21 Dec 2023

Government has taken a decision to adjust minimum wage rates for employees in applicable sectors effective February 1.

Speaking in Parliament on Wednesday, Minister of Labour and Home Affairs, Ms Anna Mokgethi said the decision was to cater for inflationary adjustment and the ever-increasing standards of living.

In that regard, Ms Mokgethi said for the financial year 2023/24, the minimum wage rates would increase in all industries by 23.5 per cent except the agricultural and domestic sectors, which will increase by 38.4 per cent to P1500 per month.

Applicable sectors include building, construction, exploration and quarry industries, wholesale distributive trade manufacturing, services and repair trades, hotel, catering and entertainment trades, garage, motor trade and road transport, retail distributive trade, watchmen employed in the above industries and trades or any sector thereof and security guards employed by security companies.

“I am convinced that an adjustment to the minimum wage rates is necessary to cater for inflation and increasing cost of living while restoring the workers purchasing power,” she said.

She said the statutory hourly minimum wage rates were last adjusted by 8.4 per cent across the board for industries other than that of the agricultural and domestic sectors, which were adjusted from P1 000 to P1 084 per month in 2022.

"The alignment of the statutory minimum wage rate for the retail distributive trade with other sectors with an initial once-off increase of 12.75 per cent to adjust the hourly rate from the current P6.51 to P7.34 will subsequently be increased 23.5 per cent like other sectors," she said.

She said the adjustment was an interim measure, pending a comprehensive review of the minimum wage rates to address all prevailing challenges and gaps.

Ms Mokgethi indicated that the envisaged comprehensive review would also categorise the various sectors of the economy taking into cognisance the uniqueness of sectors and their performance.

She said the decision to adjust minimum wage rates was taken with the advice of the Minimum Wage Advisory Board after consultations with relevant stakeholders.

She explained that the board could not recommend sectoral adjustments of the minimum wage rates pending proper assessment of sectors.

"In recommending any adjustment or abolition, the board considers among others, the needs of employees and their families, cost of living, the general level of wages in the country and desirability to eliminate discrimination between sexes regarding wages for equal work," she said.

She admitted that the cost of living for average workers and their families had gone up due to the increase in the Food Consumer Price Index, which accounts for one of the largest weights in Botswana Consumer Price Index after the Transport Price Index.

She said while inflation in the current financial year was low and projected to remain within the Bank of Botswana medium-term objective range of 3-6 per cent, the real incomes had deteriorated due to the previous inflationary environment caused by supply chain disruptions from global geo-political tensions.

Ms Mokgethi said such led to the need to strike a balance by adjusting the current minimum wage.

"The minimum hourly wage rates were increased by an average of 10 per cent between 2019 and 2022 while the basic commodity prices increased by over 50 per cent over the same period. So there is a need to promote decent work and decent wages," she said. Ends