Spain PM Says Will Not Cut Worker Rights In Crisis

Zapatero said Spain had a lot of problems, but they would have to wait.

Spain will not cut firing costs or worker rights as an answer to its economic crisis but create jobs and guarantee dole for the jobless, Socialist Prime Minister Jose Luis Rodriguez Zapatero said on Sunday.

In a week when his industry minister blamed Spain's soaring unemployment on banks' credit restrictions, Zapatero said Spanish workers should not pay for economic problems.

"This crisis wasn't started by workers, by normal people, common citizens, it was generated by people without scruples, who only think about greed," he said in an speech to Spanish mayors. "We are going to fight this crisis strengthening social policies and worker rights. To those who want to make it easier to fire, make it cheaper to fire, have freedom to fire, I have to tell them, no."

Spain has some of the highest firing costs in Europe for long-term contracts, and business groups want a labour reform to make it easier to hire young and immigrant workers.

The Organisation for Economic Cooperation and Development says Spain needs this and other structural reforms to raise competitiveness and cut unemployment which hit 14.4 percent in December, by far the highest rate in the European Union.

Zapatero said Spain had a lot of problems, but they would have to wait.

"For now, there is only one problem, and that is to attend to families in difficulty due to unemployment and get them back into work as soon as possible," he said.

Zapatero has backed away from labour reforms after Spain's main union, the CCOO threatened a general strike should the government try to cut worker benefits.

His answer to Spain's worst recession in 50 years is an 11 billion euro ($14.09 billion) infrastructure plan to create over 300,000 jobs, mainly through 31,000 public works projects in towns and cities.

He has budgeted for nearly 50 billion euros in tax breaks and state credit, as well as up to 50 billion euros in bank support, exhausting room for fiscal support.

Labour Minister Celestino Corbacho on Sunday defended the government against criticism it was slow to roll out its public works programme, which will start to create jobs in March.

"The crisis has tremendous speed; the speed of a hurricane. And the speed of measures is that of the state," he told Spanish newspaper El Pais in an interview.