A necessary compromise
The Government needs to reduce the public service pay and pensions bill by €1 billion to meet its target of a budget deficit of 3 per cent of GDP by 2015. The agreement it reached yesterday with the public service unions on pay – an extension of the Croke Park accord – represents a bold stop in that direction. What union negotiators have now agreed, their respective union executives are likely to endorse. Whether union members vote to accept that agreement will be decided in the months ahead. On balance, with the larger unions backing the proposals – which will see a €300 million pay cut in public service pay in 2013 – the rank-and-file members also seem likely to approve.
The Government hopes that with this agreement there can be certainty about public service pay until 2016, and sustained industrial peace. Union negotiators have traded no compulsory redundancies in exchange for pay cuts borne by all, but achieved in an equitable manner. All public service workers will share some part of the cost of that pay adjustment: those most able to do so will take larger cuts. Those earning over €65,000 will face a 5.5 per cent reduction in their pay, rising gradually to a 10 per cent cut on incomes over €185,000. Minister for Public Expenditure Brendan Howlin said the complex agreement was designed to ensure that, “No individual sector of the public sector is in any way targeted.”
Nevertheless, what is acceptable to a majority of trade unions remains unpalatable to a minority. Four unions, including those representing nurses and doctors, who quit before the agreement was finalised, have joined others – two organisations representing gardaí – who had earlier left the negotiating process. This means some one in four public service employees has rejected the terms of the pay agreement. However, if a majority of public service workers approves the deal, its terms will apply to all – including those who have opted out. And the Government, if necessary, will legislate to secure the necessary pay cuts. As Shay Cody, the chair of the public services committee of the Irish Congress of Trade Unions, acknowledged, “We have achieved far more through negotiation than we could have hoped to gain through protests.”
Certainly, those unions who from the outset were opposed to any reduction in the pay bill, cannot hope to secure better terms for themselves than those they have just rejected, and which a majority of public service workers now seems likely to accept. What has been proposed is a fair and balanced proposal to achieve a necessary reduction in the public service pay bill. Those who feel they are somehow exempt from that process, and should not be required to make any financial sacrifice, are unlikely to win much public sympathy or support for their case.