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Lawmakers in last-ditch bid to resolve salary scale

Civil servants and public school teachers rally outside the Tourism Ministry in Hamra, Tuesday, May 13, 2014. (The Daily Star/Mohammad Azakir)

BEIRUT: Lawmakers are poised to reach a compromise on the controversial salary scale Wednesday, as teachers and civil servants prepare to hold their “day of rage” in what is expected to be their biggest protest yet over the issue.

MPs told The Daily Star that they expect a marathon session Wednesday, stressing that all parliamentary blocs realize that they cannot leave the meeting empty-handed.

Sources said that the lawmakers might raise the ceiling of the salary scale funding from the $1.2 billion suggested by the parliamentary committee to $1.4 billion.

But even this figure falls far below the original $1.9 billion.

The lawmakers will also suggest a number of tax measures to finance the salary increases and will press the Cabinet to cut waste in many departments, most notably in the state-owned Electricité du Liban.

Among the proposals the MPs will review is raising VAT from 10 percent to 11 percent, increasing customs by 1 percent, increasing taxes on profits of banks from 15 to 17 percent, increasing taxes on interest on deposits from 5 to 7 percent and increasing taxes on real estate profits.

Speaker Nabih Berri said Parliament would discuss and agree upon each article in turn, in separate daytime and evening sessions, with the evening session lasting until midnight at the latest. He added that, if lawmakers require further time, he would call a new session after President Michel Sleiman’s term ends on May 25, so as to avoid a constitutional debate over whether Parliament could legislate in the final days of a president’s term.

Berri said his bloc rejected the proposed 1 percentage point VAT hike. Observers say most of the MPs and even those who sympathize with the demands of the Union Coordination Committee are deeply worried about the negative economic repercussions of wages being dramatically increased.

Central Bank Governor Riad Salameh has urged MPs to pay the salary increases over five years, expressing fears that a drastic increase would lead to inflation and above all to increased pressure on national finances.

Following on his call last week for a “day of rage” to coincide with Parliament’s session, UCC leader Hanna Gharib threatened Tuesday to wage a popular uprising if MPs failed to meet the demands of public sector staff.

“We promise you that we will stage a popular uprising tomorrow. Our white Lebanon, which was built with our pains, is different than their Lebanon. Wednesday will be a test for the political authority. Either we are ruled by justice or we are ruled by a bunch of criminals,” Gharib said.

Speaking before a small gathering near the Information and Tourism Ministry, Gharib insisted that the UCC would not accept any compromises.

“Today’s stepped-up action comes to avoid heading toward boycotting correcting official exams,” he told a cheering crowd outside the ministry.

He warned that government workers faced “dangerous conditions.”

The UCC has already called for boycotting Lebanon’s official exams in protest at the $700 million cut in the funding allocated to the salary scale.

Besides public schools and government offices, most private schools in the country are expected to join Wednesday’s strike, with many of their teachers planning to join the rally near Parliament.

Most civil servants have either abstained from work or refrained from performing their duties over the past week in a bid to apply pressure on MPs.

Some economists warned that the civil servants’ strikes are costing the Treasury over $50 million every day.

An MP told The Daily Star that the protesters would eventually accept the amended proposals made by the lawmakers, adding that no one has an interest in crippling the country.

 
A version of this article appeared in the print edition of The Daily Star on May 14, 2014, on page 1.

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Summary

Lawmakers are poised to reach a compromise on the controversial salary scale Wednesday, as teachers and civil servants prepare to hold their "day of rage" in what is expected to be their biggest protest yet over the issue.

Sources said that the lawmakers might raise the ceiling of the salary scale funding from the $1.2 billion suggested by the parliamentary committee to $1.4 billion.

Among the proposals the MPs will review is raising VAT from 10 percent to 11 percent, increasing customs by 1 percent, increasing taxes on profits of banks from 15 to 17 percent, increasing taxes on interest on deposits from 5 to 7 percent and increasing taxes on real estate profits.

An MP told The Daily Star that the protesters would eventually accept the amended proposals made by the lawmakers, adding that no one has an interest in crippling the country.


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