The University and the Harvard Union of Clerical and Technical Workers are closing in on a new agreement to replace the contract that expired June 30.

Union Chief Negotiator Bill Jaeger said yesterday that he expects the contract talk to conclude "With in a few weeks," and possibly as early as today.

And Harvard Vice President for Government, Community and Public Affairs John H. Shattuck said yesterday, "We remain hopeful that the settlement can be reached in the very near future."

Disagreement over the size of a pay raise for workers remains the major obstacle to a new pact, union and management officials said yesterday.

But according to both Jaeger and Shattuck, the gap between the two sides appears to be small.

Shattuck said Harvard administrators budgeted for a union pay increase "substantially above the rate of inflation," which he said is about 2.8 percent a year, measured by the consumer price index in the Boston area. He said Harvard and the union have agreed not to discuss specific wage proposals with the press.

Union sources speaking on the condition of anonymity said that raises granted July 1 to faculty, administrative and professional staff averaged 4 percent, University-wide. The sources say the 3600 union members expect a comparable raise.

There is, however, plenty of room for negotiation within that small window between about four percent and "substantially above" 2.8 percent.

"Every half a percentage point counts," Jaeger said. "The difference...is a lot of stuff one of our members either can or can't buy."

For management, Shattuck argued that "the University is very much concerned about the economic fairness to employees at all levels."

Shattuck said, however, that the institution isfinancially hard-pressed, and that "the sobereconomic realities have to be taken into accountin...reaching the final number in terms of a wagepackage."

The challenge, Jaeger said, is balancing the"fiscal soundness" of Harvard with the "economicprogress" of union members.

The sides are being helped along the way bymediation. Shattuck yesterday gave the firstofficial confirmation that a neutral outside partywas facilitating the negotiations.

Jaeger refused to comment on whether there wasmediation, saying only that the sides are"negotiating well."

Jaeger said union members plan to wear redribbons tomorrow as a sign of solidarity