Bríd Smith (Dublin South Central, People Before Profit Alliance) | Oireachtas source

It is important to bear in mind the background to these proposals. In order to bail out banks and developers, the State initiated a wave of cuts to public services and waged an unremitting war on public sector workers. Overnight, following the bank bailout and the advent of the troika, the narrative became that the great public enemies were the teacher, the nurse, the firefighter and the workers in these Houses. Their wages and conditions and their pension entitlements became the obsession of economists and commentators. The causes of the crisis were apparently forgotten as the State focused its attention on reducing the wages and pensions of public servants. In fact, it savaged the earnings and pensions of workers and retired workers and slashed the pay and pension entitlements of new recruits.

Several different figures have been offered, but one estimate is that the State took €1.4 billion from public servants every year since the crisis began. These savings were achieved through four waves of austerity measures. The first was the 11 month pay freeze introduced in September 2009 under financial emergency measures in the public interest, FEMPI, legislation. National agreement pay increases of 3.5% due in September 2009 and 2.5% due in June 2010 were abandoned under the Towards 2016 partnership agreement. The second austerity measure, introduced in March 2009, was the pension levy or pension related deduction, PRD. This levy is deducted at source and returned to the Exchequer, thereby constituting a reduction in gross pay. Higher rates were applied to the higher paid, but the average deduction was 7% of total salary. To give an idea of its scale, the PRD has yielded savings of more than €900 million, or almost €1 billion, for the Exchequer in each full year since it was introduced. The third austerity provision came in the form of a second FEMPI Act enacted in December 2009. This introduced a comprehensive pay cut from 1 January 2010 which meant a clerical officer on average pay lost €1,500 per annum. The fourth austerity measure was achieved by way of the Haddington Road agreement, which brought further cuts in public service pay and pensions and a raft of productivity measures, including additional hours valued at 6% in pay terms. This agreement introduced increment deferrals, overtime rate changes and changes in flexible work practices.

As well as the four waves of cuts, the Government restructured two levies, the income levy and the health levy, into a new universal social charge, USC. A worker on €37,000 a year, which is the maximum rate of pay for a clerical officer in the Civil Service, now pays almost €1,400 a year in USC. The lower paid took a huge hit as a consequence of this charge.

During the austerity years, successive Governments cut public service employment across the board, with numbers falling from a high of 320,000 to less than 290,000 in 2015. This reduction was achieved via the blunt instruments of a recruitment moratorium, incentivised retirement and voluntary departures. Overall, there was a 10% reduction in jobs across all the public sectors. These cuts have resulted in huge income losses for all public and civil servants, but particularly those on lower incomes of between €20,000 and €37,000. In addition, those still in work must do longer hours, have less flexibility, a larger workload and fewer supports.

As a result of these measures, the public service pay bill has fallen dramatically, from more than €17 billion before the recession to €14 billion net in 2014. As well as the impact on workers, this has also impacted the economy by way of the loss of discretionary income and savings. Despite propaganda to the contrary, the remuneration levels of lower-paid public servants in this country are, according to statistics from the Organisation for Economic Co-operation and Development, OECD, in line with or below the average pay of those elsewhere in Europe. Moreover, OECD statistics published in December 2014 show that the size of the Irish public sector, at 18.4% of total employment, is not far from the average level across all member countries. Official figures show that 45% of all public servants in Ireland earn less than €45,000 a year, while 68% earn less than €50,000. This is contrary to the impression given that the majority of public servants are slán abhaile and highly paid.

Other emergency measures that are of continuing concern to public servants were implemented in the same austerity period. One of these relates to starting pay for new entrants in the public sector. In 2010, the then Minister for Finance determined, unilaterally and without the necessity of introducing legislation, to reduce pay scales for all new entrants by 10% on all points of the scale. This meant that from 2011 onwards, workers entered their pay scales at least two points below those applying to their pre-2011 colleagues. The workers concerned are, therefore, behind where they would otherwise have been on the scales while progressing through their increments. This effect was compounded in 2012 by the unilateral abolition of universal allowances for new entrants. Given that these allowances applied to all members of the relevant grade or category, they were, in effect, a part of basic pay. For example, prison officers or firefighters recruited from 2011 were not only placed on a scale that was longer than that applicable to colleagues recruited before them, they also had to go without a significant universal allowance which their colleagues retained. This issue has been largely resolved through negotiations under the auspices of the Lansdowne Road agreement. However, the post-2013 solution to the 2010 alteration of scales for new entrants to the public service means that such workers remain on scale points behind those that applied previously.

In 2013, the Haddington Road agreement reduced the pay of public servants earning above €65,000 a year and imposed additional unremunerated working hours on employees. On average, an additional 2.5 working hours were added to the working week of all public sector workers. The issue of unremunerated working time remains unresolved. While the effect of the increase varies depending on pre-existing working hours, all public servants who worked fewer than 39 hours per week experienced an unpaid increase in their working time. There is an estimated further €430 million in savings from increases in productivity deriving from the almost 15 million additional working hours and a range of other reform measures.

It is clear, bearing in mind all these cuts, that when the Minister and others tell us how much they are increasing the pay of public sector workers, it is akin to a burglar offering to return a portion of the stolen goods. Nobody in that situation would say thanks to the burglar for giving back what had been robbed. That is why I do not welcome this Bill in its totality. The theft of workers' pay and pensions was not negotiated but, rather, imposed by means of extraordinary legislative measures passed in this House. We cannot, apparently, pass emergency legislation to deal with the housing crisis, health crisis or climate chaos but, by God, we could do so when it came to cutting the pay and conditions of nurses, teachers, firefighters and clerical workers across the service. Years after this Government told us we are in recovery, the economy is booming and this is a great country in which to do business, we continue with the charade that there is, in fact, a financial emergency, but one which only requires the theft of pay and pensions from public sector workers to address it.

The Government cannot legitimately claim that the recent pay and stability deal somehow offered workers restitution by way of a settlement that was voluntarily agreed. In fact, the so-called deal was presented as the only game in town. If they chose to reject it, workers were told, then the Government would continue to wield the big stick of FEMPI in order to impose a settlement. The proof is in the pudding in this regard because that is exactly what is happening to teachers. This is supposed to be a democratic country but here we have legislation that effectively removes the right to free collective bargaining from trade unions. Even though a majority of unions accepted the deal, this Bill effectively punishes those who did not. It allows any rise offered to some workers to be withdrawn from workers who rejected a pay deal. It copperfastens pay apartheid in the public sector and makes no reference to how and when workers, teachers, for instance, might expect to earn the same pay as colleagues for doing the same work. Nurses are particularly affected by this. These provisions bed down the inferior pensions of new recruits and, years after the crisis has passed, make permanent the various emergency measures in respect of pension entitlements. These measures seek to normalise the financial emergency, just as the Taoiseach is attempting to normalise the emergency in housing.

We will have to restate what the Taoiseach sees as a republic of opportunity to see it as a republic of opportunists that favours former taoisigh, Deputies and Minsters who will receive a handsome pension increase with new legislation to be introduced. A lot has been left unsaid about the FEMPI legislation and we will be introducing amendments to this Bill.

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