CHINA / National

China mulls cutting wages in monopoly industries
Updated: 2006-06-27 09:14

China's monopoly industries may be forced to cut their employees' wages as the government looks at reducing the country's widening income gap, the Economic Observer said Monday.

The report said the National Development and Reform Commission (NDRC), the country's top planning body has, in collaboration with other central government departments, worked out a draft document titled "Pushing forward the reform of income distribution".

The document calls for the reform of the salary, fiscal, tax and administrative systems, the report said, quoting Zhang Benbo, a researcher with the Academy of Macroeconomic Research affiliated to NDRC.

The document is still being discussed by stakeholders, Zhang said, adding that strong opposition has made it impossible to set a timetable for the document to become government policy.

High salaries in electricity, telecommunications and other monopoly industries have drawn strong criticism in China, where the gini coefficient, the leading measure of inequality, now stands at 0.46, exceeding the internationally-recognized alarm level of 0.45.

The Political Bureau of the Central Committee of the Communist Party of China has recently met to discuss the reform of the wage distribution system. The meeting called for measures to alleviate the widening rich-poor divide.

Bu Zhengfa, deputy minister of Labor and Social Security, has also lashed out at the high salaries received by workers in the monopoly industries.

At a recent meeting in Beijing, he said the real incomes of people working in for electricity, telecommunications, finance, insurance, water, tobacco and other monopoly industries are five to 10 times higher than in other industries.