Spanish unions to continue pay moderation

Spain's two main union confederations, CCOO and UGT, have agreed to continue next year with the policy of pay moderation in force throughout 2003.

The agreement, set to be finalised on 20 December, provides that the government's 2.0% forecast for inflation for 2004 should be taken as the basis of negotiation for the coming year. However, the deal, reached with the main employers' organisation, also accepts that this level of increase should be linked to revision clauses, which allow pay to catch up if inflation increases by more than expected.

The latest figure for inflation shows prices rising by 2.8% a year (November 2003).