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December 29, 2023 | Marit Severins
Businesses in Bonaire remain concerned about further price increases as the minimum wage and benefits are set to rise sharply in January and July. Now consumers’ association Unkobon and trade union Usibo have also sounded the alarm.
The Chamber of Deputies decided in October that, after almost 14 years, residents of Bonaire, Saba and Statia will receive a minimum social security from 1 July 2024. This was based on the recommendations of the Thodé and Nibud Commission of Inquiry. As a result, the minimum wage in Bonaire will have to increase by almost 30% in 2024: from $1,236 to $1,750.
Is the compensation enough?
To compensate companies for rising wage costs, The Hague will allocate 4.2 million euros in subsidies. However, employers and interest groups on the island are skeptical that the plan has been properly designed.
For example, they believe the subsidies are too little or that many companies are not aware that they are entitled to financial assistance. They worry that companies will now further increase the prices of their products and services to cover the wage increases for their employees.
Paul Coolen, president of the Bonaire Business Federation, said: “Employers are happy that a social minimum wage has finally been established because we have been fighting for it for many years. However, we had higher expectations for the implementation results. For example, the funding will also be available because the 4.2 million will soon be used up.”
“We don’t know if the compensation is enough to cover all companies,” said William of the Usibo union. “The lack of data makes it difficult. We don’t know how many people on Bonaire receive the minimum wage.”
The company raised its prices.
“Some companies have already started to increase prices,” said Norwin Willem of the Usibo union. “We heard about it from the companies we are involved with. They noticed it or participated in it themselves.”
“This primarily involves supermarkets increasing prices for the same products and charging huge price differences. We have requested an urgent meeting with the executive committee on this matter.”
Coolen (Bonaire Business Association) is also aware of these voices. “I hear big companies around me saying: I have to raise prices. Or: I will raise prices and reduce service. This will have an impact on industries such as tourism.”
Consumer association calls on public to provide information
Consumers association Unkobon is also concerned about the price increase as there has been little awareness campaign.
“Employers know that wage costs will rise, but they don’t know there will be price compensation,” said chairman Wietze Koopman. “You can’t see any information about this on websites like Dutch Caribbean.”
Koopman believes that both national and local governments must take action to “prevent entrepreneurs from playing it safe and raising prices prematurely. I’m worried that this will happen in places with a large number of low-paid employees, such as supermarkets.”
Unkobon is in discussions with local authorities about providing information and support to businesses.
“Unfair salary distribution”
There are also concerns that compensation money will not reach the companies that need help most.
“The discount is the same for everyone. So companies with high-paid employees receive a much larger share of pay than companies with a relatively large number of low-paid employees,” said Wietze Koopman (Unkobon). “There should be more targeted pay.”
The Bonaire Business Association is also sceptical. “There should be a gradual plan behind this. Now a law firm is benefiting from it, but we would like it to eventually develop into a company that employs gardeners, cleaners or security guards, for example.”
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