Thursday 14 December 2017

'Pay deal must not bankrupt country' - Coveney

Minister Simon Coveney. Photo: Frank McGrath
Minister Simon Coveney. Photo: Frank McGrath

Cormac McQuinn and David Raleigh

The country must not be "bankrupted" by the public sector pay bill, Simon Coveney has warned.

Mr Coveney said that while the Government will try to be generous in the looming pay talks with public sector unions, it must "ensure that we don't expose the State to a bill that we can't afford".

He added: "That happened before and the county was almost bankrupted as a result".

Mr Coveney's remarks came as it emerged that the Government wants to cut the €3.3bn cost of public sector pensions, a move that may put it on collision course with unions.

It is also reportedly set to offer workers a 6pc pay rise over three years.

The Public Sector Pay Commission (PSPC) is to publish its report on pay levels in the public sector within weeks.

Talks on a successor to the Lansdowne Road Agreement will begin after that.

Mr Coveney said there should be "appropriate recognition" of what workers in the public sector have been through since their pay was cut as an emergency measure during the economic crisis. But he said unwinding these measures must be done "in a way that is affordable for the state".

Read More: Pensions, not pay, may be the thorny issue in talks

Meanwhile, Finance Minister Michael Noonan said that public service pensions will be considered as part of the public pay negotiations. "Pensions are now seen as an integral part of a pay package, so it's not that pensions are being put on the table, they're on the table all the time," he said.

Public Expenditure Minister Paschal Donohoe said he wants the Government's strategy for the pay talks to be "affordable to the State" and "fair to everybody".

It was reported that the Government's submission to the PSPC urges the Commission to reflect the cost of State contributions to its workers' pensions in comparison to the costs in the private sector.

The State's contribution for public sector workers who were appointed prior to 2013 is an average of 29pc of pensionable salary. The equivalent figure in the private sector is 11pc.

The Government's submission to the PSPC reportedly suggests that this could be reduced to 25pc if pension increases are linked to the consumer price index.

Just last week the general secretary of the Public Service Executive Union (PSEU), Tom Geraghty, warned there "will be no concessions that disimprove pension entitlements".

Last night, Civil Public & Services Union (CPSU), general secretary Eoin Ronayne - who represents those paid less than €38,000 - warned his organisation will resist moves to cut the State contribution to their pensions.

"We think lower-paid workers already significantly contribute to their meagre pension... [we] will resist any suggestion that lower paid workers pay more," he said.

In a statement, the Association of Higher Civil and Public Servants (AHCPS) highlighted pay cuts their members have sustained. It said public sector pensions have undergone reform and AHCPS members have been subject to the pension levy.

Mr Donohoe's spokeswoman said the value of public service pensions is "an important component" of the overall pay packages of public servants." She said the submission to the PSPC recognises that the majority of public servants are making contributions to their pensions and most are subject to the pension levy. She added that the introduction of a different pension scheme in 2013 for new entrants to the public service will in time reduce the cost to the State.

Irish Independent

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