When speaking last night, I stated that the position on increments is inequitable and untidy. The Government must decide for the future whether there will be an increment system or a flat rate system and then it must stick consistently to one system or the other. As I stated, a person on the bottom rung of the ladder and moving up is at a disadvantage compared with somebody at the top of the scale who got the full increment and for whom this measure will not have any effect.
Regarding pensions, whether it is in the tax code, in pensions or in any other code, in my experience people like there to be a transparent, equitable and understandable system. I noticed in negotiations over the years, for example, in the taxation of social welfare benefits, that where there are all sorts of systems operating for different recipients, it is difficult for the citizen to understand. Over recent years, we have arrived at a position in the case of public service pensions where it depends on when one went out on pension as to what pension one will get, and staff with the same service could wind up with different pensions depending on the date on which they left the public service. When the Minister is summing up, perhaps he would confirm whether it is correct to state that the Bill adds to rather than solves this problem.
Until now it was reasonably simple in that for an ordinary public servant with 40 years of service, there would be a half-salary as pension. Everybody could work it out as if a person had 20 years of service, the pension would amount to a quarter of the final salary. It was transparent, simple and understandable. As I stated last night, my party deviated from this process as we did not reduce pensions in line with salaries. I am not convinced, in the long term, that it was the right decision. I had hoped that we could reconnect pensions to salary with a simple formulation.
The explanatory memorandum and the legislation do not indicate if this will happen so perhaps when the Minister of State replies, he could put my mind at rest and tell me that when the Bill comes into force, all pensions will amount to 50% of final salary, taking in normal calculation of pensionable income. If the Bill is not doing this, we will be adding to all the anomalies. My concern is that with all the side deals, instead of this Bill being the intended reform, it will have anything but that effect. With all the different deals done in recent weeks to get Croke Park II turned into the Haddington Road agreement, the Government will only be adding to the anomalies and complexity of the system. The short-term benefits of this are far outweighed by long-term disadvantages.
There has been some talk about Haddington Road being in Dublin 4 but I ask the Minister of State to check if that road goes beyond the traffic lights as this should be the Beggars Bush agreement. I suggest the Minister of State checks whether the agreement was made on Haddington Road or if, for some reason, there was a reluctance to have a pay agreement connected to a place called Beggars Bush. Perhaps he could clarify that in his summation.