Cuba Lifts Wage Limits In New Reform Move
6/12/2008 6:33 AM ET
(RTTNews) – Cuban President Raul Castro's communist government, in one
of the boldest departures from socialism, announced Wednesday it was
scrapping salary caps in a move to improve productivity.
Under a new labor law, Resolution 9-08, ordinary workers will no longer
be subject to wage limits. Those who meet production targets can get a
bonus of as much as 5 per cent of their base salary. Managers' bonus
will be limited to a 30 per cent increase for improving worker-production.
Vice minister of labor and social security, Carlos Mateu said in an
interview with the Community Party daily Granma that all state
enterprises have up to until August to eliminate salary caps. He said
the salary system should be seen as a tool to help obtain better results
in terms of output and services.
From now onwards, no longer will all Cuban workers doing the same job
receive the same pay. People who perform better will get more – and
those who offer quality service will be rewarded, he said.
The new wage policy, which was adopted in February, is the latest
unveiled by the government following changes made to land redistribution
and decentralized farming.
The move contradicts the idea of an egalitarian society long advocated
by ailing 81-year-immediate past President Fidel Castro, who was
officially replaced by younger brother Raul in February.
The average salary of a Cuban worker is about $20 but most Cubans
receive free housing, education, health care and subsidized food. Still,
many Cubans struggle to make both ends meet when food, clothing and
personal care goods are sold only in government-run hard-currency stores.
Since February, Raul has allowed Cubans to buy computers, own mobile
telephones, rent cars and spend nights in hotels, previously only the
privilege of foreigners. He has also implemented reforms that give
farmers better pay and more flexibility to buy farming equipment, a move
designed to lessen the impact of the world food crisis.
Many Latin Americans have welcomed Raul Castro's reforms, but Cuba's
greatest foe, the United States, has dismissed them as "cosmetic."