Prime Minister Juha Sipilä (Centre) was pictured at the Finnish Parliament on 10 March, 2016.Prime Minister Juha Sipilä (Centre) has announced that the response of labour market confederations to a request to clarify their position on the round of union-specific collective negotiations scheduled for the latter half of 2017 is satisfactory.

“The organisations' proposal to shift to the Finnish model is enough for the Government. It represents a major structural change, if realised – an important step,” he said on Twitter.

The Government has devised the so-called Finnish model in order to follow in the footsteps of Sweden and continue wage moderation in 2018–2019 and make future wage increases contingent on export industries.

“Labour market settlements will be used to promote the competitiveness of sectors vulnerable to global competition, long-term employment, greater productivity and the balance of public accounts,” the labour market confederations state in their response, according to Helsingin Sanomat.

Sture Fjäder, the chairperson of the Confederation of Unions for Professional and Managerial Staff in Finland (Akava), estimates in an interview with Uusi Suomi that the response bodes well for the deadlocked negotiations over measures to boost the competitiveness of domestic industries – or, the so-called social contract.

Akava presented the proposal to the Government along with the Finnish Confederation of Professionals (STTK), the Central Organisation of Finnish Trade Unions (SAK), the Local Government Employers (KT) and the Confederation of Finnish Industries (EK) on Thursday.

“[The Government] asked for this in order to be able to discuss the possible tax concessions. We've answered their questions about our stance on the upcoming rounds of union-specific [negotiations],” he tells.

Fjäder underlines that the quintet of labour market confederations will wait for a response from the Government before making their proposal public.

“This is not the Finnish model, but the actual model – if we can agree on one – won't be drafted until the social contract has been taken over the finish line,” he clarifies.

A number of stakeholders have pleaded with the Government to introduce income tax concessions to offset the effects of the social contract on purchasing power and, thereby, facilitate the ongoing negotiations. Sipilä has previously estimated that an agreement on wage formation could make the tax concessions a viable possibility.

He declined on Thursday to comment on the concessions and clarify his position on the response from labour market confederations. On Monday, however, he indicated that if an agreement on the issue is found, the Government would be close to being able to compensate for the transfer of employers' contributions to the shoulders of employees.

“[The concessions] are currently contingent on what is decided on the Finnish model,” he said.

The negotiations for a social contract ran into a deadlock on Monday after EK announced that an insufficient number of trade unions have committed to the preliminary agreement unveiled by labour market bosses on 29 February.

Aleksi Teivainen – HT
Photo: Markku Ulander – Lehtikuva
Source: Uusi Suomi