Dáil Éireann Debate, Thursday - 21 June 2018
142. Deputy Barry Cowen asked the Minister for Health the cost of the agreement reached with consultants in June 2018; the cost of retrospective payments to consultants as a result of the agreement; the cost of additional pay per year; the expected impact on the fiscal space for budget 2019; and if he will make a statement on the matter. [27361/18]
Amharc ar fhreagraLast Friday Minister Donohue and I announced that a settlement agreement in relation to cases taken by consultants seeking payment of increases provided for in Consultant Contract 2008 was concluded between the State and the consultants’ representative bodies after two weeks of intensive negotiations. This agreement applies to 10 lead cases that were before the High Court and other cases that involved the same contract and other eligible consultants who had not initiated cases.
The settlement terms achieved represent a substantial reduction on previous estimates of potential liability of up to €700 million. Under the terms of the settlement, it has been agreed to correct the pay rate only for those Consultants who signed ‘Consultant Contract 2008’ between 25 July 2008 and 30 September 2012. Correction of remuneration/pension entitlements will be effective from the ‘Date of Settlement' (15 June) but payable from January 2019.
The total cost of retrospective payments (“arrears”) under the agreement is estimated at €182 million. The additional cost of correcting the pay rates is approximately €62 million per year backdated to the ‘Date of Settlement’.
Payments of arrears will be phased over 2019 and 2020, as follows:
- 40% (€73 million) payable on or before 01 June 2019, and
- 60% (€109 million) payable on or before 01 March 2020.
The impact of the settlement on the fiscal space for 2019 is a matter for the Minister for Finance, Public Expenditure and Reform.
While this settlement is costly it is the most cost-effective outcome for the Exchequer and the taxpayer resulting in significant savings and prevents a lengthy and costly legal battle. This settlement brings to conclusion a disagreement between the parties that has been ongoing since 2009 and I look forward to a reinvigorated working relationship with consultants.
