AKP's Şamil Tayyar calls for mid-year minimum wage hike: 'Prices will rise incredibly'

As the US-backed Israel-Iran war continues into its 22nd day, the rise in oil prices has also negatively impacted fuel prices.

Due to the sliding scale system (eşel mobil) implemented at the start of the war, 75 percent of the fuel price hikes are being covered by the Special Consumption Tax (ÖTV). With the margin in the sliding scale system for the diesel group nearing exhaustion, future price hikes are expected to be reflected directly in pump prices.

Former AKP deputy Şamil Tayyar made striking assessments regarding the course of the war and its impact on the economy on the 'Medya Kritik' program, which airs on the pro-government TGRT Haber.

Emphasizing that fuel price hikes affect all goods, Tayyar noted that there will be a significant erosion in salaries by July. Reminding of the upcoming election process, Tayyar stated that economic measures should be brought forward and said, "Minimum wage earners and retirees will increase the pressure. If it continues like this, there could be a mid-year adjustment in July."

Tayyar's statements are as follows:

"A MINIMUM WAGE HIKE MAY COME IN JULY"

When you switch to the sliding scale system, you are giving up your own revenue items, meaning taxes. Today, even that has become insufficient, and further hikes have been implemented. If it continues like this, if prices continue to rise, I think the possibility of increasing the minimum wage for a second time in July will arise. Whether the government does it or not is a separate matter, but I think the pressure on this issue will increase. Because from January to July, there will be a very serious erosion in the salaries of employees. Prices will rise incredibly.

So what will happen? Minimum wage earners, civil servants, and retirees will make more demands. Therefore, they will create internal pressure. Ultimately, these are the groups that will most deeply affect the ballot box. We are talking about 17.7 million retirees. And all of them are voters. They have organized significantly in recent times, and their potential to influence public opinion has increased considerably. We will begin to experience the intense pressure from these circles on politics more in the coming period.

"TURKEY DID THE OPPOSITE OF EUROPE"

We have a difficulty compared to European countries; they followed the requirements of liberal policy, especially after the pandemic, while we did the opposite. You know, with the currency-protected deposit policy, they raised interest rates, and we lowered them. Now they are reaping the rewards of the policies of that period, and food inflation in Europe is extremely low, incomparable to Turkey.

"WAR BROKE OUT JUST AS THE ECONOMY WAS ABOUT TO RECOVER"

Turkey returned to normal with a 2-year delay. But it cannot achieve that momentum as expected. Therefore, it is spinning its wheels. Just as we thought it was starting to pull its wheels out of the mud, the war broke out. Now, with this happening, a certain segment of society says, 'The situation was already not good, don't use the war as an excuse.' For example, they are also angry about the fuel price hikes due to the war. They say, 'Fuel was already being hiked excessively for the last 2 years. The issue is not just the war.' Therefore, it will be difficult to explain the negative consequences stemming from the war to the public.

"ECONOMIC CRISIS HAS BEEN CONTINUING FOR 5 YEARS"

Because during the AK Party government, economic crises usually lasted 1-2 years. Economists generally say this; the longer a crisis lasts, the longer its rehabilitation takes. In other words, a crisis that lasts 2 years heals in 2 years. But for us, it has been going on for about 5 years since the pandemic. Therefore, we need a 5-year period for this situation to change.

WARNING TO THE GOVERNMENT REGARDING THE ELECTION PROCESS

However, time is running out. We have evolved toward the election process; we are almost about to enter the final stretch. If the election is to be held at the end of 2027 or the beginning of 2028, as these negatives spread over time, a process will work against the government. Because election processes are the most infected processes. The opposition will also exert intense pressure here, social pressure and expectations will increase, and demands will rise. Therefore, I think that some measures should be taken in advance, without spilling over into 2027, that is, by setting a barrier within 2026 to reduce its negative effects. Therefore, we must analyze the financial and political effects of the war very seriously without wasting any time and take these measures starting today."