Serbia Finance Minister Resigns over Reforms

"I have asked that we implement a difficult programme, one could hardly imagine in these circumstances, reduction of pensions of minimum 20 per cent, cut of public sector salaries for 15 per cent, layoffs for 160,000 workers and increase of the electricity price for 30 per cent," Krstic said.

"The Prime Minister has a soft heart and that is why he has the support of the people," Krstic said. "I thought these measures have to be done immediately and I think the Prime Minister and the Finance Minister have to have the same approach. Therefore, we agreed that I would resign."

Prime Minister Aleksandar Vucic said that the Economy Minister Dusan Vujovic will replace Krstic, who will stay on as his adviser.

The sudden resignation came on Saturday after the government gave a green light to a  Labour law that has resulted in union protests.

The Unions left the negotiations with the government and have announced protests. The Labour law is expected to be voted in parliament on July 15.

"Those are not reform laws, but laws that undermine employee rights in Serbia. Those laws are adopted automatically in Serbia, without any agreements and consent (from the unions)," Ljubisav Orbovic of the United Trade Unions Independence and Confederation of Autonomous Trade Unions of Serbia said on Friday.

"This is not just about the Labor law, but also about the laws on privatization, pension and disability insurance and bankruptcy," he explained.

A previous version of the draft Labour Law stirred up controversy during the winter and resulted in the resignation of the Economy Minister Sasa Radulovic who was pushing for dramatic changes in employment legislation that the government wasn’t ready to make.

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