International conference organised by the Co-operation Forum of Trade Unions (SZEF) Budapest, 30th September - 1st October 2004

Multinational capital is having an ever-growing influence on social processes worldwide – its pressure on governments is growing greater and greater. The effects of this can be observed in the moderation of the redistributive role of the state, in the re-engineering of social security schemes, in the alteration of the ratio of earnings from work to profits from capital in favour of the latter, and in the restriction of employees’ rights.

Unions representing public employees – and indirectly the millions of people using public services – must not remain toothless in the face of this global challenge. More effective co-operation and the systematic exchange of experiences are needed to obtain better opportunities for the moderation or neutralisation of those negative impacts jeopardising peoples’ quality of life.

This international conference of SZEF, entitled Public service in Hungary and Europe from the viewpoint of trade unions, held between 30th September and 1st October 2004 in Budapest, was dedicated to this aim. At the meeting, Dr. Endre SZABÓ, President, and Dr. Ágnes CSER, József FEHÉR and László VARGA, Vice-Presidents of SZEF, gave opening speeches on the actual situation in Hungarian public service. The following international participants provided very useful information on public services in their respective countries, which also attracted attention from a Hungarian perspective: Dr. Wilhelm GLOSS, First Vice-President of GÖD (the Austrian Public Service Union); Dr. Walter SAUER of ÖGB (International Department); Nick CROOK, International Secretary of UNISON (GB); Laurence LAIGO, Secretary of CFDT (France); Juan Carlos JIMENEZ, representative of the International Department of CC.OO (Spain); Paulo TRINDADE, a member of the Executive Committee of CGTP-IN (Portugal); and Dominik SCHIRMER, Head of the Bavarian Health and Social Affairs section of ver.di (Germany).

The meeting was attended by the member organisations and county-level co-ordinators of SZEF and by Dr. László VIGH, President of ÉSZT, the Union of Intellectual Workers, which is founding an association with SZEF.

Below we present a summary of the speeches. The full text of the conference is available in Hungarian on SZEF’s website at: www.szef.hu

Reports on Hungarian public service

The title of Dr. Szabó’s speech was “Public service in the stronghold of multinational capital”. The challenges applying to public employees and institutions have a global nature. This question has never been viewed by the union as a matter internal to the public sector, having always observed it in the context of the interests and expectations of citizens.

A reduction in state activities in the public sector is also visible in Hungary and we are no nearer to establishing an answer to the question as regards the extent to which the state has a responsibility to its citizens to provide provisions and services which influence their essential circumstances. In Hungary, three million people live on the edge of a minimal existence and the greater part of society – including public employees – falls within the compulsion of a very spare, poor lifestyle. The relevant cuts in state welfare services and the different schemes of self-provision do not go along with the required social conditions and living standards.

We are also missing well-founded answers to the question whether privatisation is compatible – and, if so, to what extent – with the character of decent public services. Privatisation is very significant in the health service and further steps are to be expected, while similar attempts are at work in higher education. However, a study on behalf of the state is unambiguous: privatised services cost the state budget more in general while their quality is no better and, in some cases, it is worse than that of public services.

Also of significant importance is the view that processes and methods of the competitive sphere and the human public sector are to be threatened by and large analogue. From this direction come the already-mentioned intentions towards privatisation and an unaltered, non-elaborated implementation of the principle of private sector performance in the public sector. We are not averse to the modernisation of the system of public service institutions; it is obvious that altering the social and economic circumstances, accession to the European Union, the worldwide presence of the internet and other factors justify reformation and adaptation. But we are definitively against the unfounded assassination of institutions providing public services as dictated by the fiscal situation. Our starting point is that the state must not withdraw from the responsibility of providing public services. It has to provide them predominantly – but not exclusively – through institutions financed by the state budget and with employees in public service employment relationships. Interest representation work related to this issue is one of the core areas of operation for Hungarian public services unions.

In connection with legal relationships in Hungary, the view that there is no need, within such a narrow field, to differentiate between legal relationships in the private economy and in the public sector is on the increase. To the supporters of such a view, weeding out the so-called privileges of the employment relationships of public employees, present due to the specifics of the sector, has assumed great urgency. By ‘privileges’, we mean more secure employment, a calculable career scheme and supplementary bonuses.

Two years ago, the Government decided to prepare a unified Law on the public service and was supposed to bring a bill before Parliament in autumn 2004. However, the legislative work has been delayed, partly because professionals and trade unions are sceptical as to whether it is possible to provide standardised rules on the legal status of civil servants, public employees and the members of the armed forces and the Hungarian army, and whether such a framework law is possible. Secondly, the delay – and this is quite remarkable – originates from the Government itself seeming to be uncertain on the issue. The Government has started to argue that western European practice questions the guarantees of stability and a calculable career within the public sector. Our clear standpoint is that it is not allowed to set an equals sign between relationships in the private and public sectors.

The most neo-liberal axiom – that special regulations are not required – is unacceptable to us. That is to say that employees in certain fields of the public sector are the executives of public powers, while others provide fundamental services deriving from the state’s constitutional liabilities, such as education, health etc. This remit defines also the requirements, the strict conditions of their employment and the legal and ethical expectations which apply to them.

Relating to the situation of pay and earnings in the public sector, we have to account for Hungarian remuneration lying below productivity and also in relation to average earnings in western European countries. Productivity stands at 50-52 per cent of the level of western countries, while pay (salary) on a purchasing power parity basis reaches, at maximum, one-third. Public employees in western countries, especially those with higher skills – including in Austria – earn 8-10 times more than their colleagues in Hungary. The Hungarian Government, in the autumn of 2002, did provide a pay rise of 50% for public employees while the completion of an earlier initiative resulted also in a similar rise for civil servants. This action was unparalleled and made possible a relevant moderation of the disadvantage with the private sector, even though the gap could not be closed. However, the process of making up the gap has stopped and the earlier rise has been partly devalued by inflation. This situation has generated serious protest, including the formation of the National Public Service Strike Committee.

In Hungarian public service, gross average earnings amount to 150-170 000 HUF, which means a net 80-100 000 HUF. A few days ago, collective bargaining commenced on the 2005 budget, tax and contribution law and pay. Personal income tax will be reduced next year to some extent, which may mean a pay rise of 1-2% for those earning at or below the average. Relating to next year’s pay, we argue that the real value of the rise should be equal to the rise in GDP. This is predicted to rise by about 4%. The Government is planning a 3,5-4% real wage rise. The inflation prognosis for 2005 is 4.5%; the expectation for 2004 is around 6.5-7%.

The tension in pay bargaining is coming to a head (much more than discussions on the amount or percentage of the rise) on the grounds that the Government is intending to cut expenditure on public administration by 5%, meaning that public institutions and agencies have to cover the 2005 pay rise and the 13th month’s salary from this reduced source. Our prognosis is that this may lead to the dismissal of 10 000 employees from Hungarian public administration. In other sectors of the public service, the Government will also press its case for a 1.5% increase, so we can forecast dismissals in other fields of public service as well.

According to the Government’s programme, the introduction of the Euro as the Hungarian currency will be possible around 2010. This demands the implementation of very strict requirements, including a relevant reduction in the state budget deficit and, at the same time, cuts in the sums available for redistribution. Thus, the next few years do not encourage positive expectations for improvements in the situation, which may mean the maintenance of social tensions and conflicts in the public sector.

Turning to the position of Hungarian trade unions, the restructuring of businesses, cuts in the means of interest enforcement and the weakening of the financial basis of trade unions after the system change have together led to a significant loss of members. Union density in Hungary amounts to 25% in the private sector and about 40-45% in public services. Partly owing to the unfavourable changes in their position and partly – and in particular – owing to their responsibility to maintain social stability – the unions have used the effective means of confrontation (industrial action) only rarely. This has also contributed to the fall in their support.

The result of a common intention and European requirements for social dialogue was that the institutional system of interest reconciliation was formed in Hungary at an early stage and with a wide coverage. One part of it consists of a tripartite structure; the rest works on a bilateral basis. Public service has its own interest reconciliation fora at national, regional and local levels. Our problem is the efficiency of their work. Bargaining often means consultation; agreements are full of compromises.

Very slow developments can be observed in the extension of employment, an issue which has been persistently stressed by the unions, and in the improvement of the employment ratio which is significantly lower than the European average. Approximately 57% of the population of working age in Hungary is in work. The same figure in western Europe appears to amount to 64-65%. We would like to see a faster and more visible change in following areas: the moderation of the defencelessness of employees; the improvement of the efficiency of health and safety controls; the elimination, or at least the reduction, of the shadow economy in the order of 25-30%; more dynamic gains in pay rises; and the mitigation of poverty.

The circumstances of the enforcement of interest representation are influenced to a significant extent in general – and especially in the public sphere – by the strong variations in the willingness of employees to countenance the different means of industrial action, i.e. demonstrations and even strikes. There are many reasons for this: partly, it reflects the lack of a tradition and appropriate strike funds, and in particular – and unfortunately – the fear of retaliation in the workplace.

In the public sector, there have been nationwide demonstrations and strikes in the last few years; they have brought not appropriate results but great costs to the organisation and the large risk of being unsuccessful.

Dr. Ágnes Cser, President of EDDSZ (Democratic Union of Health and Social Employees) and Vice-President of SZEF, addressed the issue of “Crisis and stability in public health care”. Among other things, she underlined that social dialogue is in crisis not only in Hungary but also in the European Union. It is clear that, regarding the Working Time Directive and other fundamental institutions, significant tensions may be observed in the enforcement of the interest representation work of trade unions.

Fourteen years after the system change, state-guaranteed public services are on the decline; universal access to those state-guaranteed public services to which everyone should be entitled as a fundamental human right does not exist. Equality and equal opportunities show as an advantage in Hungary only to a very limited extent.

This is especially true in public health care, in which deep gaps and grave discrepancies exist depending on the geographical locus in which one lives. Hungarian health care fails to meet two conditions of equality. One is the requirement for access on nearly similar (or the same) terms. The simple location of where road accidents occur contributes a significant difference regarding one’s chances of staying alive and having access to treatment – there is a great gulf between the extremes. The other equality condition is the right to health services of the same content. According to our Constitution and other laws, a citizen living in Budapest or in an isolated farmhouse are entitled to the same services. This does not work in practice – this field is also in crisis.

Hungary meets the legal requirements of the European Union but, regarding content and implementation, we have significant debits. Why do we have problems especially in the health and social services fields? One of the core problems is the absence of consensus regarding what we call fundamental/basic health care and what we mean by the requirement of equality. In addition, Hungarian public health care is risky because of the level of corruption. The collection of levies and, consequently, the system of collecting, registering and redistributing public contributions for health services has, since 1st January 1999, taken place essentially in a secret manner. Simply, we know only vague figures.

According to the Lisbon Strategy, the motor of the economy is a healthy workforce; therefore, there is a significant correlation between health care, prevention, lifestyle, employment and the representation of employees’ interests. According to the World Health Organization, only 11% of the public health budget has an influence on the state of health, whereas the impact of lifestyles amounts to 43%.

The conditions of public health care are considered in Hungary on the basis of the principle of social security – which does not mean that, in practice, a traditional social security scheme operates. It is worth analysing whether we have the appropriate resources for the provision of social security services to ten million citizens. In 1990, one-half – or a little more – of citizens were employed and paid contributions. The ratio between actives and dependants was one to two. During the ten-year period until 2000, we have lost approximately two million jobs. This has greatly affected the carrying of the public burden and unbalanced it. In 1990, the ratio of one employee to two dependants was characteristic; ten years later, this association has deteriorated to one to three. Concerning social security contributions, the state is suffering huge disadvantages as contributions are collected ineffective, many remaining outstanding.

In Hungary, every Government after the system change has had a public health reform programme and the current one is no different. They always begin the same way and the end is similar too. Instead of investing money, they talk night and day about their reform ideas. World market prices are already present in Hungarian health care whereas pay has remained at the old level. The conditions in which institutions must work are at the level of the previous socialist era but, with the opening of the borders, price rises have occurred in energy, medicine and all sorts of health care services. Basic services are not regulated in an appropriate way and citizens are not well-informed concerning their entitlements within the framework of compulsory provision. How is it possible to meet compulsory liabilities with a huge deficit in the provisioning system? My foreign colleagues do not know the term ‘parasolvencia’ which is money put into the pocket of doctors and nurses by patients.

Concerning the crisis of resources, we have to say that, in the period of the last ten years, the Hungarian health system has been deprived of 1 500 billion HUF. In our opinion, the greatest wonder is that public health care still works from the money that has been forthcoming.

Many factors show that public health in Hungary is in a state of crisis. For this reason, our union has initiated a public health roundtable. The problem is that it is impossible to reach a social consensus as the actual governing parties are not willing to take places around it. We can expect that, as a member state of the European Union, if we fail to build efficient bilateral co-operation and to reach sectoral collective agreements, our cheap human resources will migrate abroad and will provide cheaper services in privatised institutions there. For this reason, our claim is to start bilateral co-operation with the intention of concluding sectoral collective agreements.

It is in our interest that health workers in European member states maintain their jobs as we will then be able to keep our skilled human resources too. And, we would also like steadily to attain the general earnings level of European Union countries. There is a need to build sectoral links and also to use the institutional levels of the Union as a means of influencing European legislation. We are interested in the effective avoidance of social dumping in the former fifteen EU states. But we ten – not just us Hungarians – are not able to reach these aims alone; this will be possible only in the context of strong co-operation with unions in the former fifteen member states.

Mr. József Fehér, General Secretary of MKKSZ (Union of Hungarian Civil Servants and Public Employees) and Vice-President of SZEF, addressed “Reform attempts in Hungarian public administration”. The main root of the problems in public services is, in almost all sectors, the same. The modernisation of public services and, within it, public administration has been defined by every government since the system change as a key point in its programme. All governments have started different reform programmes but not one of them has been able to implement it in full and not one has finished the changes it has started. Therefore, these programmes have been subjected to systematic innovation and repetition.

Another common characteristic of the modernisation experiments has been the differing origins of their motivation. The strongest impulses concerning Hungarian public service reform have actually come from the European Union.

Furthermore, regarding the reasons for modernisation there are not many new features. Modernisation attempts have defined two aims from the direction of each and every government: the more efficient functioning of the state; and cost reduction.

A common characteristic of the modernisation experiments of the last decade is that one part of them has not contributed to the efficiency of public administration. Concerning another part, perhaps some studies or legal regulations have arisen although never implemented and, concerning a third, something concrete may have appeared, not at the outset but after several years or even a decade.

The result of the above is that we can declare Hungarian modernisation experiments to have been generally unsuccessful. This can be ascribed to two factors. The first – and maybe the most relevant – is that, unfortunately, all the reform programmes have lacked a professional and scientific basis and also the necessary financial resources for implementation. The second reason is that the experts who have defined these programmes (above all, the politicians) are either not aware of the professional questions relating to the civil service or they are to some extent theoretically professional but have no idea of what is feasible within everyday practice.

Among the reasons for the lack of success should also be mentioned that reform attempts are bound to legislative (i.e. governmental) periods. All governments have wanted to implement their own modernisation programmes without considering the steps that have previously been taken. Another very important reason for their lack of success is that the programmes have no ‘owners’. Ideas start in general at the governmental level while legal norms regulate the deadlines and the institutions responsible for their implementation. However, they do not include the necessary financial resources, the personnel requirements and the institutional guarantees.

What is the most relevant challenge facing Hungarian public services today? The greatest challenge for Hungarian public administration is its own government. It is not the first time that the demagogic requirement of a ‘cheap state’ has been defined by the government. This aim can be very attractive to ordinary people in everyday communication. We need to find arguments against it – that we need not a cheap but an efficient, service-oriented, sufficiently working or citizen-friendly state – but it is not easy to make this acceptable to public opinion.

When we negate the philosophy and the requirement of the ‘cheap state’, opponents repeat in an instant that the opposite of the ‘cheap state’ is the ‘expensive state’. An especially significant problem is when this political slogan appears specifically in budgetary policy. We are witnesses today of such a practice. The government does not want to take much trouble with or to work hard at reform programmes. It has the idea to cut first and to restrict because these will enforce reform by their own modernisation and more efficient functioning.

What kind of questions should a reform programme seek to answer? On the one hand, a relevant question is whether Hungarian public administration meets European Union requirements. Hungarian public administration has performed the necessary requirements for accession according to the highest level of foreign opinion. However, it disposes very inadequately of the conditions necessary for everyday administrative practice within the standards of the EU. There are significant structural problems and relevant deficits in the means, while attitudinal problems also work against a more sufficient functioning. Furthermore, there is also a deficit in human terms, especially in the field of foreign language competence. Possible changes can only be made by investment in human capital and resources and in the institutional system.

The second question to be answered is whether the structure of Hungarian public administration is appropriate in relation to the well-proven organisational conditions characteristic of European Union countries. Clearly, it is not. It does not meet the principle of subsidiarity in the sense that issues should be administered by institutions closest to the citizens raising them, and neither does it meet the requirements of regionalisation. Almost all programmes have included the intention of decentralisation during the last ten years and some attempts have been made, but every government, independent of its colour and value system, has centralised.

The third question is the proving of performance. We are convinced that even well-tried performance assessment measures in the private economy cannot be used in public administration, even those related to individuals. We do not close ourselves off from a stronger focus on performance, but it is not acceptable that the government should seek to define and enforce in public administration a fabricated performance requirement without a performance-related pay system.

The fourth question relates to the provider. Should public tasks be provided by public institutions and agencies or by private ones? If it relates to non-core activities – tasks of a technical nature and other activities not belonging to the core business – the involvement of the private sector is conceivable. However, concerning the core business, we hold the opinion that public tasks can be sufficiently arranged only if carried out in public institutions by public employees.

The fifth question is whether the priority of politics or that of the profession of the civil service should show up as an advantage. Independent of political colour so far, under all governments political capture has been tremendous in public administration. Every government has changed the whole administrative board endowed by the former government and almost in every management post there has been a change. This is unacceptable, baseless and has nothing to do with European practice.

Mr. László Varga, President of the Teachers’ Union and Vice-President of SZEF, concentrated his remarks on the topic of “Public education searching for the path”. Hungary spends approximately 5% of GDP on public education. This ratio is not very far from the European Union average but the statistics are distorted by Hungarian GDP being quite below that of the European Union. The nominal amount is less whereas the content and cost of the tasks are quite similar.

School structure – in Hungary, the compulsory school leaving age is 18 years. This figure, higher than the European average, also means that its performance places a greater claim on expenditure. For the past almost seventy years in Hungary, we have had an apparently stable school structure of 8+4 covering students up to the age of 18 – apparent stability because, since 1990, 6+6 and 4+8 class structures have also existed, even though most students are in the old scheme, from which situation certain structural and curricula problems arise.

The majority of children attend so-called general school for eight years and, afterwards, have three options to proceed. The lowest ratio of children – just 15% – is that of apprentices attending professional vocational schools; such a qualification does not entitle the beneficiary to further education. 80% of children attend so-called secondary modern schools with a general qualification for university entrance. Less than half of secondary schools are traditional gymnasiums; the remainder are professional secondary schools giving, over and above the right to university entrance after an examination, a middle-ranking vocational qualification.

The main issues facing policy-makers in the education environment are as follows:

• the content of education – it is about a decade that public education in Hungary, as regards content, has been based on a national curriculum framework. This is a general practice in Europe which allows, at the same time, significant differences in the design of local educational programmes depending on the current needs of the government for education. The requirements as regards content are defined here by the concluding secondary school examination. Hungarian public education is going through the first year of reform. Secondary school pupils will, for the first time, take in this school year the so-called double-level exam which consists of middle and high-level examinations. From this year on, universities will not organise an entrance examination for students passing the high-level secondary school concluding exam.
• sponsorship – subsequent to the system change, public education is provided in most cases by local authorities while secondary schools are sponsored characteristically by the counties. From this split, some problems have arisen.
• finance – a two-tier financing system is in use in Hungary. The typical pattern is that the state pays subsidies for public education organised by local authority institutions. In practice, this means that, taking an average across the counties, the central budget provides rarely more than 60-65%, with the missing resources financed by the local authority as the sponsor. This situation also raises the problem of equality – i.e. that of equal access to education. This is to say that the access to education by children within a given community depends not only on the provision of state finance but also on the financial situation of that authority. Therefore, the aim of Hungarian public education practically since the system change of becoming horizontally open has not been realised: if the parents move to a village with better material conditions, the opportunities of the child will grow while, in the opposite case, they will become poorer.
• privatisation – within public education, it is not a question of privatising the whole of the provisioning system although latent privatisation has been a problem for many years. This refers to education-related fields which are costly to the consumer. One problem is that the textbook provisioning system has been fully privatised. This brings two kinds of anomalies. The first is that, despite all the intentions to reduce the number of books on the textbook list, it still reaches 4 000. In consequence, pupils from neighbouring schools are learning from different books. This causes a problem when a child changes schools. The other problem is the high price of books. In the original programme of the government now in office, there was a point about providing books free of charge, but it was not able to cover it.
• the permanent chaos in the curricula. If somebody has three children between the ages of 8 and 14, all of them will be learning differently as a result of the latest modifications to the national curriculum from different curricula and timetables.
• we have also to meet the challenge of a continuous and radical reduction in the number of children. The demographic situation of Hungary is dreadful. From this arises the problem of unstable programmability. 20 000 less children per year are in general school and, considering this situation, appropriate measures are needed. Our union has elaborated written proposals for financing and institutional reform.
• efficiency challenges generate heavy discussions over interpretation. One challenge is that there are 200 schools in Hungary with less than 20 pupils while in one-fifth of primary schools the pupils number less than 200. This is an efficiency problem as the majority of central finance targeted at the sponsoring body is bound to per capita measures.
• cost efficiency must also be analysed. In this matter, we have significant discrepancies as regards the intentions of the education and fiscal parts of the government. The financial requirements for public education is defined by two factors: the size of the pupil group; and the compulsory teaching hours of the teachers. Both of them go along with the pedagogic and professional claims but are often formed by the fiscal aspects alone. Experiences in EU countries show that, as regards the pedagogical viewpoint, the optimal group size is twenty pupils. Standard groups sizes in Hungary, in all school years and in every school type, exceed thirty.
• the compulsory hours of teachers – as for all employees – is 40 hours a week but, within this framework, the intention of all governments over many years has been to raise this figure since, in this case, pay costs fall. Teachers in more developed countries occupy themselves with the lack of trained personnel in education. For Hungary, unfortunately just the opposite is true. Statistically, we do not have significant teacher unemployment, but the likelihood of unemployment will rise because of the reducing number of children. In recent years, among unemployed people with high school/university degrees, the number of teachers has increased, with the latest statistical data showing a ratio of approximately one-third.
• infrastructure – consciously, we do not fight only over the issue of pay but also for the improvement of conditions. Studies in recent years – independent of each other – have provided a common result: about two per cent of Hungarian school buildings meet the requirements stipulated by the law. Nearly half of the buildings used for education were built between or before the two world wars. And this means that Hungarian public education needs a process of reconstruction which aims to abolish this situation over a period of several years. The improvement process has been started: we hope that accession to the European Union will be beneficial in this respect.
• remuneration – a system of minimum wages is in use, so the majority of Hungary’s public employees earn, on the whole, similarly. Wage differences depend on qualification and length of service.

The international environment can assist us establish solutions to these issues in two main ways. Firstly, there is a need to standardise the system of data collection used in the European Union so that we can obtain precisely comparable data because our government and our politicians are very likely to try to pull the wool over our eyes. In the process of benchmarking education, nobody can really answer the question as to how the workload of teachers in Hungary really compares. Secondly, it is also necessary to define appropriate standards for educational infrastructure in order that we can adjust them with appropriate development aims.

Experiences from other parts of Europe

Dr. Wilhelm Gloss, First Vice-President of GÖD (Austria)

Dr. Gloss reported that the successive withdrawal of the state from the public sector and privatisation may be observed all over Austria and the European Union. GÖD is not against reform attempts but public service must, from a budgetary perspective, maintain its position because only an efficient public service is likely to be attractive to foreign investors. One problem facing the union is that public service personnel has been reduced in recent years while the tasks remain the same, although productivity in public services has been improved. GÖD claims that the government must not expropriate the whole profit resulting from better performance but share it with employees. The union asserts that its definitive countenance has led to the maintenance of union density; membership has even grown.

Laurence Laigo, Secretary of CFDT (France)

Modernisation in the French public service is unavoidable since the period between 2005 and 2010 will see half the current personnel retire. A reform process focusing on decentralisation has been proceeding since 1992. The greatest change, however, will be regarding a law currently in preparation which will, in the future, see that budgetary subsidies are not addressed to the ministries but to so-called public service projects. This also means that the projects themselves will have to compete for money – though they may do so in conjunction with each other, if they want.

Within the system, the role of the social dialogue is expanding.

Earlier French governments delayed or prolonged public service reform which is now unavoidable and which must be implemented under worse conditions – because of the budgetary deficit – than previously. For this reason, it is obvious that, in France as also in Hungary, reform is being undertaken due to fiscal reasons and not with the intention of development and modernisation.

Dominik Schirmer, Head of the Bavarian Health and Social Affairs section of ver.di (Germany)

The re-engineering of public service is also going on in Germany under the slogan of reducing bureaucracy and trimming public administration, but the real motivation is fiscal compulsion and political decision-making. The social and economic changes of the last fifteen years have transformed public service without even considering the issue of reform. The previous original and exclusive state remits – operating the institutions – are now provided by private entrepreneurs financed by the state. Unions have to define their relationship to these changes and challenges. For this reason, ver.di, the unified trade union for German public employees, was created and it also represents those public service employees who are working within the framework of private provision.

Juan Carlos Jimenez, representative of the International Department of CC.OO (Spain)

After the fall of the Franco dictatorship in Spain in 1972, there has been a process of democratisation which has also meant that the state has had to rebuild. This includes public education, as private schooling had become earlier more significant than public provision. The ratio of private education today reaches about 35%. If they fulfil certain conditions, such as free access to everyone at primary and secondary level, private schools receive subsidies from the state. Private schools which take money from pupils are not sponsored by the state. Public education is at a significantly higher level than private schools, although the latter have a better infrastructure.

During the democratic transformation process of the state, a decentralisation has also been implemented. The devolution of competences which formerly belonged to the state to the regional tiers (seventeen autonomous communities) has been realised, while many tasks have fallen to the lowest level, that of the local authorities. This makes the interest representation work of the union very complicated. Remuneration and the working conditions of employees in the health service, education, etc. are no longer subject to central negotiations. Bargaining – about pay as well – takes place with the seventeen regions and agreements are concluded here. Regarding civil servants, the union negotiates with central government while it often happens that a new government does not accept the agreements concluded by its predecessor.

Paulo TRINDADE, member of the Executive Committee of CGTP-IN (Portugal)

A small state is a better state – a slogan that is very often used by the Portuguese government. In public administration, and also in health care, many aspects have been privatised either in the form of a takeover of the right of provision or due to the transformation of the institution or body providing a service into a limited company. However, nobody has been able to prove so far that service is now better.

In public education services, many disruptions have occurred since jobcentres entered a privatised framework.

Private education abolishes or, at least, jeopardises the gains made by unions in public service during the past 20 years. Public administration will no longer be made up of civil servants but of public employees whose working conditions are defined by the manager. One of the most relevant achievements, the 36-hour week, is also in danger. Limited companies recently formed define working weeks as consisting of 46 hours, or more than 50, while pay remains anchored to a 36-hour week. A night shift qualifies as such only if work begins after midnight. The trade unions are seeking to inform employees of their rights in such situations in co-operation with consumer protection and other civil organisations.

Nick Crook, International Secretary of UNISON (United Kingdom)

The seven years of Labour Government has been a good period for the UK’s public service as public expenditure has grown significantly and many schools and hospitals have been built; in public services just now, only the workforce is missing. At the same time, governments’ slow withdrawal from directly-provided public services can be observed. The private sector is playing an ever-growing role in the maintenance and management of schools and hospitals built under public-private partnerships within a framework of long-term contracts. It has a divisive impact that, whereas teachers, doctors and nurses in public institutions receive public sector-agreed pay rises, the remuneration and working conditions of personnel employed by PPP institutions depend on the management. Often, these people get lower pay than the others. UNISON has concluded an agreement with the Government in order to abolish pay inequalities, although the results so far have been moderate.

In the United Kingdom, the Government does not speak about having a slim public administration; it underlines instead the need for the expansion of individual tailored services. If people are ready to pay higher taxes or more contributions, there is the possibility for provisions according to their expressed needs. This seems to be based on a richer range of products – thus, it is not easy to oppose – but, in reality, it strengthens the situation of unequal access to services. UNISON’s position has not changed: public services should be provided in public institutions by public employees and should not be profit-oriented.

Discussions

Regarding the expansion of the privatisation of public services across Europe, Dr. Vigh, President of ESZT, proposed that, as a common programme for interest representation activities, it should be made clear in every country as to the kind of public service remit the state retains to itself. Only in this way can the liability of the state be controlled.

From the answers to different questions, it became clear that trade unions have only cautious links to anti-globalisation organisations; they do not participate in the characteristically extreme demonstrations.

A large number of the participants underlined that in union work, negotiating is attaining a priority as public service employees are not ready to take industrial action and warnings are no longer effective. Unions are seeking to balance the weakening of demonstration activities with stronger PR work.

It is a general occurrence in European countries that daily working hours are becoming increasingly longer, especially in privatised bodies. It also emerged that union density is falling in almost all European countries. Unions links to young generations are failing; thus, interest in union activities is lessening. During the past decades, unions have struggled for fresh advances whereas, nowadays, they are struggling to maintain such achievements as attempts to roll them back appear to be a general approach throughout Europe. The participants also commented that interest reconciliation work within public services is stumbling – in France, the government can be coerced to negotiate only after the announcement of strikes – and it is quite frequent that the government breaks the promises it has made.

There was a discussion at the conference on the question as to whether union independence and room for manoeuvre is lessened when they accept subsidies from the government. In many countries, this is not a common practice; in others, it represents a great achievement while freedom of action remains intact.

Concluding remarks by Endre Szabó

After this conference, we are more secure in declaring which of the problems we face are common and which bind us together, independent of the special historical or actual political questions which are on the agenda in our respective countries.

This was the first time that we have met since Hungary became a member of the EU. In this respect, the weight of our common matters and problems have become greater. In the past few years, when we have observed and criticised the EU from outside, I had the impression that the European Trade Union Congress focused its attentions basically on the problems of the older EU members. I do not await a revolutionary change in this respect. However, I hope very much that, within a foreseeable period, we shall be fully integrated into the Union, including its specific environment and conditions, and I hope that the new member states will have a say, more so than earlier, when it comes to decision-making.

The Hungarian unions were unique in promoting accession even though we knew – and in some respect can now see – the requirements and certain risks inherent in it. The Government underlined during the accession negotiations why membership would be good for Hungary. Few words were spoken about the transitional – or, in some sectors, long-term – risks. There will be winners and losers. We stress this as we do not want disillusionment amongst social groups or wider communities resulting from the consequences of accession.

In 2010, we should also access the Euro zone. In this regard, we have a convergence programme. To put it very simply, this means that the framework in which living standards may be improved is threatened quite sharply. Accession does offer the possibility to gain access to subsidies, but we have to finance a part of it. The Government says that this is only possible by restricting justified expenditure. We are living out of our means, so it is again public service which has to make up-front payments, to its disadvantage, in order to facilitate the advantages coming from the EU. This is a period that we will have to endure.

During this conference, globalisation in its many facets appeared on the agenda. Globalisation by itself is not a bad thing; it also has a positive impact on social development. But, at the same time, it does have negative impacts. The two have to be seen together. Our concerted attempt to ensure that the negative impacts are swept away appears at least to be moderate and balanced. In this field, all of us have our own role and remit.

The question as regards the extent to which society promotes different justifiable claims on public services was also on our agenda. Social backing appears to be different in Hungary. The lowest level of social support is found for civil servants within public sector: people say they are shirt-sleeved bureaucrats – an attitude which is not so commonly perceived, for example, regarding health and education employees. Different studies and publications analysing what people would like to finance from their taxes concur with this approach. In this direction, health and education occupy a noble place. Union policy clearly must take the circumstances of forthcoming social support into consideration.

We have to argue against attitudes which articulate that public service is not a productive sector which is good only for reducing the social product. In modern day conditions, competitiveness is impossible without vigorous public health, high-level education, good administration, high culture, maintenance of values and safe public order. We have to use this argument in our PR activities in order to protect the public sector and to acquaint people better with the social role of public services.

We have also addressed the strength of the union movement. We have heard remarks that union density is falling or stagnating. Happily, we could consider also that, in some places, it is growing. In Hungary, the union movement is, in general, stagnating as well but there are areas where this is not the case. The major question is how to stop this process; how to orient young people in the direction of union activities. We have to strengthen people’s understanding that the only efficient means within the grasp of employees is cohesion, co-operation and better organisation. This is not an easy task.

One possibility with which to recruit more members is to offer more services for employees and affiliates – legal services, social and other provisions. However, our material possibilities are very sparse: at the time of the redistribution of union property, the division was very unfair, with the government of that period making every effort to disorganise trade unions and to weaken their financial basis. The disadvantage inherent in this measure is still functioning today.

In spite of the many specialities of the different countries, we should make greater efforts (and this is connected with support as well) to answer the new challenges with more modern strategies. The world is changing, the world of labour changes and employment relationships change too. In comparison with earlier years, quite distinct approaches are needed for homeworking, part-time working and the many other circumstances which also challenge the core fields of union activities in many other respects. We have to try to search together for better and more efficient answers to this challenge and we have to strengthen employee solidarity and co-operation, just as international capital practises excellent co-operation. The experience of its impact should be as moderate as possible.

Our conference has enriched the profile of the themes of those interests we have in common, although future conferences should concentrate on a maximum of two themes in order to go more deeply into detail.

I am very happy that every participant mentioned the importance of union co-operation. Working together with bilateral contacts is very important concerning shared European issues. Obviously, a variety of methods can be developed for this. For SZEF, I can confirm that one option of information, our website, will be developed. To our contacts, we also use the option of providing fresh news when we want to communicate on particular questions.

There have been proposals to draw up a list of themes which we can analyse together in a deeper way, one of which is the question of performance assessment. We can only reflect positively on this since it is the topic closest to the heart of our Finance Minister. He is lobbied constantly by representatives of the private sector to introduce performance assessment in the public service. We do not oppose this in general, but we are against if it is subjective and dependent on managers’ understanding.

There was also a proposal to discuss collective agreements. We fully agree; it is a relevant theme and we are ready for discussion.

The protection of the interests of employees outside unions was also mentioned. This is an issue with which we have been greatly exercised over a long period. Our experience is that, if unions do not achieve results, those shouting loudest are not members. And, when unions achieve good results, it is natural that they should share it. Therefore, it is an eternal question as to how we can ‘bind in’ the free riders or achieve in some other way that they also contribute to union costs.

Some participants also drew attention to the issue of working hours, which are on the increase and is an area which unions need to pay concerted attention.

The representative of ver.di mentioned that they have to reduce union staffing levels. In our situation, it is also the case that our financial possibilities are at the frontiers of our room for manoeuvre, among others in the employment of professional staff. This could be a topic about which discussions would be useful.

And, ultimately, we have exchanged information on our backwardness regarding the common organisation. I think it necessary to push the ETUC to play a more significant role on the different platforms of the European Union. And, naturally, co-operation between our organisations must also develop further if we want to avoid the problems which have a negative direction in European affairs.

We are ready to expand co-operation. We are also happy to initiate meetings on different matters and we are willing also to participate in fora organised by other unions.