On July 13, 2016 in Carthage, nine political parties and three national organizations, the Union générale tunisienne du travail (UGTT), the Union tunisienne de l’industrie, du commerce et de l’artisanat (Utica) and the Union tunisienne de l’agriculture et de la pêche (UTAP) signed a pact defining the priorities of the new administration, supposedly of “national unity”. It was the President’s intention that this new government should give the country a fresh political impetus.
Youssef Chahed, appointed to head the new administration, is only forty-one and displays remarkable enthusiasm for his task. His top priorities are fighting terrorism, reviving the economy and developing the remote regions. He also makes much of his determination to deal with corruption, which has undeniably worsened and spread since the revolution.
Beyond those main axes, however, there is an immense amount of work to be done. In his first speech to parliament in August 2016, soliciting a vote of confidence, the new Premier himself gave the full measure of the problem. Painting a dark but realistic picture of the national economy, Youssef Chahid focused on the fall in productivity, the wage-increase demands and the strikes that held up production and discouraged investors, and insisted as well on the overstaffing of public services.
The IMF’s Nasty Medicine
Indeed the wage share of the national economy grew by leaps and bounds between 2010 and 2016, and during the same period the number of civil-service workers rose from 600,000 to 900,000. More generally, State spending has considerably exceeded revenue and has dug the public debt deeper still, forcing the government to contract a huge loan from the International Monetary Fund (IMF). This loan is mostly meant to fill the big the budget hole: indeed; the public debt has risen from 25 billion dinars in 2010 to 56 billion in 2016, or 60% of the GDP. The Prime Minister went on to explain that to avoid austerity measures, government spending had to be reduced by cutting civil service jobs, raising both personal and corporate taxes, while declaring war on the parallel economy and corruption.
Now, while this diagnosis had the merit of truthfulness, putting this program into practice proved much more complicated. From the start, the new government has had great difficulty filling the State coffers, especially collecting taxes from the members of the different professions. A survey conducted by Inkyfada in 2016 shows the extent of tax fraud among the professions, whereas wage earners, who are subject to a withholding tax, remain the Government’s cash cow. Their contribution has risen regularly over the past few years, while “tax revenues fell by 26% from 2014 to 2015 with a sharp drop in the number of taxpayers in good standing.” The government seems unprepared to deal with the corporatism of certain professions, especially lawyers, and does not appear better equipped to deal with the parallel market which remains beyond the reach of the internal revenue authorities.
As for the fight against corruption, and despite the measures announced, the Government has failed completely. In September 2016, in his opening address to an inter-Arab conference to promote integrity and fight corruption, Youssef Chahed declared that “the struggle against corruption is more complex than the struggle against terrorism.”
However, the government’s chief difficulty lies in having to comply with the demands of the money-lenders, mainly the IMF, while at the same time taking into account the demands of the central labour union, the UGTT, regarding wage increases and cuts in civil service staffing. Last February, IMF officials on a visit to Tunisia inevitably pointed out the factors responsible for the rise in the public debt: a State budget which requires a loan amounting to 25% of its bulk and, of course, the absence of structural reforms to remedy an over-abundant administration. According to the IMF, “the civil service wages share as a percentage of GDP is one of the highest in the world.” And indeed, the administration and publicly owned companies employ a total of 900,000 wage earners for a population of 11 million.
The crisis between the Government and the UGTT has been brewing for some time. In the conflict pitting the teachers’ union against the Minister of Education, Neji Jelloul, the UGTT wishes to see the latter resign from the cabinet, while the Prime Minister has other ideas.
Slim Down the Civil Service?
The other tense issue concerns the civil service cuts and how to go about “slimming down” its numbers. Abil Briki, the Civil Service Minister and former official of the UGTT wanted to proceed gradually, relying at first on “voluntary redundancy,” although he did see the need for eventually reforming the civil service. In an interview given to Reuters, Tunisia aims to cut 50,000 public sector jobs in reforms starting this year. The Minister declared that Tunisia, in order to reduce government spending, was considering a program of “voluntary lay-offs” which would concern 50,000 civil servants. He added that those made redundant would receive an indemnity from the government (approximately two years’ wages) and assistance in getting bank loans to create their own small businesses.
At the same time that he announced this program, Briki let it be known via the media that he could put his resignation on the table, a decision he claimed to have discussed with two former general secretaries of the union, Abdesselam Jrad and Houcine Abassi. He also indicated that he was prepared to discuss the matter with President Beiji Caïd Essebissi. In this list of discussions, which sound more like negotiations, Abid Briki made no mention of the Prime Minister.
On February 25th, the latter created some surprise by announcing a partial reshuffling of his cabinet: Ahmed Adhoum became minister of Religious Affairs, Abdellatif Secretary of State for Trade and Abed Briki was dismissed.
This dismissal very much resembles a reprisal for the Civil Service Minister’s threats of resignation. The decision would have been harmless or in any case quite routine had the Minister not come from the ranks of the powerful union, had it not come about in a climate of great tension between the UGTT and the government, and had all the cabinet members not signed the Carthage Pact.
An Important Political Player
In firing Briki, Youssef Chahed acted as though he was unaware that the union has always been a major player in Tunisia’s political history and a key component of the national movement, siding with Habib Bourguiba against Salah Ben Youssef, jealously preserving its independence from the government, though not always successfully. During the revolution, it played a central role in the demonstrations that put an end to the presidency of Zinedine El Abidine Ben Ali. After which, the UGTT opted for a break with the past which inevitably led to the rejection of a constitution that bore Ben Ali’s imprint and the dissolution of his party, the Rassemblement constitutionnel démocratique (RCD). This strict interpretation of the revolution allowed the union to gloss over the collaboration of several of its leaders with the Ben Ali regime.
This strategy was successful and despite the official recognition of two other unions after the revolution, the UGTT continued to assert its power in the political arena, superseding the parties and especially those on the left, and conveying the image of a union traditionally committed to serving the people, the civil society and the street protests. This was an impressive reversion to its historical legitimacy. In July 2012, it called for the organisation of a council for national dialogue wherein the political players could meet with representatives of the civil society in order to solve the major political crisis in which the country found itself. That commitment to a “national dialogue” saved a political transition which was threatening to collapse altogether and was awarded the Nobel Peace Prize in 2015.
In the summer of the following year, when the executive made the UGTT a full-fledged partner in the Carthage Pact, it wasn’t just a labour union that was invited to take part in governmental decisions but a major political force, in addition to its societal role. Fearing a reckless wave of privatisation by a government under pressure from the IMF and aware of the social consequences of wholesale civil service lay-offs, the UGTT certainly wanted to assume the political role it had always played when it threatened to call a general strike and to withdraw from the cabinet.
The Lost Spirit of the Carthage Pact
In the face of this traditional union approach, Youssef Chahed preferred to avoid arduous negotiations by simply dismissing one of the two UGTT ministers. This was a blunder in several respects. First of all, the decision was taken without consulting the parties, which was a violation of the Carthage Pact. Moreover, the Premier decided to replace a representative of the central labour union with Khelil Gariani, a cadre from the employers’ organisation (Utica), to be in charge of the civil service. Needless to say, this was a message which did not go down well with the union rank and file, especially those who had demonstrated alongside primary and secondary school teachers who demanded the dismissal of the Minister of Education, Neji Jallul. Nor did it go down well with public opinion when it was discovered, via the social networks, that Jhélil Ghariani was related to the Prime Minister. The Web flared up in disapproval of a Premier who crosses swords with the UGTT and espouses Ben Ali’s and Beji Caïd Essebessi’s nepotism.
Now, while Nidaa Tunes and Ennahda both supported the PM, the other parties registered surprise, assuring that they were neither consulted nor informed. The outcry has been such that Khelil Ghariana finally changed his mind and turned down the ministerial offer. Now the civil service has been placed directly under the responsibility of the Prime Minister’s department.
Although the PM has reiterated his fidelity to the Carthage Pact, it has become obvious that that agreement has been rendered somewhat meaningless. Several parties have already withdrawn from it, like the Union Patriotique Libre, Machru’ Tunes or the Mouvement du Peuple. Youssef Chahed’s methods appear to have undermined the government, even if he pretends to take into account the projects advocated by certain political figures. In addressing Parliament to obtain his vote of confidence after the cabinet reshuffle, Chahed did indeed announce a number of major reforms affecting the civil service, state-owned companies, social funds and the pension scheme. He also announced an increase in the guaranteed minimum wage of 5.56%. While these measures are in line with the wishes of Abid Beiki and the UGTT, there was no preliminary consultation with the social partner as recommended by the Carthage Pact.
