Organised labour, made up of trade unions from both the public and private sectors have expressed worry about the rising cost of living which has reduced real incomes.

Real wage has declined since 2012 and the group want government to immediately address the challenge.

Reviewing the 2021 Mid-Year Budget, General Secretary of the Ghana Trades Union Congress, Dr. Yaw Baah said in analysing from inflation and exchange rate perspectives, workers real incomes based on the minimum wage have taken a nose dive.

For instance, he said real wage index which stood at 3.93% in 2012 declined to a low 3.16% in 2020. Real wage index was 3.87% in 2013 but dipped to 3.35% in 2014 and further to 3.23% in 2015. It again went down to 3.03% in 2016, but remained unchanged at 3.03% in 2017, and rose to 3.06% in 2018 and then to 3.1% in 2019.

Dr. Baah pointed out that the cost of living has surpassed income levels, saying, job losses, reduce pay and wage awards below inflation has occasioned suffering.

He therefore urged government to support the citizens to reduce the suffering, whilst immediately raising the income tax-free threshold to give relief to workers and families.

He however government to be aggressive by capturing the many rich people who are not paying the actual taxes to do so.

“VAT is an indirect tax and is regressive, so it is a tax that once you buy something it doesn’t matter how rich you are - whether you are poor or rich; that is why we are saying it is regressive. So what we are asking government to do is that over the next medium term, we should make efforts to make sure that everybody who has to pay taxes pay taxes…that is expanding the net.”

“It is right for government to make sure that all those who have to pay taxes pay taxes. At the same time, over the next few years or so we should be able to move our attention from indirect taxes which is regressive which punishes especially poor people to direct taxes, where people pay tax based on their earnings”, Dr. Baah further stated.

On the constant review of petroleum prices Dr. Baah called for the suspension of the Automatic Adjustment Formula, whilst eliminating “nuisance” taxes and levies on fuel.

Organised labour wants reform of BoG regulation

Dr. Yaw Baah also called for a reform of the Bank of Ghana to strengthen its regulation vis-à-vis supervision and monitoring in order to prevent bank failures, going forward into the future.

It expressed unhappiness that despite about ¢22 billion spent to clean up the banking space, what triggered the collapse have not been addressed, particularly the perpetrators who are still walking free.

“If you look at how much money we've spent to make sure the banks are clean, we should never make a mistake by going back to that state, therefore the Bank of Ghana itself must have to be reformed so that its supervision, regulation and monitoring is superb.”

“If we don’t do that, the risk of going back to the state which warranted the reform, we could get back there. We expect that government will do what is right. if people are found to be culpable and given how much money government has spent in reforming the banks, it is only right that people who were responsible are punished”. Dr. Baah added.   

Further details are needed on one million jobs

Government in the Mid-Year Budget Review announced the establishment of a Youth Bank dubbed “YouBanC” to revitalise the economy and create more job opportunities.

It therefore stated a strategy to create job and business opportunities for one million Ghanaian youth by 2024, through programmes including the establishment of “YouBanC”.

To this end, organised labour called for further details on the policy.

The details it wants include sector by sector analysis, region by region study that is equitable distribution with priority attention to the newly created regions and decent jobs contributing to social security and PAYE.