Here’s 5 things you should know about at the end of this week:
The latest round of tripartite negotiations that started last Friday resulted in an agreement on the same day, with major implications for indexation, tax brackets and energy subsidies.
It was the third tripartite meeting in 12 months, bringing together the Grand Duchy’s government, employers and unions.
15 measures - Overall, opinions on the agreement reached on Friday are rather positive, but what does the final text to be signed on Tuesday morning include? Click here for a rundown of the lastest measures.
Criticism - The Ecological Movement (Mouveco) opposes the extension of the energy price cap, while the Young Greens raise concerns about financing.
No tax table adjustment - The postponed wage indexation will go ahead as planned this April, with the tax brackets only being adjusted to inflation in 2024. In addition a tax credit equivalent to an adjustment of the table by two indexations in 2023 will be introduced.
Gas and electricity costs - The so-called ‘phasing-out’ will continue in 2024, which means the 15% cap on gas prices and the stabilisation of electricity costs will be prolonged beyond April this year, as initially scheduled.
Housing - In terms of housing, the amount of the “bëllegen Akt” (tax credit on notarial acts) will be increased from €20,000 to €30,000 and the ceiling on home loan repayments will be retroactively increased to €3,000.
Third agreement - The signing marks the third tripartite agreement reached by the government and social partners in less than a year.
What happens next? - Finally, the government has already committed to organising a new tripartite in 2024 if a new wage indexation is announced before October.
Read also: Real estate loans - Variable rate jumped to 3.51% in January & Solidarity Pack 3.0 - How much will you save in taxes?
Luxembourg has been battling a drug shortage and while those have occurred in the past, the situation has deteriorated in recent months.
The issue is exacerbated by the absence of everyday medication such as cough syrup, antibiotics for children, and medication for high blood pressure or diabetes. Often there are very few alternatives.
According to the Grand Duchy’s pharmacies, the issue is caused not just by supply bottlenecks, but also by Luxembourg’s reliance on other countries, particularly Belgium.
Fulfilled quota - The missing medicines mostly come from Belgium, with exports to Luxembourg being subject to a specific quota. This quota is currently being fulfilled, according to the National Health Directorate. The undeniable shortage appears to be affecting Europe as a whole.
Numerous possible explanations - Ranging from reliance on other markets, to demand exceeding supply, or even “trendy” applications of medications, such as a diabetes medication that people have recently begun using as a weight-loss supplement.
Political tensions - The situation is further complicated by the fact that only a small number of factories produce the medications, some of which are situated in countries such as China, where political tensions could quickly lead to delivery suspensions.
Pressure needed - If the situation worsens, politicians will have to step in, “including at the European level,” says the president of the Union of Luxembourg Pharmacists, Alain de Bourcy. Decision-makers may need to put pressure on the pharmaceutical industry if necessary, he argues.
Read also: LCGB urges government to act on medicine shortages
According to new figures published on Thursday, Luxembourg had the lowest inflation rate in February out of the 20 countries in the eurozone.
In addition, the National Institute of Statistics and Economic Studies (STATEC) reports that inflation slightly decreased over the past year.
Thirteen percent - According to Eurostat, the surge in grocery prices is currently compensation for the lull in energy prices, further impacting the cost of living crisis. Over a one-year period, food prices increased by 13% in Luxembourg, compared to the EU’s 15%.
At European level - It was the first time in two years that food costs rose more than energy but experts said they expected the food inflation rate to be slower over the course of the year.
Neighbouring countries - Belgium also fared well in comparison, with an inflation rate of 5.5%, France’s inflation rose to 7.2 percent while Germany’s consumer prices reached 9.3 percent in February.
Read also: Working two jobs to make ends meet in Luxembourg - “I have no choice if I want to buy myself things”
A serious collision left three people dead and one injured on the road leading from Findel into the city at around 10.10am on Monday.
A vehicle had attempted to overtake a bus which had pulled over at a bus stop, when a second car behind them did the same, colliding with the first.
Highlighted concerns - Bus stops in cities should not be obscured but clearly visible and placed right on the street, Minister for Mobility François Bausch clarified.
Overtaking a bus is legal - According to the Minister, better placement of bus stops would improve safety since cars would be forced to slow down behind a bus. Unlike in some other countries, overtaking a bus is not prohibited in Luxembourg.
Expect the unexpected - Bausch stresses that “drivers must always assume that something unexpected may occur on the road.” People behave “completely differently” in cities, and “as a motorist, you simply have to adapt to that.”
Emotional tweet - The Greens’ Laure Huberty criticised the municipality of Luxembourg City on Twitter for failing to take action that might have prevented the accident.
Using the accident as an election campaign? - Luxembourg City Alderman Serge Wilmes from the Christian Social People’s Party (CSV) showed little understanding for the criticism: “This is an unacceptable accusation for us on the aldermen council as we think such accidents should not be used for political gains.”
Crossing lines - “Elections might be coming up and people need to campaign, but there are limits and we think that limit has been crossed here”, argues Wilmes.
Tweet has since been deleted - Huberty apologised and clarified that it was not her intention to use the accident for political gains or award blame. She said the issue of transportation is close to her heart and she chose the wrong words.
Read also: Alcohol consumption involved in 70% of accidents leading to injuries
Even though men still have higher annual wages, women in Luxembourg on average are now earning more per hour than men, a study by STATEC shows.
In all other EU countries, this hourly wage indicator remains in favour of men. In most countries, the indicator has been decreasing for years, but remains largely positive in 2021.
To date, Luxembourg is the only EU Member State where equal pay has been achieved.
Reversed gender pay gap - With 0.7% in 2020 and -0.2% in 2021, it is highly likely that the wage gap will continue to widen in favour of women. Statec estimates -0.4% for 2022, but only the salary structure survey amongst companies held in 2023 will confirm this.
Explanation - Women are generally better educated than men, leading to a so-called “education gap”. Among employees aged between 25 and 35, women are already earning 7% more on average than men in 2018.
Equal work is not compared - The GPG compares average wages, not wages for equal work. In fact, the annual salary of employed women is much lower than that of men as the rate of women working part-time is much higher.
BUT - While this is undoubtedly a step forward, Statec highlights the limitations of this European indicator, which only takes into account hourly wages. Annual wages remain in favour of men.
Tiny forest - 200 people gathered in Mertzig on Saturday to help Greenpeace plant 600 trees and cultivate a micro forest expected to cover an area of 200 square metres.
Putting brakes on ban -Berlin has upset EU partners by blocking a milestone agreement to ban new sales of fossil fuel cars from 2035, as German domestic politics takes the bloc hostage.
Regulating the monarchy’s income - The government has tabled a bill to fix the compensation of several high-ranking positions within the Grand Ducal family, including the Grand Duke and Hereditary Grand Duke.
International ranking - OECD has published its annual ranking of countries by their talent attractiveness, with Luxembourg entering the top-10 this year at rank 6.
Public petition - After petition 2504 gathered more than 4,500 signatures, the proposal to improve access to MRIs, scanners, and mammographies was debated in the Chamber of Deputies on Wednesday.
Parental leave - A Women’s rights group demands three-month birth leave for both parents. According to Isabelle Schmoetten from the CID Fraen an Gender group, women often feel abandoned in the months following the birth of a child.
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