CHP Chair Kılıçdaroğlu proposes dollar-indexed minimum wage in Turkey

* Photo: CHP

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Main opposition Republican People's Party (CHP) Chair Kemal Kılıçdaroğlu attended his party's launching ceremony for the "Family Supports Insurance" in İstanbul yesterday (December 14).

Introducing the new insurance model to the public, he also talked about the minimum wage, which has not yet been determined for the next year. "If they are to determine the new minimum wage, they should pay the equivalent of 384 [US] dollars in Turkish Lira," he said.

Noting that "there will be a food crisis in the country in upcoming days," CHP's Kemal Kılıçdaroğlu briefly said:

Turkey cannot be governed, it is drifting away. The minimum wage will be determined these days. This is the lowest wage with which a family can make ends meet. The net minimum wage in January 2021 was 2,825 lira, which was 384 dollars when calculated according to the then current exchange rates (it is 198 dollars today). As you know, they say, 'Turkey is at full gallop.' If they are to determine the new minimum wage, they should pay the equivalent of 384 dollars in Turkish Lira.

Further in his statement, Kılıçdaroğlu also announced that they, as the CHP, will establish the Family Supports Insurance Institution.

Noting that they will bring all types of support under the same roof, Kılıçdaroğlu said, "We will prevent extravagance. We will end arbitrariness in practice. In a way befitting human dignity, we will bring the Family Supports Insurance into life." Stressing that they will never accept that poverty is put on display, he said, "If there is a poor person in this country, the ones who govern the country are responsible, not women or men."

Facts about minimum wage in Turkey

The economic crisis going on since 2018, the losses of job and income due to the pandemic and the recently spiking prices have decreased the purchasing power of workers, making the high prices and the difficulty in making ends meet one of the most important social problems.

Turkey is one of the countries with the highest number of working hours among the OECD countries; however, workers cannot get their share from the economic growth or increasing production.

The minimum wage is currently under the starvation line in Turkey. There is a huge gap between the net minimum wage (2,825 TRY) and the starvation line, which currently stands at over 10 thousand TRY.

With the depreciation of the TRY, the minimum wage has hit the lowest point in the last 15 years when calculated in US dollars.

Minimum wage has also ceased to be the lowest limit of wages and turned into an average wage. Compared to European countries, Turkey is the country with the highest rate of minimum wage earners.

Moreover, a high amount of taxes and pay cuts are collected from the minimum wage. In 2021, the amount of taxes and cuts was over 750 TRY in total. As a result of the indirect taxes paid by workers, the net spendable amount of the minimum wage is getting more and more meager.

Minimum wage in Turkey over the years

Following the minimum wage talks last year, the minimum wage was increased by 21.56 percent. With this pay rise, the minimum wage was increased to 2,825.90 TRY for an unmarried worker.

After the minimum wage talks the year before, the minimum wage was increased by 15.03 percent, which was 3 points higher than the official consumer inflation rate announced by the TurkStat.

Accordingly, with this pay rise, the minimum wage was increased from 2,020.90 TRY to 2,234.70 TRY for an unmarried worker.

As for the net minimum wages in Turkey in the previous years, it was 1,603 TRY in 2018, 1,404 TRY in 2017 and 1,300 TRY in 2016. While the net minimum wage was 949 TRY as of January 2015, it was increased to 1,000 TRY as of July 2015. While the net minimum wage was 773 TRY and 803 TRY as of January and July 2013 respectively, it was then increased to 846 TRY as of January 2014 and to 891 TRY as of July 2014.

How is the new wage determined?

The pay rise to be made in the monthly minimum wage next year is decided by the Minimum Wage Determination Commission headed by Turkey's Minister of Labor and Social Security.

The commission consists of 15 members: Five members are appointed to represent the government, five people by the Turkish Confederation of Employer Associations (TİSK) and five people by the TÜRK-İŞ, the largest labor confederation of the country, to represent the workers.

While the majority of votes of these 15 members is enough in determining the minimum wage, the first meeting is held at the Ministry, the second and third meetings are hosted by the representatives of employers and workers respectively and the fourth and last meeting is again held at the Ministry.

In the event of a tie in the final vote, the vote of the commission chair determines the new minimum wage.

(HA/SD)