Unions hint at "general strikes" over austerity measures in Spain and Italy

CCOO head Ignacio Fernandez Toxo said he would "probably" invoke a general strike over the Socialist government's "right-wing economic policy, financial speculation and the markets."

Spain has the highest levels of unemployment in the euro zone at 20 percent, up from a 2007-low of 8 percent, after a burst property bubble and consumer spending slump left millions from the construction and service sector without work.

After protests in Greece turned violent in early May, there are concerns Spain could follow the same route, as the government makes drastic spending cuts in an effort to convince markets its public finances are under control.

United States President Barack Obama and German Chancellor Angela Merkel have called on the Spanish government for reforms over concerns of potential contagion from the failure of an economy more than three times the size of Greece's.

While Toxo did not say how long the strike might be, a CCOO spokesman said industrial action normally lasted just one day.

CCOO and Spain's second largest union confederation, the UGT, have already called a June 8 strike of civil servants angry over pay cuts imposed by the government's austerity campaign. Asked whether the UGT would join a general strike, a spokeswoman said: "We don't rule anything out. Our position hasn't changed."

The CCOO and UGT have also promised to fight civil servant wage cuts, which form part of a 15-billion euro ($18.76 billion) austerity package announced by the government on Thursday, in the courts. [ID:nLDE64J19M]

While the unions have a strong hold over public servants, many of whom pay full union dues, the rest of the Spanish working population is less represented. Only some 16 percent of Spanish workers are union members.

Unemployed
About 90 percent of the estimated 3 million people made unemployed since 2007, in the nation of 46 million, held temporary contracts, often without union representation.

Some economists said a general strike was unlikely to draw wide participation, even from unionised workers, since many of them hold the relatively safe permanent contracts and could be loath to jeopardize them by walking out.

The unions themselves, closely tied to the Socialist government, could also be uncomfortable provoking widescale unrest against Prime Minister Jose Luis Rodriguez Zapatero. The daily newspaper Expansion reported last year that state payouts to the unions had risen by around 50 percent since 2006 and by 10 percent in the last 2 years as Spain suffered its worst economic slump in living memory.

Italy
Guglielmo Epifani, leader of the CGIL federation, also called for protests in Rome on June 12 by public sector workers who face a three-year freeze on wages as part of the €24.9bn ($30.4bn, £21.1bn) deficit-cutting measures. The union's leadership will meet in the second week of June to reach a final decision.

"The cuts are all concentrated on workers, the same old recipe that leaves out high earners,'' Mr Epifani said.

A strike by CGIL members could cause considerable disruption across Italy but the issue appears likely to divide the labour movement with two other large federations stopping short of calling on workers to down tools.

Italy's billionaire prime minister broke his silence on the austerity package, which the cabinet approved late on Tuesday, at a joint press conference with Giulio Tremonti, finance minister, denying press reports of serious divisions between them.

Mr Berlusconi said taxes would not be increased and cast the deficit cuts in the context of a joint European effort to slash government spending. The welfare system in Italy had become "irresponsible", he said.

"The sacrifices are absolutely necessary to defend our currency. It is necessary to defend the euro in order to save the future of Italy, its wealth, our wages, and family saving," Mr Berlusconi said.

"We are all in the same boat that is moving forward and we will overcome this difficult situation."

On public sector workers looking forward to retirement, Mr Berlusconi said: "We are only asking them to stay at work for a couple of months more."