By Atom Markarian
The Armenian parliament voted on Wednesday to approve a government proposal to more than double the country’s tiny minimum wage guaranteed by the law.
A government bill overwhelmingly passed by lawmakers in the first reading will raise the monthly minimum from the current 5,000 drams to 13,000 drams ($23) starting next January.
Social Security Minister Aghvan Vartanian said the measure will largely affect some 35,000 public sector employees that currently get between 7,000 and 8,000 drams a month. Most of them hold low-level positions in state-funded cultural institutions
The average salary in the Armenian public sector, which employs about 260,000 people, was until now 22,000 drams. The official average figure for the country entire workforce is about 30,000 drams. But with private employers routinely underreporting their workers’ monthly incomes to evade payroll taxes, many economists believe that the real figure is considerably higher.
The parliament-backed bill is part of the government’s plans to increase its modest social spending next year. This will involve sizable wage increases for the chronically underpaid public sector workers. School teachers, for instance, will see their salaries doubled to more than 30,000 drams.
However, their extra revenues will be at least partly offset by the continuing rise in the price of several basic food products, including bread, which is set to prevent the government and Armenia’s Central Bank from keeping the 2003 inflation below the projected rate of 3 percent. The price of bread, a staple food for hundreds of thousands of low-income Armenians, has soared by 50 percent since June. Other cereals and foodstuffs like butter, eggs and poultry have also grown more expensive in recent weeks.
Prime Minister Andranik Markarian on Wednesday blamed the price hikes on external factors, saying that those products now cost more in the international market. But his political opponents allege price machinations by a handful of government-connected businessmen who control the lucrative imports.