FINANCE minister Harris Georgiades put his credibility on the line yesterday in his attempt to defend the government’s ill-conceived decision to increase the entry-level wage for nurses. Deep down, the minister knows that the decision was indefensible because it was dictated by election considerations, made no economic sense and will set off a chain reaction of pay demands in the health sector.
And the decision was taken while the government is supposedly working on establishing autonomous, financially viable hospitals as part of its Gesy plans. Increasing the operation costs of these hospitals – other health workers with university degrees are now demanding equal treatment – will make their viability even more difficult to achieve. It is very difficult to believe that a prudent finance minister, who had tried to impose fiscal discipline in the previous four years, could now condone such reckless spending.
Georgiades said that the pay increases would not apply to all 3,200 nurses and that in the future the hospitals would also hire nurses without university degrees in order to maintain a balance and keep costs down. This would also be done by introducing the shift system so that nurses no longer worked civil service hours and paid overtime to work in the afternoons and evenings. This would be an improvement, but should nurses have been given extortionate pay rises in order to agree to what rational practice dictated?
The reality is that before Tuesday’s agreement had even been signed physiotherapists, x-ray operators, speech therapists with degrees (there are close to a thousand in hospitals) were all demanding the same entry level wage as nurses. As for the hospital doctors, their union is now insisting, with some justification, on a higher entry-level salary to maintain the pay differential with nurses. How could the government say ‘no’ to these health workers after setting the precedent?
As an economist, Georgiades knows very well that the government has made a big blunder. It agreed to have salaries determined by unions rather than supply and demand, at a time when it was imperative to keep hospital labour costs under control if the government was serious about introducing Gesy. This was why he has been arguing that a new financial feasibility study of Gesy should be carried out. Yesterday, he said that tax hikes might be needed if hospitals were not able to cover their running costs.
If he was concerned about such a possibility, why has he been defending the government’s agreement with the nurses that has set off a deluge of pay demands by hospital workers that would significantly increase hospital costs? A responsible and prudent government would not have sanctioned big pay rises, if its objective was to have financially viable hospitals, and then have the finance minister inform us that viability could be achieved through tax hikes. Unfortunately the government is doing its best to prove it is neither responsible nor prudent.
