Enda Kenny (Mayo, Fine Gael) | Oireachtas source

These negotiations have been among the most fundamental to have taken place in this country in many years. One of the reasons the Government was elected was to deal with the problems faced by our national finances. We must get our deficit to a level at which this challenge can be dealt with comprehensively. The target that has been set involves reducing the deficit to 3% by 2015. That requires serious savings of €300 million this year, and an additional €1 billion over the period to 2015, to be found. Given that pay and pensions account for 35% of expenditure, one third of the savings will have to come from these negotiations. I commend everybody who has played a part in this. The unions have to receive the Labour Relations Commission's document, which will be published later this afternoon. Each union will have to deal with that in its own way, for example by engaging in discussions with and balloting its members.

This deal is proportionate right across the board. It is designed to ensure front-line services will not be diminished or reduced. That is why the changes that have been recommended here, and accepted by the Labour Relations Commission in presenting the document to the unions, are in the interests of everybody who is putting their shoulder to the wheel so we can deal with our national financial problem.

It runs from 1 July until the end of 2016. Over the course of the agreement, the overall savings target will be achieved. There are direct pay reductions for those on remuneration higher than €65,000 and there is an increments freeze of varying lengths at different pay ranges that is designed to protect those at the lower level. There is additional productivity for extra hours from most public servants, whereby those currently working under 35 hours will in future work a minimum of 37 hours and those working between 35 and 39 hours will work 39 hours. There are a whole range of issues, for example, the elimination of twilight payments and the elimination of supervision and substitution payments.

These are negotiations that have been very intensively conducted over the past period. The Government will reduce the pay of those over €65,000 progressively, with a 5.5% reduction on the first €80,000 of salary and allowances, 8% between €80,000 and €150,000, 9% between €150,000 and €185,000 and 10% above €185,000. Across the board, this has been a fair and equitable negotiation. As I said, there is an opportunity now, when the unions receive the document from the Labour Relations Commission this afternoon, to discuss and ballot their members, each in accordance with its own democratic tradition. As I said, the issue here will greatly help the Government's programme to bring our deficit into order so it is sustainable and the country can thrive and prosper in the times ahead.

This is challenging for everybody. Nobody likes to announce that things have to be reduced or cut back. However, the trade unions which stayed in at the discussions actually did make significant improvements and alterations to the initial proposals. In that, they have protected the front-line services by making adjustments in the negotiations that took place.

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