FINANCE minister Kikis Kazamias has begun a new round of talks with public sector unions as he prepares the second package of measures for the economy that he promised to table at the legislature by the end of next week. On Monday he saw representatives of the main unions, including teachers’ unions, who had not been involved in the negotiations over the first package.
Kazamias has adopted the wise policy of not making any statements about what was discussed at the meetings so that public rows that give rise to grandstanding could be avoided. By so doing, he is also shielding himself from possible accusations by opposition parties that he had given in to the unions when he eventually announces the measures. If opposition parties did not know what was being discussed they would not be able to take the political high ground about the government’s stance.
Less wise was Kazamias’ decision to bring in the teaching unions to the consultations, thus opening another front. True, their members are also part of the broader public sector and any measures taken would affect them, but it would make it even more difficult for the minister to arrive at the compromise he is looking for when negotiating with so many unions. Already, secondary teachers were complaining about lowering entry pay scales for new recruits as this would penalise contract teachers subsequently given permanent posts.
It is quite astonishing how the government has been making it increasingly more difficult to adopt effective measures by going for the piecemeal approach – cut a bit from salaries temporarily, increase contributions by a little, put up VAT, raise property tax and so forth. Now it is reportedly looking at freezing the payment of CoLA for a year, or maybe two, cutting 25 per cent off 13th salaries and who knows what else.
How much easier it would have been if it simply announced a five per cent cut in all public sector salaries, forced public employees to contribute 6.8 per cent of their salary to the social insurance fund, like private sector workers do, and abolished CoLA for good. Public sector employees would still enjoy higher pay than private sector workers, but the gap would have been made smaller. There may have been strikes, but if the government and political parties formed a united front for the good of the economy they would not have lasted very long.
The ratings agencies would have been convinced that we were serious about tackling structural problems and we would all focus on how to stimulate economic recovery. But our government seems to prefer interminable negotiations with unions which produce inadequate measures, thus prolonging the economic uncertainty and recession. It is just not good enough.
