Brendan Howlin (Wexford, Labour) | Oireachtas source

The scale of the fiscal crisis that began in 2008 led to the first permanent cut in public service pay rates in the history of the State. In total, the Exchequer pay bill has been reduced from a peak of €17.5 billion gross at the onset of the recession to €14.2 billion net of the pension-related deduction in 2013, with a further substantial reduction this year. Given the scale of the fiscal crisis facing the country and the fiscal consolidation measures required to restore our finances, and to achieve the deficit target of below 3% next year, the contributions made by public servants were essential. I explained that to them and all their unions, and they voted on it.

I acknowledge that the absolute requirement to reduce public expenditure, including in part through pay and pension reductions, does not lessen the impact on the daily lives of hard-working public servants who are also subject to the tax and other revenue raising measures that were necessary to fix this broken economy.

Pay and pension reductions, together with substantial productivity improvements, have been facilitated by a series of legislative enactments by this Government and its predecessor - the Financial Emergency Measures in the Public Interest Acts 2009-2013. They have been supported by two significant collective agreements: the Croke Park agreement negotiated by the previous Government and, more importantly, the Haddington Road agreement negotiated by this Government.

As provided for under section 12 of the FEMPI Act 2013, I am required to review annually the Financial Emergency Measures in the Public Interest Acts 2009-2013, which gave effect to these reductions. The Act requires me to provide a written report to the Houses of the Oireachtas. My last review was laid before both Houses in June. In that review, I concluded that there is a need to continue to apply the relevant provisions as we work our way through recovery.

The nature of the financial emergency measures legislation is that the powers granted by the Oireachtas under the legislation are temporary in nature and are predicated on the presence of the financial emergency. While we have clear signs of recovery, we still obviously cannot undo all of them immediately. I hope, however, to open negotiations next year to have an orderly unwinding of these provisions as we now work our way into recovery.

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