Tens of thousands of nurses, police officers and clerks marched through Prague on Tuesday to protest against a plan to cut public sector wages, but the Czech government was determined to push on with cutting the deficit. The labour protest, the biggest of the past three years, is the first test of the new centre-right cabinet's resolve to narrow the budget gap to 4.6 percent of gross domestic product next year from 5.3 percent this year.
The protest is also part of wider discontent across Europe where unions have started a drive against austerity measures. Around 40,000 public sector union members joined the march, according to estimates by the police, whose unions took part in the protests. They blew whistles and carried banners, one saying; "We are no slaves".
"I am scared I will lose my job. They are firing people where I work. (The government) should cut their own wages, not those of us, the poor people," said Iva, a 44-year old caretaker at a state dormitory. The country of 10.5 million employs 740,000 people in the public sector, and the average gross pay of 23,937 crowns ($1,275) per month is slightly above private sector wages.
The government spent 205 billion crowns ($10.92 billion) on public wages last year, 12 percent of overall public sector spending. The Czech Republic's public debt at 37.5 percent of GDP this year is at about half of the EU average and investors see the country as a safer bet than some euro zone countries, but the state's debt load has begun to rise fast.
The new centre-right government led by conservative Petr Necas made cutting the deficit to 3 percent by 2013 and deep reforms of the pensions, welfare and health systems the main campaign issues ahead of a May election. "I have said openly that the government will not back off, under any circumstances, from the lowering of total volume of wages in the public sector by 10 percent," Prime Minister Necas said, adding: "We are ready to discuss, and we are discussing, the concrete form of the reduction." The cabinet, which is united on the need to cut but not on the changes to the wage structure, was due to discuss the various proposals on Wednesday.