U-turn on pay cuts for top civil servants followed lobbying

 

THE GOVERNMENT’S controversial U-turn on pay cuts for top public servants followed strong lobbying by their staff association that any cuts should take account of money lost as a result of the abolition of a bonus scheme which averaged 10 per cent of salary.

Official Department of Finance files show the Association of Assistant Secretaries and Higher Grades said it had legal opinion that the performance-related bonus scheme, which the Government initially suspended for 2008 and later scrapped permanently, formed an integral part of members’ remuneration packages.

The association contended that the bonus scheme represented “an arrangement whereby part of that remuneration is simply deferred pending an independent assessment of performance”.

The files also show that the secretary general for public service management in the Department of Finance, Ciaran Connolly, had urged Minister Brian Lenihan to accede to a request from the association for a meeting in advance of the budget.

“I appreciate the pressures on your time at present but, in view of the position in the Civil Service management structures of the grades which the association represents (and bearing in mind that they are not part of Ictu), I would recommend that you meet a delegation from the association in the next couple of weeks and before any decisions are announced arising from the Review Body’s report,” he said.

In the budget in December, Mr Lenihan announced pay cuts of 8 per cent for assistant secretaries and 12 per cent for deputy secretaries in Government departments.

He also announced the termination of the performance-related bonus scheme.

However, a fortnight later the Government decided that the extent of these reductions – which were based on the findings of the Review Body on Higher Remuneration – should be scaled back on the basis that the cumulative effect of both of these cuts on staff in these the grades would have been unfair.

The level of the cuts were reduced to between 3.3 and 5.5 per cent after the abolition of the bonus payments was taken into account – a move which has been strongly condemned by unions for lower-paid staff.

The files also reveal that Mr Connolly separately told the Minister that there was a risk that the proposed approach to scale back the cuts would “attract criticism from news media or unions representing lower-paid public servants which could focus solely on the reduction in the salary scale while ignoring the reduction through the suspension of the award scheme”.

“It is important that the presentation of this issue refers to the full reduction incorporating the effects of the suspension of the awards scheme resulting in overall reductions of 11.8 per cent for assistant secretaries and 14 per cent for deputy secretaries,” he said.

The official documents reveal that the Association of Assistant Secretaries and Higher Grades complained in a written submission to the Minister for Finance at the end of October that bonus payments due for 2008 had been retrospectively scrapped.

It argued that if further pay cuts were being envisaged then the abolition of the bonus payments for 2008 should be taken into account.

“As already stated, our members are prepared to play a significant role in the alleviation of the current difficulties and, while we are simply seeking equity of treatment, we have the distinct sense that we are not being heard,” the chairman of the association, Bryan Andrews, stated.

The association had earlier argued in correspondence with the Department of Finance that “while receipt of the performance-related element of pay is obviously not guaranteed to any individual, the scheme is part of our members’ basic remuneration package and amounts to an arrangement whereby part of that remuneration is simply deferred pending an independent assessment of performance”.