Government pressed on €20m back payments for public service

Staff across the public service could be in line to receive about €20 million collectively in back money under proposals being considered by the Government.

The Government is coming under pressure from trade unions to make the payments to staff arising from changes introduced last year to the application of the public service pension levy.

The back payments would likely involve gross payments of just over €60 each to staff across the public service.

The public service pension levy was introduced by the then Fianna Fáil/Green administration in 2009.

It represented the first pay cut introduced for more than 300,000 staff across the public service following the collapse of the public finances and generated about €1 billion annually for the exchequer.

Claims from unions
However, under the Haddington Road agreement on pay and productivity reached with public service unions last summer, the Government adjusted how it was applied, reducing the rate on earnings between €15,000 and €20,000 from 5 per cent to 2.5 per cent.

The change was worth about €125 per year to all public servants.

The change came into effect for staff from the beginning of this year.

However the Haddington Road deal came into force from July 1st last year and highly placed sources said the Government had received claims from unions for the back payments.

Government sources acknowledged public service staff were entitled to a refund of the money but insisted no decision had yet been made on the timing of this. Some on the Government side believe the money could be repaid at any stage during the lifetime of the deal, which runs until 2016.

Extend deadline

Separately, the Government is expected to consider proposals to extend the end-of-August deadline for public service staff to leave if their pensions are to be calculated on the higher salaries in place prior to the cuts introduced under the Haddington Road agreement last year.

The Irish Congress of Trade Unions (Ictu) warned Minister for Public Expenditure Brendan Howlin of significant implications for services and organisations if significant numbers of senior staff departed at the same time before the current "grace period" expires.

In a letter to Mr Howlin, the secretary of the public services committee of Ictu, Tom Geraghty, said: "The public services committee of Ictu believes there are sound reasons to extend the current grace period.

“In the absence of an extension there will be a significant haemorrhage of experienced public servants, causing disruption to service delivery and causing a loss of historic memory in key operational and policy areas.

Separately, HSE director general Tony O'Brien, has confirmed it has proposed changes to the current plans.

The Irish Times reported last month the HSE had warned the ending of a grace period that resulted "in a significant number of staff leaving the health services on a single day or a single month could have adverse consequences for the health service".