TANZANIA: New minimum wage for private sector announced

BY LYDIA SHEKIGHENDA.

The government yesterday announced a substantial rise in the minimum wage in the private sector, saying the changes will be implemented in the coming financial year that begins in July.

The announcement was made yesterday in Parliament by Labour and Employment minister Gaudensia Kabaka when tabling her 14,958,896,000/- budget estimates for the 2013/2014 financial year. 

Minister Kabaka said that the minimum wage scales will be applicable in twelve sectors with variation of percentages from one to another.

The sectors are industry and trade 43.8 percent, hotel and domestic services 55.2 percent, private security 46.4 percent, Mining 25.2 percent, health 65 percent, fisheries and marine services 21.2 percent, transport 49 percent and agriculture 42.9 percent.

The government has also announced the increase in the minimum wage in the four new sectors of construction, private schools, energy and communications.

Kabaka said that the new rates have taken into account a number of factors including efficiency, the country’s production situation, and provision of services. Also considered are the employers’ capability and producers of each sector as well as inflation.

“These factors have been considered to ensure that there is no redundancy or transference of investment to other countries where the cost of production is low,” Kabaka explained.

On withdrawal benefits, which are the right of an employee who has a qualified pension plan to cash-out any accumulated benefits upon leaving an employer, she said that recommendations on how to deal with the matter have been prepared and will be discussed by stakeholders before tabling them in Parliament.

Clarifying on the issuance of work permits, Minister Kabaka said her ministry in collaboration with other stakeholders has already prepared a draft bill and that it will be tabled in Parliament in the 2013/2014 financial year.

“The bill is meant to standardise the law governing issuance of work permits and to do away with the current system that has several authorities and laws dealing with the matter separately and independently,” she explained.

On the same subject, the Committee Chairperson, Jenister Mhagama (pictured), said that currently, the issuance of work permits is not favourable to the locals as it denies employment to a majority of Tanzanians employment by allowing foreigners to do work that could be done by locals.

Also, Mhagama insisted that the government should invite investors only to the sectors that need big capital and technology that is not readily available in the country but to avoid offering them small projects that can be done by locals.

Presenting the opposition speech on the Ministry’s budget estimates for 2013/2014 financial year on behalf of the Shadow Minister, Joseph Mbilinyi, Special Seats MP for Chadema, Cecilia Paresso, accused the government of excessive spending in research conducting into whether there ever was the need to increase minimum wage for the private sector.

She revealed that in just two financial years, the government has spent 197,925,000/- in coordination and facilitation of research on minimum wage for the private sector.

“The Opposition Camp is disappointed with the governments’ tendency to unnecessarily set aside funds for research while it is obvious that the wages need to be raised simply based on the high cost of living in the country,” Paresso said. 

SOURCE: THE GUARDIAN: http://www.ippmedia.com/frontend/index.php?l=55286