The Government's fresh attempts to rescue the defeated Croke Park deal are already in jeopardy as a majority of Labour TDs have declared they will not legislate for pay cuts, it can be revealed.
Only a negotiated "tweaking" of the defeated Croke Park deal including "across the board" pay cuts can deliver the needed €300m in payroll savings, junior finance minister Brian Hayes has written in a piece in today's Sunday Independent, see page 23.
Yet, last night SIPTU General President Jack O'Connor rejected any suggestion of "reworking the dead agreement".
The news comes as embattled Public Expenditure Minister Brendan Howlin has had to deny charges of being a "Thatcherite" minister in the wake of the defeat of the deal.
Mr Hayes said despite the defeat of the Croke Park II deal "many of its core recommendations are still the only way forward." He added that the €300m in savings cannot be achieved unless pay reductions are implemented.
He writes: "The simple truth is that the savings in the public pay bill cannot be achieved unless pay reductions across the board are put in place. Fair and balanced pay reductions, with the top taking a bigger hit and those on the bottom protected has to be the core of any new solution."
But driven by the realisation that Labour TDs will not legislate for pay cuts without union agreement, Mr Hayes said the preferred option is negotiation.
"A deal on this issue is still the preferred option and can still be possible if some new thinking is brought to the debate. I'm a great believer in the principal of jaw jaw over war war. More talking has to be preferable over the manning of the barricades. It would be madness to bring on some industrial warfare within the public sector when it has achieved so much with diminished budgets over recent years," he added.
However, Mr O'Connor said any suggestion of tweaking the existing deal was futile.
"There is no point in trying to return to this on a dotting the I's or crossing the T's basis. That is not going to win sufficient support. No massaging of this deal has any prospect of being passed," he said.
But the vast majority of Labour TDs, even party loyalists, have said they will not legislate for pay cuts under any circumstances, a canvass of more than 20 party members has revealed.
"There is no chance of us legislating for these cuts now. How can we? Nobody wants to see the streets filled with striking people," said one Dublin TD.
Carlow Kilkenny TD Ann Phelan said: "No one wants to be legislating for pay cuts, but we know the money has to come from somewhere. If you vote with your heart there is a good chance of getting it wrong."
Many Labour TDs, despite their reluctance to countenance legislating for pay cuts, said it is now incumbent on the unions to respond with alternative ideas. "We need to step back, but let's wait for the unions' formal response," Phelan added.
It has been learnt that a memo sent from the Chief Whip's office to the opposition whips, just hours before the deal was rejected, confirmed that the Government's budget estimate for this year included the €300m pay bill savings sought under the deal.
Fianna Fail's Sean Fleming said this showed the "hypocrisy and arrogance assumptions" at the heart of the Government. "The Government have called for time for reflection when they assumed the deal would pass all along. It hasn't worked out for them and they thought they could punish the nurses and get the deal over the line."
Denying he is a Thatcherite, Mr Howlin said he would only be pretending if he thought he could continue to borrow more than €1bn a year to sustain public services.
"As for the claims that the Government or my party is Thatcherite, we are doing what we need to do to recover the economy.
"We could pretend that we can continue to borrow €1bn per annum to provide for the current level of expenditure on public services. Nobody will continue to give us €1bn if we do not balance our books," Howlin said.