LFMI news and activities: 2012 January

The first month of 2012 has brought some good news for the Lithuanian Free Market Institute. For the fifth year in a row we have been recognised as one of the best think tanks in Central and Eastern Europe. This year we were ranked 13th among 537 public policy institutions in Central and Eastern Europe. We are very happy to share this news with you and we thank you for trusting us. This recognition is a result of cooperation with all our friends, colleagues, and supporters.

Another piece of good news is that the Ministry of Social Security and Labour advised the Government to not approve the automatic increase of minimum wage. In December LFMI has warned that if minimum wage were calculated as 50% of the statistical average wage, this would ensure a regular increase of minimum wage without any regard for the economic situation or the capabilities of businesses. After this question was discussed in the Government, Prime Minister Andrius Kubilius stated that, in his opinion. „it‘s too early to talk about raising the minimum wage by tying it to the average wage in such a difficult economic situation“. The Tripartite Council has postponed the discussion on this question.

It is good that the decision makers listen to our arguments and are starting to doubt if the businesses, especially small and medium enterprises, could afford to pay substantially higher minimum wage. It is also very important that the policy makers are starting to take into account – and we have been stressing this for several years – that when comparing minimum wage in Lithuania and other countries, it is necessary to compare the ratio of minimum wage to average wage. When these ratios are compared it turns out that the level of the minimum wage in Lithuania is comparable to that in the EU and other developed countries.