Raise wages, not prices

From July 1, 2024, cadres, civil servants, public employees, and armed forces will have their salaries increased by adjusting the basic salary from VND 1.8 million to VND 2.34 million/month (an increase of 30%). In addition, pensioners and social insurance beneficiaries will also receive an additional 15%. These are the highest increases ever, demonstrating the attention of the Party and State, the great efforts of the Government, and contributing significantly to improving the lives of wage earners as well as those who are receiving allowances, subsidies, and other policies associated with the basic salary. From here, income from wages has increased significantly.

But there is a big worry that if wages increase, the prices of goods will increase massively if not managed well. This makes the wage increase almost only increase the amount of money in the account, not improve the living standards of workers. Because if prices increase, the purchasing power of money decreases, so the wage increase is often just a form to compensate for inflation. To make the wage increase truly meaningful, the first thing to do is not to let the prices of goods "follow the rain".

The problem at present is to have reforms, direction, and management of the macro and micro economy to control prices.

In fact, the phenomenon of “following the flow”, taking advantage of wage increases to increase prices of goods without any rules, simply because workers get a pay increase is real. This phenomenon needs to be corrected.

It can be said that this salary increase is the best immediate solution, meeting the needs of cadres, civil servants, public employees, and workers receiving salaries from the state budget. To be more precise, this is the highest basic salary increase ever, up to 30%. However, if salary reform is not carried out, the basic salary increase will not be accompanied by an improvement in the quality of life of workers. This is only a temporary solution. The Government still needs to continue to direct research and prepare the necessary conditions to implement salary reform at the appropriate time.

In my opinion, salary reform has many advantages, ensuring fairness, science, and approaching the salary calculation method of many advanced countries in the world. However, to change the salary calculation method with a truly radical change, there must be many accompanying conditions, especially conditions on resources and institutional reform. This is a long-term problem. To implement it, in addition to saving, many other solutions are still needed to improve labor productivity, increase income, so that the average annual GDP index increases higher, not just simply how much money we can save to implement salary reform...