Irish News

Wednesday 20 August 2014

Public sector warned of 7pc pay cut if Croke Park deal rejected

Fionnan Sheahan Political Editor

Published 05/04/2013 | 04:00

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Public Spending Minister Brendan Howlin is making his most explicit warning to date to public sector workers that they face a flat-rate pay cut of 7pc if they reject the Croke Park II deal.

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And Mr Howlin clearly says the savings will be made "unilaterally" through legislation if they cannot be achieved through agreement with unions.

Writing in today's Irish Independent, Mr Howlin appeals to public servants to "think about what is best for them and their families".

Targeting low- and middle-income workers, he specifically points out that there would be no core pay cuts for those on under ¿65,000 under the deal.

Mr Howlin says the reform measures on the table, including working extra hours, a reduction in staff numbers, and less use of agency workers, reduce the amount of cash required from public servants' pockets.

And he is quite clear rejection of the deal would cost workers even more.

"In the absence of these measures, a straight pay cut would require a greater ask to reach the same target. Public servants that under this agreement face a gross reduction in pay of, say 4pc, could potentially see that increase to 7pc in the absence of an agreement," he says.

Mr Howlin is making an eleventh-hour intervention in the debate on the plan as union members are currently voting on the proposal.

His comments come after a week of teacher union conferences where there was substantial opposition to the deal.

Mr Howlin admits the Government has been reluctant to get into a discussion about what will happen if the proposals are rejected as the ballots under way "require respect".

"But those casting their ballot cannot be misled on this core point. The €300m savings to the pay bill are in this year's budgetary arithmetic. Those savings will have to be made from the pay bill – the money simply isn't provided for. Similarly, the €1bn savings will have to be achieved by 2015. Those savings cannot be made in the context of the existing Croke Park agreement," he says.

"If they cannot be made within the confines of an agreement with the public service unions, they will have to be made unilaterally. This will require legislation. The precise nature of that legislation will be considered if that eventuality arises," he adds.

Mr Howlin said all unions recommending rejection feel singled out for unfair treatment.

"But by definition, not everybody can be unfairly targeted," he says.

Mr Howlin said the result of the talks was a compromise.

"And, like all compromises, there is something in it for everyone to feel unhappy about. But, now the first reaction is over, public servants need to think about what's best for them and their families," he says.

The Government appears to be appealing to low- and middle-income workers to back the deal to avoid the uncertainty of what happens if the new deal is rejected.

A majority of the membership of public sector unions are still expected to vote for the agreement.

Coalition sources are keen to emphasise the fairness of direct cuts to core pay only applying to those on over €65,000.

"The alternative to this deal could be a flat rate cut across the board. It's about the uncertainty of rejection. If you vote No, you don't know what the consequences are.

Irish Independent

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