MP Baum stressed his party’s continued commitment of honouring the current tripartite agreement. “There is no reason for us to question it at the moment”, said the politician, while also acknowledging the recent forecast from the National Institute of Statistics and Economic Studies (STATEC), which estimates that inflation will last longer than anticipated when the agreement was signed back in March.
The DP thus holds on to the tripartite accord, which regulates that no more than one annual index cut should be made until after the next Chamber elections at the end of 2023.
As there is a substantial risk that businesses will be forced to pay out two or more index cuts in 2024, MP Baum believes that the next administration will have to call for another tripartite meeting at the beginning of that year.
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The meeting with social partners held in Autumn will mainly focus on means of compensation for depreciation. Asked whether a new accord signed at the end of the year may not risk canceling out the previous one, MP Baum admitted that this is possible.
MP Baum explained that since the government refrained from adjusting tax rates to inflation, which would have cost an estimated €600 million, the coalition has sufficient financial means to continue supporting households and businesses.
The DP politician also expressed support for the idea of introducing a complete taxation scheme for MPs. Yves Cruchten, chairman of the parliamentary group from the Luxembourg Socialist Workers’ Party (LSAP), recently argued in favour of the same proposal, as did Djuna Bernard, party president of the Greens.
