The second edition of the EZA Brussels Conference aimed to examine some of the policies adopted at national and EU level to fight inflation and the role of trade unions in this context.
Participants in the first panel, dedicated to wage policy, were unanimous in recognising the key role of the social partners and social dialogue in helping to preserve workers' purchasing power. Unsurprisingly, however, the perspectives of employees (Veselin Mitov, Podkrepa) and employers (Isaline Ossieur, BusinessEurope) differed on the contribution of higher wages to the price levels. As for the role of politics, Dennis Radtke (European Parliament, EPP) stressed that the European Union, and in particular the European Parliament, was not in the driving seat when it comes to providing immediate solutions. However, the EU has made a major contribution with the adoption of the directive on adequate minimum wages. The directive is a key instrument that trade unions can use immediately to support their wage demands, insisted Torsten Müller of ETUI, pointing to the Belgian, Austrian and Dutch examples.
Another instrument used to fight inflation is monetary policy, which was the subject of the second panel. David Sondermann (ECB) gave an overview of the recent action of the European Central Bank to tackle inflation. He also pointed out that the current rise in prices was not only due to supply factors such as the war in Ukraine or the pandemic, but also to a demand shock in the EU. However, according to trade unions, the successive interest rate hikes decided so far by the central bank have a rather uncertain impact on inflation. Moreover, given their negative impact on growth and employment, "the cure may be worse than the disease" warned Renaat Hannsens of ACV. Clément Fontan (Catholic University of Louvain) acknowledged that the current ECB was more open to recognising the contribution of factors such as rising profits to the current inflation crisis. He suggested that the Frankfurt-based institution should pay more attention to its secondary objectives (growth, employment) and not only to price stability and called on the European Parliament to cooperate.
The EU's external dependency for its supply of critical raw materials was the subject of the third panel. The conflict in Ukraine and sanctions against Russia, in particular, have led to soaring energy prices - one of the main components of current inflation. Outi Slotboom (DG Internal Market, European Commission) presented the main pillars of the EU's open autonomy strategy, the Union's plan to end its dependence on imports. Alexander Conway (Resilium) highlighted the questions that this strategy raises, notably the social and environmental impact of its implementation.