Ligi: Thousand-Euro Minimum Wage Not Realistic

Jürgen Ligi (Postimees/Scanpix)
6/16/2014 2:20 PM
Category: Economy

Finance Minister Jürgen Ligi expressed concern that failure to reach a benchmark recently mooted by a businessman - a 1,000-euro minimum wage by 2018 - would end up being held against the government.

In an interview with Eesti Päevaleht, Ligi said a media bubble had arisen around Indrek Neivelt's comments, made on ETV last week, and the story was taking on a life of its own. The Cabinet was not operating with the same figures as Neivelt, Ligi said..

"We have made it a goal in the Cabinet and supported the rise in the minimum wage and rise in the tax-free minimum, but one man is simply multiplying it with some coefficient and all theories and others are laughed at," he said.

Ligi said that although Neivelt had emphasized the employers' role in rising wages, the upshot would be that the Cabinet would be blamed for not providing such wage growth.

"There's no point in getting people's expectations up, what we have to instill is that the goal should be improving the quality of life, not a long jump into the future followed by a fall back into the distant past."

Ligi declined to name a year when the minimum wage would reach 1,000 euros. It is currently 355 euros and will still be under 400 euros in 2015.  

The Cabinet has been haunted before by overoptimistic pronouncements, a case in point being then PM Andrus Ansip's mention, years ago, that Estonia could be one of the wealthiest countries in Europe next decade. 

Indrek Neivelt, a bank supervisory board director, made his comments on ETV's morning talk show on June 5, where he expressed concern that Estonia's current practice of small incremental hikes in key indicates, often delayed, would not be enough and that a dramatic policy change was required.  


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