Civil Service pay cuts not the answer


OPINION:A reduction in public sector pay is not the magic solution to the problems with the public finances, writes DAVE THOMAS

I REPRESENT the Association of Higher Civil and Public Servants (AHCPS). My members are senior civil servants who include senior tax inspectors, members of the courts service, among others. As an association we have traditionally been reluctant to become involved in public debate.

However, recent times have seen an extraordinary degree of comment in relation to our members that is as vituperative as it is inaccurate. For this reason we now feel compelled to enter the debate and correct the myths about the public sector which have continued to flourish like noxious weeds.

To listen to some media commentators and business representatives, the simple way to restore stability in the public finances is to embark on a slash and burn exercise in the public service.

The logic for this is crude and simplistic. The latest exchequer returns show that Government tax revenues are €5 billion less than this time last year. Therefore, those who perform all the tasks that make sure we have a functioning State in the first place must make up that shortfall by making huge sacrifices for the greater good. The justification for this is that the public service was unduly rewarded during the good times. And just as business has suffered in recent times, so too must the public sector through ongoing reductions in pay and numbers.

The notions of collective responsibility and burden-sharing are entirely absent from this narrative.

On behalf of our members I would like to point out the very good reasons that contributed to certain pay increases being made when the money was available. Moreover, it is vital to outline the sacrifices that many of my members have already made over the last 12 months.

I would like to do so cognisant of the need for discussions about reforming our public service to fit the new economic reality. That is something the AHCPS has repeatedly offered – to sit down and have a mature and reasoned conversation with Government.

But it must be done in full recognition of the vital tasks civil and public servants carry out and an honest appreciation of the pay and conditions that we receive, set against our equivalents in the private sector. All of this must be done in a spirit of co-operation which recognises the fact that finger-pointing and abuse will get us absolutely nowhere.

First and foremost, public servants did not cause the economic crisis. The 3,400 people whom I represent worked diligently and efficiently through the boom years. We carried out our jobs on a daily basis to ensure the smooth and effective running of the State.

Administration is a much abused word but without proper administration our taxes would not be collected, our courts would not function, no legislation would be enacted, our State would grind to a halt. Effective administration is critical to the functioning of this State. It is not the dispensable luxury that some commentators imply.

As the economy and private sector salaries grew, there was a clear need for fair rebalancing of wage discrepancies between the private and public sectors, allied with an independent pay determination mechanism.

It was recognised that in the absence of such an independent process, public sector pay would be determined on the streets.

In addition, the public service pay determination model was outmoded and out of step with the times. From this need, the benchmarking process emerged.

Benchmarking remains one of the great misunderstood phenomena of the Celtic Tiger era. As the Report of the Public Service Benchmarking Body states, it was introduced to carry out “a detailed examination into the jobs, pay and conditions of public servants” and to compare these “with jobs of equal size in the private sector using representative data on pay and conditions”.

It was also part of a wider process of modernisation and change in the public service that was required to bring our administration up to date with modern Ireland.

The comparators used included comparing the pay and conditions of, for example, a human resources (HR) manager of a government department with that of a HR manager in the private sector. Few would argue that the scale, scope and responsibilities of these jobs are not comparable.

While the 2002 benchmarking report recommended increases for the great majority of public servants, the most recent benchmarking report (December 2007) recommended a zero award for the vast majority of public servants, with the exception of a small number of grades. This fact is conveniently ignored.

The AHCPS sought fairness for our members when times were good. We also recognise the new economic reality. But just as we sought equality of treatment during the Celtic Tiger, we are also seeking fairness in the new economic context.

We have consistently said that we recognise the need to continuously review the services delivered to the public and to make every effort to stabilise national finances. We fully accept the need to scrutinise expenditure and to cut back on non priority areas until the wider economy improves.

But we can only go so far. Our members have already been severely hit by a combination of measures: the pension levy, the income levy and the increase in PRSI contributions.

The combined effect of these measures is a pay cut of 17 per cent. In addition, the non-payment of national wage increases due under Towards 2016 compounds the pain experienced by members.

In this context, a further cut to public sector pay is not the magic solution the country requires. Yes, we are going to have to be a lot smarter and more strategic about how we manage public spending. But we will also have to widen the tax base to ensure that all of society pays its share. This is an unavoidable truth that many commentators seek to simply gloss over.

Behaving like a circular firing squad will do nothing for our country.

What we now need is a collective effort across all stakeholders to restore economic stability, rather than a narrow focus on cutting public sector pay. We recognise our civic duty to play our part in addressing the economic difficulties, but we are not prepared to do so in isolation.

We will play our part. But will others?

Dave Thomas is general secretary of the Association of Higher Civil and Public Servants, which represents 3,400 senior civil servants and managers in the commercial and non-commercial State sector