In view of potential new tripartite negotiations in autumn or winter, the government met with the trade unions and the employer representatives separately on Thursday.
The talks mainly focused on which data and information will be needed to conduct a thorough analysis of the current situation that will be accepted by all parties as a trustworthy and neutral starting point. On Thursday, Prime Minister Xavier Bettel stated that this is particularly important to him. Bettel added that the government has also presented the social partners an updated overview of the situation.
Minister of the Economy Franz Fayot presented an overview of the economic situation, while Minister for Energy Claude Turmes focussed on energy, and Minister of Finance Yuriko Backes on the financial situation. The Prime Minister announced that he has already scheduled a follow-up meeting on 14 September to discuss the updated calculations provided by the National Institute of Statistics and Economic Studies (STATEC).
Michel Reckinger, the President of the Luxembourg Employers’ Association (UEL), stressed the importance of having a mutually prepared and accepted analysis. The UEL does not want to take decisions based on emotions, Reckinger said.
The UEL President stated that he hopes that the next tripartite will be “honest” and not “a politicised tripartite ahead of the elections”. “If we are honestly engaged for the good of the country during a tripartite, then we will also have to take the right decisions,” Reckinger added.
In order to be “more transparent” regarding the current situation, the UEL has also shared figures from the individual sectors.
The bilateral discussions will continue on 14 September, when new, adapted data will be available. However, for the time being, the government is unable to announce a date for the next tripartite. According to the Prime Minister, this depends on the figures provided by STATEC, i.e., when exactly the next wage indexation is likely to be triggered. “Once we know this, we know how much time we have,” Bettel explained. Depending on STATEC’s projections, preparations for the next tripartite could thus continue well into winter.
The UEL President declined to answer whether, based on the current figures, companies would be able to pay out another wage indexation this year.
Neither the trade unions, nor the UEL, and certainly not the government hinted at any red lines or concrete demands on Thursday.
Following the discussions on Thursday, the trade unions stated that they are in favour of an in-depth analysis of the situation followed by “enough time” to prepare solutions.
The Independent Luxembourg Trade Union Confederation (OGBL), the Luxembourg Confederation of Christian Trade Unions (LCGB), and the General Confederation of the Civil Service (CGFP) met with Prime Minister Xavier Bettel, Minister of Finance Yuriko Backes, Minister for Energy Claude Turmes, Minister for Small- and Medium-Sized Enterprises Lex Delles, and Minister of the Economy Franz Fayot. One of the reasons for another tripartite is the rising inflation rate, which causes prices to soar, particularly in the energy sector.
Upon leaving the discussions, Minister of Finance Yuriko Backes described the atmosphere as “friendly,” but declined to comment on anything specific.
CGFP President Romain Wolff stressed the need for “precise data” for the analysis, stating that this is “particularly important” for the trade unions.
In a statement released after the bilateral discussions, the CGFP reiterated that the deferral of wage indexations must not become the new normal, as this would lead to “structural problems”. Instead, the CGFP is in favour of considering new measures, such as adjusting the tax table for inflation, which has not been done since 2009. In addition, the CGFP points out that inflation is now also affecting the middle classes, which is why measures “must not exclude a broad part of society”.
OGBL President Nora Back stated that finding solutions to the current situation is “not easy”, especially since the situation got worse since the last tripartite, notably due to soaring energy prices. Back considers the latter to be “one of the main issues”.
For this reason, the OGBL President thinks that it was important that Minister for Energy Claude Turmes was also present during these initial discussions to present an overview of the evolution of energy and gas prices.
The wage indexation system, on the other hand, was not discussed at all, neither with the UEL, nor with the trade unions. Nevertheless, it seems “likely” that another wage indexation will be triggered this year. While the trade unions have been demanding for months that the wage indexation system should once again be implemented as normal, Back stressed that this next tripartite “cannot only be about the wage indexation system”.
“It’s not a solution not to pay out a wage indexation,” the OGBL President stated. As such, it is important that the next wage indexation will be paid out, but the current crisis “goes way beyond that,” according to the OGBL President. Back noted that the population’s purchasing power has taken a toll “far into the middle classes”. Since everyone will be affected by this price explosion, “we all have to be open for all kinds of solutions,” Back argued, adding that “there is a willingness to engage in a dialogue”.
Despite the fact that the wage indexation system was not discussed on Thursday, it might well end up being one of the main points of contention. Speaking to our colleagues from RTL.lu, OGBL President Nora Back notably admitted that it will be “rather unlikely” that there will be an agreement if another wage indexation is to be postponed this year. Nevertheless, all trade union representatives assured that they will enter the upcoming negotiations with “an open mind”.
