Identifier
Created
Classification
Origin
08HAVANA353
2008-04-30 20:11:00
CONFIDENTIAL
US Interests Section Havana
Cable title:
CUBA INCREASES SOCIAL SECURITY BENEFITS
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C O N F I D E N T I A L HAVANA 000353
SIPDIS
SIPDIS
DEPT FOR WHA/CCA
E.O. 12958: DECL: 04/25/2018
TAGS: ECON PGOV PINR PREL CU
SUBJECT: CUBA INCREASES SOCIAL SECURITY BENEFITS
Classified By: COM: Michael E. Parmly: For reasons 1.4 b/d
C O N F I D E N T I A L HAVANA 000353
SIPDIS
SIPDIS
DEPT FOR WHA/CCA
E.O. 12958: DECL: 04/25/2018
TAGS: ECON PGOV PINR PREL CU
SUBJECT: CUBA INCREASES SOCIAL SECURITY BENEFITS
Classified By: COM: Michael E. Parmly: For reasons 1.4 b/d
1. (U) SUMMARY: Official media announced on April 27 that
starting in May the government will increase pensions and
social assistance disbursements by 20%. In addition, the GOC
will increase court/district attorney salaries by as much as
55%. According to the GOC statement, salary increases will
be extended progressively to other sectors as economic
conditions improve. Separately, a special 5% social security
contribution, which is deducted from salaries and currently
affects few workers, will be expanded gradually to other
sectors. End summary.
2. (U) Factoring in the 20% increase, government pensions
will now range from a minimum of 164 Cuban national pesos
(CUP) (USD 7.38) to a maximum of 400 CUP (USD 18). The
average Cuban salary is about USD 17. Social assistance
disbursements, received by the poorest families, will
increase from 122 CUP (USD 5.49) to 147 (USD 6.62). All
together, according to the GOC, the increase will benefit
close to 2.2 million Cubans.
3. (U) The GOC further announced a salary increase for
judiciary workers, especially those of judges and
prosecutors. The measure will affect more than 9,000
employees, whose average salaries will go from 360 CUP (USD
16.20) to 559 CUP (USD 25.16).
4. (SBU) All Cuban employers and the GOC -- which employs
more than 90% of the workforce -- pay a 9% social security
contribution per employee. Employees in a few sectors where
salaries are higher and better linked to productivity -- such
as GOC companies under the "enterprise optimization" program
and some joint ventures -- already have a special 5% social
security contribution deducted from their salaries. The GOC
statement announced that it plans to expand this practice
gradually to other sectors as economic conditions improve and
salaries increase.
5. (C) Comment: Although working Cubans often make
additional money with informal jobs or thanks to remittances,
many retirees depend on their pensions. They will be far
from satisfied but will definitely appreciate the slight
increase. Increasing court salaries, especially those of
judges and prosecutors could be a pre-emptive measure. Given
the GOC's latest limited economic liberalization measures and
the possibility that more may be coming, it seems logical to
bolster a court system which could be vulnerable to
corruption in the presence of new wealth and could easily
become a liability. Further salary increases in other
sectors will depend strictly on GOC priorities and available
funding -- which is extremely limited. The additional social
security tax will probably provoke grumbling as it is
introduced, but Cubans will have little choice but to accept
it.
PARMLY
SIPDIS
SIPDIS
DEPT FOR WHA/CCA
E.O. 12958: DECL: 04/25/2018
TAGS: ECON PGOV PINR PREL CU
SUBJECT: CUBA INCREASES SOCIAL SECURITY BENEFITS
Classified By: COM: Michael E. Parmly: For reasons 1.4 b/d
1. (U) SUMMARY: Official media announced on April 27 that
starting in May the government will increase pensions and
social assistance disbursements by 20%. In addition, the GOC
will increase court/district attorney salaries by as much as
55%. According to the GOC statement, salary increases will
be extended progressively to other sectors as economic
conditions improve. Separately, a special 5% social security
contribution, which is deducted from salaries and currently
affects few workers, will be expanded gradually to other
sectors. End summary.
2. (U) Factoring in the 20% increase, government pensions
will now range from a minimum of 164 Cuban national pesos
(CUP) (USD 7.38) to a maximum of 400 CUP (USD 18). The
average Cuban salary is about USD 17. Social assistance
disbursements, received by the poorest families, will
increase from 122 CUP (USD 5.49) to 147 (USD 6.62). All
together, according to the GOC, the increase will benefit
close to 2.2 million Cubans.
3. (U) The GOC further announced a salary increase for
judiciary workers, especially those of judges and
prosecutors. The measure will affect more than 9,000
employees, whose average salaries will go from 360 CUP (USD
16.20) to 559 CUP (USD 25.16).
4. (SBU) All Cuban employers and the GOC -- which employs
more than 90% of the workforce -- pay a 9% social security
contribution per employee. Employees in a few sectors where
salaries are higher and better linked to productivity -- such
as GOC companies under the "enterprise optimization" program
and some joint ventures -- already have a special 5% social
security contribution deducted from their salaries. The GOC
statement announced that it plans to expand this practice
gradually to other sectors as economic conditions improve and
salaries increase.
5. (C) Comment: Although working Cubans often make
additional money with informal jobs or thanks to remittances,
many retirees depend on their pensions. They will be far
from satisfied but will definitely appreciate the slight
increase. Increasing court salaries, especially those of
judges and prosecutors could be a pre-emptive measure. Given
the GOC's latest limited economic liberalization measures and
the possibility that more may be coming, it seems logical to
bolster a court system which could be vulnerable to
corruption in the presence of new wealth and could easily
become a liability. Further salary increases in other
sectors will depend strictly on GOC priorities and available
funding -- which is extremely limited. The additional social
security tax will probably provoke grumbling as it is
introduced, but Cubans will have little choice but to accept
it.
PARMLY