A living wage will bring to the real

Ukraine is going to completely redefine not only the size of a living wage, but the methodology for calculating this indicator.

Прожиточный минимум хотят приблизить к реальному

This was discussed at the parliamentary hearings on the theme “problems of formation of the subsistence minimum in Ukraine”, writes Today.

The authorities seem to have to recognize another kind of a living wage is real. Thus, social policy Minister Julia Sokolowski admitted during the parliamentary hearing even the actual subsistence minimum (UAH 4218) at this time is calculated according to a long-outdated methodology and without taking into account important social and medical science-based standards.

It is necessary not only to use the “correct” price. You must also change the range of products and services that are included in the consumer basket of Ukrainians and on the basis of which, in fact, calculated the size of the subsistence minimum.

As stated during the hearings in the Verkhovna Rada Vice-speaker Elena Kondratyuk, “poor people, according to UN standards and the European Union, to include not only those who have meager earnings. Poverty in the modern sense is the availability of a number of basic social, medical and IT services, automobiles, mobile, washing machine, computer, etc.”

She noted that the poor are those people who spend the most money on food, pay rates, living paycheck to paycheck, with no ability to save for large purchases and unexpected expenses.

Today in the consumer basket of Ukrainians and, accordingly, in cost of living does not include the cost of mobile phones, the Internet, even on such usual things like washing machine and vacuum cleaner.

Meanwhile, in European countries the situation is quite different. For example, in the UK the consumer basket includes even the tickets to the football and gardening, and in France – cosmetics, buying food for Pets, visiting beauty salons.

With regard to the structure of spending of income in economically developed countries the share of food is quite small.

For example, in the United States is spent on food, an average of 6.4% of their monthly income in Canada – 9.1 per cent. In Kenya and Cameroon, which is considered one of the most underdeveloped States, people spend on food is 46.7 and 45.6% of revenues. In our country, according to the state statistics service, the average family devotes to food, 49.4% of income (latest data for the first half of 2019). About 17% of income goes to utilities.

We will remind, in the budget 2020 envisages raising the minimum wage only 550 UAH. Planned increase should take place in stages: in January, July and December.