Cowen dodges pay cut issue
Taoiseach fails to detail savings in public sector wage bill
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TAOISEACH Brian Cowen 'kicked to touch' yesterday on cutting the pay of the State's 400,000 public sector workers
Mr Cowen alluded to a pay cut when he said the Government had to look at "all the options" for spending cuts.
But he didn't provide any details about how and when the Government might implement any cuts.
He said there must be recognition by public sector workers and their unions of the need to generate the scale of savings needed in the necessary time period.
"The Government, as employer, must therefore look at all of the options that would minimise the impact on public services and public service jobs of unavoidable spending reductions," he said.
If the Government doesn't want to cut services, then it leaves pay as the obvious option. Speaking at the Institute of Public Administration's national conference, he didn't rule out pay cuts.
"When you look at the range of issues that have to be addressed, and the scale of issues that have to be addressed, there is no part of the public expenditure programme you can exclude from consideration, so you try and bring about the necessary adjustments in that way," he said.
Mr Cowen also announced the Government's intention to go ahead with the plan to allow senior management in the public service transfer between different departments and agencies.
The Taoiseach's comments came after two leading economists said pay cuts were required.
Economist Colm McCarthy, who headed the 'Bord Snip' review group said there should be a new benchmarking review with the power to recommend pay cuts in the public sector.
Shortage
"A small reality is this country is bust. There is no shortage of compassion, there is a shortage of money," he said.
"We are borrowing €400m per week and a big component of that is the public sector payroll. If people think that we can fire ahead and keep borrowing money to maintain the current levels of public spending that the Government is committed to, then they are out of touch with reality."
Senior ESRI researcher John Fitzgerald said the decentralisation policy had been a "disaster", but no one was prepared to say so it.
While on the issue of the Irish public service's reluctance to let people develop specialist skills, he said: "This is a major problem. It is not a question of hiring more people with PhDs but of allowing staff to develop expertise. There are 135 economists in the Northern Ireland finance department but the point is that they are working in a structured way. The Republic's Civil Service prefers to buy in the expertise rather than develop it. They are doing it much better in the North."
Mr McCarthy said there had been a shift of political and financial power from the Department of Finance to the spending departments in recent years. "The bean counters need to get back in charge, now that we've run out of beans," he said.
- Fionnan Sheahan and Brendan Keenan
