Agreement signed on modernisation and improvement of public administration

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In November 2002, the Spanish government and three trade unions (CC.OO, UGT and CSI-CSIF) signed an agreement on 'the modernisation and improvement of the public administration'. The two-year deal will introduce changes aimed at improving the services provided by the public administration and rationalising the structure of the workforce. It provides for above-inflation pay increases and the introduction of a 35-hour week, along with measures to promote employment stability.

On 7 November 2002, the government and three trade unions representing workers in the public administration - the Trade Union Confederation of Workers' Commissions (Comisiones Obreras, CC.OO), the General Workers' Confederation (Unión General de Trabajadores, UGT), and Confederation of Independent and Civil Service Trade Unions (Central Sindical Independiente y de Funcionarios, CSI-CSIF) - concluded a two-year collective agreement 'for the modernisation and improvement of the public administration' (Acuerdo para la Modernización y Mejora de la Administración Pública).

Main points of agreement

The accord's stated aim is 'to increase quality in the provision of public services and the effective management of human resources'. Increased quality and competitiveness, and a more flexible and responsive administration must, according to the pact, be promoted through: greater motivation of the workforce: improvements in working conditions and employment stability; enhanced 'professionalisation' and levels of qualification for public employees; and rationalisation of the structure of the workforce. To achieve these objectives, the agreements lays down the following main guidelines.

• Measures to increase the efficacy of the provision of public services include: reallocation of workers to priority areas; promotion of worker mobility between different public authorities and across the European Union; abolition of the current limited 'replacement rate' for public administration vacancies, by allowing all vacancies to be covered through public administration recruitment procedures; monitoring of temporary employment in public administration recruitment procedures; extension of the hours of public access to services and homogenisation of working time schedules; establishment of single information services for all authorities; and schemes for reducing absence from work (with the target of a 20% reduction).

• To improve the reconciliation of work and family life, an effort will be made to promote nurseries (with increased spending of EUR 1.2 million) and to promote part-time work and the possibility of worker mobility for health reasons.

• 'Professionalisation' will be promoted through internal promotion and training, particularly in languages and new technologies. EUR 3.6 million will be allocated to this purpose.

• Measures will be introduced to enhance the stability of employment in the public sector, by finalising processes of consolidation, decreasing the rate of temporary employment (to 8% of all public administration employment) and regulating temporary recruitment.

• Efforts will be made to improve quality of life at work and to improve the regulation of pay and incentive payments, together with programmes to increase productivity and performance, among other issues.

• There will be an improvement in the public administration industrial relations framework, with the establishment of joint working groups to assess and streamline bargaining procedures.

The agreement also contains provisions on pay increases and working time reductions. On pay, it provides for a real increase of 2.5% over two years: 1.3% in 2003, in addition to a 2% rise to reflect the forecast increase in the retail prices index (RPI); and 1.2% in 2004, plus the forecast RPI increase for that year. Special payments have been increased, amounting to a 0.7% overall increase in paybill, while there will be non-consolidated pay increases linked to the achievement of objectives. On working time, the agreement introduces a maximum working week of 37.5 hours (the equivalent of 1,647 hours per year), with the possibility of bargaining over a 35-hour week in local administrations. Annual paid leave has been increased to 26 working days. Other specific provisions include: the creation of an occupational pension fund to be implemented in 2004; and the establishment of three joint working groups to monitor the areas of human resources planning, absence and provision of services, and industrial relations.

The agreement's economic measures will cost a total of EUR 129.62 million over 2003 and 2004. Of this, EUR 71.8 million will be allocated to the increase in special payments, and in 2004, EUR 24.65 million will be allocated to the new pension scheme. The non-consolidated pay increases linked to the achievement of objectives are costed at EUR 28.36 million

Reactions

The government states that the new agreement will improve the functioning of the public administration and the working conditions of public employees. The most important point for the government is the change in conditions of service, in which the improvement in pay is only one point within a framework of measures that will promote productivity and competitiveness in the public administration. Other aspects of the agreement that the government believes will contribute to this objective are: the rationalisation and professionalisation of the workforce; the measures to harmonise working time; the reallocation of workers to cover areas such as offices and units dealing with foreign nationals, border inspection units, healthcare units, peripheral units and others (offering better pay); and the measures that will attempt to reduce absence from work by 20%.

CC.OO has welcomed the deal for several reasons. First, the agreement marks a change in the model of collective bargaining in the public administration, in that it provides for the government to accept responsibility for pay bargaining with regard to all public employees, and it reinforces the joint General Civil Service Commission (Mesa General de la Función Pública) and promotes bargaining in local and regional authorities. Second, the accord opens up the issue of pay by increasing special payments. Third, it reduces casual employment. Finally, it abolishes the 'replacement rate' and allows all vacancies to be covered through public recruitment procedures.

For UGT, the agreement means first and foremost the recovery of public employees' right to collective bargaining, something UGT attributes to the pressure exerted by general strike held on 20 June (ES0207201N). The accord is also seen as positive due to: the disappearance of the staff replacement quota and the new measures for reducing the temporary employment rate to 8%; the working time reduction; a pay rise higher than the inflation forecast, thus reversing the trend of recent years; and the establishment of the various joint working groups.

For CSI-CSIF, the importance of the agreement lies mainly in the reintroduction of an overall agreed framework for the public administration, which has not existed since 1997. Other important points include the improvement of working conditions with regard to: internal promotion; reconciling work and family life; the increase in annual leave and other time off provisions; a commitment to spend 1% of paybill on 'social action'; the modernisation of services; and the pay increase. CSI-CSIF believes that such measures illustrate the government's efforts to achieve a dialogue.

Commentary

The new agreement represents a significant change in the framework of industrial relations in the public administration (ES0102232F). From the viewpoint of pay, it breaks with the recent period of a total wage freeze for public employees (ES0107149N and ES0102233F). Furthermore, it attempts to contain and reduce temporary employment in the public sector (ES0201251F). It is the first wide-reaching agreement between trade unions and the government in a long time, and represents an attempt to normalise relations after many disputes in the public sector and the June 2002 general strike.

However, the agreement does not include a clause on wage revision if inflation exceeds forecasts, and accepts a fairly unreliable forecast of inflation (2%) for 2001. This may lead to a new loss of purchasing power for public employees. It also involves the acceptance of the loss of purchasing power during the earlier period of wage freeze: in the past decade there has been a sharp decrease in real pay in the public administration, in some cases of over 10%. Functional and geographical mobility have also become more flexible, because it is no longer necessary to negotiate with the trade unions on such issues. The government has thus obtained a new period of industrial peace with the most representative trade unions in a very important sector, and the trade union leaderships have returned to a consensus approach. (Daniel Albarracín, CIREM Foundation)