Health service to contribute €420m as State looks to cut pay and pensions bill

Fri, Jan 18, 2013, 00:00

The health service will have to contribute €420 million towards the Government’s target of reducing its pay and pensions bill by €1 billion over the next three years, trade unions have been told.

At talks on a proposed extension to the Croke Park agreement yesterday, unions were also told savings of €350 million will have to be generated in the education sector pay bill between now and 2015.

About €120 million will have to be saved on the pay bill in the Civil Service, non-commercial State bodies and the Prison Service, which were considered together as one group. Separately, savings of at least €90 million are to be sought on the local authorities pay bill.

A further €60 million will have to come from the Garda pay bill and €35 million from the pay bill for the Defence Forces. Unions said public service management gave no details on how it proposed to achieve the savings.

Flexibility

At the opening of the talks on Monday, management gave a broad indication that it wanted to cut pay for some grades, cut overtime and premium rates, increase working hours and introduce greater flexibility in redeploying staff, including extending the distance personnel can be asked to move.

A spokeswoman for the Department of Public Expenditure and Reform said last night no specific targets had been set for sectoral savings as of yet.

She said the presentations given to unions were “indicative of the proportion of expenditure in various sectors and were designed to give all participating in talks an appreciation of the scale of savings required”.

The presentation drawn up by the Department of Health, which has been seen by The Irish Times, said: “Our proportion of the total public service pay bill for 2013 is over 40 per cent. Therefore to contribute the proportion of savings to the €1 billion target, we need to find total savings of at least €420 million.”

Total savings

The local authority document said: “Local government proportion of the total public service pay bill is nearly 9 per cent . Therefore, to contribute the proportion of savings to the €1 billion target, we need to find total savings of at least €90 million.”

Unions said there would also be a net cut of 2,400 posts in the health service this year. The health document said that in addition to basic pay, the HSE paid €257 million in overtime and €242 million in weekend/bank holiday premiums last year.

Yesterday management provided details on the existing level of spending in areas such as direct labour costs, pensions, overtime and agency spending.

After the talks Siptu health division organiser Paul Bell said: “What the Department of Public Expenditure and Reform and the Department of Health are seeking is extremely challenging. We have decided to review the exact figures that have been presented.

“We presented a number of preliminary questions for the department to respond to, and the HSE, and we would hope to have those early next week.”

These concerned cost effectiveness, efficiencies and the expenditure, especially on agency workers and contract services.