Public workers union calls for nation-wide protest

Barclays warns against tax-and-spend policy

The Syndical Coordination Committee, a union of public sector workers and public and private school teachers, has called for a nation-wide protest on October 10 to urge the adoption of the new salary scale for civil servants and teachers.

The union called on the Cabinet to send the salary scale draft law to Parliament to be approved. The law would raise civil servants' salaries by 60 percent on average. The union threatened to declare an open-ended strike if its demands were not heeded.

The Cabinet approved the new pay scale in early September, but said it would not refer it to Parliament unless the needed funds, some $1.1 billion, are secured first.

A range of taxes had been proposed to come up with the funds to pay for the public sector salary rise. But business leaders as well as economic experts have warned of the risks of adding more burdens on the Treasury and the private sector. Global ratings firm Barclays Capital also warned against the tax-and-spend policy. It said implementing such measures despite the economic slowdown would worsen the country's macroeconomic and fiscal outlook.

The new salary scale offers civil servants salary increases according to their grade. It would raise the wages of top level 'grade one' civil servants, from $3,400 to $5,900. Salaries of the lowest level 'grade one' civil servants will go up from $2,000 to $2,800. Wages of top level 'grade two' civil servants will rise from $1,900 to $4,000.