Austerity and social dialogue
France
Brussels meeting February 2013
Gilles Jeannot, Ecole des ponts
Paul Emmanuel Grimonprez Ministry of interior
National austerity measures
wages
• “point” has grown to 2,8% for 2008-2011
for a 4,4% inflation.
– Specific compensation against loss : 56 000
public servants received on average 800
Euros
– Half of the gain from staff cutback
redistributed (salary grids, overtime)
• Global salary : plus 2,9 % in 2009-2010.
• Bonus salary based on job level and
efficiency
National austerity measures : staff
cutback
• Non replacement of one out of two retirees
• -75 000 in 2008 , -45 000 in 2009 for State
administration
• Simultaneously local government and
hospital staff increase
National social dialogue and
austerity
• The national dialogue on inflation
adjustment “point” has been cut,
compensated by a technical discussion on
salary grids
• Zero discussion on large reorganisations
(revision générale des politiques
publiques) at a national level and limited
scope for local discussions
Social dialogue reform (2010)
• New Trade union representation rules (all trade
unions equal, elections held during one day
only)
• A joint statement is recognised only if signed by
Unions representing 50 % of the voters,
Government is considered bound by the signed
agreement.
• But Government keeps the choice between
negotiation and unilateral regulation.
• More importance put on organisation (health,
reorganisation) (basis for representation)
Local government public service
• Created in 1983, tension between an integrated
model (communists) and a decentralised model
(Deferre Marseille’s Mayor)… in fact real
autonomy.
• At the national level general rules are designed
for State civil service and then adapted for local
government
• At the national level it is difficult to find local
employer representatives (Mayor associations
or Superior council representatives?)
Austerity in local governement
• Budget
– restriction to come : 1,5 Billion 2014, 1,5 Billion 2015
for
• Staff :
– net growth 140 000 over 10 years,
– 75 % lowest level (catégorie C),
– 9 over ten of them recruited informally
• Salary
– 60 % of catégorie C earns private minimum salary
(SMIC) + local bonus
– Very little salary increase
– Result: stronger impact of salary freeze
National social dialogue for local
authorities
• National social dialogue is mainly based
on national exams (concours) and career
grids but most recent recruitments have
been made without national exams and
salary increase mainly dictated by
minimum salary increase.
• National social dialogue is mainly
focussed on certain categories (firemen,
policemen).
Saint Etienne
Case study : Saint Etienne
Financial situation
• Industrial city close to Lyon in decline
(population declined 240 000 - > 175 000)
• The biggest debt per habitant among
French cities (2158 Euros preceding
Marseille and Lille).
• Junk loans resulting in a 150 million Euro
loss for a 350 million Euro annual budget
Saint Etienne
• 2008 new Mayor (socialist) and austerity plan
– + 9,5% on local taxes
– Investment limitation
– 1% maxi payroll growth with a “shift-age-technical
skills” of 3%)
– Limited staff cutback (100).
• Reorganisation
– Power concentration
– Rationalisation of street level organisations
(swimming pools, street cleaning, police …)
Saint Etienne : social dialogue
• Formalised social dialogue procedures
mixing direct and indirect dialogue
• Special attention to psychological risks
• Real dialogue and conflict on street level
reorganisations
• Unease among medium managers
• Balanced impression: real confrontation
but dissatisfaction
Case study conclusion
• Modernisation continues
– End of customary rules
– Customer-oriented organisations
• Formalised form of social dialogue (in
these cities?) but a culture of conflict.
• Best practices : mix between indirect and
direct participation, mix between habitant
participation and social dialogue.
Conclusion 1 austerity measures :
Lagged responses ?
• Staff cutback, wage freeze, and new
retirement rules launched by ex-President
Sarkozi are not completely linked to crisis
but not “lagged responses”
• President Hollande expands the austerity
measures (tax increase, local government
restrictions, retirement wage freeze…)…
Conclusion 2 : social dialogue restriction
resilience reconfiguration ?
• Austerity measures and reengineering in State
administration have not been discussed =
restriction
• Contrasts with new rules set to give more
legitimacy to social dialogue (2010 law) that
have not really been used to deal with austerity
measures = a lost opportunity for reconfiguration
• Vivid social dialogue in local municipalities in
crisis and subject to direct accountability to
electors = resilience
French civil service
• French civil service was organised in 1983
into three sections: State, local
government, hospital.(5,3 million)
– State civil service (2,4 million) (50 %
executives, managers “catégorie A”)
– Local government (1,8 million) (76%, workers
“catégorie C”).
– Hospitals (1,1 million)
• Civil servants are mainly on tenure (status)
Social dialogue
• National dialogue on wages
– Global adjustment to inflation “point”: discussed in
media
– Salary grid by corps: specialized
– Bonus: secret
• National dialogue on rules (conseils supérieurs
de la Fonction publique)
• Dialogue on personal questions (career,
mobility) is more active than dialogue on
organisation (health, re-organisations).
• Trade union competition (tension between
corporatists and non corporatist Trade unions).
Trade unions
• 15 % membership ; 70 % participation election
basis for official representation
• CGT (23,5 %) especially strong among workers
in municipalities, ex “communist” Union, now
open to negotiation
• Force ouvrière (17,6 %) corporatist, now
confrontational
• CFDT (16,8 %) non corporatist, open to
negotiation
• FSU (11,%) very strong among teachers
• SUD (9,6 %) extreme left, confrontational
State public
service
(thousands)
Local
government
public service
Hospitals
total
Total
employment
France
Public
employment %
1996
2413
1222
885
4521
23055
19,6
1998
2452
1266
904
4622
23780
19,4
2000
2484
1328
931
4744
25006
19,0
2002
2557
1417
973
4947
25439
19,4
2004
2567
1525
1038
5130
25516
20,1
2005
2568
1564
1052
5185
25705
20,2
2006
2560
1612
1056
5228
26012
20,1
2007
2498
1704
1073
5276
26364
20,0
2008
2422
1771
1085
5278
26238
20,1
2009
2392
1806
1100
5298
26007
20,4
Source : Rapport annuel de la Fonction publique 2010-2011 , p. 302.