COVID-19 Lockdown: MCTU asks Government to increase PAYE free threshold from MK40,000 to MK100,000

By Duncan Mlanjira

Malawi Congress of Trade Unions (MCTU) has asked President Peter Mutharika that for the Lockdown to be effective, amongst other measures, to seriously consider cushioning workers’ disposable income by increasing Pay As You Earn (PAYE) free threshold from MK40,000 to MK100,000.

This should be done until such a time that the carrying out of economic activities return to normal after the pandemic is over.

Through a public statement, MCTU is also asking the Government to reduce Value Added Tax (VAT) on all food items and basic amenities and to reduce tariffs on water and electricity.

It should also order utility parastatal bodies (Water Boards and ESCOM) to suspend their disconnection campaigns as ways of compelling consumers to pay their bills until such time that economic activities return to normal.

And that it should liaise with or direct Malawi Communications Regulatory Authority (MACRA) to enforce the reduction of the internet tariffs so as to provide a conducive environment for people to work from homes during the lockdown as they will not be able to get to their offices or usual places of work where they access internet. 

“In addition, the tariff reduction should be extended to both calling and money transaction costs charged by TNM and Airtel,” says MCTU. 

MCTU has been compelled to issue the public statement after taking note that the Government did not take on board the recommendations that were brought to its attention for consideration in the event that a lockdown was instituted and enforced. 

MCTU reminds the Government that the recommendations it presented were formulated on the basis of its “recognition of the hard and brutal facts of the social and economic plight of the majority of citizens”. 

“In particular, over 89 percent of the population earn their incomes and sustain livelihoods in the informal economy. 

“Most of these people work under precarious and vulnerable conditions, earn very low incomes and are circumstantially unable to make any savings as their daily subsistence depends on the very meagre amounts of money they are able to earn in any single day.

“It is evident that the lockdown presents a serious policy dilemma:

While it is a proven way of containing the spread of the virus as evidenced by experiences in other countries, it is a significant and devastating shock to the already precarious and fragile livelihoods of the majority of citizens and workers.

“A lockdown situates the majority of workers and citizens between prevention from contracting the deadly COVID-19 on one hand and starvation and destitution on the other.”

Now that the Lockdown will be executed effective from Saturday April 18, the Government should provide some financial packages, cash transfers and free food to vulnerable workers and households that earn their living in the informal economy. 

And that priority should be given also to citizens in unplanned settlements in the urban and peri-urban areas as this will enhance adherence and compliance to the lockdown.

The Government is also being asked to increase the capacity to carry out the COVOD-19 tests and should, in the similar vein, consider making testing compulsory, especially in high density settlements areas so that detection is made early and measures for containment are instituted.

MCTU also asks Government, in liaison with the private employers, to ensure protection of jobs and provision of social security and any other relevant support to workers. 

“We urge prioritization of social dialogue and collective bargaining processes in identifying measures to mitigate the economic impact of the Coronavirus on both the employer and the employees. 

“Unilateral decision making by employers is strongly discouraged as this would put the jobs and lives of the workers at risk.

“We urge government to come out clearly and publicly on this matter and urge employers to take heed of these guidelines for good labour practices to ensure labour justice for both employers and workers.”

In its preamble, MCTU — a National Centre comprising of 25 Trade Unions representing over 300,000 workers in all economic sectors of the country — acknowledged the difficult times Malawi as well as the world at large is going through in the wake of the COVID-19 pandemic. 

“It is trite that the current circumstances, require tough and critical decisions at the level of government,” MCTU said in the preamble.

“In view of the number of positive cases of COVID-19, it is obvious that the virus is among us and that if drastic and unpopular but effective measures are not taken to arrest the spread of COVID-19, the country risks high morbidity. 

“It is for this reason that MCTU commends Government for instituting a lockdown and other associated measures in order to save lives and contain the virus. 

“Given that our health services are underdeveloped and struggling in many ways, measures aimed at prevention of the spread of COVID-19 are our best efforts in responding to the pandemic.”

The grouping of Trade Unions in Malawi also said it is evident that the lockdown presents a serious policy dilemma, that while it is a proven way of containing the spread of the virus as evidenced by experiences in other countries, it is a significant and devastating shock to the already precarious and fragile livelihoods of the majority of citizens and workers.

“A lockdown situates the majority of workers and citizens between prevention from contracting the deadly COVID-19 on one hand and starvation and destitution on the other.”

And that’s when the MCTU reminded and urged Government and employers to seriously consider the measures explained in the report to mitigate the impact of the lockdown on the livelihoods of mentioned categories of the citizens and workers.

“In conclusion, MCTU would like to commend Government for the reduction in fuel prices. However, this has not had a significant impact on the workers as its potential effect on public transport fares were eroded by a hike due to the requirements of social distancing. 

“It is our considered view that positive reception and uptake by Government and employers of the recommendations outlined above will go a long way in supporting livelihoods of workers and citizens during the lockdown. 

“We, therefore, appeal to Government to seriously consider immediate adoption and implementation of these recommendations.

“On the other hand, Government should ceaselessly keep track of the effects of the lockdown on the general multitude and swiftly consider otherwise should its impact on people’s livelihood surpass those of the COVID-19 itself,” says the statement issued by MCTU secretary general, Denis Kalekeni.