The leader of the Association of Croatian Trade Unions (MHS), Vilim Ribic, said on Friday that a radical, double-digit wage increase in public services was a "first-class national interest," assessing that there was 4.7 billion kuna (€634 million) available for that in the state budget.

“Our children are leaving the country, 400,000 have left. In that situation all dogmas about financial consolidation, public debt and deficit need to be put aside. We have to use our last internal reserves,” Ribic said after the start of negotiations on an annex to the basic collective agreement for public sector employees.

Ribic recalled that Finance Minister Zdravko Maric had forecast a deficit of 0.9 percent of GDP, yet a surplus was generated. That means that there is about 4.7 billion kuna (€634 million) available for wage increases if a deficit of 0.9 percent occurs, he said.

“That leaves room for a double-digit wage increase. That would be a psychological message to the people that things are changing for the better, that they need to stay in Croatia and that not everything is hopeless. We should not be bailing out companies before we save the people,” said Ribic.

“We constantly have situations like the one in Uljanik and it is time for citizens of this country to have their turn,” he added.

The government’s negotiation team, Ribic said, insists that there is a lack of money due to financial consolidation, however, public sector unions have pointed out that the enormous number of people emigrating, low wages and the dissatisfaction of the people are a much more important problem.

“We believe that considering the current budget potential, the government can meet union demands without any problems. We expect a significant step forward regarding wage increases because wages are growing much faster in neighbouring countries. Of all eastern European countries, Croatia has been at the bottom of the ladder regarding wage increases over the past five years,” Ribic underscored.

Negotiations on the collective agreement for public services will continue over the next ten days, with Ribic underscoring that there is a lot to be discussed, however, raising the base pay is a priority.

Commenting on Prime Minister Andrej Plenkovic’s message that the ongoing school strike is absurd, Ribic said that his message is irresponsible. The prime minister is a diplomat who is not familiar with economic processes, he said.

“People have the right to strike and he has to re-examine his starting position,” Ribic added.

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