Calviño asks for a three-year agreement for "moderation" of business benefits and wages

The First Vice President and Minister of Economic Affairs, Nadia Calviño, summoned this Wednesday the majority unions and the representatives of the employers' association to reactivate the negotiations on an income pact that distributes the damage of inflation between workers and employers. As she explained after the meeting, she has asked the social partners for a three-year agreement for "moderation" of business profits and wages.

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The economic vice president stressed that it is “essential” that “the margins of the companies [la capacidad de obtener beneficios de las ventas, que se mantiene o aumenta si se repercuten las subidas de los costes (como la energía) a los precios finales] do not grow” and says that he sees unions and employers in a position to reach the income agreement.

On behalf of the Government, Calviño has confirmed that the SMI will be raised again in 2023 until the objective of representing 60% of the average salary is reached, and that work continues to increase the Corporation Tax for the electricity sector. After the appearance of the economic vice president, the unions have highlighted that there is no roadmap for the income agreement, and that it is also important that "fiscal measures" be taken.

Collective bargaining is once again crucial for the Executive, since the measures to contain runaway prices are not being forceful enough. The Government defends that they have managed to subtract about 3 points from the CPI (Consumer Price Index), although, in June, this indicator registered the record advance of this crisis, when it reached 10.2% compared to the same month last year according to the data advanced by the INE, despite the cap on gas in electricity generation, the discount of 20 cents on fuel (whose inefficiency is becoming apparent) or the rest of the Shock Plan, which has been recently renewed until December.

According to theory, this income pact should seek "a commitment from companies to limit their profit margins" and, at the same time, "increases in multi-year salaries", to compensate in the medium term for the loss of purchasing power for families which implies inflation, whose persistence is feared due to the threat of a cut in the supply of Russian gas in the fall. Especially in the case of the poorest households.

Meeting Preparation

This same Wednesday, before meeting at the dialogue table convened by the Ministry of Economic Affairs, the general secretary of the CCOO, Unai Sordo, and that of the UGT, Pepe Álvarez, pointed out that companies “are passing on the increase in energy costs” and they have been reminded that “they cannot only safeguard their benefits without distributing them to their workers”, after the failure of the last attempt at collective bargaining.

Also before the meeting, the president of the CEOE, Antonio Garamendi, stated that his organization is not opposed to raising wages, but to indexing them to inflation, since this would cause second-round effects (a spiral of prices and salaries that, according to certain experts, would feed back into inflation) that would make Spain lose competitiveness and companies, productivity.

The truth is the economic recovery has already suffered a slowdownalthough numerous economists argue that the priority now is to protect the spending capacity of families, especially the most vulnerable, while tourism can be a differential for our country compared to other comparable countries in the eurozone.

The Second Vice President and Minister of Labor, Yolanda Díaz, also did not want to miss the opportunity to warm up the meeting and made "a clear call" for a salary increase in response to the impact of inflation.

Díaz, who met this Wednesday in Rome with his Italian counterpart, Andrea Orlando, and with the European Commissioner for Employment and Social Rights, Nicolas Smchmit, supported the wage demands of the Spanish unions and recalled that the European Central Bank (ECB) has also recommended raising salaries.

For her part, in Palma, the Minister of Industry, Commerce and Tourism, Reyes Maroto, admitted that there is "a slowdown" in economic growth in Spain, but stressed that "in no case" does the Government of Spain foresee a recession.