Freeze public sector pay, says Lenihan

MINISTER FOR Finance Brian Lenihan has signalled his desire for a public sector pay freeze to form part of any agreed national pay deal.

Mr Lenihan yesterday called on the social partners to "reflect" on the extra cost to the taxpayer that would result from any increase in payroll costs in the public service - €180 million a year for each percentage point increase. This was a considerable amount of money in the current economic climate.

While he didn't want to interfere in the talks between unions and employers, the Minister said "there are times when the general economic welfare of the country has to take priority over all sections".

Mr Lenihan also revealed that the estimates would be published on the same day as the budget this year. Normally, the estimates appear about six weeks in advance of the budget, but because of the Government's decision to bring forward this year's budget by almost two months, the two events will happen on the same day.

The decision was taken in response to the economic slowdown, including a dramatic drop in tax revenues and a fall in consumer demand.

The Finance Bill, which gives effect to many of the decisions made in a budget, will also be brought forward. The Bill is likely to be published before the end of November and should have passed through the Oireachtas by the end of the year. It is expected to become law sometime in January, compared to March this year for last year's Finance Act.

Asked about a comment by Tánaiste Mary Coughlan that there would be no further cuts in spending following the measures imposed in July, Mr Lenihan said this referred to this year only.

Even then, if other Ministers believed they could make any other savings they were welcome to do so, he said.

"The measures we announced in July were taken to deal with problems that were emerging then, and those measures are now being implemented. I have indicated to other Ministers that if there are any other savings they can make before the end of the year well and good, but you'll appreciate it's late in the financial year and the vast amount of spending is committed."