Spain workers to protests pay cuts, tax hikes

Business

Spain workers to protests pay cuts, tax hikes

Close

Spanish workers Thursday plan the biggest protests against latest pay cuts and tax hikes.

19 July,2012 08:17 pm

The two main labour unions UGT and CCOO said public sector workers will stage more than 80 demonstrations across the country, with the flagship Madrid march due to start at 1830 GMT.Smaller protests, organised largely via online social networks, have occurred daily since the latest austerity measures were announced on July 11, with some workers taking to the streets during their morning coffee break.Hundreds of protesters, including firefighters wearing their helmuts and police in black T-shirts, have marched through the streets of Madrid, blocking traffic and yelling Hands up, this is a robbery, with their arms in the air.The sustained string of protests erupted after Prime Minister Mariano Rajoy last week announced new pay cuts and tax increases, aiming to save 65 billion euros ($80 billion) in order to slash the public deficit.Among the latest steps is a cut in the Christmas bonus paid to civil servants, equivalent to a seven-percent reduction in annual pay. This came on top of a pay cut in 2010, which was followed by a salary freeze.Under pressure from the European Union to stabilise Spains public finances, the conservative government also cut unemployment benefits and raised sthe ales tax, with the upper limit rising from 18 to 21 percent.Budget Minister Cristobal Montoro defended the measures on Thursday, saying they were needed to lower Spains borrowing costs.There is no money in the coffers to pay for public services. We are making reforms that will allow us to better finance ourselves, he said.Spain had to offer investors sharply higher interest rates on Thursday to raise 2.981 billion euros in debt auctions with maturities of two, five and seven years.The higher rates suggest investors remain worried over the countrys ability to repay its debts as it struggles with its second recession in four years and an unemployment rate of over 24 percent.Critics say the governments new austerity measures will worsen economic conditions for ordinary people.The new cuts harm the weakest sectors of society without one single measure that involves any effort by companies and the highest earners, the CCOO said in a statement.Eight firemen posed in the nude outside their fire station in the nothern town of Mieres on Thursday to protest against the new austerity measures.Eight firefighters who show their ass are worth more than a protest through the streets against the cuts, said Javier Piedra, 41, one of the members of the Mieres fire brigade who took part in the protest.Unions have called for the protests to be peaceful but clashes broke out on the fringes of some demonstrations in Madrid last week, including one major march by striking coal miners.They have already lowered and frozen our salary and this is the final blow, said Ines Cornide, 44, a worker in the justice sector, protesting in Madrid on Tuesday.These measures they are taking will not stimulate consumption and will not create jobs, said Cornide.Spain is due this month to become the fourth eurozone country, after Greece, Ireland and Portugal, to get bailout funds in the current crisis when it receives the first loan from a 100-billion-euro credit line for its banks.Eurozone leaders are expected to finalise the deal in a telephone conference on Friday.Spaim aims to slash the public deficit from 8.9 percent of economic output last year -- well above the EU limit of 3.0 percent -- to 6.3 percent this year, 4.5 percent next year and 2.8 percent in 2014.