Tuesday, 29 September 2020

Ceisteanna (96)

Mairéad Farrell


96. Deputy Mairéad Farrell asked the Minister for Public Expenditure and Reform if a commitment will be given to remove FEMPI legislation. [26636/20]

Amharc ar fhreagra

Freagraí ó Béal (6 píosaí cainte) (Ceist ar Public)

The current public sector pay agreement expires on 31 December this year. There is no doubt that the Minister will be sitting down with representatives of ICTU's public service pay committee. I am concerned that with the Financial Emergency Measures in the Public Interest Act, the FEMPI legislation, still in place the Government will hold a big stick over the heads of the public service unions. Does the Minister plan on committing to remove the FEMPI legislation before entering into negotiations with ICTU's public service pay committee?

The Public Service Pay and Pension Act 2017 provides for the restoration of reductions made to public service pay and pensions by the Financial Emergency Measures in the Public Interest Acts 2010 to 2013. That process of restoration began on 1 January 2018 and is due to conclude by 1 July 2022.

In that regard, on 1 October 2020, public servants will receive a 2% pay increase by way of restoration. This will complete the pay restoration for public servants earning up to €70,000 per annum. Also on 1 October, reductions of between 5% and 8% made to certain allowances in 2010 will cease.

The Public Service Pay and Pensions Act 2017 provides that by end 2020, an order is made to restore, at a date to be decided, reductions made to certain public service pensions. In addition, section 20 of the Public Service Pay and Pensions Act 2017 provides explicitly that for certain public servants, pay restoration cannot be completed before 2 October 2021.

Under section 12 of the FEMPI Act 2013 the Minister for Public Expenditure and Reform is obliged, before 30 June each year, to submit a written report of the operation, effectiveness and impact of the FEMPI Acts of 2009, No. 2 of 2009, 2010 and 2013 to the Oireachtas. As part of that report, consideration must be given to whether or not any of the provisions of the relevant Acts continue to be necessary having regard to the purposes of those Acts, the revenues of the State and State commitments in respect of public service pay and pensions. Key considerations include the economic circumstances of the State, the budgetary outlook, debt, returns from taxation, Brexit and preparedness for other economic shocks.

The 2020 report that was laid before this House last June concluded, on the basis of the prevailing economic and fiscal outlook, that the timetable for pay and pensions restoration up to July 2022 continued to be appropriate and necessary. I assure the Deputy that the Government will continue to take the most appropriate course of action in this key policy area into the future.

We should not forget that the FEMPI legislation was emergency legislation introduced to tackle the onset of the financial crisis of 2008, when we saw the first permanent cut in public service pay rates in the history of the State. Here we are almost 13 years on and the legislation is still in place. Today we face a crisis of a very different kind and the emergency measures that were introduced to tackle a very different crisis cannot be used to tackle this one. Is the Minister planning to slowly unwind the legislation in the future and remove the more draconian parts of it while keeping other parts he considers necessary? Will the Minister tell us prior to that, which parts will be removed and which retained, and what is the rationale behind such decisions? I would urge the Minister to do so.

To be clear, if we were to repeal the suite of FEMPI legislation tomorrow then certain former public servants on quite high pensions would have the pension reductions that were imposed on them reversed immediately. In addition, all very senior public and civil servants, including politicians, would have the cuts that were imposed reversed overnight. We need to deal with this issue in a managed and phased way.

To return to the point made by the Deputy earlier, it is my objective to negotiate a new public service pay deal. It is in the interests of the State, the trade unions and the workers that they represent to have the certainty and stability of a new public service pay agreement. We are in difficult circumstances and it will not be easy to negotiate a successor agreement. We are in exploratory discussions at the moment with the trade unions and will see where that goes in the weeks ahead. As the Deputy said, the current deal runs up to the end of the year. We are seeing that deal through and part of that involves paying the 2% increase which, on balance, is the right thing to do.

We need a new collective pay agreement and I think I am correct in saying that the Minister will be the first in the history of this State not to have such an agreement in place. It is extremely important to ensure that an agreement is reached with the unions which brings about real pay equality in our public services. We need to have good public service wages. We have been quick to clap in this Chamber. I have been here when we clapped front-line public sector workers since the onset of this crisis but applause do not put bread on the table for these families or keep a roof over their heads, which is extremely difficult to do in the current housing crisis. This Government regularly says that we are indebted to our public sector workers but it is time to put its money where its mouth is and reach a fair deal that recognises the pain they have suffered since 2008 as well as the heroics they have performed since the onset of Covid-19.

I have put on the record on a number of occasions as Minister my admiration for the work of our public servants. We now have approximately 340,000

public servants, over one third of whom work in our health service. The work they have put in over the last number of months has been immense, against huge adversity. We are doing the right thing as a Government in honouring the agreement that was entered into, even though it was entered into in much better times. We have had an enormous economic shock as a result of Covid-19 but honouring that agreement and paying the 2%, albeit at a significant cost, is justified in the circumstances.

I want to negotiate a new agreement and my officials are in initial, exploratory discussions at the moment and we will see where that goes in the next number of weeks. I hope a deal can be agreed but there is no certainty about anything. We have had periods in the past where we have not had an agreement in place. There is real value in a collective agreement and it is the Government's objective to secure one but it cannot be at any price.