Annual Report - paperJam

5.
Social affairs & Employers’ representation
The budget austerity package
In 2010 began the long awaited negotiations
on the methods and means of how to reach a
budgetary equilibrium of the Luxembourg public
administration by the year 2014.
After several encounters between the government
and the social partners on an individual
basis, the tripartite committee sat together four
times. These talks were held in parallel with
other planned wide-ranging reforms, namely
health and pension reform, as well as the reform
of the remuneration policy of the public sector.
In April, however, Prime Minister Jean-Claude
Juncker declared that the talks had failed. The
issue of the state of competitiveness of the
Luxembourg economy (the trade unions refused
to acknowledge the analysis made by public
officials as well as the representatives of the
employers’ organisation) and the issue of the
indexation of salaries (a governmental proposal
to cap the level of indexation at a certain height
of salary was also categorically refused by the
trade unions) were the reasons for the failure of
the tripartite committee. The talks emphasised
the huge gap between the social partners, and
they also uncovered the ideological discords
within the governmental coalition, which nearly
provoked early elections.
After the State of the Nation speech by Prime
Minister Juncker in May, the government submitted
its own savings packet for 2011, which
notably introduced a 0.8% crisis contribution,
a new maximum fiscal threshold of 39%, and
an increase of the solidarity tax.
Discussions with the social partners only resumed
after the summer break in October, in the shape
of a bipartite model, between the government
and the trade unions, and later on in November
and December, between the government and
the employers’ organisation.
To the dissatisfaction of the employers’ organisations
no structural reforms but merely small adjustments
resulted from that round of discussions.
Those adjustments can be summed up as follows:
• an increase in the State participation in
employers’ professional training costs;
• a reimbursement by the State of employers’
cost of the minimum social salary increase of
1 January 2011, to be paid into the “Mutuelle
des employeurs” and redistributed internally;
• the government‘s commitment not to raise
social contributions until the year 2014.
14 June 2010
The ABBL hosts the European Banking Federation’s
Anti-Fraud & Anti-Money Laundering Committee and
Physical Security Working Group.
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