The Government Will Decide on the Amount of Minimum Wage

The proposal for the minimum wage law, under which the amount of the minimum wage would be determined by the Government through a regulation, was accepted today at the Government session, where it was emphasized that this proposal is made with the aim of maintaining workers’ standards.

Minister of Labor and Pension System Mirando Mrsić reminded that they identified several problems in the implementation of the law from 2008 and that the system needs to be organized differently, which, he says, is also agreed upon by social partners.

– The Government should determine the amount of the minimum wage by regulation, immediately before the adoption of all other parameters, such as the state budget at the end of the year, in consultation with social partners – said Mrsić.

He stated that they also considered the problems in certain industrial branches due to low accumulation, so they legally provided for the possibility that collective agreements could stipulate a lower level of minimum wage that cannot be less than 95 percent of the amount applicable to other employees in Croatia. Therefore, the Government will, after the adoption of this law, also adopt a regulation on the minimum wage for 2013 and all subsequent years.

– We believe that in this way we will protect workers’ standards and not allow the minimum wage to fall below the poverty line – said Mrsić. The Government also proposed an amendment to the Law on the Croatian Bank for Reconstruction and Development (HBOR), which increases the number of members of the Supervisory Board of HBOR from nine to ten, specifically for the minister responsible for regional development and EU funds.

– In the coming years, we aim to channel the largest part of Croatia’s share in financing projects through HBOR, and I think we need the minister for that – said Finance Minister Slavko Linić, adding that this will be the Minister of Entrepreneurship and Crafts.

Minister Linić also presented data on audits conducted in 2011, as well as the annual report on state aid for that year. According to him, out of 447 financial audits, only 22.6 percent received an unconditional rating. This means, he said, that there were many shortcomings and that more attention must be paid to public money.

He reported that in 2011, the state paid more than nine billion kuna in aid, which constitutes 2.7 percent of GDP, while the EU average is one percent, and in the eurozone, it is 0.5 percent. This, he emphasizes, is one of the main reasons for the high budget deficit and an indicator that a different approach must be taken towards sectors such as shipbuilding, railways, and agriculture.