In a step that many activists consider a way of bribing civil servants and workers not to participate in the ongoing protest, Egypt's Ministry of Finance announced a 15% increase in wages and pensions.
“We will not sell our blood with over 300 martyrs for a 15 percent wage increase. The martyrs sacrificed with their lives for a decent life and freedom,” said a joint statement signed by four NGO’s and workers movements in Egypt. The signatories also said that this increase is not sufficient to cover the price hikes in consumer goods during last year. “We refuse this “old game” that is being repeated again where the increase in prices eat up the wage increases,” stated the signatories.
In fact, the increase will most probably, as usual, be calculated based on basic salaries, which in some cases represent only 20 percent of employees' total salaries. For the first time, however, this will not be the case for pensions, with increases to be based on the entire pension. The total amount of the new salary increases in the 2010/1011 budget will not exceed LE 700 million. While the increase of pensions will cost the budget LE 6,5 billion next year.
For the first time ever, the increases will be allocated to the beneficiaries of Al-Sadat pension, who are paid about LE 124 per family monthly, while the poverty line per person in Egypt is, according to government estimates, about LE 165 per person per month.
A LE 5 billion fund will also be created to compensate families of victims and those whose property was damaged during the last protests.
“These decisions were taken in response to the demands of the street”, said an senior official at the Ministry of Finance who assures that, so far, there are savings in expenditures and increases in revenue that will counter the new expenditures. “So far, we won’t need to search for new resources and the deficit will not increase from the forecast”, adds the same source, explaining that the deficit was expected to decrease from the forecasted 7.9 percent of GDP to below 7.5 per cent, but that this cut will not take place following the new decisions.
On their part, the NGO’s and movements that published the statement against this decision presented an alternative list of five demands, allowing for a better distribution of income.
The first of these demands is to fix a minimum and maximum fair wage so as not to increase the ratio between them, where the minimum should stand at 1200 LE (200 dollars) per month. This sum was a demand that rose up across the country after an Administrative Court ruled in mid 2010 that the government must set a minimum wage compatible with costs of living.
The demands also included providing adequate health care insurance for all wage earners, give full time workers contracts, in the government and administrative units and public enterprise sector, the announcement of a national plan to deal with employment that includes an unemployment allowance and finally the right of same wage for same work.