Dáil Éireann Debate, Tuesday - 9 June 2015
370. Deputy Finian McGrath asked the Minister for Public Expenditure and Reform if he will support the restoration campaign for low paid public service staff; and if he will make a statement on the matter. [21459/15]
Amharc ar fhreagra393. Deputy Sean Fleming asked the Minister for Public Expenditure and Reform the mechanism that will be employed to record acceptance by public sector employees of the public service stability agreement, if a majority vote of the public service committee of the Irish Congress of Trade Unions will be sufficient to implement the agreement across the entire public sector; and if he will make a statement on the matter. [22408/15]
Amharc ar fhreagra394. Deputy Sean Fleming asked the Minister for Public Expenditure and Reform the overall cost to the Exchequer of the public service stability agreement net of tax, pay related social insurance and the universal social charge effects in 2016; and if he will make a statement on the matter. [22409/15]
Amharc ar fhreagra397. Deputy Sean Fleming asked the Minister for Public Expenditure and Reform the gross cost of pay increases under the public service stability agreement in 2016; and if he will make a statement on the matter. [22412/15]
Amharc ar fhreagraI propose to take Questions Nos. 370, 393, 394 and 397 together.
These questions all relate to the recent Labour Relations Commission proposals for the extension to the Public Service Stability Agreement to 2018, under the title of the 'Lansdowne Road Agreement'.
Following the conclusion of discussions on pay and reform in the public service on 29 May last, the negotiators on both sides, with the expert assistance of the LRC who oversaw the talks process, have come forward with a set of proposals to form the basis of a new agreement, the Lansdowne Road Agreement. This will extend the terms of the Haddington Road Agreement to September 2018, while securing an Industrial Relations framework that will foster and support further productivity and change at the level of the workplace. The proposals provide for the gradual unwinding of the Financial Emergency Measures in the Public Interest legislation, which was put in place in response to the financial crisis. The Government is satisfied that they are in keeping with the commitment to give priority, in any unwinding of FEMPI measures, to those public servants on lower pay rates. The Lansdowne Road Agreement will extend the existing Public Service Stability Agreement from 2016 to 2018.
These proposals, which will partially unwind the pay reduction measures imposed on public servants, are prudent and sustainable in the fiscal space currently available to Government. The estimated overall gross cost of these pay measures (inclusive of the previously committed costs attributable to the Haddington Road Agreement) in each year of the Agreement is €267m in 2016, €290m in 2017, and €287m in 2018 or a cumulative €844m by 2018 of which €278m is attributable to the pre-existing Haddington Road Agreement commitments. This should be compared to public service pay bill savings of €2.1bn annually, achieved as a direct result of pay reductions under the FEMPI legislation.
With regard to the net cost of the pay measures, each employee's tax, PRSI and USC treatment is an individual matter while the mix of pay increases and a reduction in the Pension Related Deduction which are provided for within the proposals attract different treatment under the tax code. However, as a rule of thumb, fiscal deductions to increases in gross pay to employees generally are estimated to amount to about a third of any gross pay award. When the deductions that are specific to public servants are included, the average is likely to be in the region of 50%.
Negotiations in relation to the Lansdowne Road Agreement proposals were undertaken between representatives of the Government and the Public Services Committee of the ICTU. The declared position of the Committee was, in entering those discussions, to enter a single collective agreement with the Government. A similar parallel process was conducted with the Representative associations of the Garda and Defence Forces. It is now a matter for Union and Association members representing the public service workforce to consider and ballot on the proposals made. It is not a matter for me, as Minister, to interfere in this process.
Subject to agreement by the Unions and Associations on the proposals made, I will bring forward the necessary legislative amendments to enable the terms of the Agreement to be implemented from 1 January 2016.
