Dáil debates

Thursday, 20 June 2013

Ceisteanna - Questions - Priority Questions

Haddington Road Agreement Savings

5:35 pm

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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1. To ask the Minister for Public Expenditure and Reform if he will provide a detailed breakdown of the public sector pay and pensions savings from planned retirements, the targeted voluntary redundancy scheme, changes to pensions in payments and the provisions of the draft Haddington Road agreement as approved by him and put to ballot of public sector staff; and if he will make a statement on the matter. [29859/13]

Photo of Brendan HowlinBrendan Howlin (Minister, Department of Public Expenditure and Reform; Wexford, Labour)
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The voluntary redundancy scheme is expected to give rise to savings in three areas where it will be initially rolled out. These include the Department of Agriculture, Food and the Marine and specific parts of the health and education sectors. The relevant Departments have estimated that there will be scope to effect approximately 2,000 exits from these areas over time, mainly from back-office, support areas and management and administrative grades. How this estimated number of exits translates into actual money savings over the next few years will be determined by several variables, including the take-up rate among staff in the targeted areas, their number and grade mix and the timing of departure. Information on outcomes in respect of these variables will not become apparent until the scheme is offered to those affected.

Public service trade unions are continuing to consider the various proposals put forward under the Haddington Road agreement ahead of the implementation date of 1 July. The composition of the savings arising can only be finalised when responses to the proposals from all the unions are to hand. However, the measures set out in the agreement, taking account of savings from pension adjustments, will enable the Government to achieve the targeted savings that I have set out of €300 million in the public service pay and pensions bill this year, including savings in local government. It is estimated that the measures set out in the Haddington Road agreement and the related legislation will reduce the public service pay bill by €1 billion by the end of the agreement.

Savings arising specifically from pension reductions are expected to begin from 1 July when changes to the existing public service pension reduction are due to take effect, as provided for in the Financial Emergency Measures in the Public Interest Act 2013. These changes will apply to public service pensioners with pensions greater than €32,500 and are estimated to amount to €12.9 million this year and €24 million in 2014.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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I put down this question for the Minister to get some information on the breakdown of the savings from the targeted voluntary redundancy scheme, the changes in the pension payments, which he has provided, and the changes in the draft Haddington Road agreement, which the Minister approved and which went to ballot. I have not really got an answer to my question. I tabled a parliamentary question on 12 June on a similar topic, the difference between the savings under the Haddington Road agreement and the Croke Park agreement. The last paragraph of that answer is identical to the response I have just received.

I asked the previous question more than one week ago. The last time the Minister took Oral Questions he undertook to give us a breakdown of the savings. He could not do it that day even though the agreement had been reached. I realise this matter is subject to agreement but my question was whether there was an agreement. I realise SIPTU and various others have voted for an agreement and that is to be welcomed. We are pleased that public sector workers were wise enough to throw out the first proposals, which were unfair, but they have accepted this proposal which is slightly better.

Photo of Michael KittMichael Kitt (Galway East, Fianna Fail)
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A question please, Deputy.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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Will the Minister give us the figures in terms of retirements? How can the Minister say he will reach his target of €1 billion if he maintains the savings from the 2,000 exits in the Department of Agriculture, Food and the Marine, the HSE and the education sector have yet to be determined because they are dependent on the scheme when offered? The Minister cannot provide a breakdown but yet he has stated in reply after reply that he will achieve savings of €1 billion. If he does not know the make-up of the €1 billion he should not give that figure.

Will the Minister give a more detailed breakdown, as requested in the original question?

5:45 pm

Photo of Brendan HowlinBrendan Howlin (Minister, Department of Public Expenditure and Reform; Wexford, Labour)
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I understand the question, and I understand the Deputy’s eagerness to get the information. I am anxious to give him an accurate answer but I am not in a position to do it right now. While the pieces on the deck will certainly amount to €300 million in the current year and €1 billion between now and 2015, the exact make-up of those pieces will not be known until the ballots are over. It will be a different make-up, for example, if the education sector is subject to the FEMPI legislation or whether it is subject to the Haddington Road agreement. The actual component parts of the money to be achieved are not determined until the outcome of the ballot is known. I will be in a position to give definitive answers when we have an overall picture of how the individual component parts are to gel together.

As Deputy Fleming is aware, under the FEMPI legislation, we will achieve the savings either through the pay reductions, which will be implemented, or through measures that line managers, Ministers or those responsible employers designated under the Act, will be required to take to save the money in each sector.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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I understand that the Minister had indicative figures of what would be achieved under the Croke Park II agreement but it was not accepted. He said the higher pay cuts would be approximately €250 million. We did not get the figures from the Minister because he has never given a figure in the House but they were obtained elsewhere. Figures were given for the redundancy, agency reductions and overtime cuts. The Sunday premium was due to save approximately €65 million in the period as well as savings on increments and substitution and supervision in education, which has changed a little in the agreement.

I do not know whether we will have another opportunity for Question Time before the summer recess but I seek an undertaking that when the agreement is reached, whether the Dáil is still in session or if it is a week later, that the Minister would publish a breakdown of the figures so that we would know how much the different components in the different sectors are adding to the €1 billion. The target is €1 billion and people need to know whether it is a real target. I urge the Minister to make a commitment to provide the figures at the earliest possible date.

Photo of Brendan HowlinBrendan Howlin (Minister, Department of Public Expenditure and Reform; Wexford, Labour)
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It is not only a target, it is a target that will be achieved because we have enough pieces in the legislation and in the agreement to make it. The exact make-up in terms of how much of it will be from the Haddington Road agreement and how much will be achieved through the FEMPI legislation will depend on the outcome of the ballots. I cannot give the definitive breakdown until I have the result but I will give it to the Deputy as soon as I have it.

Photo of Michael KittMichael Kitt (Galway East, Fianna Fail)
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As Deputy Mary Lou McDonald is not present we will move on the Priority Question No. 3 in the name of Deputy Joan Collins.