December 2, 2020

The employer lashes out at the 0.9% rise in civil servants’ wages and pensions: “It doesn’t make sense”

The president of the main employers’ association, CEOE, has criticized this Tuesday the 0.9% rise in salaries for public employees and pensions embodied in the 2021 General State Budget project. As defended by the governor of the Bank of Spain last week, Antonio Garamendi has opposed this general increase and has argued that the rise should have been “discriminated” so that it benefited to some specific groups, such as “health workers and police” and, in the case of pensions, only to those with a lower amount.

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The governor of the Bank of Spain criticizes the increase in the salary of civil servants and pensions

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“I don’t really understand that 0.9% increase for civil servants. I say this when deflation is going to be 0.9%. That is to say, we are talking about the 1.8% increase, “said the business leader at an information meeting organized by Nueva Economía Forum.” We would even understand raising something more to health workers, to the police, to people we all know there are to reward. Because we also know, as has happened to us in companies, that there are other people who are at home. They had to have discriminated, “he added.

The Basque businessman agrees on this approach also with regard to the 0.9% rise in pensions. The Government has reflected in the Budgets the agreement that the parties have reached in the Toledo Pact Commission: annually revalue pensions based on the CPI. As the forecast of the GDP deflator – an approximate indicator of the CPI – that the Executive manages is 0.9%, this is the increase that has been incorporated into the public accounts, in addition to a 1.8% rise for non-pensions. contributory, lower pensions of people who have not contributed enough to access a contributory pension.

“I do not understand the rise in pensions either. It could have been understood even a greater rise in minimum pensions, because we understand that part of solidarity, but it makes no sense to have risen to the maximum, which is a structural expense that is there”, Garamendi has argued. The businessman stressed that “we must be very careful, the European Union is telling us that in 2022 we can have a deficit of 8% when the objectives of Brussels are 3%. In that sense we will have a problem in Spain because we will have to adjust the boots”.-

The president’s criticism of Spanish businessmen is in the same vein as those of the governor of the Bank of Spain, Pablo Hernández de Cos, in his analysis of the Budget project. Several members of the Government, from the economic vice president, Nadia Calviño, to the minister José Luis Escrivá, came out publicly to defend these increases. “The fiscal or public deficit problem in Spain is not precisely in the salaries of officials”, underlined the Minister of Inclusion, Social Security and Migrations, formerly responsible for the independent Fiscal Authority (AIReF).

Against “ideological taxes” such as Heritage

The president of CEOE has also criticized other items of the Budgets, such as the agreed increase for the wealth tax and other tax increases for the highest incomes. Garamendi has insisted that “it is not the time to raise taxes”, but has also criticized the increase in “ideological taxes”, as he has described the Wealth Tax and the Inheritance Tax, which in his opinion “do not collect and only put impediments to saving “.

Antonio Garamendi has also insisted on the need for the State to maintain and increase support for the business sectors most affected by the pandemic, among which tourism and hospitality have stood out. Among the measures for this, he has mentioned extending the ERTE beyond January 31 with the same unemployment protection for workers and exemptions for companies, as well as “giving a kick forward” to ICO credits. Garamendi has insisted on also considering alternative measures to business closings, for example in the hospitality industry. “The easy thing is to say I close. When very effective measures could be taken from the health point of view that do not involve closure,” he said.

The Basque businessman has also reiterated that the commitment to the Radar COVID app, which in his opinion “is the best tracking system we can have” and “is not working in Spain”. The CEOE president also recalled that companies can collaborate more in the screening functions and help in this regard to control the pandemic.

Garamendi has maintained that these days there are “moments of certain optimism” thanks to the news of the high effectiveness of the coronavirus vaccine developed by Pfizer, according to the pharmaceutical company. The businessman has called for a long look at economic matters and to pay attention not only to what is going to happen in 2021, but in 2022, because “we can have problems,” he indicated.


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