Thursday 21 November 2019

Finding the balance between pay and jobs

Kieran Mulvey, chief executive of the Labour Relations Relations Commission, thinks that countries like Greece, Italy and Spain would "love" to have an equivalent of Ireland's Croke Park agreement, designed to buy industrial peace at the price of guaranteeing that there will be no cuts in public service pay.

Mr Mulvey is probably this country's leading expert on industrial relations. He has had a lifetime's experience in the field. His views must be treated with respect by those who question the value of the agreement -- including its many critics in the Fine Gael party.

But his own support for the Croke Park deal is not unqualified. He believes that the agreement may have to be "revisited". That may seem a mild comment, but coming from such a source it counts as a strong hint of the need for radical reform and rethinking.

Thus far in the tenure of the Fine Gael-Labour coalition, ministers have relied on a trade-off between pay and jobs in the public service. There are several flaws in this approach.

For example, much of the work in the sector is labour-intensive in nature and the long-term prospects for further job cuts must be severely limited. The cost savings achieved so far constitute only a tiny fraction of the total bill. The attempt to abolish a mere handful of unjustified allowances resulted in a fiasco.

None of this is necessarily an argument for scrapping the agreement altogether and cutting pay unilaterally. That would not plunge us into Greek-style riots, but it would bring back the spectre of work stoppages and gravely damage the social solidarity that has survived our economic woes.

Accordingly, a new means must be found of achieving the necessary savings -- something that requires calculations in billions, not chipping at the margins.

"Revisiting" Croke Park has to mean root-and-branch public service reform on a scale never before attempted in this State. Co-operation with the reform would make it possible to preserve pay scales. Failure would make cuts inevitable.

Most union leaders are well aware of these basic facts, though they may be wary of discussing them in public. Mr Mulvey has done the country a service by prompting public debate on the question.

Irish Independent

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