Middle and lower-income workers in the public sector will see their core pay cut if they don't agree to taking cuts on overtime and allowances as part of the new Croke Park deal, the Government has warned.
The stark threat comes as a new nationwide poll reveals that less than one in four people believe the new deal will deliver substantial additional savings.
As talks continued yesterday in Dublin, Public Expenditure Minister Brendan Howlin, who needs to find an extra €1bn in pay savings by 2015, is adamant that workers at all levels, including those at the lower end, "will have to see changes in their take-home pay if €1bn is to be saved from the overall paybill", sources close to the talks have revealed.
Mr Howlin and his department, under pressure from the Troika and from some in Fine Gael to drive more savings from the Croke Park deal, is seeking to radically reduce the €750m a year it is spending in overtime, premium payments and various allowances that account for a significant part of the annual pay and pensions bill.
As part of an extension to the Croke Park agreement, the Government wants to abolish special "twilight" payments for staff who work in the evenings. Special payments for Saturday would also be abolished under the Government's proposals.
However, the Government is warning this weekend that if agreement is not found on the additional payments, then core pay will have to be targeted.
"If it is excluded from the discussions, more of the burden will have to fall on core pay, including of the middle and lower paid," the source continued.
Mr Howlin has repeatedly said he wants to achieve the savings through negotiation, but sources close to the minister have said it is "simply unfair" for those who receive these benefits to "expect others who cannot boost their income in this way to take more of the burden".
Public sector unions have again been warned that if a settlement cannot be reached, "the Government will have to address these unsustainable pay drivers in any case".
Talks this weekend are concentrating on the areas of Health and Education, two of the biggest spending departments. A spokeswoman for Mr Howlin said: "The purpose of these discussions is to work through some detailed design and implementation issues to deliver the broad outline of cash savings."
She added: "All items, including the following will continue to be discussed; overtime, premia payments, pay at higher levels, increments, supervision and substitution and public service numbers."
Poll and anaLysis Pages 20, 21, 26
According to a poll for the Sunday Independent, conducted by MillwardBrown, just 24 per cent of those polled believe a new deal will lead to significant reduction in the public sector pay bill. In contrast, 37 per cent feel strongly that it won't deliver major savings while 39 per cent said they didn't know.
Less than one in three people polled believe the first Croke Park deal was a good idea, while 39 per cent of Labour voters disagreed.
Interestingly, despite many protests about the deal from their TDs, 41 per cent of identified Fine Gael voters said they strongly supported the suggestion that the first Croke Park deal was a good idea.
Just under one in three voters (31 per cent) also said they feel Croke Park hasn't gone far enough in securing public sector savings, while a slightly higher number (35 per cent) said the deal has gone far enough. However, 34 per cent said they didn't know either way.
Impact general secretary Shay Cody yesterday said talks on a new deal were moving into a "much more complex and challenging phase".
He said the discussions affect 290,000 people who deliver a whole range of services. "When you start changing attendance patterns and terms and conditions it has enormous complex implications and that's what they're working through," he added.