There will be no further strike of the civil service and public companies. It was already anticipated after the “success” in halftone of the first two strikes that the two parties will eventually return to the negotiating table and find the solution that lets both sides sit on the fence. It must be noted that the powerful labor organization has finally come to its senses.
Indeed, after almost a month of union gestures and threats of strikes for which the UGTT mobilized drums beating, Youssef Chahed and Noureddine Taboubi sat for eight hours around a table and the UGTT finally came to its senses.
Details of the increases and their cost on the budget
Indeed, according to Secretary-General of the Government Riadh Mouakhar, the agreement includes an increase, for the civil servants of the State, for a total volume of about 1.2 billion TD in gross, payable and distributed over two years, 2019 and 2020.
In 2019, the budget will only bear about 600 MD. For 2020, the wage increase will be made in the form of a tax credit, i.e. the salaries of the beneficiaries will be subject to less tax, which will automatically result in an increase in the salary received.
Importantly, the rise in wages will affect both public sector workers and retirees through the effect of equalization.
For the part that will be served in the form of a tax credit, retirees will be able to benefit from it through a law article that should be introduced in the next finance law for the 2020 financial year.
Overall, the increases will be paid in three installments. A first tranche of 90 DT net. It will take effect from December 2018, but will not be paid until June 2019.
The second tranche is of 40 TD net and will take effect in July 2019, but will be disbursed and paid to both active workforce and retirees in January 2020. A third tranche of 20 DT will take effect in January 2020 as a tax credit.
The agreement, which was officially endorsed and accepted on Thursday, February 7, 2019, by the administrative committee of the UGTT seems indeed to have allowed both sides to sit on the fence. It takes into account the capacity of state resources and does not increase the wage bill.
Indeed, with this agreement, to which we must add that of teachers, for which the premium of the new school year will increase from 360 DT to 1200 DT served in “One Shot” and once a year, but with total and final cancellation of the specific bonus that used to be monthly, the finances of the state will, if we dare say, make a “good deal”.
That means satisfying the demands, without weighing down its charges beyond the sustainable.
All, according to our sources, should represent only a 3.5% increase in overall payroll which should increase to 17.1 billion DT.
What about the IMF’s reaction
It should be noted, without saying that the UGTT has yielded to the unchanged position of the government of Youssef Chahed, that Noureddine Taboubi has come to understand that the use of the fatal weapon that is the general strike cannot be repetitive without risks, even for the unions.
Youssef Chahed and his government will have the merit of having resisted two strikes of the civil service, but also resisted pressure from the UGTT, despite the call of the Head of State to give in to “buy” peace social.
But we also know that the recent protest by student parents in front of the UGTT headquarters (for the record, this seat housed a police station of the time of the French colonization) and also the attempt by angry parents to break into the seat of the powerful union and the intervention of the security forces to prevent them and to protect a union which was frankly against the government and openly called upon to bring it down would have had an effect on the change of position of the UGTT and its return to reason.
It will remain for the government of Youssef Chahed to manage the pressure of the IMF, already angered by the images of its managing director flanked by a red cross and brandished during the recent strike by public employees.
The International Monetary Fund has repeatedly warned of the dangers of any increase in the wage bill on the recovery of the economic and financial situation of Tunisia.
By signing the latest agreement with the UGTT, the Prime Minister will have demonstrated the nullity of the argument of the UGTT which argues that the IMF dictates its law to the government.
The latter will have done what it could and will have to convince its donors of the correctness of its decision and the imperative to continue to financially support the Tunisian economy which will have proved, by this agreement with the UGTT, that it managed the finances of the State as a good father and not a good student of the IMF.
Through this agreement, the two social partners will also have been able to show a good sense of the state, giving in each to the demands and constraints of the other, but without breaking the machine that feeds everyone.
We will wait for the next round of IMF / Government negotiations to see if the main donor will release the next tranche of credit. We will also wait to see if the UGTT will be satisfied
and will make peace with the Tunisian economy, or if it will start again, as it already promised, with new strikes in July 2019.