With parliamentary elections getting closer, the Lithuanian Social Democratic Party, the Homeland Union – Lithuanian Christian Democrats (TS-LKD) and the Labour Party have all promised to raise the minimum monthly wage during the next parliamentary term, but which party is promising the biggest increase?
The Labour Party tops the bidding with a promise to raise the minimum wage up to €656 within four years, which would be equivalent to 60% of the average salary. However, Nordea bank chief economist Žygimantas Mauricas said that the Labour Party’s intention to ensure that the minimum monthly wage would amount to 60% of the average wage is populism, noting that no EU country has such a high percentage.
He also pointed out that the minimum and average wage ratio in Lithuania now the highest among all Baltic countries, so the government should be targetting growth in average wages across the economy.
The Social Democratic Party has committed to raising the minimum wage to 50% of the average wage, or not less than €500.
The Homeland Union – Lithuanian Christian Democrats are proposing that the minimum wage should rise each year by about 7%, reaching €500 by 2020. The current minimum monthly wage is €350 and from July 1 it should rise to €380, so acording to the the TS-LKD plans.
Only the Liberal Movement has not offered a specific minimum monthly wage the party. The party‘s candidate for finance minister Giedrius Dusevičius said it is important to not only concentrate on the minimum wage.
Meanwhile, the Peasant and Greens‘ Union Party member, economist Stasys Jakeliūnas said that the party has not yet confirmed a specific economic election platform, so it is too early to consider what minimum monthly wage could be achieved.
“Purely arithmetically, both the Conservatives and Social Democrats proposals are possible to implement. Given the projected earnings growth of 5-6% annually, €450-500 minimum wage is quite a realistic plan. Of course, it can also be reached through implementation of the necessary reforms to ensure a rapid Lithuanian economy and average wage growth,” said Mauricas.