Labour Minister Dr. Rashid Pelpuo has cautioned that a lack of coordination between the Public Utilities Regulatory Commission (PURC) and organised labour could jeopardise the 2026 national budget.

Appearing on Joy News’ PM Express on December 9, Dr. Pelpuo stressed the critical need for sustained dialogue to bridge any understanding gaps and avert decisions that might disrupt government spending plans. He revealed the government is closely monitoring the situation.

“Government is very curious about what is going to happen. We are watching, and we are speaking to PURC, we are speaking to labour as well, and we want to make sure a close understanding of what has happened,” Dr. Pelpuo said.

The Minister reiterated the government’s commitment to fulfilling its obligations to workers, while simultaneously urging all parties to maintain a collaborative approach. He highlighted the potential for significant repercussions should figures within the approved budget undergo revisions.

“Government’s intervention will have a long-term effect… changing figures there will have a consequence of having a total effect on the figures that we put out already,” he explained. “So we are praying that this thing will be solved soon, that we don’t have to intervene in any form that will offset the situation PURC is putting across or that will unbalance the labour demands.”

Dr. Pelpuo also commended organised labour for demonstrating understanding regarding the current economic constraints facing the nation, and for their willingness to make necessary sacrifices.

“I’ve always been lucky to see that labour not just want to walk along, but also are willing to sacrifice a little… There comes a time when you need to sacrifice a lot for the general good of the people,” he stated. “And I find the working, you know, labour at all classes, at all levels, come to a point when they appreciate the situation we face ourselves.”

He emphasized the delicate balance between providing adequate compensation for workers and ensuring the financial sustainability of the government. “Should we spend 47% of our total revenue on compensation for people who are less than one million, or should we increase it to 50%? Should we increase it to 65%? These are all possibilities, dependent on how much request they are making for increases in salaries,” Dr. Pelpuo questioned.

Addressing concerns surrounding recent tariff adjustments, Dr. Pelpuo clarified that the intention isn’t to disadvantage workers, but rather to mitigate broader economic impacts. He suggested a careful consideration of the overall effects on the workforce.

“It will be difficult to give you a direct answer… maybe we don’t call it short change, but we look at it as a question, how will it have a total effect on the worker? Is it going to be a direct consequence of deliberately hurting the income of workers and creating a problem for them?

“How can it be adjusted with government intervention in future? How can PURC have a conversation that will result in workers not feeling shortchanged?” he asked.

Dr. Pelpuo concluded by stating that the 9.8% increase was the result of extensive negotiations and a thorough evaluation of various economic indicators, urging stakeholders not to view it negatively. “The negotiation that went on, including the influence of PURC, resulted in the 9.8%… which enabled them to come to reality and find what we presented today,” he said.

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