November 12, 2018 / 12:04 PM / a month ago

Croatia's public sector unions reject wage offer, threaten to strike

ZAGREB (Reuters) - Croatia’s public sector trade unions on Monday rejected the government’s offer of a 3 percent wage hike in 2019, saying that they may call a general strike.

The government last week proposed a 2019 budget which targeted a deficit of 0.4 percent of gross domestic product, a touch lower than this year’s target of 0.5 percent.

“The public sector trade unions agree that we cannot accept the government’s offer,” Branimir Mihalinec, head of a union for teachers, told a news conference.

“We will press the government to change its stance and, if not, we will announce the details of a strike,” he added.

The trade unions, which largely represent employees in education and health sectors, say that salary growth in the public sector has considerably lagged behind that in the private sector over the last 10 years.

“A three percent hike cannot make up for 10 years of (public sector) salaries continuously falling behind. The level of salaries does not motivate people to stay working in the public sector,” said Vilim Ribic, another union leader.

The government has so far insisted that it cannot offer a larger increase.

“It has become irritating to listen to the government saying there is no money, while there is money for some tax cuts and paying state guarantees for the Uljanik shipyard. How come there is never money for us?,” Ribic said.

The government plans to halve value added tax on key food products from the beginning of next year. It must also pay around 4.2 billion kuna ($636.70 million) in state guarantees extended in recent years to help the Uljanik shipbuilding group remain in business, although the dock is now on the verge of collapse.

Last month trade unions organised a protest against pension reforms which will increase the retirement age. They now plan to start collecting citizens’ signatures, aiming to push through a referendum on the issue.

($1 = 6.5965 kuna)

Reporting by Igor Ilic; Editing by Kirsten Donovan

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