Trade Unions and Privatisation

By Sekul Popovic, Alternative Information Network (AIM)—Athens, Banja Luka, 15 July 1999

Welfare programme first and then privatisation

Numerous economic, social and political obstacles were encountered in the process of translating principled support for privatisation, i.e. reforms into practice. Support for privatisation was frequently just a screen hiding the inter-party struggle for power. There is an illusion in the public of the Republic of Srpska that reforms are already underway which is a reason for refuting all criticism and warnings, especially those coming from the trade unions and workers who are hardest hit by the sluggishness and lack of determination in implementing the reforms.

Enormous losses of the enterprise sector, slow economic recovery, low incomes and high unemployment have forced the trade unions to insist on speedy reforms. It could be said that the trade union has assumed the role of an initiator of transition and reforms instead of serving as a controller of reforms and protector of workers' interests.

Privatisation is at the center of all reforms since the character of property relations determines the quality of the economy and society as a whole. The Republican Trade Unions say that under irregular and legally vague conditions for the acquisition, or as people call it the “theft”, of social capital some people ( mostly former and present powerful directors and enterprise managers) become rich overnight and secure privileges for themselves. This has brought discredit upon privatisation and caused social stratification, further complicating property relations.

Proceeding from their fundamental congress commitments, the Presidency and the General Council of the Trade Unions of the Republic of Srpska adopted in April this year a Resolution on the Tasks of Trade Unions in Privatisation and Transition. The Resolution clearly states that the trade unions have to uphold and advocate the introduction of a market and open economy, social state based on the rule of law and privatisation which would serve to increase economic efficiency and improve the general economic and social position of workers and pensioners.

The trade unions will insists on the lowest possible social risks that privatisation entails while preserving an active position of workers in ownership transformation. According to the Resolution, as far as privatisation is concerned, the RS Trade Unions Federation will channel its activities towards attaining 26 set objectives, including the determination of the best possible form of ownership into which social enterprises could be transformed. Trade Unions are committed to an equal treatment of private, state and mixed property and consistent application of the Convention 158 which says that in the process of privatisation no worker can lose his job or be denied appropriate social care.

Obrad Belenzada, President of the Metal Workers' Trade Union of the RS, an experienced trade unionist in former Yugoslavia, has said that privatisation is a necessary evil at this moment. “Workers will get nothing with privatisation in the Republic of Srpska, but will only lose as their primary interest is to work and earn good wages, as well as to live off their own labour, so that it is absolutely irrelevant for them who owns the enterprise”, said Belenzada.

Belenzada thinks that through privatisation a worker becomes dependent which will make his position even worse unless the state takes over the welfare role from state enterprises.

Summing up past experience of the countries in transition, Belenzada pointed out that a large number of workers had lost their jobs so that political oligarchies benefitted from privatisation and became enterprise owners overnight. “No one tries to determine the origin of capital of these people with which they bought or will buy such enterprises and I fear that something like that is bound to happen in the RS, which will also have adverse consequences”, said Belenzada.

He added that there were no data nor estimates on the exact number of workers to lose their jobs on account of privatisation nor information on who will provide for them since there is not yet any social safety net nor sources for its financing. Without a consistent welfare programme based on experience and knowledge with participation and full agreement of the trade unions, the Government and Chamber of Commerce which would then be adopted by the RS National Assembly, there are no guarantees that any single privatisation model will be successfully implemented. Redundant labour cannot be assessed without respect for collective agreements and workers' awareness of their rights based thereon.

The law must clearly define the rights of jobless workers including buy-up of contributory periods, severance pay, retraining, etc. Workers and their trade union organisations in enterprises have to be informed of this, as well as of the model of privatisation to be applied in each individual enterprise. By taking over the debts of some enterprises and by repaying them, the Government will put them at an advantage over workers of those state-owned enterprises which have covered their debts at the expense of their workers. Enterprises for which no buyer can be found will pose a special problem.

“The Republic of Srpska is the first post-communist country in the world to carry out privatisation of state-owned enterprises without revaluation of the workers' past labour”, said Danko Ruzicic, Member of the Presidency of the Trade Unions Federation of the RS and Chairman of the Textile, Leather and Footwear Trade Unions of the RS. Ruzicic also said that urgent adoption of a durable welfare programme was necessary as a precondition for any privatisation on which trade unions also must have a say.

The recently held session of the Joint Coordinating Board of the Trade Unions of the RS and the FB&H in Doboj concluded that the Governments of both entities should be asked to suspend the implementation of privatisation process until after the adoption of welfare programmes. If the Governments choose to ignore this trade union demand, their presidents said that they would invite the workers to obstruct the first round of privatisation. Judging by announcements, a showdown can be expected between the trade unions and Governments in both entities in Bosnia and Herzegovina.