Rethink MFP wage plan

Rethink MFP wage plan

The Move Forward Party (MFP) policy to immediately increase the daily minimum wage to 450 baht and adjust it annually to keep up with inflation is generating widespread debate. While the intention to support unskilled workers may be noble, it is crucial to acknowledge the potential impacts on businesses and the overall economy.

Sia Jampathong, MFP's list-MP candidate and labour activist, has emphatically stated that "no one is bigger than the hardships of the people" and that, as a result, the daily minimum wage must be increased to 450 baht within the first 100 days of the party assuming office.

While his statement reflects strong emotions, it sounds spurious. In a democracy with an open and free market, the government cannot simply force the private sector to increase daily wages. It is essential to engage in discussions and find a solution that is acceptable to all stakeholders. For international acceptance, wages should be considered by a tripartite advisory body.

In Thailand, the tripartite national wage committee, comprising the government, employers and labour unions, would need to finalise the details of any proposed wage hike and submit them to cabinet before making an announcement.

This approach will ensure transparency and accountability in the decision-making process, considering the wide-ranging impact on stakeholders.

The daily minimum wage should be increased, considering the rising prices of essential goods and food. However, how much the rate's increment will be and when the hike will start must be carefully decided based on comprehensive and quality data.

They must take into account comparisons between Thai and foreign workers who will benefit from the increase, the scale of impacts on employers, especially small and medium-sized enterprises, and the potential adverse consequences, such as more pressure for goods price increases. In some cases, a significant minimum wage increase might not benefit workers if it leads to a disproportionate rise in prices.

It is better to examine the history of minimum wage adjustments. A significant wage increase occurred in 2012 under the Yingluck Shinawatra government, when the minimum wage was raised to 300 baht per day from about 200 baht.

Subsequently, the wage remained unchanged for five years until it was adjusted again in 2017, and subsequent increases have been implemented, including the most recent adjustment just on Oct 1, with the wage increasing to between 328 and 354 baht per day.

If the wage was to be raised to 450 baht per day, as proposed by the MFP, it would represent a 27%–37% increase.

The increase could be feasible if the MFP had a clear and practical economic policy to drive economic growth. Unfortunately, the party does not prioritise such objectives.

Parties should refrain from using wage increases as a campaigning strategy in elections. It is crucial to recognise that wage increases are not the only solution to address inequality and may not be the most effective approach.

It is true that the MFP has a mandate from 14 million voters to implement its promised policies, but they do not represent the entire population, nor do they provide legitimacy for the party to bend policies to its own course simply because it must satisfy voters at any cost.

The party needs to listen and carefully consider the implementation of its policies, which will have wide-ranging impacts on various stakeholders.


Bangkok Post editorial column

These editorials represent Bangkok Post thoughts about current issues and situations.

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