Wage reform off to slow start in Cuba, report says

By Marc Frank

HAVANA (Reuters) - More than a year after Cuban President Raul Castro pushed through a wage reform aimed at rewarding productive workers most state-run companies have yet to implement it, the official Bohemia magazine reported.

It was the latest evidence that Castro's efforts to modernize the communist country's economy were being resisted by a state bureaucracy that controls more than 90 percent of economic activity.

The decree promulgated by Castro was supposed to lift wage caps and replace a collective wage system with one based on piecework as a centerpiece of his program to raise Cuba's economic output.

But Bohemia said in its latest issue available this week that a recent labor ministry inspection found that "only 25 percent of the companies inspected used some variant of the piecework system."

A law leasing vacant state lands to anyone willing to till them was also stalled by bureaucracy, Raul himself admitted late last year, though land grants have increased since then.

Castro assumed Cuba's presidency on February 24, 2008 from his ailing brother Fidel Castro, and quickly instituted reforms such as decentralizing agriculture and opening up sales of such things as cell phones and computers to the Cuban people.

He pledged to tame communist Cuba's bureaucracy and improve production and efficiency by replacing an egalitarian pay system, in which everyone received more or less the same amount, with one in which pay is determined by productivity.

Egalitarianism, Castro said, had encouraged sloth, which was hurting Cuba's economy.