Major public sector union holds congress

SZEF, the dominant trade union organisation in the Hungarian public service and civil administration sector (and arguably the country's largest union confederation) held its third congress in May 2003. The congress overcame a leadership crisis and adopted a programme for the coming five-year period.

The Trade Unions’ Cooperation Forum (Szakszervezetek Együttműködési Fóruma, SZEF), the dominant trade union organisation in the public service and civil administration sector - and arguably the biggest Hungarian trade union confederation with approximately 300,000 active members (HU0206102N) - held its third congress on 25-26 May 2003 in Budapest.

In preparing for the congress, it was widely reported in the Hungarian press that SZEF faced a leadership crisis provoked by the announcement of Endre Szabó (aged 71) of his retirement. Mr Szabó has been the president of the confederation since its foundation in 1990 and is regarded as having steered the loosely-knit confederation ably. No replacement candidate was found who would have been accepted by all major member unions. Some unions even threatened to leave the confederation, fearing that a change in the presidency might lead to a radical shift in SZEF's policy. Last-minute negotiations before the congress, however, led to a compromise. Mr Szabó agreed to run again for another term as president. He was smoothly elected president at the congress and the presidents of the three major member unions were elected as vice-presidents of the confederation.

The congress evaluated the work of the confederation over the past five years and developed a programme for the next five-year period. The past five years were a volatile period for SZEF. Despite the strong economic growth since 1997, the right-wing government of the time froze public sector wages in 1999 and pursued a policy of sidelining unions. SZEF organised a series of protest actions in an attempt to force the government to change its attitude and adopt a new policy. The protest actions, as well as what was regarded as a deliberate shift in the policy of the government in an attempt to ensure re-election in 2002, led to a certain change in the relationship between SZEF and the government from 2001 onwards. In March 2001, an agreement was signed between the government and SZEF to endorse a government proposal to introduce a 'life-time career model' for public administration employees, including a substantial pay rise, and to remodel the institutional framework of public sector social dialogue.

Despite this agreement, SZEF’s discontent increased, as it believed that the government did not seriously involve trade unions in the decision-making process concerning the public sector and rejected SZEF's proposals on wage increases for 2002. The Hungarian Socialist Party (Magyar Szocialista Párt, MSZP), then in opposition, embraced many of the public sector unions' demands. After the elections, the new MSZP-led government introduced a package to increase the wages of public service employees by 50% and offered a wholesale revitalisation of the institutions of public sector social dialogue (HU0207102F and HU0208102F). The third SZEF congress recognized the historic importance of the recent substantial wage rises, which closed the gap between wages of the public sector and the competitive sector. The good relationship between unions and the current government was underlined by the Prime Minister at the congress.

The congress called for SZEF's role to be bolstered from that of a union confederation mostly representing sectoral interests to a confederation which has a say in broader socio-economic issues. The congress also urged the involvement of unions in the various fields of public policy, including supervision of social security boards, labour inspectorates and regional and sectoral development policies, and the involvement of unions in schemes facilitating life-long learning at the workplace level. To underpin such a shift, however, the research, professional policy-making and training capacities of the confederation need reinforcement. The congress also urged the government to ensure public funding for union activities, such as taking part in training and retraining, as well as for participating in the work of social dialogue institutions and in international forums.

In the light of the current debate on privatisation of hospitals (HU0306102N), it is of special importance that SZEF's new programme for the period 2003-7 rejects all plans for privatisation of public services, or the withdrawal of the state from providing them. It also rejects any cuts in employment in the public sphere as well as the contracting-out of certain types of jobs.

While the programme emphasises the importance of government efforts to introduce a single framework law regulating major employment issues across the public sector, it argues for an increased role of workplace and sectoral collective agreements. SZEF supports a wage system which, on the one hand, enshrines the common status of public sector employees, but on the other hand allows differentiation according to the specificities of a given job and the performance of the individual employee. The programme demands a dynamic and continuous increase in public sector wages in order to reach the level of average wages in the poorer current EU Member States in four years. It also demands the reduction of weekly working time to 38 hours in the public sector by 2006.

In his speech to the congress, the Prime Minister underlined that there is a natural alliance and partnership between MSZP, the government and the unions. Nonetheless, he argued for wage restraint in the short run in order to underpin sustainable growth and made it clear that the government is resolute about carrying through a major reform of the healthcare system, which would include privatisation and consequent changes in the employment status of some employees.

It appears that the success of forthcoming negotiations on a long-term agreement between the government and SZEF covering the public sector will be crucial in shaping the nature of industrial relations in the future, in light of the apparent gap between the programme of SZEF and the reform plans of the government.

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