The Tribune

By Fay Simmons

Tribune Business Reporter

jsimmons@tribunemedia.net

The Opposition’s leader yesterday said implementing an as-yet undefined and undetermined liveable wage could help more Bahamians gain middle class status.

Michael Pintard, speaking to Tribune Business, said many households are struggling due to rising costs and a move towards a liveable wage would ease their burden.

“The Bahamians who are presently making minimum wage are struggling, and not just them but persons who are even above minimum wage are struggling. It has been the position of the FNM, certainly been my position, that we have to move towards a liveable wage,” said Mr Pintard.

“Clearly Bahamians are under tremendous pressure because, in part, of increases in taxation by this administration, the escalating cost of utilities - in particular electricity - and the rising cost of food in stores. We’ve not made any appreciable improvement in the food security initiatives that the Government has been bragging about introducing.”

Mr Pintard argued that while a transition to a liveable wage may be required, it must be done in a way that will not negatively affect businesses. “In all cases where one is considering the move to the minimum wage, you need to engage all stakeholders to have a discussion,” he added.

“You must also have the requisite studies to look at the impact of any mandatory move, whether it’s in National Insurance, whether it’s in minimum wage, whether it’s the introduction of taxation.

“The challenge right now is: How do we assist Bahamians in moving towards a liveable wage while guarding it from negatively impacting small and micro enterprises and middle-sized companies? We need to ensure they can continue to hire more Bahamians and not lay-off existing staff.”

Mr Pintard said through collaborating with businesses, and not implementing policies that “strangle” the private sector, the Government and companies can move towards a liveable wage that, thus far, has been more of an aspirational goal.

“I believe through dialogue we are able to accomplish both things - to move towards a liveable wage and for the Government not to strangle businesses, but work with them so that they are able to become increasingly productive,” said Mr Pintard.

“Ensure that you don’t increase their costs by introducing a whole bunch of new regulations, which is what this government has done by requiring these businesses to now have audited financials, requiring them to report VAT receipts at an earlier period of time, and asking them to estimate essentially what they will be earning.”

Mr Pintard’s comments came after a recent report asserted a Bahamian family where both adults are earning the minimum wage would have to increase their income four-and-a-half times to reach “middle class living standards” on New Providence.

Lesvie Archer, a University of The Bahamas (UoB) researcher, in a 14-page paper published in the International Journal of Bahamian Studies, disclosed that the total $27,040 annual income for such a family is far removed from the estimated $122,400 annual earnings needed to enjoy “a decent middle class life on New Providence”. For Grand Bahama, the figure was pegged at $121,200.

The study, which did not seem to define what ‘middle class’ is in the Bahamian context, said it focused only on “determining the cost of acquiring and maintaining certain middle class status symbols in The Bahamas” such as food, housing (rental), clothing and footware, recreation, communications, household needs and other items. Inflation was also factored into the calculations.

“The study reveals that, as of March 2024, a middle class family of four requires an income of $10,200 monthly if living in New Providence, and $10,100 monthly if living in Grand Bahama. These estimates are higher than the updated estimates generated for lower-income families by 104 percent in New Providence and by 53 percent in Grand Bahama,” Ms Archer wrote.

Multiplying these figures by 12 gave the annual earnings required by such families to attain middle class status on both islands. And, given that working class families were “assumed” to be minimum wage earners, the study said persons in this income group would need to more than quadruple their earnings to achieve middle class status - a goal that, for many, may be well out of reach.

“This means that a reference-sized family where both adults are employed full-time earning minimum wage ($260 per week per person, or $27,040 per family per year) would have to increase their income by an estimated 350 percent to meet the living standards that characterise the New Providence middle-income household profile determined in this study,” Ms Archer wrote.

“A family of four should earn an estimated $122,400 per year to afford a decent middle class life on New Providence, and $121,200 if desiring to have a middle class life on Grand Bahama..... This brief report may be a starting point for informing policies related to living costs and standards in The Bahamas. It also offers insight into economic loss associated with quality of life debates.”

The report is likely to revive debate about income inequalities in Bahamian society as well as renew calls, in some quarters at least, for greater progress towards the so-called ‘liveable wage’ promised by the Davis administration although such a concept has yet to be clearly defined.