Whether the national minimum daily wage (NMDW) will increase to Nu 450 as pledged by the government has still not been decided, according to Layog Lyonpo (Labour Minister) Karma Dorji.

During his first question hour at the National Assembly yesterday, Lyonpo said that the review of the NMDW will be completed early next year. “Whether it is raised will depend on the study results.”

In 2011 it was raised to Nu 100. The most recent revision in 2014 increased it to Nu 125 a day.

Phuentshopelri-Samtse Member of Parliament Ganesh Ghimiray said that it was high time the NMDW be revised, given the high inflation rate since the Covid-19 pandemic.

The average inflation rate measured in Consumer Price Index (CPI) was 8.24 percent as of July this year, 5.63 percent in 2020 and 2.73 percent in 2019, according to the National Statistics Bureau (NSB).

Layog Lyonpo said that attempts to revise the minimum wage were made in 2017 and 2020. “The past revisions were based on the national poverty index and inflation rate, which have been found not to be applicable.”

In 2011, the wage was revised based on the inflation rate. In 2014, it was revised based on the national poverty index (NPI) and inflation rate. In 2017, the suggested NMW based on NPI and inflation rate amounted to Nu 117, lower than Nu 125. In 2020, it was worked out based on the international practices, which came to Nu 917.

Lyonpo said that the ministry is working on the review, basing it on workers’ productivity, whereby salary will be topped-up with 39 percent of the worker’s productivity.

Lyonpo also said that even without the wage revision, employees in the private sector earn above Nu 450 a day, those in the construction sector earn about Nu 700, and the Bhutan Schedule of rates is Nu 460.

“It is important to revise the wage holistically, as there are chances employees in shops and restaurants could lose jobs with the revised wage, as they currently earn about Nu 230 a day,” Lyonpo said.