“THE GOVERNMENT OF THE RoC PROTECTS ALL WORPLACES!”

1. INDUSTRY UNIONSSSSH “THE GOVERNMENT OF THE RoC PROTECTS ALL WORPLACES!” March 2009 - Ivo Sanader, prime minister November 2009 - Jadranka Kosor, prime minister February 2010

2. INDUSTRIAL CROATIA2015 PLAN OF ACTION FOR THE REORGANISATION OF THE CHROATIAN INDUSTRY

3. STRUCTURE OF ENTERPRISESREGISTERED IN CROATIA March 2009 (Date of the daily paper ‘Jutarnji list’ 19.05.2009) REGISTERED ENTERPRISES 264.200 NON-ACTIVE 140.184 53,1% ACTVE 124.016 46,9% 0 EMPLOYEES 55.559 44,8% 0-9 EMPLOYEES 33.203 42,9% 9-250 14.626 11,8% 250< 628 0,5%

4. Wages

5. Employment and wages 2009 Source:HSH

6. Source:HSH

7. Processing industry Source:HSH

8. Processing industry Source: HSH

9. HOW WAS THE ECONOMY PROTECTED • Total number of employees decreased between 08./9-09/9 by 72.552 • Out of 37.793 unemployed 31.259 come from the industry • 93,7% of the employees in the industry earn less than the Croatian average wages WHAT HAVE WE ACHIEVED? • The government had no intention or interest to take measures so the trade unions and the employers in the industry negotiate about survival strategies

10. CONSTRUCTION INDUSTRY • 49 companies employing 12 639 workers decreased the wages of 4500 in agreement with the trade unions • 525 workers on “waiting list” • agreement on dismissal for 1400 workers • announcement of another 2367 dismissals • benefits of 1382 workers not paid • late payment of wages for 1646 workers METAL INDUSTRY • This year agreement was reached to cut the working week and reduce wages in 15 companies with 3678 workersin total.

11. ENERGY, CHEMICAL AND NON-FERROUS INDUSTRIES • 2400 jobs lost during the year • shorter week for 3123 workers in 9 companies • decreased wages for 4313 workers in 7 companies • wages not changeed for 15 214 in14 companies WOOD AND PAPER INDUSTRY • 7000 jobs lostt this year The Act on the decrease of working time and the efficiency of the resulting measures need to be reviewd as nothing was achieved,while the subsidy funds (around 250 million kuna) have not been used.

12. AZ SSSH GAZDASÁGI SZAKSZERVEZETEK 2009.12.7- EI ELŐTERJESZTÉSE A KORMÁNYNAK ÉS A HORVÁT MUNKÁLTATÓK SZÖVETSÉGÉNEK (HUP) “ SSSH (INDEPENDANT CROATIAN TRADE UNION CONFEDERATION) AGREEMENT ON “THE STRATEGY TO OVERCOME THE CRISIS OF THE SECTOR” • workers were no dismissed 2010 • 2009 wage level was retained for 2010 STARTING POINT OF THE AGREEMENT • The economic crisis and its consequences need to be defined, systemised analysed without delay in the different branches and sectors within the frame of local and national trilateral dialogue. For companies outside without any agreement a general economic CA needs to be made to set the lowest wage level by a multiplier of 1:3,2

13. monitor company norms and their efficiency • revenue per employee • gross wage costs • cost of employees • creation of a SUBSIDY FUND to help workers in need due to the global crisis • creation of a CRISIS FUND by joining national and local instruments to help workers in the economy whose jobs are threatened

14. measures and incentives to protect national production • urgent amendement of the act on subsidies to compensate the decrease of the working time • draft legislation on the return of the “crisis tax” to employees and the privatisation vouchers of state companies

15. SSSH PARTNER ORGANISATIONS 43,64% 2,63% 56%

16. INDUSTRIAL PRODUCTION • after a year of sharp decrease in October 2009 the production of the industry decreased by 8.6% compared to the previous year. • in the first 10 months of 2009 the production of the industry was 9,6% lower than a year before.

17. EMPLOYMENT IN CROATIA 2008 Source: HSH

18. THESIS: we do not support the crisis management “model” rooted in the dismissal of workers and unpaid or decreased wages. We already saw this model at the late 1990ies whenthe “spontaneous” privatisation in an already tense crisis deprived workers of their rights and wages, turned the country into indebtedness and workers dependant on the budget.

19. Conclusion – the Croatian economy is not the problem of others, we are all sitting in the same boat! • decreasing purchasing power • consequence: decreasing domesticproduction and GDP • no surprise that stopping or holding back investments cause major uncertainties • lack of funds and creditworthiness in the economy • consequence: lack of employment and wage cuts • further decrease of purchasing power • SPIRAL! • IN THE NEXT ROUND WE WILL FALL EVEN DEEPER!

20. Loosing business on the horison 2009! • increasing stocks • Resulting from the stop on investments major drop in the domestic demand for durable and capital intensive goods. During the crisis in the EU there is no hope for anyone supporting our economy by importing Croatian products (the drop of Croatian export in the first 10 months was 22%). • Questionof all questions: who and in which months will by domestic products?! • Industrial production of the first 10 months is10% less than in the year before

21. The loss of jobs, delayed payment of wages and the pressure on cutting wages erodes state revenues • the decrease of workforce in the processing industry equals the drop of the industrial production • national wages are stagnating – this means that workers provide a maximum investment in order to manage the crisis • result: dramatic fall in the domestic purchasing power • this is clearly visible today – through the decreasing budget revenues from contributions • parallel with this there is an increase in the bank deposits – those who have money see major risks and are pessimistic about the recovery of the real economy

22. Ignoring the role of the state in the economy • just like in the process of privatisation, none cares for the people deprived of their rights • do we have to give in again and let the remaining companies ruined? • do people have to be left without housing and income while some are contracted to paint tunnels for millions? • after dubious cases of contracting and sub-contracting within the public procurement processes we d not believe any longer in stories about market competitions and the selection processes to find the best companies • we demand from the administration that in line with the regulations and international agreements it spends a part of the purchasing power of the state on helping and saving the companies, the national producers and construction companies.

23. True – the state is not an enterprice but ..! • ...it has to sit down with the large, medium and small businesses, trade unions and has to find the means to develop and grow companies in 2010 and to find the way to distribute the costs of crisis management not on the basis of low value of work or dismissals – this is not in the interest of the state or the economy.

24. Reform of the state administration and how to eliminate bribing and corruption from public utility companies • Are public companies controlled by state institutions and far do they contribute to the achievement of the objectives of the national economy and the elimination of the crisis? • What was the investment level of public utilities and public companies 2009? • Thes companies – especially if in monopolistic position – must enforce austerity measures and efficient financing but above all they must fulfil their obligations visa vie the suppliers! • Does the government aim to increase the skills, the efficiency and the quality of state administration and do politicians have the necessary strength to achieve this? Everyone claims that the state administration is big but no one speaks about how to modernise and adapt it to the need of the companies.

25. Collective bargaining between the governemnt as employer and tax-payers as those who carry the burden • We demand that the government of Croatia as employer acts according to the financial possibilities of those who fund the budget i.e. citizens working mainly in the private sector • This means that modesty and savings in the area of wages can not be expected if afterwards the funds are distributed behind closed doors in another manner • We demand to avoid any new or the increase of the existing taxes when the budget is less filled than expected • Workers expect quality services in return for the taxes they pay – we do not intend to pay a penny more for health and other insurances or other contributions

26. Government policies and programmes to stabilise the expectations of the people and the businesses • Respecting the rules of the market economy and of businesses, the government will enforce a ban of any speculation in the market until the first signs stabilisation of the economy, which normally follows a crisis • Will help calm down the panic of the markets (goods, labour market, capital and financial markets), guarantees at least in 2010 a partial planning for business and life and will set up measures to stimulate the economy.

27. Announcement of the public work crisis management package – to conribute to growthprivate capital must have the possibility to invest in infrustructure/concession/privatisation projects • announcement of the public work crisis management package to be funded either by concession or by PPP – CRISI MANAGEMENT CLUSTERS • no direct burden on the budget • large infrastructure projects by the involvement of foreign funds, EU funds • main objective of the package is to retain the necessary speed of employment and production in the sectors that are the fastest to be activated but also the fastest to be dissolved e.g. the construction industry. • we support public investments, local and regional projects which provide opportunity for different businesses and skills (maintenance of regional public road network, construction of kindergartens and schools, energy industry and water management investments).