairs Pham Minh Huanconfirmed that the ministry still proposed following the road map onwage rises in the private sector.

At present,domestic enterprises and foreign-invested enterprises are applyingzone-based minimum wage levels based on the socio-economic developmentof each zone.

Zone 1 covers urban Hanoi and HCMCity . Zone 2 covers rural Hanoi and HCM City plus urban CanTho, Da Nang , and Hai Phong. Zone 3 covers provincial cities and thedistricts of Bac Ninh, Bac Giang, Hai Duong, and Vinh Phuc. Zone 4covers the remaining localities.

The zone-basedmonthly minimum wage now ranges from 2 million VND (96 USD) for Zone 1,1.78 million VND (85 USD) for Zone 2, 1.55 million VND (74.5 USD) forZone 3 and 1.4 million VND (67.3 USD) for Zone 4.

The ministry proposed three options to raise minimum wage levels, with a20 per-cent increase as the lowest rate. If approved, an increase inthe zone-based minimum wage levels would be applied next year, Huansaid.

According to Vice Chairman of the NationalAssembly Committee for Social Affairs Bui Sy Loi, the economic slowdown,thousands of dissolved enterprises and a higher rate of unemploymenthad been factors in the Government proposing the delay.

However, Loi said, according to the conclusion of the Party CentralCommittee's meeting last May, the minimum wage for employees in theState sector should be increased to help them ensure basic living costsin 2015.

"Funding for wages is a kind of investment for development of human resources,” Loi said.-VNA
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