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FG: 'No justification for pay cut U-turn'

THE Government will be forced to defend the embarrassing climbdown over pay cuts for senior civil servants, which were revised days before Christmas and mean that the highest-paid staff will take a smaller cut than that announced in the Budget .

The opposition have blasted the row back, declaring it a victory for the "permanent government" at the expense of lower-paid workers, and said they wanted to hear the Government's explanation for caving in and for the way they "slipped it out" just days before Christmas.

Fine Gael's finance spokesman Richard Bruton accused the Government of underhanded tactics after the Department of Finance decided to reduce the severity of pay cuts for senior civil servants .

Speaking to the Sunday Independent, he said: "Pay cuts graded according to ability to pay was a key feature of the Budget. So the Government's decision to reduce the level of pay cuts at senior grades, on the basis that a separate bonus scheme was suspended some time ago, is underhand and unjustified.

"The Government should have been upfront about this proposal and announced it in the Dail, in order to subject it to proper scrutiny. Instead, Fianna Fail has tried to slip it out under cover of darkness.

"There is no justification for exempting senior civil servants from the pain that the rest of the public sector is being forced to bear.

"For a start, the Department of Finance is wrong to consider bonuses as part of core salaries."

The new measures came into effect from the start of the new year.

In his Budget speech, Finance Minister Brian Lenihan announced pay cuts of 8 per cent for assistant secretaries and 12 per cent for deputy secretaries in government departments.

He also ended the performance-related bonus scheme for top civil and public servants, which over recent years has involved an average payout of 10 per cent of salary.

Following representations from senior officials, the Government has now decided that the cumulative effect of both of these cuts on staff in these grades would be unfair.

The Department of Finance announced revised pay-cut levels for assistant secretaries and deputy secretaries to take account of the elimination of the performance-related bonus schemes.

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The department said a similar approach would be taken in respect of equivalent grades in other parts of the public service, such as the HSE, local authorities and the gardai, where performance-related award schemes had been in operation but which have now been terminated.

Taking the elimination of the 10 per cent bonus, the new adjustments will see the pay of deputy secretaries in government departments fall by 14 per cent , while the remuneration of an assistant secretary will be cut by 11.8 per cent.

A deputy secretary who up to now received a salary of €177,547 plus an average performance-related award of €17,755 (total €195,302), will be reduced to €168,000.

An assistant secretary on the maximum point of the scale who had a salary of €150,712 plus an average performance-related award of €15,071 (total €165,783) will see this fall to €146,191.

"The Government decided to terminate the performance-related awards for certain civil service grades and related posts," said the Department of Finance.

But Karl Whelan of the Irish Economy blog wrote that, given that the bonuses were gone already, these measures imply a cut of only 3 per cent for assistant secretaries and only 5.4 per cent for deputy secretaries.

He also said these bonuses were not pensionable.

"Because civil servants' pension obligations are still based on the full pre-pension-levy salaries, this means that the pensionable salary of an assistant secretary has only fallen 1.8 per cent this year.

"Senior civil servants close to retirement have been almost completely protected from the consequences of the fiscal crisis," Mr Whelan wrote.

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