After numerous promises by different governments to set a maximum wage for public-sector employees in recent years, promises which have never materialised, the interim government last week set the country's maximum wage at 35 times the minimum wage for employees working in the public sector. According to the governmental decree, the new maximum wage will be implemented starting in January 2014 with a ceiling of LE42,000 per month. However, the mechanism of implementation was not announced, and the government has tasked the ministers of finance and administrative development with setting appropriate measures to apply the new wage limit. The government said that setting a maximum wage was part of its economic programme and followed the minimum wage, set in September at LE1,200 per month. The new minimum wage will also be implemented in January. The new wage limit is not applicable to all public-sector employees. While it will be applied throughout the administration, no decision has yet been made on whether it will be applied in public banks and companies and in the petroleum sector and other economic entities. Farag Abdel-Fattah, a professor of economics at Cairo University, praised the decision, saying it was a positive step towards achieving social justice, which was a core demand of the 25 January Revolution. However, he said that the new measure should be followed by additional steps, and he was in favour of a gradual approach in applying it. Abdel-Fattah said that the wage cap could start to be applied in the administrative apparatus and then be extended to other public-sector bodies, such as public banks and companies. “If we want to achieve social justice, this entails applying the maximum wage to everyone,” Abdel-Fattah told Al-Ahram Weekly. While he applauded the decision, he also said that the decision to set the maximum wage at 35 times the minimum wage had set it too high, and that it should have been set at between 25 and 30 times the minimum wage. He added that the government should reconsider the number of consultants it had hired during the rule of ousted former president Mohamed Morsi, saying that this had led to a waste of public resources and should be rationalised. Regarding implementation, Abdel-Fattah saw no difficulty in applying the maximum wage to government employees, but he feared that some might resort to various manoeuvres in order to avoid the new wage cap. Abdel-Fattah Ibrahim, head of the Egyptian Trade Union Federation (ETUF) which has roughly six million members, also praised the new wage cap, saying that the decision epitomised Egypt's revolutions as it would help in achieving social justice and bridge the social income gap. Implementing the maximum wage in the government administration will save some LE2 billion per year, but if it were to be applied throughout the public sector this could lead to savings of some LE20 billion. Public-sector salaries comprise nearly a quarter of all government expenses, and they have grown from LE86 billion in 2009/10 to LE171 billion expected in 2013/14, or a whopping 98 per cent growth in five years. According to official data, the number of employees in the public sector increased by two per cent in 2012/13 to stand at 5.54 million compared to the 5.43 million one year earlier. A public-sector maximum wage has been a pressing and controversial issue since the 25 January Revolution. Setting fair minimum and maximum wage limits has been a prime demand of the revolution that consecutive post-revolutionary governments have failed to achieve. In December 2011, the Supreme Council of the Armed Forces, the de facto ruler of the country at the time, issued a decree which set a national maximum wage at 35 times the minimum wage in the public sector, putting this at LE50,000 per month. In April 2012, the now-dissolved People's Assembly approved a draft law which also set the maximum monthly wage at LE50,000. Wage disparities in the country's public sector are striking. While some workers receive a little over LE700 per month, others in senior posts may receive more than LE1 million. Despite the fact that the difference between the basic salaries of junior and top-level public administration employees is about one to five, allowances and bonuses for top officials are theoretically unlimited.
