The Tribune

By FAY SIMMONS 

Tribune Business Reporter 

jsimmons@tribunemedia.net

THE body responsible for dealing with all labour-related matters in The Bahamas has not discussed any proposed minimum wage increase because it has not been reformed since July 1.

Peter Goudie, the Bahamas Chamber of Commerce and Employers Confederation’s (BCCEC) representative on the National Tripartite Council, told Tribune Business that it cannot meet until the Government reconstitutes it by appointing new members.

His comments came as Raymond Jones, the Bahamas Petroleum Retailers Association’s (BPRA) president, said another minimum wage rise would further increase the “hardship” petroleum retailers face as their margins have remain unchanged for 13 years despite higher operating costs.

He added that gas retailers have been “suffering and operating at a loss” for years, and their fixed margins have “totally eroded”

any chance of seeing a return on their investments. Mr Jones said: “A further increase in the minimum wage is only going to increase the hardship that petroleum retailers in this country are facing. We want to be like any other entrepreneur, be able to adjust our costs based on the rising cost to do business, not to put on an extra burden.

“The gas station retailers have been suffering and operating at a loss for many, many years now. It’s virtually impossible to make a dollar. The issue we have is simply that the increase in costs against a fixed margin has totally eroded any sense of getting a return on investment at this point. We’re operating because we’ve got too much invested to give up.”

Mr Jones argued that increasing the minimum wage without granting a gas margin increase would add “another burden on top of a donkey that can’t walk right now”, and called for the dealers’ request to add 25 cents per gallon on gasoline and 15 cents per gallon on diesel to be granted.

He said: “We’re not going to dispute the Government’s analysis of a need to put in a minimum wage increase. But we’ve seen the price for our costs to operate go up, and I under- stand the need for price adjustment.

“All we’re asking for is to be treated the same and recognise that we need the price adjustment on our margin so we can survive. Another minimum wage increase is just another burden on top of a donkey that can’t walk right now.

“We’re not against the efforts to try to help the working public and residents to have a living wage. We want the same thing. We deserve the same thing, a living wage in terms of having a margin that can cover the costs to operate, because we’re not like other retailers who can adjust our margins based on our rising costs.”

Gas retailers have not received a margin increase since the then-Ingraham administration granted one 13 years ago. Unlike virtually all other industries, which are able to increase prices to cover rising operating expenses, the Bahamian petroleum industry operates on price-controlled fixed margins that require government approval before they can be changed.

Dealers say that, especially following the post-COVID cost of living crisis, ever-rising expenses have effectively wiped out the 54 cent and 34-cent margins per gallon of gasoline and diesel sold, driving them into losses and placing some in a position where they are threatening to close their operations. The Government, though, has been reluctant to raise the margins for fear it will increase fuel bills for motorists.

Mr Jones said there is an “urgent and immediate” need for gas retailers to be granted a margin increase as operation costs such as insurance, NIB and electricity have increased over the last decade. He explained that the 25 cent margin increase would translate to the cost of a 12 ounce bottle of water to consumers weekly, but will greatly improve their ability to pay operating costs.

He said: “We’re praying and hoping that the Government, after studying for the last two years all the data we’ve given them, realise there is an urgent need and immediate need for us to have an increase. That will allow us to breathe and pay our bills and be able to continue to operate without stressing out about not making any money.

“The cost of power increased. We’ve had cost of minimum wage increase before, the cost of increased insurance, the cost of depositing cash at the bank, credit card fees. We welcome the digital age, but there is a cost to us against a fixed margin. On July 1, we saw an increase in National Insurance. What we are seeking in terms of an increase will amount about a bottle of water to the average consumer per week.”

Mr Jones said the cost of gasoline has decreased by $2 per gallon in the past two years, so consumers have already seen the benefits of a price reduction, but retailers who are operating on a fixed margin would see their operating losses increase with a minimum wage increase.

He said: “In discussions with the Government over the past few years they said wait for a reduction in the cost of fuel. Well, today fuel is literally $2 a gallon cheaper than it was two years ago. So, the public is getting a benefit of a reduction. A further increase in minimum rates would continue to erode and increase our operating loss from a fixed margin that has been totally decimated with the rising costs.

“We’d love a big increase, but we recognise that it’s a consumption market and the consumers are paying a fair price for our products. We want to provide the service and to operate so we can actually achieve some sense of an operating profit.”

Pia Glover-Rolle, minister of labour and the public service, said the Davis administration wants to increase the minimum wage again soon but did not give a timeline for when a decision would be made. She said officials had discussed the matter with a senior economics wage specialist at the International Labour Organisation.

The Davis administration increased the minimum wage from $210 to $260 in January 2024. That was the second increase since the Ingraham administration introduced the minimum wage in 2001 at $150 per week. Some workers said the increase did not go far enough given rising food and electricity costs.