Workers fume as Russia struggles to pay them

ChrisD(RJ) chrisd at russiajournal.com
Sun Aug 4 08:04:57 PDT 2002


Chicago Tribune August 4, 2002 Workers fume as Russia struggles to pay them By Alex Rodriguez Tribune foreign correspondent

MOSCOW -- In the small city of Orenburg in southern Russia, teachers like Nina Polyakova scrape by between paychecks that come only every four months.

A speech teacher with a college degree, Polyakova scrubs floors and asks friends for money to keep her family clothed and fed. She says that if she had an audience with President Vladimir Putin, she would tell him, "This is not a life, this is a labor camp."

"People want to eat, they want a decent life, they want decent clothes," said Polyakova, who makes $552 a year as a teacher. "Please give us our salaries. It's impossible to survive on such money."

Since Russia's economic meltdown in 1998, the nation has steadily chipped away at the back wages it owes its labor force, but this year the Putin administration has again had trouble paying workers on time, largely because it asked regional authorities to fund raises they couldn't pay for and because the floods that ravaged southern Russia this summer claimed cash reserves that could have helped pay workers.

The amount of back wages the Russian government and the country's private sector owe was $1.04 billion in May, a 10 percent jump from $949 million at the end of last year.

The problem has become severe enough that Putin has chided his top aides to ensure that public-sector workers, especially teachers, get paid on time.

Frustration heard

"When will we finally solve problems concerning arrears of wages, and primarily payments due to wages and vacation pay to teachers?" Putin told the Russian news service, Interfax.

Wage arrears in Russia were at their worst during the 1998 economic crisis, when the ruble's value plummeted and the nation was neck deep in debt. Since then Russia's economy has made strides, but certain industries--including mining, textiles and machinery production--remain mired in hard times and cannot pay workers on time, said Robert Yakovlev, deputy director of Russia's Research Institute of Labor and Social Insurance.

In those industries, up to six to eight months of back pay is owed to workers, Yakovlev said.

Miners and other workers with the Vorkutaugol Coal Co. went on strike recently after four to six months without pay.

"The trade unions are worried because it may go out of control, just the way it did in 1998 when miners' wages were running 11 months behind," Yevgeny Shumeyko, deputy chief of the Vorkuta Independent Mineworkers Union, told ITAR-Tass news agency.

Russia's long-standing struggle with wage debt has even resulted in an arrest this year. In June, the manager of an agricultural cooperative in the Rostov region in southern Russia was charged with failing to pay workers $27,714 in wages dating to last fall.

The manager, a deputy in the local parliament, neglected to pay workers despite having enough money in the cooperative's accounts and forged payroll documents to cover up what he had done. Officials with the company said last week that workers have since been paid.

Budgets strained

In the public sector, teachers and medical workers regularly go without pay for months. Putin aides have said the Russian government's decision to give state workers a 60 percent increase strained the budgets of regional governments.

In addition, the Russian government diverted millions of dollars to the country's southern regions, which have been devastated by floods that killed 114 people and destroyed 13,000 homes in June. Putin's finance minister, Alexei Kudrin, said the government planned to pay off wage arrears by September.

Yakovlev said Russia could do a better job planning for contingencies but agreed that the June floods waylaid Russia's reserves and played a role in the government's latest struggles to catch up with wage debt.

"You must have a reasonable reserve," he said, "but we're not a country so rich as to have that large a reserve."

Officials in cities and regions hit hardest by wage debt blame the Putin administration for not giving local and regional governments enough money to meet federal government-mandated pay increases for public-sector workers.

"They need to send money, because it is not possible to keep silent anymore," said Zoya Tsiguleva, head of the teachers union in Orenburg.

Putin aides counter that regional governments have done a poor job planning their budgets. The federal government steps in and assists regional parliaments that spend more than 40 percent of their budgets on wages and still cannot meet payrolls, Yevgeny Gontmakher, head of the Putin Cabinet's social development department, told Yezhenedelny magazine this spring.

But if a regional government's budget earmarks less than 40 percent for wages, the federal government is less likely to help.

"In principle, one can find funding to cover the shortfall," Gontmakher said. "One just has to work better, not to wallow in self-pity."



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