Austrian civil servants settle

Following difficult negotiations and the threat of action Austrian civil servants have agreed a flat rate increase of Euro36.33 a month for 2001. The agreement is significant as it is first deal this group of workers has reached with the coalition government formed earlier this year, which includes the far-right Freedom Party. It is also likely to influence other negotiations for next year, which are just beginning.

The flat rate sum for 2001 means a 3.3% increase for the lowest grades, but around 1.0% for those at the top of the scale. For most civil servants it is equivalent to about a 2.0% increase. This is below inflation, currently 2.7% (August), but Fritz Neugebauer, the president of the union involved, the G(tm)D, sees it as a positive result given the circumstances. The government was initially looking for a pay freeze.

For 2002 an increase of 0.8% has been agreed, around half the expected inflation rate. However, this will be re-examined in the light of the actual inflation rate at the end of the year.