Geneva, 14/06/2010
I take the floor to alert this conference to two key European developments.
The first concerns the economic crisis. In 2007/8 the leaders of the world avoided the grave errors of their predecessors in 1931. They did not all cut public expenditure at the same time, unlike the President Hoover generation of leaders. Indeed, many introduced stimuli packages. Those actions led to the crisis not descending into a repeat of the Great Depression.
But now that fiscal stimulus is coming undone. All EU governments are cutting, or proposing to cut their deficits, primarily by reducing public expenditure, prompted by fear of financial markets, but also by IMF and OECD pressures.
This is crazy. It will risk plunging the EU and much of the rest of the world into depression, just like similar action did in 1931. There will be huge cuts in public services and jobs, in wages and pensions, and so in purchasing power and demand.
This is crazy. It will risk plunging the EU and much of the rest of the world into depression, just like similar action did in 1931. There will be huge cuts in public services and jobs, in wages and pensions, and so in purchasing power and demand.
We therefore face a bleak midwinter, perhaps several, with few rays of hope. Maybe the impressive Asian growth rates will pull Europe forward. May be the USA will establish a firmer base for its economic growth. May be countries can export their way back to growth. May be, may be …
But optimism is difficult when faced with a combination of a weak recovery and major cuts in public expenditure.
This of course is not just an EU problem. The EU is 30% or so of world GDP, so it is everyone’s problem.
Unions are mobilising for growth and development and against austerity in a wide range of European countries and the ETUC itself will be arranging a European Day of Action on September 29. We will not give up on growth and jobs.
My other point concerns a recent ILO Committee of Experts ruling on the BALPA case. This ruling rightly found serious weaknesses in both EU and UK labour law. We understand that employers, especially the British employers, are blocking further action in the ILO. But today I give notice that we will use the ruling of the Committee of Experts to press the European authorities for decisive action to ensure that the free movement principles of the EU do not dominate the collective rights of workers, including the right to strike. Recent decisions of the European Court of Justice in the Laval, Viking and other cases are leading in the direction and establishing that economic freedoms are superior to workers rights. When the exercise of fundamental social rights conflicts with businesses’ interests, trade unions must now prove that their actions are legitimate and strictly necessary. This is the wrong balance, the wrong approach. It violates ILO standards.
The EU needs to put this right with a clear social progress protocol emphasising that fundamental rights are fundamental, not secondary, that there should not be scope for the ECJ to apply a proportionality test and so countermand a union’s view about the appropriateness of industrial action, and that better traffic rules for free movement, especially for posted workers, should be established.
The EU needs to put this right with a clear social progress protocol emphasising that fundamental rights are fundamental, not secondary, that there should not be scope for the ECJ to apply a proportionality test and so countermand a union’s view about the appropriateness of industrial action, and that better traffic rules for free movement, especially for posted workers, should be established.
Thanks to the Committee of Experts for their support, and I demand that the ILO continues to take a close interest in these affairs and holds the EU – and the UK – to proper account.