Dáil Éireann Debate, Thursday - 26 March 2015
107. Deputy Joe Costello asked the Minister for Public Expenditure and Reform his plans to commence talks with the public sector unions with a view to addressing the cutbacks imposed during the troika years; if these talks will also address the specific reductions in the salaries and allowances of new entrants into the public sector; and if he will make a statement on the matter. [12403/15]
Amharc ar fhreagraThe Haddington Road Agreement (HRA) underpinned by the Financial Emergency Measures in the Public Interest (FEMPI) Acts 2009-2013, forms the cornerstone of pay policy in the public service until 2016 when it is due to expire. The Agreement, which contains a number of measures directly affecting the pay of staff, is delivering and is making a significant contribution to the achievement of the Government's fiscal consolidation deficit target of below 3% of GDP for 2015. The ongoing recovery in the economy is in no small part due to the contribution of public servants to keeping the cost of the public service paybill at sustainable levels and the recovery has facilitated the reinvestment by the Government in 2015 of some €300m in frontline services mainly in Health, Education and An Garda.
The FEMPI Acts govern the €2.2bn direct reductions in public service remuneration and pensions. Notwithstanding our improving economy, because of the magnitude of these reductions, the economy could not sustain the immediate restoration of such reductions. I believe that public servants understand that position. However, I have indicated that, following receipt of the 1st Quarter Exchequer returns and engagement with my Government colleagues, it is my intention to engage with Public Service Unions regarding the gradual unwinding, in parallel and consistent with our improving economy, of the emergency measures implemented under the FEMPI Acts. This is consistent with the approach adopted in securing agreement on the HRA through engagement with those directly affected.
The legality of the Acts is predicated on there being a financial emergency. In fact, I am required to review these Acts annually. My next review of the Acts is due to be carried out, and a report laid before the Houses of the Oireachtas, before 30 June this year.
With regard to new entrants, the 10% reduced rates of pay were one of a number of measures introduced over the period since the fiscal crisis which directly affected the pay of staff. The reductions in starting pay were introduced as part of the National Recovery Plan in order to reduce the Public Service Pay and Pensions Bill. However, this Government has since provided for an agreed process under the Haddington Road Agreement for the amalgamation of pay scales to address any imbalance in pay scales between those who entered the public service as new entrants after January 2011 with those applying to public servants before January 2011. The revised scales provide for assimilation of new entrant public servants to a single applicable scale to each grade and represent a significant redressing of any imbalance particularly in the context of the savings required under the Haddington Road Agreement.
Public servants, in common with all employees, will have seen benefits this year to their take home pay arising from the tax reductions the Government has been able to introduce following its prudent management of the economy. I have, however, made it clear that public service pay rates will continue to be frozen in 2015 the 7th consecutive year in which there will have been no pay increases for public servants and, as we know, there have been 2 or 3 actual cuts in wages over that period. It is now appropriate for the Government to plan for the development of a sustainable public service pay and pensions policy that will continue to support our ongoing economic recovery over the medium term. Having worked over the last number of years to restore the health of the public finances I am determined that any outcome of discussions with unions is consistent with our overall financial position.
