Our View: Koushos made a mistake in trying to broker the CoLA deal

IF HE has made a full recovery from illness and returns to work on Tuesday, the first thing the labour minister Kyriakos Koushos would have to do is make a decison on the Cost of Living Allowance. This was what he said he would do after last Thursday’s meeting between unions and employers’ organizations, which failed to bridge difference between the two sides. He conceded, after the meeting, that although there had been some movement, the positions of the two sides remained too far apart for him to submit a mediation proposal.

While employers said they were prepared to pay 50 per cent of CoLA as had been the practice in the last five years, the unions, which were demanding 100 per cent, indicated they would accept the gradual restoration. Despite the lack of any common ground, Koushos said he was to carry on consultations with the two sides in the hope of reaching a breakthrough. He would also speak with the president and the finance minister before he decided to declare a deadlock or submit a mediation proposal.

The truth is that the labour minister does not have the authority to impose his decision, nor does the government. The ministry can facilitate negotiations, but nothing more. Koushos had made a mistake, by agreeing to act as mediator in a negotiation that neither employers nor the finance ministry wanted. For the state, the full restoration of CoLA would mean €150 million would be added to the public sector payroll, something that had not been accounted for in the 2023 state budget which had been submitted to the legislature.

This alone should have discouraged the government taking on the initiative in trying to broker a deal. There was also the fact that only between 20 and 30 per cent of private sector workers were entitled to CoLA. In other words, the fat cats of the public sector – all of whom are paid CoLA – would have benefited from a pay rise close to nine per cent if CoLA was fully restored, while those on minimum wage in the private sector would have gained nothing. Under the circumstances it is difficult to understand the hard line of the private sector unions, which have threatened a general strike if CoLA was not fully restored.

The strike could take place because there is no way employers’ organisations would agree to anything other than keeping the agreement of 2017, which stipulated the payment of half of CoLA, in place. As for Koushos, he made one mistake by becoming involved in the issue, on his own initiative (there was no government decision on the matter), he should now step away, by declaring the matter closed as there is no common ground for an agreement which requires the consent of both sides. The unions can stage a general strike in protest, but it will change nothing.