KYIV, Ukraine—A new law ensuring minimum living wage and salary, adopted by the Ukrainian Parliament on Tuesday, has stirred conflict in Parliament over the financing of the law. Opponents of the law have called on Ukrainian President Victor Yushchenko to veto the law.
The law aims at establishing a minimum living wage and minimum salary that will provide adequate social protection for every citizen of the Ukraine in the current period of economic crisis.
The minimum salary is planned to start in November this year at 701 Ukrainian hryvnia (US$85) per month, with a monthly raise up to 875 hryvnia (US$107) in December 2010.
A total of 254 out of 429 MPs voted in favor of the law. With 172 of its deputies voting in favor of the law, the Party of Regions has showed the greatest interest in the law's adoption.
The Party of Regions say they plan to raise social standards through using the money given by the International Monetary Fund (IMF).
“The government has received 10 billion dollars. It is waiting to get five billion more. ... What money does it need?” said Alexander Peklushenko, parliament member of the Party of Regions after the parliamentary session.
Deputies from the Yulia Tymoshenko Bloc, Ukraine’s leading political force led by Ukraine’s Prime Minister Yulia Tymoshenko, have appealed to the president of Ukraine Viktor Yushchenko to veto the new law.
The oppponents of the law doubt that the IMF will allow the use of its funds to improve these standards.
“The Fund can’t provide funds for such purposes. The IMF does not [allow] such a practice,” said Ivan Kirilenko, member of parliament of Prime Minister Yulia Tymoshenko’s Bloc.
Head of Parliament Volodymyr Lytvyn, visiting London, commented through his press office on the adoption of the law. “I am convinced that there is nothing to comment, but [we] should carry out this law. For all agree that people cannot survive, receiving meager salaries and the same meager pension.”
The second step now, according to Lytvyn, must be “substantive work on the budget taking into account the embedded options and approaches regarding the state social standards—a living wage and minimum wage.”
No Funds
Earlier, First Vice Prime Minister of Ukraine Oleksandr Turchynov said that the new law is not supported by the right financial conditions. He believes that if the law is adopted, it will lead to the issuing of the Ukrainian currency, the hryvnia, to support the costs.
“It can definitely destroy the hryvnia and unbalance finances in Ukraine,” said Turchynov.
Member of Parliament Pavlo Movchan is of the same opinion. “How can we raise the social standards when there are no resources?" he said. "It is necessary that the National Bank print hryvnia, which means that we tend to hyperinflation. If we devalue hryvnia, we will take a very long time to pick it up.”
The adopted law on social standards enters into force upon signature by the Ukrainian president.
