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Addressing the 157th Annual General Meeting of the Planters’
Association of Ceylon, Chairman Lalith Obeyeskere said, as a result of
the wage hike in the tea plantation, workers now earn Rs515 per day.
“Assuming an attendance rate of around 75% this will translate into
approx. Rs12, 875 per month. This is a 27.1% increase in wages.”
The wage hike was granted after a collective decision was made for an
independent study on the sustainability of the industry to work out a
compromise between the trade unions, workers and the planters’
association. The study was headed by well-known economist Dr Ramani
Gunatilleke
The study concluded that the best way to increase profits was to find
ways to increase productivity since at present Sri Lankan tea is already
out pricing itself. The wage hike has pushed the cost of production of
Sri Lankan tea further. At present the cost of production of tea in Sri
Lanka is around Rs331 per kg Kenya, one of Sri Lanka’s main competitors
on the international market, produces1000kg per hectare more than Sri
Lanka and at a 35% less cost of production.
Attempts were made to tie productivity to profitability in the sense
that a minimum quota be implemented to justify the wage hike, but
Obeyesekere said that this development fell through, primarily due to
reluctance on the part of the trade unions. ‘What people have to realize
is that, what has been provided is much greater than other sectors. No
other industry has seen such a drastic increase in wages’. Obeyesekere
was dismissed allegations that plantation workers live in poverty and
stated that the term ‘poverty’ is one that is loosely used.
‘I’m no economist but poverty cannot be linked only to income, many
other factors need to be taken into consideration. The manner in which a
person spends money is often a contributing factor to poverty.’
At present the national poverty line is Rs3249 per person per month, according to the Department of Census and Statistics.
Association of Ceylon, Chairman Lalith Obeyeskere said, as a result of
the wage hike in the tea plantation, workers now earn Rs515 per day.
“Assuming an attendance rate of around 75% this will translate into
approx. Rs12, 875 per month. This is a 27.1% increase in wages.”
The wage hike was granted after a collective decision was made for an
independent study on the sustainability of the industry to work out a
compromise between the trade unions, workers and the planters’
association. The study was headed by well-known economist Dr Ramani
Gunatilleke
The study concluded that the best way to increase profits was to find
ways to increase productivity since at present Sri Lankan tea is already
out pricing itself. The wage hike has pushed the cost of production of
Sri Lankan tea further. At present the cost of production of tea in Sri
Lanka is around Rs331 per kg Kenya, one of Sri Lanka’s main competitors
on the international market, produces1000kg per hectare more than Sri
Lanka and at a 35% less cost of production.
Attempts were made to tie productivity to profitability in the sense
that a minimum quota be implemented to justify the wage hike, but
Obeyesekere said that this development fell through, primarily due to
reluctance on the part of the trade unions. ‘What people have to realize
is that, what has been provided is much greater than other sectors. No
other industry has seen such a drastic increase in wages’. Obeyesekere
was dismissed allegations that plantation workers live in poverty and
stated that the term ‘poverty’ is one that is loosely used.
‘I’m no economist but poverty cannot be linked only to income, many
other factors need to be taken into consideration. The manner in which a
person spends money is often a contributing factor to poverty.’
At present the national poverty line is Rs3249 per person per month, according to the Department of Census and Statistics.
