Implementation to be clear by October

How the government will implement its policy to raise the daily minimum wage to Bt300 will become clear by October, Labour Ministry permanent secretary Somkiat Chayasriwong said yesterday.

The top official did not rule out a request by the Federation of Thai Industries (FTI) to gradually lift the minimum wage step by step over three to four years.

"We are ready to listen to all sides," Somkiat said.

The Labour Ministry, he added, was now surveying wage rates across the country.

Somkiat said the Department of Skill Development (DSD), in the meantime, had been instructed to promote skill training by offering eServices to interested employers.

He said improved skills would make workers well qualified for a daily wage of at least Bt300.

At present, laws encourage employers to provide training for their workers/employees by giving tax benefits. Employers should be able to claim tax deductions of an amount two times of the training cost. However, due to complicated procedures, some employers have not organised the training, paying fines to the Skill Development Fund instead.

"To simplify procedures to claim tax deductions as part of training costs, the DSD will launch eServices on September 8," Somkiat said.

He said employers could also check out useful training courses at www.dsd.go.th, and register the courses they were going to provide to their employees/workers via the web site.

Jiyuan Wang, the International Labour Organisation's country office director for Thailand, Cambodia and Lao People's Democratic Republic, downplayed any concern that rising wages would worsen inflation.

He said it was inflation that was now putting pressure for higher wages.

He said Thailand's daily minimum wage had clearly not risen in line with the country's inflation rate during the past decade.

In 1995, wages accounted for 72 per cent of the country's total income. By 2006, they accounted for just 63 per cent of total income.

Wang also pointed out that the Gini coefficient of Thailand, a measure of inequality of income or wealth, was the highest in Asia.

"It's at 0.43," he said.

According to Wikipedia, Gini coefficients for income ranged from around 0.23 (Sweden) to 0.70 (Namibia) although not every country has been assessed.

Wang said although some economic sectors would offer less job opportunities if the minimum daily wage rose, workers would still be able to switch to other economic sectors.

"Higher wages will mean higher consumption. It will stimulate the country's economy too," he said.