Finance minister pledges to maintain public sector wages

Spanish Finance Minister Cristóbal Montoro on Tuesday said civil servants should have nothing to fear about the government’s planned overhaul of the country’s public administrations.

But he warned the country’s town halls not to maintain bloated workforces for political or other reasons.

The minister insisted that the object of the reform was to make savings by slimming down the public administrations with superfluous branches. Spain’s town halls control 1,793 companies, organizations and public consortiums, some of which Montoro said may be used to hide debt.

“We are going to carry out these changes and savings maintaining the wages of public sector workers,” the minister said.

Montoro was responding to an article in EL PAÍS’ Tuesday edition that said the Finance Ministry wants municipal governments that have signed up for a scheme to pay off their suppliers to cut their workforces or reduce wages.

Montoro said it would be up to the town halls how to decide how best to get their finances back in shape, with wage cuts an option only in cases where it is necessary to ensure the viability of publicly owned companies that are overstaffed.

“It seems that we are looking at a situation in which [town halls] are considered job placement agencies, and that is a wrong idea,” Montoro said.

The 4,622 municipalities that have signed up for a scheme engineered by the central government to settle a massive backlog of unpaid bills from their suppliers will be required to submit to the Finance Ministry their plans for balancing their books.

The ministry has identified 23 specific areas in spending and revenue-raising measures that among others include a “reduction in personnel costs.”