Following the presentation of two bills in Congress seeking to declare the increase in the minimum wage in Peru to be of national interest, various authorities from competent bodies on the subject have spoken out. One of them was the Minister of Labor, Daniel Maurate, who considered that the increase in the minimum wage should be discussed for political and not technical purposes.
Another of those who criticized these initiatives was the president of the Central Reserve Bank (BCRP), Julio Velarde. He stressed that the establishment of the minimum wage in our country is the responsibility of the Executive Branch, since it consults with a specialized commission to make a balanced decision. Let us remember that the National Council of Labor and Promotion of Employment (CNTPE) is in charge of institutionalizing its calculation and approving a final proposal.
Minimum wage increase in 2024: How much does Congress propose to raise it to?
The minimum wage in Peru was last increased on May 1, 2022 during the term of former President Pedro Castillo, from S/930 to S/1,025. Since then, the National Labor Council (CNTPE), a space that brings together the State, business associations and trade unions, has not been able to reach a consensus on a formula for its technical review.
Given this situation and despite the fact that it is not part of its powers, two bills have been presented by Congress to declare the increase in the minimum wage in Peru, which is currently set at S/1,025, to be of national interest. The first proposal by legislator Gustavo Cordero Jon Tay seeks to raise the minimum wage from S/1,025 to S/1,500, while the second initiative by Waldemar Cerrón proposes automatically adjusting this amount to 30% of the Tax Unit (UIT). In other words, to S/1,545.
Both bills have been referred to the Economy and Labor committees of Parliament, chaired by César Revilla and Pasión Dávila, respectively. Their discussion will take place when parliamentary activities for the 2024-2025 legislature, scheduled for the end of July, resume.
What did the Minister of Labor say about the projects to increase the RMV?
In repeated statements to the media, the Minister of Labour, Daniel Maurate, has stressed the importance of the increase in the minimum wage being based on technical criteria and not only on political considerations as proposed by Congress. According to the head of the MTPE, any adjustment in the minimum wage is conditional on the recovery of the economy and must be the result of an exhaustive analysis that considers several indicators.
“The idea is that it should be a consensus between employers and workers and that it should not be a political decision, much less a populist decision. There should not be an increase in the minimum wage from a political point of view, but rather a technical one,” he mentioned during a press conference.
Finally, he insisted that he is not against a possible salary increase; however, he pointed out that this matter should not be taken lightly, since “it is linked to the country’s economic growth.” He stressed that in April there was a significant increase that was not mainly due to mining, but to other drivers of development.
“If we continue to grow, the second half of this year will be a good time to discuss the increase in the minimum wage at the National Labour Council,” he said.
Increase in the minimum wage: what is Julio Velarde’s position?
Regarding the legislative proposals promoted by Congress to increase the RMV, the president of the Central Reserve Bank (BCRP), Julio Velarde, agreed with the Minister of Labor that a possible increase in this basic income should be addressed from a technical, rather than a political, perspective.
“What we have always sought is to have clear criteria for increasing the minimum wage, so that it is not a political decision. And every two years, or whatever period is established, it is adjusted. More than before elections or for political reasons. So that it is more predictable. Also, looking at what happens in the labor market,” he said a few days ago during the presentation of the June inflation report.
Finally, he recalled that Congress “is not responsible for setting the minimum wage, since the Executive Branch, through the Ministry of Labor, is responsible for consulting with a commission.”
By how much would the minimum wage increase in Peru?
Since 2003 to date, the minimum living wage has increased by S/615. The last time this amount was modified in our country was in May 2022 during the government of former President Pedro Castillo, when it went from S/930 to S/1,025. Although President Dina Boluarte announced the increase in the RMV in July of last year, this issue does not seem to be a priority on the agenda of the National Labor Council.
However, it is necessary to highlight that since 2007 there has been a technical review mechanism so that the percentage increases of the RMV in a given year are equivalent to the sum of inflation and the percentage change in average labour productivity in the previous year.
Source: Larepublica
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