While the Government is slashing its payroll, a Minister is “begging and pleading” with private sector bosses to give their workers a wage increase in a bid to spur economic recovery.
Minister of Transport, Works and Maintenance Dr William Duguid made the plea in Parliament on Tuesday while contributing to debate on the Income Tax Amendment and Validation Bill.
He argued that it was only fair for the local private sector to give an increase to workers considering Government’s recent decision to lower the corporation tax rate from 30 per cent to between one per cent and 5.5 per cent, and Government’s decision to grant civil servants a five per cent increase.
“I am begging and I pleading now, you are getting a reduction in the taxes you are going to pay, you are seeing an increase in business, you got a tax write off on tax arrears, get out there and increase the amount that the people are paid because if everybody plays their part it would help to turn this economy around and we need all to play our part,” said Duguid.
He praised the Barbados Hotel and Tourism Association (BHTA) for reaching an agreement with the Barbados Workers’ Union (BWU) on a three-year collective agreement for tourism industry workers last Friday.
This agreement will cover the period December 15, 2017 to December 14, 2020 and provides for hotel employees receiving a two per cent increase in wages in the first year, two per cent in the second and 1.5 per cent in the third year.
“That is a start and a move in the right direction,” said Duguid.
He argued that Government’s five per cent pay hike in August this year, and effective from April 1, 2018 to March 31, 2019, was simply not enough to spur economic growth through consumer spend, since Government only employed about 25,000 people.
Arguing that the private sector employed approximately four times that number, Duguid said with the reduction in corporation tax he expected a range of sectors to now jump at the opportunity of granting their workers an increase.
“We are going to reduce your tax that you pay. So, if you were making taxable income of $100,000 you now going down to $5,000. You now got $95,000 in your company that you didn’t have before. Good gracious, you mean to tell me that you are not going to share that with your employees?” he said.
“You got to look at giving the people an increase. It is not the unions, it is the private sector that has to understand that the people of Barbados have held strain. In the same way that the private sector joined with the then government and instituted a wage freeze – the wage freeze is off; the government gave an increase – join with us in the same way and give the employees an increase. I applaud the hotel sector. I want to see it in manufacturing, I want to see it in the retail sector, I want to see it in banking, I want to see it in insurance, I want to see it in sales, I want to see it all through Barbados,” said Duguid.
He reasoned that should private sector workers get more pay they would spend more and then the economic growth the country so badly needed, would take place.
“If you put more money in the people’s hands, what are they going to do? They are going to spend more. If they spend more, what does that means? The economy turns around. You start to put little oil and grease on the wheel and instead of moving so slowly get it moving faster. You are going to be able to increase the spending power and each employer has to play their part,” said Duguid.
The post Duguid: Pay workers more to boost economy appeared first on Barbados Today.
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