1 / 19

Banknote Production Trade Union View 12th April 2018

Insights on Euro banknote production, trade unions' analysis, recent industry evolutions, and challenges faced by printing works within and outside the Eurozone. Recommendations for stability and future enhancements.

martinbrooks
Download Presentation

Banknote Production Trade Union View 12th April 2018

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Euro Banknote Production:the point of view of the trade union Frankfurt – 12th April 2018 by Luc PLETINCKX & Guy PONNET

  2. PRINTING WORKS WITH SETP BEFORE THE NEW GUIDELINE Public / In-House Belgium France Greece Subsidiary Austria Portugal Ireland Italy Greece Subsidiary Spain PrivateCompanies GB Delarue Giesecke-devrient D Oberthür FR Bundesdruckerei D

  3. ACCREDITATION In-House Printing Works • In Eurozone: 8 • OusideEurozone – Inside EU : PWPW Poland for testingonly? PrivateCompanies • In Eurozone: Enschédé NL Giesecke-devrient D Oberthür FR Bundesdruckerei D • OusideEurozone: Alreadylost, out afterbrexit Delarue GB

  4. THE END OF THE SINGLE EUROPEAN TENDER PRODUCTION New Guideline: EUROSYSTEM PRODUCTION AND PROCUREMENT SYSTEM Assuringcontinuity of supply Maintaininginternal know-how and takingadvantage of innovations 2 pillars system has been created…

  5. THE 2 PILLARS Group of NCB’swith in-house Printing Works producing at theirownfacilities a. France – Italy – Spain b. Belgium – Austria – Greece – Ireland - Portugal Group of NCB’s tendering their production a. Tenderingprocedure Germany – Lithuania – Latvia b. JET Group created by Nederlandsche Bank Adhesion of 7 countries: Estonia – Cyprus - Luxemburg – Malta Slovenia – Slovakia - Finland Over 26% of total production Production quota of approx 10%

  6. THE INTENTION WHEN CREATING THIS TWO PILLAR SYSTEM MIGHT HAVE BEEN NOBLE, BUT IN PRACTICE WE SEE THAT IT DOES NOT SOLVE A SERIES OF PROBLEMS THAT WERE ALREADY EXISTING UNDER THE SETP SYSTEM ANALYSIS OF THE TRADE UNIONS WITH REGARD TO TODAY’S SITUATION AND TO SUGGEST A SERIES OF MODIFICATIONS TO THE EXISTING MODALITIES OF BANKNOTE PRODUCTION ALLOCATION AIMING AT CREATING A MORE STABLE FUTURE FOR THE IN-HOUSE PRINTING WORKS

  7. RECENT EVOLUTIONS Within the Private Printing Works (compagnies withprivateshareolders) A. Tendency to maximize: Profits, Marketshare B. By lowerwages and working conditions C: Results: G&D its profit by lowerwages in former DDR (from Munich to Leipzig) Oberthur Bulgarian PW Lowerwages Delarue Certification Enschede Under scrutinyIrregularities

  8. RECENT EVOLUTIONS Within the Private Printing Works (compagnies withprivateshareolders) OBSERVATIONS MONOPOLISTIC TREND IN PRIVATE PRINTING WORKS • « Private » part of the productions isshared by 2 or 3 compagnies only • Eachgetsshares of roughly 10% to 20% (Large scaleadvantage) • Guarantees for long production runs • In limitednumber of denominations (1 to 2) • = Creates optimal conditions for lowering unit cost per producedbanknote

  9. RECENT EVOLUTIONS Within the IN-HOUSE Printing Works (Very strict conditions) A- Production quota defined by Capital Key only: Banknotes value based production • Countries withlowCKs • Low quantities Under production (< break-even) • Capital investments for machine, buildings & installations, • increasing at ECB inspections additionalweight to the part • fixedcost(= proportionalyhigher for small institutions) • PWscannotdownscale by anymeans B- Strict limitations C- Strict methodology of cost attribution BASED ON THE PRODUCTION FIGURES OF 2017: ONLY THREE BIGGEST (Italy, France, Spain) REMAINS UNDER QUOTA

  10. RECENT EVOLUTIONS Within the IN-HOUSE Printing Works (Very strict conditions) How to overcomethese obstacles? Printing worksfromlarger countries convertedintoseparate NCB-ownedcompanies Less favorable labor conditions for the workers Leads to downward spiral by propagation throughout the ESCB Printing worksfromsmaller countries tempted to alternative ways of dealing production obligations ex. Belgium – 3.5% of overal euro prod. Closed in 2020. High quoted skills and knowledge thrown overboard for the sake of one or another benchmark defined by some ECB Committee

  11. RECENT EVOLUTIONS Within the IN-HOUSE Printing Works (Very strict conditions) A recent adaptation of EPPS Guideline Possibility of horizontal cooperation for NCBs NCB printing workscommonworkswithother in-house PW Belgium, Austria and Portugal Quality Control Leads to around 4% of overall production for Austria and Portugal • QUESTIONS: • For how long willthis arrangement stand as the collaboration iscovered • by a fixedtermcontract ? • What’s about the final fate of Irish and Greek Printing Work under the existing • Production arrangement ? • MONOPOLISTIC TREND IN PUBLIC BANKNOTES PRINTING ?

  12. THE COMPETITION Private - Low costwin • Tender versus quota • Large scale production • In limited productions • On salaries & working conditions • closing of G&D Munich and Enschedé, and Oberthur • development that bought the printing house of the NBB • and National Bank of Bulgaria (lower salaries). Among Public Printing works • Among countries • EUROPAFI (BdF, BdI, P, ÖeNB) versus • FNMT (Public paper_mill, not in house) • Scalebased • On statute (salaries, working conditions,…) • New subsudiaries (EUROPAFI, IMBISA,…) oftenworks • withothercontracts (temporary, privateinstead of civil servant

  13. FEAR RULES THE WAVES Workers of small institutions • - risks to lose their job • - willgetunappropriated jobs • Even thoseinvolved in bigger initiatives (ie: EUROPAFI) Workers of big institutions • Are afraid of losingtheir job of worsentheir salaries or • working conditions by monopolistic trend in public PW • FNMT in competitionwith EUROPAFI • Italian jobs/contract/salaries/also pressure

  14. WHAT THE UNIONS BELIEVE To modify the modalities of the EPPS system Urgent needs to avoidthis catastrophe scenario To open possibilities of structural collaboration among NCBs on a broader scale than it is the case today, without exclusion To abandon the idea of splitting up NCBsinto 2 separated groups For a long lasting resilient environment for euro production For a full collaboration with contribution fromeveryNCBs The threat of the negative effects of the existing situation Not to take the only element of banknote production and handling that is equally distributed : the monetary income resulting from circulation divided purely by capital key and gives no incentive whatsoever for NCBs to contribute in one way to long term objectives

  15. WHAT THE UNIONS SUGGEST TO ACTIVELY RECONSIDER Euro banknotes are not a simple commodity Modification of the distribution system based on the « capital key » First step: from « banknotes value » based production to « sheet volume » based production. The continuity of supplywillbegrantedonly if the in house printers are able to use theiravailablecapacity 1 2 3

  16. WHAT THE UNIONS SUGGEST TO ACTIVELY RECONSIDER Givingopportunity for every NCB to collaborate with the in-house group In-house development of features (R&D dpt) must besupported by ECB A coordinated boost launchedfrom ECB to developsecurityfeatures for all levels by in-house printers Re-shifting of the « value adding » frompapermills to printing houses 4 5 6 7

  17. WHAT THE UNIONS SUGGEST TO ACTIVELY RECONSIDER Design and origination of euro banknotes must berealised by in-house printers environment Augmented use of the « test » facilities. The allocation of the test center must be the result of long termagreements 8 9 In order to organizecompetitionamongprivate and public sector and evenworser: within public banknotes printing sector the ECB and banco-committee must stand for organization of cooperation in a public context !

  18. CONCLUSION WE ARE READY TO BRING OUR CONTRIBUTION TO RECONSIDER THE EXISTING PARAMETERS OF THE EPPS MODEL

  19. THANK YOU FOR YOUR ATTENTION

More Related