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July 1, 2010

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Home » Opinion » Chinese Views

China may cap pay of state monopoly bosses

Source: Xinhua | July 1, 2010, Thursday | Print Edition

CHINESE authorities are considering capping salaries - especially those of top executives - at profitable state-owned monopolies as part of government efforts to narrow the widening wage gaps between the rich and poor.

The Ministry of Human Resources and Social Security (MHRSS) said in a report that it would map out specific measures to "strictly control" the total payments distributed at state-owned monopoly businesses.

The report, written after a working group from the Standing Committee of the National People's Congress (NPC), China's top legislature, contained proposals on the enforcement of the country's Trade Union Law.

It did not spell out the upper limit of payments.

In China, the monthly salary for an average employee at state-owned monopolies, such as telecommunications and natural resources, could be three times as high as pay for those working in the private sector, most of whom earn around 3,000 yuan (about US$440) per month.

This widening gap has resulted in some public complaints and driven millions of college graduates to seek jobs at state-owned monopolies, where employees are assured of better health care insurance and a more stable income.

To establish a "normal wage growth mechanism" the ministry said in its report it would continue to address wage gap problems by putting "a ceiling on high-income, expanding the medium-income class and ensuring minimum wages."

The ministry would also continue to push for the establishment of a mechanism that grants workers more decision-making power in formulating salary policies and allows their wages to fluctuate in line with the ups and downs of businesses, according to the report.

It said the income of executives, especially those in the senior ranks, in centrally administered state-owned enterprises should be regulated and authorities should ensure minimum wage standards be altered in a reasonable and timely manner.

The Standing Committee of the NPC assigned a working group to review the enforcement of the country's Trade Union Law from July to August last year.

Based on investigations and research, the working group made proposals on the implementation of the Trade Union Law.

The MHRSS, in collabora-tion with the ministries of commerce and health, the All China Federation of Trade Unions, as well as the Legislative Affairs Office of the State Council, or China's cabinet, made the report based on these proposals.

The report was then submitted to the State Council and forwarded to the top legislature at the 15th session of the Standing Committee of the 11th NPC, a four-day meeting that ended last Friday.

Copies of the report were distributed to members of the NPC Standing Committee during the meeting.



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