The EU has stepped in and forced a 5% reduction in the pay of Spain's public sector employees. Spain has a UK-like public sector deficit of 11% of GDP. As a Eurozone member it is meant to adhere to a maximum deficit of 3% of GDP.
As well as pay, pensions and Spain's 2,500 Euro "Baby bonus" are also to be cut.
The EU has been forced to take the initiative given the fall out from the Greek financial debacle.
Will the Tory and Liberal Democratic dare impose such fiscal discipline on the UK economy?
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