State to seek cuts if no deal struck, say unions

The Government has made clear that it will unilaterally impose €1 billion in cuts to its pay and pensions bill if it cannot reach agreement on an extension to the current Croke Park agreement, unions have said.

The largest public service trade union, Impact, told members yesterday that if this were to happen it would ballot for industrial action.

Talks on the new extension to the Croke Park deal between public service management and trade unions will commence next Monday.

In a letter to members yesterday, Impact general secretary Shay Cody said it was clear that if unions failed to reach a new agreement or failed to engage in talks “the employers will seek to impose payroll reductions in ways of their choosing as they have done in the past”.

Pay cut of 7%

Some trade union leaders have calculated that to reduce the pay bill by €1 billion in the absence of any reforms, measures or savings could involve a pay cut of about 7 per cent.

In a letter to trade unions earlier this week, secretary general of the Department of Public Expenditure and Reform Robert Watt said some €300 million in additional savings on the public service pay and pensions bill would have to be generated this year.

Overall, the Government wants to make savings of €1 billion on its pay and pensions bill over the next three years.

He said the measures under the Croke Park agreement would not deliver the scale of savings required nor could they be achieved by reducing staffing levels alone.

“Therefore, the measures the official side propose to put on the table will have to involve reductions in payroll costs for serving staff, as well as substantial additional productivity and workforce reform measures for all to assist in controlling any underlying expenditure pressures that may relate to the reduction in public service numbers.”

Additional hours

There has been speculation the Government is expected to propose additional working hours for staff as well as reductions in premium payments for weekend work in some areas. There may be proposals for changes to supervision and substitution payments for teachers, and for pay cuts for some high-earners.

The Government has confirmed it has asked the OECD to review pension arrangements for serving public service staff. This report is due next month.

In his letter to members yesterday, Mr Cody said: “We have been advised that the employers want to reach an agreement with us over how such a substantial cost reduction can be achieved. Equally, we have been left in no doubt that they will seek to impose the savings, possibly in ways that would be far less acceptable, if agreement cannot be reached.

“If this were to happen we would have no option but to ballot you for industrial action, as we did in 2009.”