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Tuesday, November 16, 1999 Published at 09:23 GMT

Business: The Economy

TUC warns against following US

An AEEU/MSF merger will create the UK's largest union

TUC chief John Monks has warned that it would be a disaster for the UK to follow the US example and cut labour regulation.

Deregulation will not solve the UK's problem of low productivity, Mr Monks said.

"Deregulation is not a panacea, which through some mysterious process, delivers improved business performance," he said.

Highly-regulated countries such as France, Italy and Germany all have higher productivity than the UK.

"Although their unemployment is higher than the UK's today, overall their performance in terms of productivity, growth, training, investment and balance of payments has been better than ours," he said.

"It would be disastrous for the UK to follow the same path as the US - with declining real wages for the majority," he said.

Union merger

Mr Monks is to speak at a conference organised by the Amalagamated Engineering & Electrical Union (AEEU) and the Manufacturing, Science and Finance ( MSF) union.

These two unions, two of the UK's biggest, plan to merge to form the country's largest union.

"One giant union in manufacturing would give British industry one clear employee voice to promote and defend it," Roger Lyons, general secretary of the Manufacturing, Science and Finance Union, said.

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