Linda Hutchinson-Jafar, Business Writer

Trinidad and Tobago Prime Minister Patrick Manning's administration has made settlemetns with unions amounting to about US$316 million in the past two years. - File

Trade unions and government-paid workers in Trinidad and Tobago are threatening to withhold their votes from the ruling party if their outstanding salary negotia-tions are not completed before the November 5 general election.

Two weeks ago, over 12,000 teachers pounded the streets of the capital demanding settlement of their 2005-2008 wage negotiations before the elections.

If not, the ruling People's National Movement (PNM) could kiss their votes goodbye.

Union leaders representing other government-paid workers who took part in the protest demonstration reminded the Government that "workers are voters," and warned that all negotiations should be concluded by October 12 - today.

Settlement

A day later after the massive demonstration, Prime Minister Patrick Manning in his capacity as political leader of the PNM announced at the opening of a political office that settlement was reached on the teachers protracted negotiations.

It will now cost the Government an additional US$40.3 million from December for the new salaries for teachers.

There are similar rumblings from trade unions who want wage settlement before the polls.

Stephen Thomas, acting president of the Public Services Association (PSA) said outstanding negotiations for workers of the Airports Authority, Civil Aviation Authority, National Insurance Board and Housing Development Corporation "must be settled" before the election.

The three-year period for collective agreements being negotiated will expire in December.

Collective bargaining

"We are of the view it is immoral for Government to abdicate its responsibility to treat with the legitimate demands of these workers for salary adjustments via the free collective bargaining process and then ask the same workers to come out and vote for any political party," Thomas declared.

President of the Communications Workers Union, John Julien said the union would have to "step up" its action before the election day as it demanded settlement of collective agreements for workers at the Trinidad Hilton hotel and Telecommunications Services of Trinidad and Tobago.

Fire and prison officers are also protesting the delay in settling their wage negotiations.

They've held protest action outside the office of the Chief Personnel Officer, Narieman Hosein-Ahmad, singing: "No money, no work. No money, no vote."

Economist Mary King said it is the norm in local salary negotiations for these to be dragged out.

Back pay

"People seem to like having a back pay, enforced savings, to splurge on things. But if this is drawn out too long they lose on taxes. The recent negotiations have indeed been going on too long and there is surely some pressure being put on the government to settle before the elections and some move by the government to look responsive if not really in fear of losing votes, " King told the Financial Gleaner.

However, she said the ruling party has an entrenched constituency and does not depend on the swing vote to win an election. Political Analyst, Derek Ramsamooj said unfortunately, there is a sub-culture in terms of labour relations in the Caribbean throughout history where the majority of public servants negotiate the best possible package during an election year.

"It is also practised by incumbents using state patronage to influence the outcome of voting. It is typical in this case, " said Ramsamooj referring to the settlement of the teachers wage dispute.

"It's all about retaining government. The economic decision making is driven by the political desire to hold office so they appease the workers who are voters," Ramsamooj told this paper.

Noting previous calls by the Trinidad and Tobago Central Bank for wage restraint, King said higher wages will indeed increase government spending and if allowed by the Central Bank, to increase liquidity which will push inflation.

"The Central Bank would have to take it out as quickly as possible, restrain the velocity of the circulation of this money," she said.

Freezing money

"We have been able to restrain inflation somewhat in the face of government spending because the Central Bank has been freezing money via OMO and increase in the reserve requirements of the commercial banks and its increase in sales of U.S. dollars up from US$700 million four years ago now at US$2.09 billion."

Year-on-year inflation to August in Trinidad was 7.9 per cent.

The economist said inflation is being driven primarily by government spending.

"Government budgeted spending, funded by increased petroleum prices and production, has almost tripled in the last six years," said King.

"Though food prices are being forced up by import pressures, these are being exacerbated by the high liquidity in the country and naturally food is the target of markup inflation because of its low elasticity of demand."

In a signing ceremony between the chief personnel officer and the teachers union over the new salaries package, Public Administration Minister Dr. Lenny Saith noted that government's settlements with various unions during the past two years amounted to over US$316 million.

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