2017 salary negotiations “may be a bit violent” – OTM-CS Secretary General

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2017 salary negotiations “may be a bit violent” – OTM-CS Secretary General

4:32 CAT | 04 Jan 2017

@Verdade / Alexandre Munguambe

Since the last wage increase in Mozambique last April, official inflation has worsened by more than 25 percent. Staple food products have registered increases of around 40 percent.

“Inflation was quite high, purchasing power was badly eroded, and we realise that salary negotiations next year (2017) may be a bit violent,” said Alexandre Munguambe, the secretary general of the Mozambique Workers’ Organization Central Trade Union (OTM-CS), in an interview with @Verdade.

At the same time, the Minister of Economy and Finance has revealed that the lack of money for goods and services could jeopardize the productivity of civil servants.

But the new year has begun, and after the long weekend break and holidays for the privileged, Mozambicans again face the harsh reality of a cost of living that remains high, and – despite all the strategies, speeches and appeals of the Government – shows no sign of reversing its upward trend.

This year, civil servants, who by this time have usually received their 13th month salary, will receive it only partially. Among private company employees, to have received their December pay at all will have already been a source of great joy. Many have wages in arrears and many others do not even have jobs, contrary to the official claims of having created more than one million new posts.

But for most Mozambicans, who live from agricultural labour and informal business, the situation is much worse. The minimum wage in 2016 increased by only 3.6 percent and stood at 3,298 meticais for the agriculture, livestock, hunting and forestry sector. However, most farmers do not even have a work contract guaranteeing even this remuneration, and are hired seasonally and paid what agricultural bosses decide without even the payment of Social Security assured.

Foto de Adérito Caldeira

Speaking with @Verdade in Maputo after an end-of-year champagne toast, the OTM-CS general secretary acknowledged the obvious. “Inflation has been high; purchasing power has been eroded,” he says. But although he heads an organization that has a tradition of being compliant towards to the ruling party, Munguambe predicts that this year’s negotiations “are going to be a bit violent”.

Munguambe said that it is too early to have a concrete salary increase proposal, as he is awaiting the input of economists advising OTM-CS on this matter, but says that “from April 1, salaries haveto be revised”.

“When we go to the negotiating table we have in mind the following. We have to guarantee what was eroded by inflation, we have to secure jobs. Increases in wages can not lead to mass lay-offs. We also have to seek to ensure that new jobs are made available … we can not go to the negotiation and tighten the screw on companies in such a way that we force them to reduce their workforce or not create new jobs,” he explains.

Given this equation, @Verdade asked whether the OTM-CS thought there would be no increase in wages in 2017, in order to preserve existing posts and not stifle companies.

“We never advanced the hypothesis of not raising wages. It never entered in our heads that someone could come to us to say that we wouldn’t increase wages in 2017,” he declares.

Some subsidies to civil servants “reach up to 100%”

@Verdade asked the Minister of Economy and Finance, Adriano Maleiane, how civil servants salaries are seen, taking into account the International Monetary Fund observation that “increased expenditure on wages and salaries has been putting pressure on fiscal policy” in Mozambique.

“The question of salary is not the increase; what we are discussing with the International Monetary Fund is the structure, how [to make the] our payroll sustainable. As you know, there is the basic salary, then there are all these subsidies. We are working internally to see what it can be because there are indicators that wages can not exceed 8 percent of GDP. We are at 10.7 percent, so we must see how we can handle this,” Maleiane said.

The minister also explained to @Verdade that “the subsidies, if we add them up, sometimes equal 100 percent [of the salary]. For example, specialization, and so on, because they were all created in a context. One must see if it is the subsidy or something else that should be”.

“Looking also at the experience of other countries and comparing how we are, for example, operating expenses in the (2017 State) Budget are 49.4 percent wages and 17.4 percent of goods and services. This is something that needs to be revised. If you do not have goods and services at the time of maintenance and consumables this employee will not have adequate means to work and his productivity will be put in doubt. This has to be discussed,” Maleiane concludes.

Source: @Verdade