Joint press statement of the ETUC (European Trade union Confederation), EPSU (European Federation of Public Services Unions), Ver.di (Vereinte Dienstleistungsgewerkschaft), ICTU (Irish Congress of Trade Unions).

Attacking Public Sector wages: The wrong thing to do at the wrong moment

Brussels, 4 March 2009

European trade unions are stunned to observe the president of the European Central Bank (ECB) attacking public sector wages once again. The independent ECB is providing political backing to governments keen on implementing wage cuts to the order of around 15%. Moreover, the president of the ECB is advising ‘bad economics’: With the economy facing the worst recession since World War II, wages should be a pillar of stability and not an accelerator of depression and deflation.

Reiner Hoffmann, deputy General Secretary of the European Trade Union Confederation (ETUC) says: ’It is frightening to see how the president of the European Central Bank has forgotten the lessons of the Great Depression of the 1930’s. Not wages but interest rates should be cut’.

Carola Fischbach-Pyttel, General Secretary of the European Federation of Public Services Unions (EPSU): ’Labour is not a commodity. We welcome the recent Ver.di agreement in the German public sector (a 5% wage increase over two years) as striking a balance between the need to support household demand in times of crisis and the objective to maintain the sustainability of public finances’.

David Begg, Secretary General of the Irish Congress of Trade Unions (ICTU) says: ’Calling for deflation is not the way to go. The name of the game is debt deflation. Wage cuts will worsen the already excessive debt load of households and this will end up in killing the domestic side of the Irish economy’.

Frank Bsirske, President from Ver.di (Federation of Public services: Vereinte Dienstleistungsgewerkschaft) says: ’In the past, German economic policy has done exactly what the ECB is now recommending. Generalised stagnation of average real wages together with real wage cuts for workers at the bottom of the labour market have proven to be disastrous. The German economy has remained in the doldrums for many years while poverty, in particular child poverty, has seen a spectacular increase’.

(Pictured Irish Public Servcie Workers marching against cuts last month)Photo by Mark Condren and courtesy of the Sunday Tribune

Press contacts: ETUC: Patricia Grillo, +32 (0) 2 224 04 30 EPSU: Brian Synnott, + 32 (0) 2 250 10 80 ICTU: Mcdara Doyle, + 353 1 8897799 Ver.di:+49 (0)30/6956 1011