The situation in the Zagrebacki Holding city enterprise is alarming but the provision of services to Zagreb's residents is not in question, Mayor Milan Bandic and CEO Slobodan Ljubicic told reporters after an emergency meeting on Friday.
Bandic announced radical cutbacks in the enterprise, which is nearly HRK 3 billion in debt, saying either 20 per cent of the 13,500 employees would be laid off or salaries would be slashed by 20 per cent.
He said the cuts would have to be negotiated with the unions, voicing confidence that Ljubicic would know how to reach an agreement with them.
Bandic said the city had lent Zagrebacki Holding the money for this month's salaries.
He announced an extraordinary City Assembly session for August 30.
Ljubicic said the Holding's short term liabilities were about HRK 3.3 billion and short term claims about HRK 1.1 billion.
Zagrebacki Holding, which consists of 18 branches, is in charge of municipal, transport and market functions.
