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Hungary rail strike ends pending further talks; cost estimated at 2.4 billion forint

AFX News Limited: 02.07.08

BUDAPEST (Thomson Financial) - Hungarian rail workers were expected to resume work on Thursday afternoon, ending a four-day strike over pay that caused severe disruptions to rail services and is estimated to have cost Hungary's state rail company 2.4 billion forint, a key railway union said.

Union leaders said members are returning to work for safety reasons. They said the strike could resume if there was no agreement with rail company MAV in the days ahead. Those on strike included mostly ticket and safety inspectors.

'The VDSzSz union will suspend the strike at noon until February 15,' Istvan Gasko, the leader of the Independent Railway Workers' Union, told a press conference in Budapest.

The union is demanding a 10 percent wage hike plus an extra two-and-a-half months' salary on top of the 6.9 percent hike MAV has already offered. MAV has rejected the demand. The two parties are expected to meet again on Friday.

The East European country is experiencing significant social tension as the government aims to cut the runaway budget deficit and slim down the public sector. Real wages have fallen by as much as 4.7 percent as austerity measures drove inflation and hit growth.

Rail services suffered fewer disruptions today as only four percent of workers continued the four-day-long strike. Overnight, about 8 percent of railway employees had stopped work, MAV said.

'The strike has lost momentum and traffic is starting up again,' MAV spokesman Imre Kavalecz said.

The national rail company predicted that rail traffic would slowly be restored during the day, with local trains leaving every 90 or 120 minutes, and long-distance services every three hours.

Only 40 percent of trains ran on Wednesday, up from 30 percent on Tuesday, MAV said.