The MCTU is right: the minimum wage is scandalously low. AT MK 18000 per month it is not possible to live on it. The basic needs basket of Centre for social concern stands at MK 161996. This is a scandalous discrepancy.
The argument against raising minimum wage, that it will push up prices further increasing inflation is real, but it can easily be offset: lower tax rates. That way the money will end up in the pockets of the lowest paid, where it adds the most to the utilitarian ideal of the greatest happiness for the greatest number of people. This clearly means that government spending needs to be controlled.
Minister Gondwe of finance has declared that there is about 30% wasteful spending in government. Add to this the widely cited 30% corruption and you get to the number of 60% wrong spending in government.
While it is clear that this cannot be cleaned up over night, a reduction of government spending that offsets the raising of the minimum wage can easily be found.
The money is better in the pocket of the lowest paid than used to import a new convoy of top of the range luxury cars for the President. These imported cars mean that the money is lost to the Malawian economy, while the lowest paid do not afford expensive imported products: they buy local That means the money stays in the Malawian economy, and benefits us all. The same goes for the President taking half the village to the UNGA and paying them over US 400 per day in allowances: this money goes to luxury shopping in New York, and is lost for the Malawian economy.
We don’t need conferences in luxury resorts, we don’t need the paperwork out of these conferences, since most of it is never implemented. We need money in our pockets, and we need lower taxes. We need government policies that push down inflation, not extra taxes on basic needs like milk and water, that only push up inflation further. Government needs to clean up its own house, rather than burdening the lowest paid with inflating minimum wages and VAT on basic needs.