CUBA: Slight Wage Increase for Health Workers and Teachers

By Dalia Acosta Reprint | | Print |

Dalia Acosta

HAVANA, Jun 24 2005 (IPS) - Some 860,000 teachers and health care workers in Cuba will be granted a raise as of Jul. 1, although it will be "modest", in the words of President Fidel Castro.

The average monthly increase will amount to 57 Cuban pesos in the public health sector and 43 pesos in education – both of which are equivalent to less than three U.S. dollars.

Two currencies are used as legal tender in Cuba: the regular peso and the – convertible peso" or CUC, which was created in 1994 as a substitute for the U.S. dollar in internal transactions. The CUC and dollar were used interchangeably until late last year, when the U.S. currency was removed from circulation on the island.

At the current exchange rate, adjusted earlier this year, the U.S. dollar is worth 80 cents of a CUC, and 25 pesos are needed to purchase one CUC.

Cubans receive their state salaries and pensions in regular pesos, which they use to pay the low utility rates and to buy a very limited amount of low-cost rationed food items. Regular Cuban pesos can also be used to buy products in the farmers’ markets that opened in the mid-1990s and operate according to the laws of supply and demand, as well as in stores that sell a limited range of consumer goods and food products in Cuban currency.

The CUC, meanwhile, provides access to a much broader range of often essential goods and services, including food, clothing, footwear, and personal hygiene and household products.

Government sources estimate that 60 percent of Cuba’s population of 11.2 million has access to dollars, mainly through remittances from relatives living overseas, but also through work in tourism-related or other activities.

In a six-hour round-table discussion broadcast live Thursday night by two of Cuba’s four TV channels, Castro said "socialism that does not reach everyone is inconceivable," and ensured that the government would continue working to improve the current wage system in order to make it more just and to guarantee that salaries are in line with professional achievements and skills.

The wage raise, which has been demanded by teachers and public health workers since the early 1990s, was presented as part of a broader state effort to upgrade the educational and health systems that provide free coverage to all Cubans.

Since the January 1959 triumph of the revolution led by Castro, Cuba’s health and education systems have been touted as the socialist government’s main achievements.

But both sectors were hit hard by the severe economic crisis that broke out in the early 1990s when the Soviet Union fell apart and Cuba lost its main aid and trade partners in the former East European socialist bloc.

"This was a long-standing demand," a high school teacher told IPS. "No one even knows how many good teachers turned to other occupations because of the low salaries, the poor conditions in the schools, or transportation problems."

One of the consequences of the "dual economy" created through the legalisation and subsequent free circulation of the U.S. dollar – a measure adopted in the 1990s to alleviate the effects of the economic crisis – was the emergence of extreme asymmetries in income and a so-called "inverted social pyramid".

Hotel doormen, taxi drivers, and others who work in the tourism sector, and thus have access to dollars, can make as much in a day as a doctor or other state-employed professional earns in an entire month.

The exodus of workers also affected the public health sector, to the point that Cuban authorities were forced to adopt severe measures to regulate movements of workers into other sectors of the economy and to restrict the temporary or permanent departure of health professionals from Cuba.

In Thursday’s television appearance, Castro analysed widespread complaints like the shortage of medicines, reports that some doctors insist on being paid in dollars ôunder the table" for their services, and the quality of education in general.

Salary increments based on seniority and higher salaries for supervisory or directorial positions will be maintained in the educational sector, while the additional amount paid to those who have a masters’ or doctoral degree will go up to 80 and 150 pesos, respectively.

In education, the raise will only apply to teaching staff, at the primary, secondary and tertiary levels, but in public health the increase will go to all technical, administrative and service staff, as well as the health professionals.

The highest-paid health professionals will be specialist doctors, whose salaries will rise from 575 to 627 pesos a month, while both nursing and service staff will see their salaries increase from 225 to 315 pesos a month.

Wage rises began to be gradually implemented in Cuba in 1999. According to Minister of Labour and Social Security Alfredo Morales Cartaya, 1.8 million Cubans benefited from these increases between 1999 and 2004.

In addition, this year’s increase in the minimum wage, from 100 to 225 pesos a month, benefited more than 1.7 million people, and more than one million retirees saw their pensions expand.

However, an economist consulted by IPS said the raises are necessary but not sufficient, given the extraordinary rise in the cost of living on the island since the early 1990s.

A survey conducted in Havana at the start of the decade found that an average family of four would require seven times the average salary – which is roughly 260 pesos, equivalent to 10 dollars a month – to meet their basic needs.