Dáil debates

Wednesday, 20 January 2010

 

Departmental Expenditure.

11:00 am

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)

The Government obtained recommendations and it is a matter for the Government to implement them or not, as the case may be. In the case of pay issues, one would look to do that. If an objectively-based anomaly arose, which the review body acknowledges may have to be catered for because of the limited number of grades being examined for the purpose of the exercise in which it is engaged, the Minister for Finance would have to make technical adjustments to accommodate them. There is a reference in the body of the report to this fact

This issue arose and it had to be considered by the Minister, who felt, taking into account all the facts, that he would proceed as he did and there was an objective reason for that. It was not an attempt to show favouritism to one grade over another. The issue arose and there were good grounds for the decision, which I have set out.

Of course pay reductions impose a certain degree of hardship on people, who I understand have existing commitments, but if we had to make those reductions then last year was the year to do so because there were reductions in the cost of living of the order of 6.5%. The purchasing power of the salaries that were being adjusted was maintained and that makes last year unique compared to other years which have an inflationary effect. The overriding reason was that it was necessary to adjust the pay bill given its size in terms of overall Exchequer spend. One could not make a €4 billion adjustment, which I think everyone in the House accepted was necessary given the fiscal situation, without seeking a contribution of the order we sought on the pay side. Otherwise one would be asking the non-pay side and the delivery of services to take a hit that would greatly affect the level of service one could guarantee. In a difficult situation this was the best outcome that could be formulated by the Government, looking at the facts of the situation as they faced us at the time.

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