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By Harlyne Joku

PORT MORESBY, Papua New Guinea (January 30, 2001 - The National/PINA Nius Online)---Papua New Guinea's Cabinet is likely to rescind the Minimum Wages Board's decision to raise the minimum wage by 160 per cent to K 60.42 a week (US$ 19.28), an aide to Prime Minister Sir Mekere Morauta said.

And in a statement confirming this, Sir Mekere said that the National Executive Council (NEC) will be considering the recommendations of the recent national wage case.

The board's decision on the raise was published in the National Gazette on January 11, which made the new minimum wage rate applicable to all employers and employees.

But the Prime Minister said decisions such as the recent one by the Minimum Wages Board are of national importance and must be considered by Cabinet.

Sir Mekere further said that a submission relating to the increase was being prepared and would go before the NEC soon.

"Until Cabinet has made a decision, the national wage case recommendations remain just that -- recommendations.

"There are two important factors to be considered, the interest of the workers and the interest of the nation," Sir Mekere said.

The Prime Minister added that these interests must be balanced so that everyone benefits as much as possible without causing further harm to the country's already fragile economy.

The Prime Minister's aide said that the gazetting of the Minimum Wages Board's decision has not been accepted by Cabinet, therefore recommendations have been made for the board's decision to be rescinded.

The National last Friday reported several top business executives as saying that the PNG economy would be devastated in a matter of weeks after the gazetting of last month's decision by the Minimum Wages Board for a 160 percent hike.

Also reported was the Employers' Federation's move to seek an interim order to delay the implementation of the new wage, and its application to the Industrial Registrar for a judicial review of the decision.

A check with several nationally owned companies, including security firms, showed that the companies were already suffering as a result of the decision.

Johnson Tolabi of Tolabi Security said the decision was bound to affect most of the security firms, which would be cutting down on the number of guards because it would be too costly to maintain them.

Mr. Tolabi said he was considering laying off between 20 and 30 guards because he could not afford to pay them the new rates. He said similar action would be taken by most security firms nationwide in relation to the board's decision. The decision would cause a chain reaction and affect the private sector as well as the welfare and well being of families of workers who would be laid off.

For additional reports from The National, go to PACIFIC ISLANDS REPORT News/Information Links: Newspapers/The National (Papua New Guinea).

Pacific Islands News Association (PINA) Website: 

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