Civil servants' pay negotiations break down.

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Following the freezing of civil servants' salaries imposed by the Government for 1996, the Government announced the convening of pay negotiations which have been continually put off since the spring of 1996, but which will now not take place at all.

In January 1997, during bilateral talks with all the public employees' unions, the Minister for the Civil Service announced that the Government proposed to keep purchasing power at the current level in 1997 and 1998. The civil servants' unions objected unanimously to these proposals and fiercely criticised the Government's refusal to make up for the salary freeze imposed during 1996. Faced with this disagreement, the Government decided to impose unilaterally a pay rise of 1% for 1997.

As a sign of protest, all the civil servants' unions called for a "national day of action, of strikes and demonstrations" on 6 March. Apart from a salary review, the unions are demanding the improvement of public services, as well as job creation, notably through a reduction in overtime.

The Government's decision is a continuation of the austerity measures imposed on the civil service for over 10 years, which have led to a substantial loss in purchasing power for the 5 million working public employees and the 4 million on pensions.

The Government has made no secret of the fact that its decision is intended to demonstrate to the financial markets and to its European partners that it is capable of maintaining a policy of fiscal austerity. The unions see this measure as essentially symbolic, insofar as the consequences for the budget of their demands would have been relatively minimal. The basic demands would in fact have caused an increase in public spending of about FRF 25 billion, which would represent an increase of around 1.5% over 2 years, or a total equivalent of a third of the tax reductions promised by the Prime Minister last autumn. With the approach of the general election in March 1998, the Government probably hopes to benefit more from this last measure, while at the same time maintaining the possibility of giving a "boost" to civil servants' pay just prior to the elections, as has often happened in the past.