Taoiseach Brian Cowen indicated today the Government may look again at public sector pay rates as part of its bid to tackle to the current budgetary difficulties by next year.
Speaking after a conference on the public sector at the Institute of Public Administration in Dublin today, Mr Cowen said that while the flexibility, redeployment and other productivity measures that are being pursued with the trade unions were essential to protect services, there had to be a recognition of the need to generate the scale of savings required in the necessary time period.
“The Government, as employer, must therefore look at all of the options that would minimise the impact on public service and public service jobs of unavoidable spending reductions,” he said.
The Taoiseach also said the Nama Bill had been signed off by Cabinet and would be published in the coming days.
Earlier, the chairman of An Bord Snip called for a new review of pay levels in the public service. Economist Colm McCarthy said that such a “Benchmarking III” process should be freed to recommend pay cuts where necessary.
He said the last benchmarking exercise had been prohibited in its terms of reference from recommend pay reductions.
Mr McCarthy acknowledged that staff in public sector had already seen their pay reduced by 7.5 per cent under the Government’s pensions levy and an examination of top level pay rates was currently under way
He said public officials were entitled to be paid similarly to people in the private sector but that might involve pay reduction
“There should be a new Benchmarking III without restrictive terms of reference” he said.
After the establishment last night of a new campaign by public sector unions to oppose the Bord Snip recommendations on cuts, Mr McCarthy said: “A small reality is this country is bust. There is no shortage of compassion; there is a shortage of money.
“We are borrowing €400 million per week and a big component is the public sector payroll,” he said. “If people think that we can fire ahead and keep borrowing money to maintain the current levels of public spending that the Government is committed to, then they are out of touch with reality."
Meanwhile ESRI economist John Fitzgerald strongly criticised the Government’s decentralisation programme as a “disaster”.
He said it was causing chaos in the public sector. “People who know about it cannot speak about it because they are pulic servants,” he said. “They tried this in Burma and sent all the civil servants out into the jungle. And look at Burma. It cannot work where people are split up and sent around the country.”
He said one British observer he spoke to over the summer had said overseas development aid had been “messed up” by transferring staff to Limerick.
Mr Fitzgerald said staff dealing with climate change policy in the Department of Environment had “jumped ship” rather than be transferred to Wexford and replacement staff in this area were now retiring early.
Knowledge in this area had “gone up in smoke”, he said.