All the ceremonies are ready for the unions to approve the labor reform proposed by the Government this morning. Both CC.OO. As UGT, they have summoned their management bodies at 11 in the morning and plan to announce the decision around one in the afternoon. And in the afternoon, Minister José Luis Escrivá will go to detail the initiative to the Toledo Pact commission of the Congress of Deputies.
Although yesterday afternoon there was some pending fringe, everything indicates that the two unions will give their approval to the project presented. “Except for great surprise, we approve it,” said a negotiator. Also in the Ministry of Inclusion they take for granted the yes of the unions, although it needs to be formalized in these meetings of their highest management bodies.
In this way, both the acceptance of the unions and the rejection of the employers are reaffirmed. Yesterday, the president of the CEOE, Antonio Garamendi, raised his tone by stating that the Government has presented the pension reform debate as if they were “lentils”, “stealing the debate” and the negotiation from the parties and without a financial report to assess the effects of the proposal.
In this way, Garamendi contradicts the Minister of Inclusion and Social Security, José Luis Escrivá, who stated that the employers have not presented proposals. “We have raised things, but we have not been given data… It is very difficult to talk about something without numbers and the reality is that as of today we do not have the economic memory of the reform… The minister does not tell the truth,” declared the president of the CEOE.
There are two major attacks on the pension reform proposal since the project came to light: that it puts all the weight on an increase in social contributions and that it is not a sustainable model. The employers especially insist on the first point, on the increase in contributions via the top of the maximum pension, the increase in the Intergenerational Equity Mechanism (MEI) and the creation of a solidarity quota on high incomes. “Call it what you want, but I think it is a full-fledged reduction in rights,” said yesterday the president of the Association of Self-Employed Workers (ATA), who added that he supposes that “twenty million citizens are going to pay more taxes, work more years to collect fewer pensions”.
The second point of criticism focuses on the sustainability of the reform. Both Fedea and BBVA Research consider that it will need extra income. For Fedea, it will have a high and growing basic deficit in the coming decades, and for BBVA Research the measures imply an increase in spending of more than 3.5 points of GDP, while revenues move in a range between 0.8 and 1 ,7 points.
However, what Escrivá has achieved is the endorsement of Brussels, which always takes the final result into account, and leaves room for the formulas to reach this objective, be it through cuts or extra income. The first statements by the Commissioner for the Economy, Paolo Gentiloni, were to highlight “the positive spirit” of the negotiation, although without ruling on the substance.
