MADRID – Spain will deliver labour reform plan, without lowering pensions

The Spanish government said it will fulfill its commitment to change the country’s labour laws and will not lower public pensions after the approval of the EU recovery fund earlier this week, Labour Minister Yolanda Diaz said on Wednesday (22 July).

Her comments echoed remarks by Foreign Minister Arancha Gonzalez, who said Spain intended to reform its labour laws to reduce the structural unemployment rate as part of commitments tied to the disbursement of the EU Recovery Fund. Read more here.

“We will fulfill the government agreement because it is necessary,” the labour minister told Spanish radio station SER when asked if the EU deal could affect the agreement between the Socialist Party and its leftist coalition partner, Unidas Podemos, to modify the 2012 labour legislation.

Diaz said it was necessary to correct what she called the “enormous precariousness” of Spain’s labour market and its wage devaluation, but stressed those issues would be addressed in talks with unions and business associations.

Asked if public pensions would be lowered as a consequence of the EU deal, she replied: “No”.

Introduced by a previous conservative government, the labour reform allowed far greater flexibility in the labour market, making it easier to cut wages and cheaper to lay off workers.

( **note with Reuters

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