September 18, 2015 / 2:29 PM / 3 years ago

Thousands rally in Helsinki to protest cuts amid flagging economy

HELSINKI (Reuters) - More than 30,000 people rallied in Helsinki on Friday to protest against government plans to cut workers’ benefits, with strikes also halting railroads, harbours and paper mills around the country.

People demonstrate against budget measures proposed by the Finnish government, at the Central Railway Station in Helsinki, September 18, 2015. REUTERS/Markku Ulander/Lehtikuva

Outside the square where the demonstration - the biggest in Finland since 1991 - was held, the capital’s rainy streets were quiet, with office workers opting to stay at home as much of the public transport system was shuttered due to the strike.

The centre-right government, facing an economy in stagnation, announced plans last week to cut workers’ overtime pay, holidays and sickness benefits - matters traditionally agreed by labour unions and the employer organisations alone.

“The economy has not been well, but it will not recover by force, it requires cooperation,” Antti Rinne, leader of the opposition Social Democrats and a former union boss, said in a speech to the cheering crowd.

“You can be certain that rain, wind and thunderstorms will continue if you keep up this line,” he said, addressing his message to the government.

About 300,000 workers went out on strike on Friday. The demonstrators, mostly union activists, said it was unfair make cuts in sectors where salaries were already low. They expressed anger that the government had unilaterally pushed through the changes.

“Back in the day, other sectors got wage increases while public sectors were given more holidays. Those holidays just can’t be taken away like this,” said a public day-care centre worker who gave her name as Maija.

Prime Minister Juha Sipila took matters into his own hands after talks with unions failed twice since he took office in May.

This week, he gave a rare speech to the nation, urging citizens to find a “common spirit of reform” to save the welfare state and create more jobs rather than letting strikes impede an economy already hit by vast staff cuts at former national growth engine Nokia.

The Confederation of Finnish Industries estimated that Friday’s one-day strike cost the economy 100 million euros.

“Everyone should understand that in the future, we can’t afford these kind of losses. It’s hitting both the companies and their employees,” EK executive Ilkka Oksala said.

The benefit cuts are part of Sipila’s long-term plan to save 10 billion euros ($11.4 billion) by 2030 to balance Finland’s public finances.

The country of just 5.5 million people has seen its competitiveness decline since 2007 relative to Germany, the rest of the euro zone and Sweden, as labour costs have climbed despite a poor economic performance. ($1 = 0.8764 euros)

Editing by Niklas Pollard and Toby Chopra

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