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Jan 11, 2021
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Russians will live. But bad and not for long

Russians will live.  But bad and not for long

Photo: Kirill Kukhmar / TASS

The government has set the value of the subsistence minimum per capita for 2021 – 11,653 rubles. The corresponding decree was signed by the Prime Minister Mikhail Mishustin… For information: in the past year, the cost of living in Russia was not much less – only 11,301 rubles.

It is reported that now the subsistence minimum for the working-age population has increased to 12,702 rubles, for children – 11,303, for pensioners – 10,022 rubles.

Another important change: the cost of living is set for a year, and not for a quarter, as was previously adopted. In addition, from January 1, a new method of calculating the minimum wage began to be applied. Whereas previously the subsistence minimum was calculated on the basis of the cost of products included in the consumer basket, now it depends on the median per capita income. Since the new year, this ratio is 44.2 percent. According to the new methodology, it should be reviewed at least once every five years.

At the same time, the minimum wage cannot decrease even with a decrease in the size of the median salary. Corresponding amendments at the end of last year were prepared by United Russia parliamentarians Andrey Isaev, Sergey Neverov and Andrey Turchak… According to their amendments, the annual establishment of the size of the living wage and the minimum wage should be supported by trade unions and employers.

As the government explained at the end of last year, from January 1, the minimum wage will grow by 5.5 percent (up to 12,792 rubles). And for the first time will exceed the cost of living. Thus, any salary in the country will exceed the subsistence level for the first time. According to the forecast of the Ministry of Labor of Russia, the increase in the minimum wage will affect 3.9 million people.

However, the question of people working part-time or under a civil contract remains open. Which is not subject to labor laws at all. Will their salaries still remain below the minimum wage? But last year the president said more than once that salaries below the minimum wage contradict the Constitution and are unacceptable. In addition, he stressed that the priority of the government’s work in 2021 should be the fight against poverty.

Will it become? Or they will simply report on the increase in the cost of living and the minimum wage. Is that all?

– This is the manipulation of officials on duty, – is convinced the director of the Institute of Freedom, member of the bureau of the political council of the Rodina party Fedor Biryukov… – We need to statistically work somehow to increase the income of citizens. So officials are raising the living wage, the minimum wage (what is his vulgar abbreviation – minimum wage). Then they rummage around in the so-called consumer basket, multiply and divide with the average salary. And in the end, they give out some kind of garbage about income growth. Informational “placebo” in its purest form.

The socio-economic characteristics of Russia allow tens of millions of people to live in poverty, but at the same time, it seems, everything is “like people”. But this is not progress, but the conservation of poverty. Poor citizens do not buy domestic products that are too expensive for them. This weakens the national economy. Truths that are tired of repeating. But the government does not understand them. And as before, it presents to us, instead of a roadmap for a national economic breakthrough, pitiful circulars about the minimum amount of poverty. Ashamed and despicable, gentlemen and ladies from the White House!

“SP”: – What should the government do?

– First: to establish, instead of subsistence and other minimum squalor, a single standard of decent life. This idea, proposed long ago by the Rodina party, was immediately supported by the Federation Council. But then the topic “faded away”. The banking lobby worked.

What to do? And that’s what! Personal loans should not be 20%, but 2%. Reduce the retirement age, personal income tax and other taxes on small and medium businesses. To direct the super-profits of state corporations to ensure the national interests of the peoples of Russia.

“SP”: – Earlier, the President has repeatedly noted that salaries below the minimum wage contradict the Constitution and are unacceptable. Now the government has reported that after the adoption of this law, all wages in the country will exceed the subsistence minimum for the first time. The authorities presented this as their success. Will help in the elections?

– This is just an option that will allow the government to report to the head of state for the work done. The same negligible interest. Meanwhile, oligarchs and corporations have earned billions, hundreds of percent. Bestiality at the expense of the people!

– Honestly, I am surprised that in Russia, which, according to preliminary estimates of the IMF, took the 61st place in the world in terms of GDP per capita in 2020, the cost of living, as in the poorest countries of the world, is calculated based on physiological needs, – says a political columnist for the newspaper “2000” Dmitry Galkin… – It is clear that in order to maintain dignity and lead a normal social life, it is not enough for a person to just be full. You must have at least a little money in order to take care of yourself, at least occasionally go to the cinema or the theater. Therefore, in many countries, including those poorer than Russia, the living wage also includes a social component.

So, in Bulgaria, which in terms of GDP per capita last year took 62nd place, i.e. goes right behind Russia, the cost of living is 308 euros. This is almost 28 thousand rubles, which is two and a half times more than the cost of living in Russia.

However, Russia cannot benefit from the experience of other countries with relatively high incomes. And the point here is not so much the lack of funds for social needs in the state budget, but rather the unacceptably low wages. If we include the social component in the Russian living wage, it becomes clear that the majority of those working in Russia receive wages that are slightly more than the subsistence minimum. And in a number of regions it does not even reach it.

“SP”: – The subsistence minimum is set for a year, not for a quarter, as was previously adopted. What is the purpose of this change? Is it good or bad for citizens?

– It seems to me that the main goal of this innovation is to get the opportunity not to increase the cost of living throughout the year. In the first half of 2021, food prices are expected to rise rapidly. Therefore, the cost of the consumer basket, on the basis of which the minimum wage is calculated, may increase significantly. Therefore, the government decided to insure itself in advance.

“SP”: – In addition, since January 1, a new methodology for calculating the minimum wage has been applied. If earlier the subsistence minimum was calculated on the basis of the cost of products included in the consumer basket, now it depends on the median per capita income. Many experts believe that the introduction of this approach was clearly rushed. Do you agree? Why?

– The method of calculating the minimum wage, based on the median per capita income, is used in countries with high wages. For example, in the United States, Britain and Germany, the cost of living is set at 40% of the median income. And in Finland, Italy and Spain – at the level of 50%. As a result, it is 347 euros in Germany and 540 euros in Finland.

Calculating the cost of living in a country with low wages in this way is possible only if your main goal is to save on social costs.

“SP”: – Now the minimum wage cannot be reduced even with a decrease in the size of the median salary. Is this good or bad for citizens? And how to achieve this in a crisis?

– In the conditions of the crisis, a significant part of the employed will be forced to receive “gray” wages or even work without official registration. Therefore, their income will not depend at all on the size of the official subsistence minimum. Enforcement of labor laws is not difficult, but the government does nothing to achieve this. Therefore, the increase in the subsistence minimum has practically no effect on the real state of the labor market.

“SP”: – And what about people who do not work full-time or are employed not under the Labor Code, but under a civil law contract? Their salaries will still remain below the minimum wage?

– Of course, employers (including state corporations and municipal structures) have long been using this technique in order to avoid higher wages. Workers in villages and small towns often apply for a part of the rate so that they can be paid below the subsistence level. Thus, the salary of a rural postman in many cases is less than 6 thousand rubles.

“SP”: – As noted in the government, after the adoption of this law, all wages in the country for the first time will exceed the subsistence level. Is this progress or so-so? People will really feel the improvement?

– If you set the cost of living at the level of physical survival, then the statistics can be even better. One gets the impression that the Russian government sees its main goal in improving static indicators through various kinds of manipulations. Including – due to unjustified underestimation of the subsistence level. Meanwhile, it is the responsibility of the government to seek real improvements in living standards.

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