Monday 24 July 2017

Paschal Donohoe: How we spend public money is a painful but key lesson of the crash

Minister for Public Expenditure and Reform Paschal Donohoe. Photo: Tom Burke
Minister for Public Expenditure and Reform Paschal Donohoe. Photo: Tom Burke

Paschal Donohoe

One of the many painful lessons we have learned since the economic crash of the last decade is the need to carefully plan how public money is spent. This is particularly vital for a small, open economy like Ireland's. A crucial part of doing this is ensuring that we plan for public pay, making a collective approach to the issue vital.

A collective approach involves public sector unions and government working together to promote an affordable, sustainable and fair pay settlement that gives certainty to civil and public servants and gives confidence to the private sector to invest. This approach encourages the creation of jobs and promotes the economic growth that allows the Government to spend money on important services such as education, health and transport. Unpredictability in respect of public pay means we cannot plan investment in these areas.

It was with this in mind that I considered the implications of last November's Labour Court judgment on Garda pay. At the time I stated that the Government respected the status of the court as an independent adjudicator in industrial relations matters and would accept the ruling. However, it was very obvious to me, following that acceptance, that we would also have to respect those who signed an agreement with the State on their pay.

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