Howlin may need a shovel allowance to dig himself out of this
Tinkering with a few special payments to a handful of staff will not save the minister's face, writes Fiona O'Shea
Brave decision, Minister. Sinn Fein's Mary Lou McDonald accused Minister for Public Expenditure and Reform Brendan Howlin during the week of making a "dog's ear" of the review of public sector allowances. This must be particularly embarrassing for his department, responsible as it is for leading the process of reform throughout the public service.
Howlin announced the review last December, saying that it would lead to cuts in allowances and thus to savings of €75m for the Exchequer this year.
Just last month, the minister admitted that he had picked the figure of €75m without properly drilling down first to find out what could realistically be achieved and what would be fair. He admitted to being "chastened" by the affair which, he said, had been badly handled.
This was following the announcement that just one allowance, a 'dual duties' allowance, was for the chop. Instead of the projected €75m, just €3.5m would be saved this year. With at least 1,099 allowances staying intact for serving public servants, if not for new entrants, it was clear that the minister and his department had undertaken the review without any prior research or planning.
An age-old strategy in the Irish civil service is to bury a new enthusiastic boss (or minister) in paper. Asked by the Department of Public Expenditure and Reform (D/PER) to submit business cases to justify the allowances, departments reacted with 800 documents covering 1,100 allowances. The range of the allowances is staggering, including the seagoing allowance for seamen, dog handlers' allowance for dog handlers, forklift allowance for forklift drivers and principal allowance for -- surprise, surprise -- school principals.
The quality of the business cases is very mixed. Few of them would be acceptable to a bank to justify a loan request. And even some of the better cases are far from complete. There is no sign in the Department of Finance business case, for example, of the €166,000 paid in higher, special or additional duties allowances in 2011. The Road Safety Authority, on the other hand, included higher-duty allowances paid to 10 staff members due to "a reduction in numbers and the need to maintain a high standard of service."
The tipping point, however, is whether these allowances are really allowances or 'core pay', which is protected by the Croke Park Agreement.
It must have started to become clear to the minister and his department that they had opened a Pandora's Box. If they didn't see it, the Department of Finance surely realised that firstly, it would be nearly impossible to make sense of the various allowances that had sprung up over the years, attached as a band-aid to centralised pay structures to allow for local variations, and secondly, that negotiating their abolition would turn into a house-by-house street fight.
Having made the decision to head for cover, D/PER didn't even bother to make it look like a professional review. It published the business cases on its website but did not provide any report or assessment of the cases. All it added was a nine-page list of the allowances under headings along the lines of: 'protected', 'protected for serving incumbents only' and 'scrapped'.
D/PER sprang from the Department of Finance, complete with that department's wily ways. Reluctant to let go of any control in the matter of recruitment and pay, Finance has always been happy to let others clear up its mess.
Now D/PER is trying to recover some ground by farming out the allowances problem to the other government departments.
In a widely reported letter to heads of department, Howlin's secretary-general, Robert Watt, invoked an age-old civil-service strategy known as 'pass the monkey'.
He told management in different parts of the public service to engage with trade unions to eliminate 88 allowances. While a full list of these 88 has not been made available, they include:
• Island inducement allowance.
• Cardiac allowance for ambulance staff.
• Locomotive allowance for senior gardai.
• Entertainment allowance for Defence Forces officers while abroad.
• Consultants' medical training allowance.
Not included in the 88, it seems, are the big-ticket allowances, where the big savings could be made if they were to be tackled.
These have been centrally negotiated with the Department of Finance over the years. The question is, are they allowances or are they core pay?
They are the 'acting-up' allowances, still payable to staff who take on the duties of a higher grade despite flexibilities allegedly agreed under Croke Park. The Department of Social Protection alone paid €619,000 in higher, special or additional duties to 353 staff in 2011.
Or the 'annual personal to holder' allowances, used by the Department of Finance in the past to buy co-operation with changing work practices.
Or the 1 per cent of payroll available every year to departments to pay for flexibility and co-operation with change under a clause in the 1994 social partnership agreement, 'Programme for Competitiveness and Work'.
Available to all departments, only a handful referred to it in their business cases. With a public sector pay bill for 2011, excluding pensions, of €14.7bn, 1 per cent of payroll comes in at a tidy cost of €147m.
That the 1 per cent is still very much in use is clear from the claim taken by the association representing senior public servants to the Labour Court last year. It sought the 1 per cent for staff at the Personal Injuries Assessment Board, a State agency established in 2004 and so not even in being when the 1994 agreement was reached. The Labour Court was not convinced and refused the claim.
Howlin seems happy that departments will be able to use a 'dedicated fast-track arbitration process' to the Labour Court to deal with the 88 allowances that are for the chop. 'Fast-track', however, is not the term that comes to mind in the context of this review, if elimination of each of the 88 allowances is to be negotiated separately.
Taoiseach Enda Kenny says that eliminating these allowances will result in maximum savings from the public sector pay bill.
Some may. But it is unlikely that eliminating an island allowance of €2,000 a year, paid to just 10 public health nurses, or the overseas Army officers' entertainment allowance, which cost €2,415 last year, will contribute significantly to the financial recovery of the State. Nor would cutting the €65 footwear allowance paid to a couple of hundred civil service attendants.
When the allowances cull appeared to be shelved last month, the unions seemed surprised. David Begg, general secretary of the Irish Congress of Trade Unions, said that the allowances system was outdated and that public sector pay scales should be adjusted to take account of the extra payments. Shay Cody of Impact was surprised that his union hadn't been approached on the matter, hinting that some level of agreement might have been reached without recourse to the Labour Court.
The mood of the unions is different this time. Patricia King, vice-president of Siptu, has said that while the union would be open to consolidating allowances into pay, it would oppose attacks on low-paid staff.
Liam Doran of the Irish Nurses and Midwives Organisation (Inmo) said that the payments targeted were core pay for many of the grades in the health service.
The Labour Court will be busy. I wonder if the staff get dual-duties allowance?