Sacrifice, discipline, patriotism and solidarity summarise Rama Sithanen’s new mantra. The Deputy Prime Minister and Minister of Finance wants the whole population to be driven by these values as the country sails through rough waters.

The Minister made a strong plea last week in favour of a new mindset among the various stakeholders in order to bring about a sustainable recovery of economic growth and to put government finances in order . Reforms can’t wait anymore. “The cost of doing nothing is much higher than the cost of reforms” argues Rama Sithanen. But he stresses on the need to equitably share the burden of reforms among the various segments of the population.

One of the main priorities of the restructuring agenda is to put things in order in government finances. Rama Sithanen promises bold initiatives in his next Budget to reverse the trend in fiscal deficit. Measures to reduce the increase in recurrent expenditure are being seriously envisaged.

The Ministry of Finance has given clear instructions to all quarters of the public administration and to parastatals to cut down on wastage and inefficiencies and to benchmark their spending plans against budget discipline and value – for – money considerations.

The Finance Minister has also appealed to pressure groups to take into account the pressure on government finances when they submit proposals in view of the forthcoming Budget. Bids pointing to tax exemptions, for instance, stand little chance of being endorsed by the Ministry.

In the absence of discipline, the government will be forced to increase tax, he warns.

The Finance Minister delivered the same message of discipline, of responsibility and of solidarity at the annual tripartite meeting that was held on Thursday in Port Louis. But people with different interests view these signals differently. Trade unions and the employers’ representatives were at odds on almost every issue that was on the table.

<I>Trade unions said that compensation is only a way to catch up with the loss in purchasing power they have been suffering over the years. They argued that numerous price hikes have hit the working classes.</I>

The Mauritius Employers’ Federation (MEF) pointed to the risks that salary compensation might feed into a prices and wages spiral, thereby further eroding our competitiveness in world markets. In some industries, like in garments, they said, producers can hardly demand higher prices from their buyers due to intense competition from low-cost players like China, India and Pakistan. A higher wage bill without productivity gains would mean eating into already meagre margins.

Trade unions, on the other hand, said that compensation is only a way to catch up with the loss in purchasing power they have been suffering over the years. They argued that numerous price hikes have hit the working classes and that it is only fair that the tripartite forum attempt to restore some kind of social justice.

They forcefully resisted claims to factor in productivity, efficiency and other performance indicators in the computation of the wage increase. They insisted that this is a solely cost of living-driven wage adjustment and has nothing to do with a comprehensive review of salaries.

Unions also opposed arguments in favour of collective bargains at sector level. They pointed out that any attempt to revisit the tripartite model will jeopardise industrial harmony in the country.