Seán Fleming (Laois-Offaly, Fianna Fail)
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Question 4: To ask the Minister for Public Expenditure and Reform his plans to look at the issue of reimbursing public service staff for pay cuts introduced over the last year, when savings have been achieved under the Croke Park Agreement. [20295/11]

Brendan Howlin (Wexford, Labour)
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The Financial Emergency Measures in the Public Interest Acts 2009 imposed a pension related reduction effective from March 2009 and a reduction in pay rates effective from January 2010 ranging from 5% to 15% for all public servants. The effect of these measures, combined with measures to reduce the numbers of public servants and to restrict other elements of the public service pay bill, has been to reduce the net cost of the Exchequer pay bill by some 15.5% between 2009 and 2011. The implementation body for the public service agreement in its report to Government of 15 June 2011 established that the estimated sustainable pay bill savings in the order of €289 million in the public service pay bill had been achieved in the year, March 2010 to March 2011, along with other substantial savings in the delivery of public services.

Paragraph 1.16 of the Public Service Agreement 2010 – 2014, Croke Park agreement, provides that the position regarding public service pay, including any outstanding adjudication findings, would be reviewed in accordance with the statutory requirement under both the Financial Emergency Measures in the Public Interest Acts of 2009 to review the operation and effectiveness and impact of the Acts before 30 June 2011. In addition to the criteria set out in those Acts, the review would take account of sustainable savings generated from the implementation of the Agreement.

The Minister for Finance in line with the requirements under the Acts completed a review of their operation in June. The reports were laid before both Houses of the Oireachtas on 30 June and have been published on the website of my Department. The reports concluded that, having regard to the overall economic conditions, national competitiveness and Exchequer commitments in respect of public service pay, the measures put in place by the Acts continue to be needed.

As required under the Croke Park agreement, there has been ongoing dialogue between representatives of public service management and the public service committee of the Irish Congress of Trade Unions in relation to the outcome of the reviews. The context is the Government's affirmation of the key commitments under the Public Service Agreement 2010-2014 to no further reductions in pay rates for serving public servants and no compulsory redundancies, save where there are existing exit mechanisms. These commitments are contingent on delivery of the necessary flexibilities and reforms to public service delivery that are required under the agreement.

The fiscal targets in budget 2011 are based in part on the reductions in the Exchequer pay bill achieved under the Acts, and can be met only through a continued policy of pay restraint. I believe that the general measures the Government is taking to reduce the overall public service pay bill are understood by the public service committee.

Seán Fleming (Laois-Offaly, Fianna Fail)
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I really must take issue with the Minister. It is a scandal what he has done. In his reply to my question he has broken the Croke Park agreement. The Minister and I both know there is a clear commitment regarding low paid workers and that is why they voted for the Croke Park deal. The Minister quoted from paragraph 1.16 of the Public Service Agreement 2010 - 2014 but did not quote the last two sentences of the paragraph, which state:

In the event of sufficient savings being identified in the Spring 2011 review, priority will be given to public servants with pay rates of €35,000 or less in the review of pay which will be undertaken at that stage.

Very low paid workers, those who are taking home between €400 and €500 a week, voted for this agreement on the basis that they would be the first people to get a reimbursement of salary and wages. The Minister stated that verifiable savings of €289 million in the public service pay bill had been achieved. I want the Minister to give figures for the number of low paid worker in the public service earning less than €35,000 per annum. To quote the financial emergency measures to them at this stage, 18 months after they have delivered the savings and for the Minister to thank them for the savings but in the national interest they will not be paid their increase even though they were first in line under the Croke Park agreement-----

Brendan Howlin (Wexford, Labour)
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What brass neck - I have seen brass neck in this House over the past 20 years but this is something. The objective of the Croke Park agreement and all the measures we have taken, including not resiling from the Financial Emergency Measures in the Public Interest Acts that the previous Government put in place is to restore economic solvency of our State. Deputy Fleming and his party broke that. I am glad that the arbiters of the Croke Park agreement are not Deputy Fleming and his party but those were party to the agreement.

I met the implementation body, the unions and employers organisations and, unlike the Deputy opposite, they have an understanding of where the nation is and what needs to be done. Our objective is to take the painful path for all people in the State to restore our economic sovereignty, to ensure there is a public service and that pay slips and money are available to maintain the public service into the future. We will do that. We inherited a broken, damaged economy but we will restore it. We are already taking steps to do so as the review by the troika indicated today. We will not be lectured about what we need to do by the people who were party to the damage done to our economy.

Seán Fleming (Laois-Offaly, Fianna Fail)
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I compliment the Minister on restoring the minimum wage to people mainly in the private sector, including contract cleaners in council and local authority offices. I do not understand why they singled out the low paid workers in the public service not to receive a similar increase when it is provided for and earned under the Croke Park agreement.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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Question 5: To ask the Minister for Public Expenditure and Reform his plans, if any, to review the public sector recruitment embargo in particular in relation to its impact on frontline services and its real cost savings; and if he will make a statement on the matter. [20624/11]

Brendan Howlin (Wexford, Labour)
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The Government is committed to reducing public service numbers in accordance with the programme for Government subject to there being no compulsory redundancies and to the protection of front line staff. The recruitment moratorium is a means to this end and is being used with redeployment and increased productivity to limit the impact of necessary savings on all public services. As outlined in the Government programme, this will involve a fundamental change to the way in which the Government and the public service operates, including the rationalisation of core processes across the public service, a reduction in the number of State bodies and the elimination of non-priority programmes and outsourcing of non-core functions, where appropriate. This is being reinforced by the comprehensive expenditure review which focuses on reform and on new ways of delivering public services taking advantage of the opportunities and challenges arising under the Croke Park agreement. This review will identify the policy decisions within which the reduction of public service numbers will be made. These numbers reductions will be a driver for public service wide reforms. This includes reforms to the manner in which frontline and back office services are delivered across the public service. Staffing resoures will be refocused on delivering priority service and programmes as set out in the Government programme.

The comprehensive review of expenditure, therefore, seeks to identify areas where reductions can be achieved and will identify areas where staffing resources can be freed up through the use of shared services. In the Croke Park implementation group's first progress report, Exchequer pay bill savings in the order of €289 million were identified as having been achieved in the 12 months to end March 2011. The provision under the National Recovery Plan 2011-14 is for a gross Exchequer paybill of almost €16 billion in 2011. When compared with the 2010 paybill, this would represent a savings target of approximately €223 million for 2011.

At this point it is expected that the target for a gross Exchequer pay bill of almost €16 billion for 2011 will be met. Current targets for staff numbers will be kept under review in the context of budgetary considerations later in the year.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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The Minister is right to treat with contempt the interrogation of Fianna Fáil on the reasons why we are in this disastrous situation. Is it not the case that the Government's decision to adhere to the EU-IMF austerity programme, continuing with the public sector recruitment embargo, is not leading to reform but towards a slaughtering of public services? The figures in education indicate 1,400 jobs garnered gone out of the education sector when 10,000 extra children come into the primary schools every year. This amounts to a savage assault on our education system where services are giving way.

Michael McCarthy (Cork South West, Labour)
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I ask Deputy Boyd Barrett to ask a question.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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It is not the case that, with nearly 5,500 health service workers down as a result of the embargo, this is the reason or hospitals and accident and emergency services are closing down? It is not unbelievable that 13%-----

Michael McCarthy (Cork South West, Labour)
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That is not a question.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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That is a question. I said "Is it not the case".

Michael McCarthy (Cork South West, Labour)
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Deputy Boyd Barrett is offering a point of view and prefacing it with "Do you believe" or "Is it not the case". I ask Deputy Boyd Barrett to pose a question because otherwise time will run out.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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The Acting Chairman is cutting into my time.

Michael McCarthy (Cork South West, Labour)
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Deputy Boyd Barrett is cutting into his time. I ask him to put his questions.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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Is it not the case that continuing with the embargo on the slaughtering of our public services that, for example, a 13% cut in staffing in local authorities means local services are slaughtered? Is it not time for the Minister to reconsider the sanity of this embargo if we are to have any public services for the people of this country?

Brendan Howlin (Wexford, Labour)
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Deputy Boyd Barrett is an idealist and he believes what he says. The problem is that we must pay our way. We are borrowing €18 billion to fund ourselves for this year. Do I like the memorandum of understanding we inherited from her predecessors? No, I do not, nor do I like reporting to external forces, chapter by chapter and the line by line of public expenditure. I am determined and the Government is determined to get us back to a position where those domestic decisions are made by the sovereign Government of Ireland without oversight. In order to do that, we need to make reductions in expenditure that are laid out in order to get to a balanced budget and a 3% deficit by 2015. This is our determined view.

The notion that we could abandon the memorandum of understanding and tell the Troika of the EU, the IMF and the ECB to take a hike is fine. They would happily take a hike. This would leave us with an €18 billion hole in expenditure this year. That is not having a moratorium on staff, that involves closing hospitals and schools and Garda stations. That is the slaughter of public services, the consequence of Deputy Boyd Barrett's idealism or naivety if he thinks we can simply magic away a gap in our expenditure of €18 billion.

We must be honest and truthful with people that there is no magic way of getting out of the debt burden placed upon us by previous Administrations and decisions made by them. It falls to us, those elected in this House now, to have the responsibility to face up to that and make the hard decisions.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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A brief supplementary-----

Michael McCarthy (Cork South West, Labour)
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The time is up and we must move on.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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Just one line.

Michael McCarthy (Cork South West, Labour)
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Time is up, unfortunately. I regret that.