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PRAGUE, December 29 (Reuters) – The new center-right Czech government to freeze civil servants’ salaries and cut previously announced salary increases for others as it seeks to narrow the budget gap amid inflation , the ministers announced on Wednesday.
The government, appointed earlier this month, has pledged to reduce the central government deficit in 2022 to less than 300 billion crowns ($ 13.66 billion), from 380 billion envisaged by the previous government .
“We are freezing the salaries of public administration employees (…) and for ourselves,” Labor and Social Affairs Minister Marian Jurecka said at a press conference.
“We have found a compromise so that key frontline professions such as social and health care, teachers, military, still have some increase.”
The reduction is a signal of the intention to save money, but is only a fraction of the overall savings ambition, with the freeze reducing central government spending by around SEK 4.7 billion compared to previous shots.
Teachers will get a 2% pay hike and health and social workers exposed to the coronavirus pandemic will get a 6% hike. The military and police will receive a monthly salary increase of 700 crowns.
The government will also prepare a law to freeze the salaries of politicians for next year.
Inflation climbed to 6% in November and is expected to hit around 8% by early 2022, as rising energy prices are accompanied by supply chain disruptions and a tight labor market .
Jurecka said the government had agreed to expand aid programs to help households hardest hit by rising energy prices.
The country will start 2022 on a provisional budget, and the cabinet plans to prepare its new project in the first quarter.
The finance ministry last forecast in November 2022 a public sector deficit of 4.4% of gross domestic product.
($ 1 = 219,620 Czech crowns)
Reporting by Jan Lopatka; Editing by Giles Elgood
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