Slovenian government set to slash wages, benefits

Slovenia's government wants to slash civil service pay, parental leave and unemployment benefits to consolidate its public finances, according to a proposal to unions published Saturday. The centre-right government proposes to cut this year's spending by 818 million euros ($1.1 billion) to around 9.3 billion euros and bring its deficit to 3.0 percent of gross domestic product (GDP) from around 6.0 percent in 2011. Almost half the savings will come from a 15 percent salary cut for civil servants, suspension of this year's holiday allowances and reduction of health care benefits. The plan would also reduce unemployment benefits and parental leave benefits while holding maternity leave at 12 months. In education, it calls for extending working time for teachers and increasing the number of students per class. The government also wants to eliminate two of the country's 14 public holidays. Prime minister Janez Jansa said in an interview broadcast live on Saturday evening the measures were "essentially, relatively mild considering the situation our state is, this is only a first step." "These are our negotiating positions, they are not yet final decisions," Jansa said, but warned a budget revision was urgently needed since the current budget had been based on a 2.5 percent growth forecast. "If the government and parliamentary majority do not approve this package for balancing the budget in a month's time, I will not have to resign since the whole system will collapse," Jansa told POP TV when asked if he would offer his resignation if the austerity measures were not approved in parliament. "We want to show we are trustworthy when the European Commission delegation comes in April to check our plans for balancing public finances," Finance Minister Janez Sustersic said when announcing the broad outlines of the austerity measures on Thursday. He said the measures would be included in a revised 2012 budget proposal to be sent to parliament in early April even if the government fails to reach agreement with the unions. Along with the budget revision, the government will submit a proposal to introduce a so-called "golden rule" into Slovenia's constitution that would require a balanced budget.