The government of Vietnam has turned down the proposal to raise the monthly minimum salary to 20 per cent for workers at state-owned sector in the 2008-2012 period, explaining that the rise will put the state budget into difficulties.
Earlier, the Ministry of Labor, War Invalids and Social Affairs (MoLISA) suggested two hike levels: 15 per cent and 20 per cent for the 2008-2012 minimum salary hike roadmap.
Accordingly, the monthly minimum wage will be VND540,000 (US$33.7) in 2008, VND648,000 (US$40.5) by early 2009 and VND777,600 in 2010 if the second rise level (20 per cent) is applied.
Estimation from the central government warned that total spending for the rise will account for 95 per cent of the state budget if this plan is approved.
Meanwhile, if the first hike level (15 per cent) is approved, the monthly minimum salary will be VND518,000 (US$32.2) in 2008, VND595,000 (US$37.1) in 2009 and VND648,000 (US$40.5) in 2010.
Prime Minister Nguyen Tan Dung has asked the Steering Committee for Salary Mechanism Reform under the MoLISA to consider a more proper plan and then submit to the government.
The increase will be the third time over the last three years. The most recent hike was last October, an official of the ministry said.
Vietnam now has more than 44 million people of working age. Of the figure, seven million people are paid from the state budget. Monthly salary for them is currently at VND450,000 (US$28).
Vietnam plans to apply a standard minimum wage for all sectors by 2010. (Vietnam Economic Times)
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