Tuesday, 5 December 2017
Public Service Pay and Pensions Bill 2017: Committee Stage (Resumed)
We are, but in a proper and balanced way I want to make a point to the House. We are told that we are extreme and that the Deputies on the opposite benches are the moderate Deputies, the parties of the centre.
"The reasonable Deputies", that is right. Is it not interesting that, on the basic simple principle, which would have the support of the overwhelming majority of ordinary decent people in this country, equal pay for work of equal value, the people who are taking the extreme position are the Minister of State, Deputy Alan Farrell and members of their party, and the people taking the reasonable, sensible, sane position are the Deputies of the radical left on these benches?
The Government states it is making progress, that there is a big gap between the young workers and the others and it is going to try to narrow the gap, but this agreement, running for another four years, states very clearly that the gap will not be bridged in those four years. In other words, it intends to maintain pay apartheid, not just next year but for the three years after that. Then it will see. That is the Government's position.
The idea that full pensions are being restored to Brian Cowen and Bertie Ahern under this agreement, while young teachers and workers will continue to be denied equal pay for work of equal value is absolutely scandalous. That is the end of my reasonable contribution.
I know that the amendments have been ruled out of order and that I cannot speak to them, but I want to state my dissatisfaction at the lack of consistency in the way the amendments have been ruled out of order. Amendment No. 11, for instance, in the name of Deputy Dara Calleary - I am not picking on the Deputy, but I want to highlight the inconsistency - which calls for a report to be commissioned and within three months of the passage of the Bill to be prepared and laid before the Oireachtas, is in order. Amendment No. 5, however, tabled by the same Deputy, which also calls for the preparation and laying before the Oireachtas of a report within three months of the passage of this Bill has been ruled out of order. There is no consistency in what is happening. I do not know why of two amendments seeking reports to be laid before the Houses within three months of this legislation being passed, one has been ruled out of order and the other has not. Perhaps the Minister of State can indicate why that is because it is very frustrating when we draft and submit amendments to be told that they have been ruled out of order. There does not seem to be any consistency in that regard.
I move amendment No. 4:
In page 11, between lines 2 and 3, to insert the following:“Equal pay for new entrants
11.The Minister shall, within three months of the passing of this Act, prepare and lay before the Oireachtas a report on the cost of and a plan in dealing with pay equalisation for new entrants to the public service.”.
We were told that amendment No. 5 was not relevant to the Bill, which points out the contradiction in the way section 39 organisations and their employees are treated. That is the explanation I was given by the Bills Office.
Amendment No. 4 requires the Minister to lay before the House a report and plan dealing with pay equalisation for new entrants to the public service. The issues and frustrations that are being articulated relate to the central issue that is driving opposition to this Bill and the deal that underpins it. There is a sense, as has already been articulated by Deputy Richard Boyd Barrett, that the Government does not wish to deal with it or does not have an interest in bringing it to a head. Addressing pay equality needs to be a political priority and that is why I am proposing this. I know the Public Service Pay Commission under Mr. Kevin Duffy is currently compiling a report. That is not due until next June. In the meantime, we have 14,000 teachers at primary and secondary level who have been recruited since 2011 on different pay scales, on a pay scale which one would really need a map to try to resolve. Many of those teachers will never get to the top of it. Many will be tens of thousands of euro worse off than they would be had they started employment in 2010. Primary teachers have worked 171 days for free, based on comparisons with those who began work ahead of 2011. That is nearly an entire school year. As Deputies have said, it makes the difference between being able to afford a house and not.
At second level, an area the Minister of State, Deputy Patrick O'Donovan, worked in, there has been a significant fall this year in the amount of people looking for what used to be the Higher Diploma in Education. There was a drop of over 50% in the Professional Master of Education, PME, applications, which is the new equivalent of the higher diploma. Are we serious as a country, when talking about STEM subjects, our presence in the world and the quality of our education system, when we are undermining that very system by making barriers to entry to teach that system through the different pay rates? Those that we educate and put time into, who are willing to give their patience and talents to teaching, are now going to England, the Middle East, Canada and Australia and we are not doing much to bring them back.
Three teaching organisations are very reasonable and have come together to work on this issue but there is equally an issue in nursing and health care. We are all dealing with issues where there are major vacancies in services across the country in occupational therapy, physiotherapy and speech and language therapy. There is a 97 week waiting list in County Mayo for access to occupational therapy because we cannot get it due to the unwillingness to engage with the pay equalisation issue and our reliance on HR policies that belong in the 1980s due to their lack of flexibility and lack of respect for people.
I will clarify that the agreement seems to state that there will be no further room for pay equalisation during the lifetime of the agreement but that is not in the legislation. If Mr. Kevin Duffy gives us a report, then there needs to be a commitment on the part of the Government to implement it and that the provisions contained in the report will be implemented in budget 2019. We are putting the Government on notice about that now. I get a sense that there is no political priority for this issue in Fine Gael which is why I propose this amendment to have a timeline to get a report on how this issue will be dealt with and to give a signal to every person affected by this within the civil and public service that as an Oireachtas we care about the situation and intend to resolve it.
I too am disappointed at the way in which amendments were ruled out of order. A number were amendments that I had tabled. I will speak to Deputy Dara Calleary's amendment since it can follow from one of my previous two amendments that had been ruled out of order. I support the amendment. It is not ideal because the ideal is to have pay restoration and equalisation. That is needed in education. If this amendment is accepted, a process can begin which would allow that to happen. I proposed in my amendment that equalisation would apply by 1 January 2019; therefore, if the amendment is accepted, there is an opportunity that could still be realised. Overall, the discrimination is extremely unfair against those entrants appointed on or after 1 January 2011. It affects staff morale and it is a group that is already disproportionately affected by the cuts that came in the recessionary budgets.
Like others, I have been contacted by quite a number of teachers who are affected. Some of the emails came from people appointed since 2011 who are directly affected, but a significant number also came from teachers who were appointed pre-2011, so they are not directly affected. They are all concerned about the unfairness in this inequality. Nobody wants to take industrial action because there is obviously a loss of earnings but there are measures that unions and their members cannot tolerate. I hope there will be a commitment to the process suggested and that it is not going to be an empty gesture but will lead to real progress on the matter. There is a crisis in teaching, in finding substitute cover in primary schools, cover for career breaks and for many subjects at second level. We need to encourage people to go into teaching and I know there are difficulties with it. I had a question for the Minister for Education and Skills on this matter which came from my direct experience in chairing a board of management of a primary school. We spent two days, one in August and one in September, trying to cover posts and we were back again in October for another day. We are still struggling due to the situation. I know the Minister, Deputy Bruton, might think that these shortages are sporadic but the facts are present in surveys and reports done by various unions.
Pre-service training for post-primary teachers, for example, of which I was one, is now two years long. Instead of the one year Higher Diploma in Education, there is now a two-year programme, the fees are between €9,000 and €15,000 and there is a loss of income for one year. As they are starting a year later, they are at an immediate disadvantage in terms of their position on the scale. It is a matter of equality, fairness and attracting people into teaching. We must value education because everything else in society will follow from education. We have to restore pay. Nobody goes into teaching to make a fortune. I certainly did not back in the early 1970s. One goes into teaching because of the regard and love one has for children and one's belief in the value of education. I hope the amendment, if it proceeds, will see a restoration of the fairness that has been lacking in the past few years.
I support Deputy Dara Calleary's amendment. A great deal of the focus in this debate has been on the past but if one wants to talk about education in a serious way, one has to talk about the future. It is the future of all children and young adults who are students. The world in which they hope to make their way has to be taken into account. The purpose of education is not only to allow them to develop themselves to the best of their potential but also to provide a mechanism through which they can hopefully contribute to the world, their country, society and community. What is amiss with the Government is that it is not up to speed with what is happening currently in the world of education. This morning I talked to somebody who was in the fourth year of degree studies to become a secondary teacher and is planning to go to England. That person feels that the remuneration will be better and that it will enable saving towards the purchase of a house and establishing a household.
Since my constituency, Dublin West, is such a huge area with developing schools and has an enormous number of children and young people, we employ thousands of teachers in the area.
However, it is becoming increasingly difficult to find teachers at second level who teach the specific subjects required. I say this with disappointment, but we are making very little headway in training people to teach STEM subjects, although there is a great deal of conversation in the Department of Finance about it being one of the key areas in the context of our future economic development and prosperity. There is, however, no sustained focus on it by the Government.
I hope and I am sure the Government will agree to the amendment because it just calls for a study. However, one point that I hope eases the Government's path to agreeing to it is that yesterday's Exchequer returns were very good overall on the tax side. They show the Government as having a bounty in the taxation received and, importantly, a significant underspend on the expenditure side. We have moved out of the crisis period and must act as though we know it. We can start to build infrastructure again. Our educational infrastructure is vital.
Many of those entering the teaching profession are transferring from other degree courses. Notwithstanding what their first degree is or a number of years spent doing other work, they are deciding they that would like to be teachers, which is great. There are also people in their 30s and 40s who are deciding to convert to being a teacher. However, the courses are quite expensive, particularly for those who are self-funding and in another job while getting ready to transfer. If they are full-time day students, they will not receive any tax relief. The same applies to those who are studying later in life to become doctors. We want and need people in our expanding population to pursue these areas of study.
Let us consider the Exchequer returns and population growth together. We have healthy Exchequer returns, thanks partly to the sacrifices everyone made. However, they will not stay healthy unless we invest wisely to protect our future. This involves investment in the built infrastructure. Most of the older schools should be rebuilt. The Minister has moved extraordinarily slowly on the school building programme and left me puzzled as to why he would delay the building of new schools. Staff and students should be able to feel proud of the school in which they are teaching or attending.
Mature students will require the standard starting salary. The Minister has an opportunity to avail of a review to accelerate and bring forward restoration. In turn, it would send a strong message of confidence to those studying for education degrees in various colleges and universities. I hope it would then see them staying in Ireland to contribute their skills in the economy rather than feeling obliged to move away.
We also have to bear in mind that rents are sky high. I hear about this issue all the time when talking to teachers in staff rooms, particularly in the greater Dublin area, but I also hear it in most city areas and large towns. Those starting a teaching career could also be trying to pay rent, while ultimately trying to fund an affordable house purchase. Essentially, the Government will need to address the salary issue. Otherwise, people will inevitably be poached by the finance and IT sectors in which, within a number of years of taking up a role in these fields, they can expect to earn significantly higher salaries than those of teachers. In Ireland teachers have traditionally started on relatively high salaries, but they then face a salary scale that extends over a long period.
I also want to speak briefly about the position of those being recruited at third level. I say this as someone who was a member of the Teachers Union of Ireland for approximately 20 years and worked for 20 years in the Dublin Institute of Technology. What is happening to assistant lecturers and those on contracts needs to be addressed. Many of them have studied to PhD level or are studying for a PhD, but they are not getting a fair deal. A study such as the one suggested by Deputy Dara Calleary would allow for these anomalies to be addressed. I appreciate that the Government may not be able to address all of them at once. However, looking to the future, it could start to address them on a much faster scale than that set out. I say this in the context of yesterday's Exchequer results and the likely end of year figures which are robustly healthy owing to additional corporation tax and tax receipts under other headings. It is foolish to allow the teaching profession to be demoralised when the Government could address this issue and set out a better timetable and timeline for pay restoration.
I would have liked to have supported Deputy Maureen O'Sullivan's amendment which I think would have dealt with this matter. Bar one or two Ministers, when asked about equal pay for equal work, Deputies on all sides of the Chamber all said they were in favour of it. If we are in favour of it, let us do something about the matter. I do not know if the Minister will accept Deputy Dara Calleary's amendment, but I hope he will. Perhaps he might indicate if that is the case because Deputy Dara Calleary is just looking to have a report commissioned and laid before the Oireachtas on the cost and formulation of a plan to deal with the issue of pay equalisation for new entrants to the public service.
What is ironic is that we had the biggest turnover of new Deputies after the general election in 2011 when I think there were approximately 70 of us here for the first time. If someone had told those 70 or so Deputies that they would be earning less than those who had been in the previous Dáil, it would not have been tolerated. However, in one minute Deputies will come into the Chamber to vote against pay equalisation for teachers and nurses, while at the same time not tolerating such a move for themselves. That is hypocritical of them. If we are to deal with this issue, let us deal with it.
As I said, I hope the Minister will accept the amendment. It is irrelevant whether he does because it will be passed if pushed by Deputy Dara Calleary. I hope it will be pushed by him because the Opposition has already indicated that it will support it. It would send a message from the Government benches if it were to support it. No one is saying the Minister has to bring about pay equalisation in the morning, but he should give some indication to newly qualified teachers and nurses that he is listening to them by telling them that the Government will come back within three months with a report on how much it would cost to pay them the same salary as someone who started pre-2011. Not only would it tell us the cost, but it would set out a plan for how the Government would achieve pay equalisation.
If he does not do so, he will be headed for more trouble down the line.
I fully support the amendment tabled by Deputy Dara Calleary. It is regrettable that we have to go to these lengths to raise policy issues and give this House an opportunity to express what I expect is a majority view. If we were permitted to express that view and a motion were tabled calling for the immediate restoration of full pay for new entrants, it would undoubtedly be carried by the House. One has to ask, therefore, why this democratic view is not allowed to be expressed here this evening in this debate. We are forced to abide by the Standing Orders that apply, which, as other Members have said, are extremely restrictive.
It is important to consider the backdrop to this debate. During very difficult times, when the country was in very severe economic difficulty, decisions were taken to introduce various austerity cuts. There is a very strong view that those cuts were introduced in a very unfair manner. Very often, the people who could least afford them were made to bear them. A cohort in comfortable financial circumstances was not affected to any great extent by the additional charges and taxes introduced in the austerity years.
A major embarrassment for much of the establishment during the time of the FEMPI cuts was the fact that so many of them went along with the idea of imposing even greater cuts on young public servants. In many ways, that was a shameful act. It was shameful on the part of the Government and also some of the social partners. It should not have happened. As a society, we are now paying a very significant price for it. A very large number of the younger generation feel very much let down and abandoned by their elders. Not only have they been saddled with very significant debt for the foreseeable future, not only was the housing situation brought to crisis point, where it continues, and not only do we not have properly funded public services but it is also the case that a cohort of younger public servants are expected to survive on significantly lower pay than their elders even though they are essentially doing the same work. To a large extent, they have the same living expenses, if not higher. This was a shocking act of betrayal for the younger civil servants and public servants generally. It is one reason so many people in their 20s and early 30s are working in London, Canada and Australia. They feel very alienated by the actions of the establishment in this country. They feel very let down and abandoned. That is a very dangerous situation for the country to be in. I stress to the Government that it and the establishment are obliged to make up to those people and right the wrongs that were done to them.
Unequal pay is a glaring anomaly. It is a glaring example of unfairness imposed on the younger generation and it continues under this legislation and the public service stability agreement. In normal circumstances, this should be very welcome legislation. It should be about reversing the FEMPI cuts in a fair and balanced manner. It does not do so. The public service stability agreement accords only a certain amount of priority to people on low pay. The unwinding of the FEMPI legislation for people earning in excess of €70,000, up to €150,000 and more, is happening quite quickly. On any grounds of fairness, there should be a longer delay in restoring pay for people at the higher end in order to speed up the restoration of pay for people at the lower end. Included in that, of course, should be the younger public servants.
This is not a good news story because it continues to leave behind and compound the wrong that was done to younger public servants. This agreement should be welcomed by all the unions representing public servants but it is not. The Minister is trying to implement a separate set of conditions for those who are not covered by the pay deal. We still live in a democracy and people should be able to express their view on whether they support a pay deal. Whatever about people who vote against a pay deal not being covered entirely by the provisions of the deal, the Government is going much further. It has very much set out to punish those people and unions that have not accepted the pay deal. That is completely unacceptable.
The unions did not refuse to sign up because they wanted more money. That is a very important point. It was not the reason the three teacher unions and Unite voted against the pay deal. They refused to sign because they wanted a fair deal for new entrant colleagues. That is a very legitimate demand to make. We have all talked to teachers all over the country who have made the point to us that they could not possibly continue to work alongside their younger colleagues and sit in staffrooms with them while they have been sold down the river by this pay deal. In fairness to and in solidarity with teachers' younger colleagues, the teacher unions voted against the pay agreement. They were right to do so because the treatment of young entrants is absolutely indefensible. It would have created all kinds of difficulties, strains and stresses within workplaces if the older teachers had continued to abandon their new entrant colleagues.
This legislation leaves over 50,000 so-called "new entrants" on unequal pay scales with nothing but a promise of a review of their circumstances. A couple of meetings have taken place but they have not really got anywhere, as far as I can see. It is not adequate to respond to younger people in this way. They were very badly treated during the austerity years and there is now a need to make up for it.
The ASTI, the TUI, the INTO and Unite have rejected this deal. The teacher unions have specifically cited pay equality as a reason. It is not because they are greedy or looking for more. It is estimated that a teacher appointed in 2011 has already lost over €26,000 in earnings due to the two-tier pay scale. That is indefensible. We should not continue to stand by it. This matter will not be addressed regardless of whether those concerned are party to the pay deal. It is important to point that out.
It is simply not good enough to attempt to plámás new entrants by promising them an examination of the pay scale within 12 months, particularly when the examination will apply only to new recruits covered by this agreement. One has to ask why young entrants should be forced to wait a further 12 months to even begin having the circumstances examined.
The affected generation is constantly forced to bear the brunt of its elders' mistakes.
Now they are expected to continue to work on an unequal footing with their colleagues in order that the Government can claim that it has unwound the FEMPI legislation, but that is not the case. It is only the beginning of the process of addressing the impact of the FEMPI legislation on those affected by it.
It is all very well to say the Government has made savings in this area, but we are paying a very big price for it. It is only a couple of years since we had such a glut of teachers that there were not enough jobs for the number of qualified teachers available in the country, but now the position has changed completely. There is a serious shortage of teachers across the various sectors. We hear school principals talk on a regular basis about the difficulty in recruiting substitute teachers or say that even in cases in which there is a permanent post available the level of interest in applying for it is very low. We also regularly hear complaints from school principals that three, four or five members of staff have taken a career break and gone to work in Dubai or Abu Dhabi simply because they cannot survive on the reduced pay scales. We have an entire generation of teachers who are affected, but other public servants are also affected. They can no longer have the aspirations and dreams others have and that their parents would have had in getting to a point where, having qualified for a professional job, they are doing the job but find the remuneration is not adequate to enable them to live a reasonable life. The housing crisis plays centrally into this, but even allowing for it, it is extremely difficult for young public servants who are forced to accept unequal pay to have a decent lifestyle which would them to aspire to owning their own home or even renting a decent house, starting a family and doing the things their parents did. They can no longer aspire to doing the same things as them.
The actions of their elders have alienated an entire generation of younger public servants, which is shameful. What we should be doing as a matter of urgency to establish our faith with that generation of young people is moving immediately to restore the pay cuts they were obliged to suffer and which they continue to suffer. It is wholly inadequate to suggest to them that there will be discussions on the matter in a year's time and that we will consider how it is to be done. For that reason, I very much support the amendment, but we should be going so much further. I believe the democratic will of a clear majority in the House favours a full restoration of pay for those who are forced to continue on unequal pay scales.
I have already spoken about the issue of pay inequality on the amendment that was ruled out of order. I am aware that quite a few teachers and other public servants are watching this debate and it is worth explaining to them because they probably do not know that our amendments and those of others - Deputy Maureen O'Sullivan, Solidarity-People Before Profit, Deputies Clare Daly, Mick Wallace, Joan Collins, Seamus Healy and others - were ruled out of order. They sought to end pay inequality. Therefore, we have been forced to table secondary amendments in an attempt to get around the provisions that allow amendments to be ruled out of order on this and many other issues dealt with in the recent Finance Act. We have had to resort to requesting reports to look at an issue because that is the only way we can have the matter discussed. Those watching must understand the ludicrous way in which Parliament works and that in many cases we cannot table amendments to legislation on the matters that really count for workers and other citizens.
To put it in very simple terms - it is an indictment of the regression in society that Fianna Fáil, Fine Gael and the Labour Party which all variously supported the FEMPI legislation passed legislation that will mean that new entrants to teaching, nursing and the public service will work longer and harder for less and that they will receive pensions of less value. That is the gift Fine Gael, Fianna Fáil and the Labour Party have bestowed on future generations, which is shocking when one thinks about it. Our bequest to future generations is that they will be worse off. They will work longer and harder and when they retire which will be later than previous generations, their pensions will be worth less. That says it all about the regressive, backward-moving direction of society.
One of the things that has not been mentioned but which is worth saying, given that Deputy Jonathan O'Brien referred to how angry Deputies might be if there was to be pay apartheid for them, is that in a supreme insult to the post-2011 and 2012 generation Deputies, Ministers and Taoisigh who were elected prior to 2011 will enjoy far superior pension entitlements than those who were elected afterwards. The Minister should not get me wrong; as far as I am concerned, the pensions and pay of Deputies, Ministers and Taoisigh should be further reduced, but it is very telling that the political architects of the unprecedented crash in the economy which inflicted a decade of austerity which, in the case of pay equality, will mean that a younger generation of public servants will feel the impact of their crimes for the rest of their lives, unless pay and pension equality is restored, insulated themselves against the impact of the measures taken, which is absolutely disgusting. I have had to use that word twice in this debate, but it really is and people need to know because I suspect they do not. Some Ministers and Deputies are still sitting in this House who, because they happened to be elected before 2011, will be insulated against the pension reductions that were rightly imposed on the political class after 2011. They are the one group of people who deserved to have some cuts imposed on them after the crash, but those most responsible insulated themselves and bestowed all of this degradation in the value placed on the work of a younger generation who will work longer and harder for less and who when they retire which will be later, will receive pensions of less value. It really is utterly shameful.
I will conclude as I made most of the broader points in my previous contribution. That generation should not forgive the people who have done this and are continuing to do it to them. Their lives and even the value placed on their professions have been degraded as a result of the changes made which I do not think many of them will forget. It was noticeable at the demonstration outside last week of the young teachers from the ASTI, the TUI and the INTO just how angry and politicised they were by this injustice.
What is terrible is that now we are in a so-called recovery, but there is no acknowledgment or apology from the Government to the effect that what is being done to the people in question is wrong. It simply will not admit it; rather, it tries to suggest the starting salary of teachers is actually improving, that it is not bad and so on. It is trying to gloss over the fundamental injustice, that is to say, the people in question will forever and a day be on lower pay scales than those who entered before 2011. That is the position, unless it is changed, something to which the Government will not commit. At least, it could apologise and acknowledge that it is an injustice and promise that it will get rid of it.
The Minister of State, Deputy Patrick O'Donovan, said it would cost €1.4 billion to do what some of us were proposing, that is, to get rid of pay inequality and ensure the full restoration of pay. That is less than the potential increase in expenditure if we meet the 2% requirement under the permanent structured co-operation agreement the Government is trying to ram through this week. Our current level of military expenditure is €900 million. To put it another way, military spending accounts for 0.5% of GDP. Under the deal the Government is trying to ram through this week, that figure will have to move progressively towards 2% of GDP. By the way, we cannot borrow to finance that spending. It will mean quadrupling military expenditure to a little under €4 billion. The precise figure is €3.6 billion. We can afford to support the military industrial complex and the armaments producers in Europe and sign up to it without much of a debate - the Government is trying to push it through under the radar - yet we cannot afford to provide for pay restoration for new entrant teachers. It is simply not true to say we cannot afford it; it is simply the case that the Minister's priorities are wrong. He believes building up the European military industrial complex and all of the military producers that lobbied the European Union on the PESCO arrangement are more important than restoring pay equality for young teachers, nurses and public servants. That embodies the distorted priorities of the Government.
Before I call Deputy Paul Murphy, I reiterate what the Ceann Comhairle said. The provisions in Standing Orders replicate the Constitution in the context of Members, other than members of the Government, introducing amendments that would impose a charge on the Exchequer. There is no prohibition on them debating matters related to amendments that have been ruled out of order. They can be debated on the question that the relevant section stand part of the Bill. That is what Deputy Richard Boyd Barrett has just done. Contrary to what he said, Members can make a contribution.
That is great; I have a copy in front of me too. It states clearly that legislation cannot be enacted that would have the effect of imposing a charge on the people or the State without the consent of the Government, that is, on Final Stage. Standing Orders prevent us from even bringing them forward on Committee Stage to be discussed or debated to enable political pressure to build on the Government. It is an urgent democratic reform that needs to be addressed, not to mention the matter of the extreme use of the money message provisions by the Government to stop legislation such as the Cannabis for Medicinal Use Regulation Bill proceeding to the next Stage.
Agreed. I support the amendment simply because our amendments and others that would have the effect of undoing pay discrimination and pay inequality have been ruled out of order. The amendment which calls for the presentation of a report is the best we can do. I put it to the Government that either way this amendment will be passed. The Minister will have to bring forward a report within three months. It would want to include a concrete plan for a quick ending of pay inequality or the Government will meet the wrath of many teachers, nurses and public sector workers who will not accept ongoing pay discrimination.
It is not surprising that the Labour Party would like us to look to the future, considering the role it played in the past in the implementation and standing over of the horrific creation of an edifice of pay inequality. It is an attempt to undermine solidarity between workers who are doing the same work but who happened to enter the workforce at different points.
A woman by the name of Ciara Kinsella wrote an article in thejournal.ieexplaining why had taken strike action with the ASTI. It reads:
IN MY SCHOOL, just like in every other school around the country, there exists inequality.
Not inequality based on gender, although that fight is still on-going.
A new inequality has emerged – pay discrimination for younger teachers.
Since I began my first teaching job in 2007, I am on what is called the ‘pre-2011’ teachers’ pay scale, while my colleagues who began teaching ‘post-2011’ are on a much-reduced new entrants’ salary scale.
I share the same duties and responsibilities as these new entrants, and we are both held equally accountable. Yet there will be a six-figure difference in our lifetime earnings.
It is unacceptable and wrong to accept this situation in any profession. Therefore, this autumn, as a member of the ASTI, I will be voting ‘yes’ to industrial action, up to and including strike action, to put an end to marginalisation and pay disparity.
We are not looking for a pay increase; we are demanding a pay restoration for our most vulnerable colleagues.
For the first time in six years, we have been given the opportunity to stand with our lesser-paid colleagues and show intergenerational solidarity.
That sums it up. It sums up the attitude of the vast majority of workers in the public sector, whether they are pre-2011 or post-2011 employees. They do not accept the division the Government is attempting to create through this pay discrimination. They reject it and see it for the danger it is. They would like to have the opportunity, without all of this draconian legislation, to struggle against it. It is worth looking at. When these points are made, Government Deputies try to retort by confusing the issue and talking about things that are different. There are different pay scales. The new entrant teachers will never reach the level of the equivalent earlier entrant teachers. The same applies in other parts of the workforce also.
The money involved is astounding. It amounts to a six figure sum. Over a 40-year period a primary school teacher could earn up to €200,000 less. A secondary school teacher could earn up to €300,000 less in the same period. Therefore, a phenomenal amount of money is involved.
As the new pension arrangement comes into being - it is based on lifetime earnings - it will hit people again. There will be a double impact, whereby people's pensions will also be affected. It is scandalous that the Government wants this to become a permanent feature of the landscape and it will spread. It is spreading already to some degree to the private sector. This pay inequality is based largely on age and its purpose is to save money and undermine the trade unions and collective solidarity.
I thank all Deputies for their contributions on this important section. I will make a number of overall points about the Bill that are pertinent to the section being debated. The first point is broad.
The Bill looks to deliver wage restoration for the overwhelming majority of public and civil servants.
By the end of the lifetime of the agreement, 90% of State employees will have their wages restored to pre-crisis levels. All of the public service trade unions completed a ratification process in respect of the wage agreement and it was accepted by a large majority of those who voted, although not all the trade unions accepted it, as a number of Deputies pointed out. As a result of ratification, the agreement is being implemented in this legislation.
The amendment is exciting a great deal of interest because it addresses an understandable concern. However, it is worthwhile to put in context the overall importance of the Bill and the progress it will make in dealing with the restoration of wages, addressing the legal imperative facing us and trying to do so in an affordable and fair manner. As Minister for Public Expenditure and Reform, I must consider that any move made in one part of the public and Civil Service results in immediate calls being made to have the measure in question extended to everyone else who works in the public service. I have shared a number of times with the House figures showing what the change in salary scales proposed to meet the definition of equality for those who are campaigning on this issue would mean for the teaching profession alone. The cost for education would be €70 million, while the cost of scaling out the increases to the entire public and Civil Service would be €200 million. To put the latter figure in context, it is higher than the cost of a 1% wage increase for every State employee.
The nub of the issue is that the changes made in salary scales gave the employer, namely, the Government, the ability to hire more public and civil servants and we have hired more teachers and front-line public servants in virtually every part of the public service. The changes in salary curves and to employees' position on the salary curve gave the State the ability to invest more in front-line services. Any change in the current position will have significant consequences for investments that we make elsewhere.
One of the particular aspects of my job is that while Deputies can make arguments on particular sectors or policy issues, I, as the Minister for Public Expenditure and Reform, must find a way to pay for everything. If I cannot do so, I must find ways of paying for nearly all or most of what the Oireachtas or citizens want. I have not been able to meet the demands placed on me by those campaigning for full pay restoration because of its cost and the consequences it would have for the entire civil and public service. In addition, I cannot provide for full pay restoration while meeting many of the other demands to improve wages for everyone. That goes to the heart of the challenge we face.
I appreciate and I am aware of the scale of feeling among those who are affected by this issue and on whose behalf the trade unions representing them have advocated. In recognition of this, we agreed a process to address this matter in the public service stability agreement. This process has begun and my officials have met representatives of the teaching unions in recent weeks to scope out the different issues involved and consider if or how progress can be made on this matter during the lifetime of the agreement. The Government is entering this process in good faith, as has been acknowledged by those with whom we are engaging. The costs and consequences of any change in this area are significant.
I reiterate that a process is under way with the teaching unions as part of the agreement ratified by the majority of public servants. I am obliged to complete this process with the trade unions to ascertain whether progress can be made on this matter. However, I cannot give a commitment to the House tonight that this will happen because a process is under way. We must await the outcome of the negotiations when we will learn what will be the costs, if these costs can be reconciled with the agreement we have and whether I can make a recommendation to the Cabinet and, ultimately, the Oireachtas about what to do. At this point, the process has only begun and it will take time to complete. When it is complete we will review the position and decide whether the Government can respond on the issue. Everything I say must be considered in the context that a process is under way and I can make a recommendation as to whether any change can be made only at the end of that process.
Given that Deputy Dara Calleary's amendment refers to costs and a plan without obliging me to state I am in a position to implement pay restoration, I will accept it. If there is a process under way on this matter with the trade unions, it is appropriate that at some point in the discussions, I should outline more fully to the Oireachtas what are the consequences of dealing with this matter and what issues will arise as we embark on the process to which I have committed in the public service stability agreement. I accept the amendment on the basis of the range of opinions articulated by Deputies. In doing so, I emphasise that this does not prejudice my ability, acting as a Minister on behalf of the Exchequer, to reach an agreement, if any. At this point, given the costs and consequences that arise in respect of this issue, I cannot say whether that will happen. If I were able to do so, we would not have a process in the first place. We are engaging in the process for these reasons. Given the interest in the matter, I will be pleased to report to the Oireachtas, perhaps through the Joint Committee on Finance, Public Expenditure and Reform, and Taoiseach, where we stand and the broader costs and consequences involved in dealing with this matter.
The first thing that young teachers, nurses and other public servants should take from the Minister's response is that they should continue to campaign on this issue because their campaign is working. It is clearly the pressure of the ASTI, the TUI and the INTO, in coming together to oppose the latest deal which does not fully restore pay or deal with pay equality, that has forced the Government to acknowledge the depth of feeling and accept an amendment that at least proposes to examine the issue.
Action works. That is the lesson. The fact that the unions, driven by their grassroots, have come together in a united front against this is having an impact. The lesson is also for the rest of the trade union movement, namely, that they need to stand up against this kind of stuff and not accept there is no alternative to the partial half-hearted restoration and failure to deal with these issues the Government initially proposed. The Minister should honestly answer the question I posed.
I will give him a few other suggestions. If the cost of pay equalisation for new entrants into teaching, nursing and the public service generally is €200 million, how can the Minister, Deputy Donohoe, not make a commitment on €200 million when he will propose on Thursday of this week that a commitment be made to increase substantially the proportion of national income that is spent on weapons? We do not know the cost but the Government wants Members to vote through the agreement in a week. This is an issue that has been debated and is relevant. The Minister asked where can we get the money. The Government states we cannot make a commitment on getting the €200 million necessary for pay restoration but wants the Dáil to make a commitment this week to increase annually military spending in real terms towards a 2% of GDP target. That will involve substantial and dramatic increases far in excess of the €200 million it would cost to restore equality for teachers, nurses and other public servants. How can the Minister give a commitment on one when he will not give a commitment on the other? I note the issue of pay equality is a far greater priority for the people, particularly young people in those professions and in the public service, than is boosting the profits of the European arms industry.
Another suggestion is a financial transaction tax. The estimated yield involved has increased because financial transactions have dramatically increased. I refer to the culprits for much of the crash that led to this pay inequality in the first place. Why will the Minister not levy a 0.1% tax on financial transactions? That would raise €500 million a year or more than twice what the Minister needs in this regard. Why will the Minister not even entertain it? The Minister could do that. The losses brought forward mean the banks are making big profits. AIB is one of the most profitable banks in Europe at present and is paying zero tax because of tax loopholes. What about closing that one down? That would give us the €200 million.
What about a wealth tax on the exponential growth in the wealth of the top 5% in Irish society? Wealth taxes are not unusual across the rest of Europe but in Ireland, of all places, there has been spectacular growth in household wealth. It is has increased by 49% since 2012 and the overwhelming majority of that is concentrated in the hands of the top 5% or 10% of the population. The Minister will not even consider a wealth tax and states it is too difficult to impose. It is not difficult to cut the pay of new entrant teachers but apparently it is complex to tax the extraordinary wealth of the richest 5%.
Another suggestion for the Minister is to take a little extra from the corporate profits that have more than doubled since 2008. A sum of €200 million is a drop in the ocean compared with the €70 billion plus in extra profits they are making now. There were €149 billion in aggregate profits in 2015, up from approximately €70 billion in 2008, on which they are paying on average 6% real effective tax. Could the Minister take a little bit more off them? That €200 million would be a drop in the ocean compared with that but the Minister has resolutely refused to consider that. Ultimately, €200 million is a small price to pay for pay equalisation and to provide fairness to new entrants in the public service including teachers, nurses and other public servants.
I welcome the Minister's acceptance of the amendment. The process he speaks about is important. It is being carried out through the Public Service Pay Commission, which was established to address all these issues in a constructive way. It was established through the confidence and supply agreement between both of our parties.
I note the qualifications and I respect them. I am confident that the commission will look at this. It is the first time we have a process. This issue has been raised in the Oireachtas consistently since 2011, not only in the past few weeks. It is important that the Oireachtas plays some sort of role as that process comes to a completion.
I had another amendment on this section that was ruled out of order. Can I speak to that amendment now or does the Acting Chairman want to deal with this amendment?
The Minister has made a sensible decision to accept Deputy Calleary's amendment as we need the information. While we need the facts and figures, as I stated before the Minister, Deputy Donohoe, came into the Chamber, we also need to look to the future and not just to the past, particularly in areas such as education and health.
The key point in education is we are beginning to experience a severe shortage of teachers. With rents now being so high, both in the greater Dublin area and in most large towns and cities as landlords have sought to maximise the returns from their rents, particularly for new tenants in the market, I constantly meet people who are taking up jobs on the fringes of Dublin, including in my own constituency in west Dublin, who are commuting on a daily basis to home because they simply cannot afford the rent. This is true in all the other cities. Because there is such population growth, which is wonderful, we need more teachers. We also are now mainstreaming children who have a disability in primary and secondary schools. That is a really positive development for this country that will require significant extra staffing. Unless the Minister accelerates the pace at which pay restoration will be provided, I fear that many of those teachers will go abroad.
Previously I raised with the Minister the issue of staff in hospices. I am not talking about a significant number of staff but these are employees whose pay is parallel to that of public servants. The Minister undertook earlier to review this issue. He stated he would be looking at it in the Department and I appreciate him doing so. It is really difficult for the hospice movement and other such section 39 organisations. I had it down in my notes to talk about this. These are public servants. For the information of Deputy Calleary, these are employees who are paid out of the public purse. Those who are working in the HSE began to get pay restoration some months ago. Because the staff come freely over and back between the HSE and the hospices, and almost all hospice staff in medical, nursing and other disciplines are recruited from and on similar terms to the HSE, there will be a serious problem in respect of recruitment.
I hope that the Minister will look at this carefully and work on a solution although I am conscious of the fact that none of the potential solutions are particularly easy.
During Question Time with the Minister recently I pointed out that four banks, including Bank of Ireland and Allied Irish Bank, have €5.5 billion of deferred tax assets between them. On the basis of yesterday's Exchequer figures, the Minister appears to have some room for movement, which I am sure was welcome news on what was a difficult day for the Government. Alongside that, we have a situation now whereby the banks are very profitable again. They are including all of this in their briefing notes to investors and to the markets and so on. They have €5.5 billion of deferred tax assets, that is, losses that they will claim against their profits until such time as they are exhausted. I have proposed to the Minister that the banks should not be allowed to do that at a time when the economy needs more funding for both current and capital investment. It is also an offence to taxpayers who bailed out the banks that they should be boasting in notes to investors about the value of these deferred tax assets, which are very significant. The Minister wants to put more money into key areas like education, health, housing, social services and infrastructure. He cannot allow the banks to get away scot free in terms of contributing corporation tax.
I am sure the Minister must have been shocked by the statement from the Revenue Commissioners last week about up to ten very large companies. I do not think the statement was referring to the banks because it related to a period before the banks began to return to profitability. That is only happening now and that is why we are raising it now. Notwithstanding the bank levy, it is really wrong to let them get away with it. It is something that the Minister could address and some of that money could be used to provide additional funding for education, health and other areas of badly needed social provision. Our increasing population and the fact that our economy is growing means that we need to invest.
The best thing in a growing economy is to see wages growing strongly. In that context, I would strongly recommend that the Minister reintroduces social partnership. I wish to refer to the teacher unions and the good work that their members did during the recession. In that context, Fine Gael should have a change of heart and positively embrace social partnership and collective agreements that provide for wage growth as well as for agreement on social investment and social provision. Fine Gael should also acknowledge the status of people who work in the public service. It is true that entrepreneurs work hard but so too do public servants. We have an economy that is a mixture of public and private and we want it to stay like that.
I will be brief. I welcome the fact that the Government will have to come back to the House and present a report which will give us an opportunity to continue the debate. It will also give young teachers and their unions an opportunity to exert more pressure on the Government on this issue. However, I want to comment briefly on a point that the Minister made in his speech which has not been challenged yet in this debate but which should be challenged. The Minister essentially said that while equal pay for equal work is a good idea and something to which we should aspire, it is something that he feels we cannot afford at the moment and he trotted out the figures: €70 million for the education profession and €200 million across the public service. As Deputy Boyd Barrett has said, the money is there if the Government is prepared to go after the wealth that is held by the wealthy and the elite in this country. I agree with that point entirely but there is another point to be made here. If a Government Minister can stand up and say that we cannot afford equal pay for work of equal value, what will he say next? Will he say that human rights are a good idea but we cannot afford them or that democracy is a good idea but we cannot afford it? Either one believes in the principle of equal pay for work of equal value or one does not. Clearly, on the basis of its comments and actions, the Government does not. Many young teachers and young public sector workers will draw political conclusions from this. If Fine Gael Ministers and the capitalist system they defend say that we cannot afford to pay equal pay for work of equal value, a lot of people will draw the conclusion that they cannot afford to have Fine Gael in government or the system that it defends.
Before we move on, I tabled an amendment that was ruled out of order but Deputy Burton made reference to it a moment ago. The amendment relates to section 39 organisations including hospices and other care organisations where there is a complete disparity of treatment. Staff in those organisations experienced pay cuts in 2008 and 2009 equivalent to the pay cuts that would have applied to them had they been working in State organisations. Now that we are on a path to pay restoration, however, similar restoration is not been given to them. This is putting section 39 organisations which deliver vital services under enormous pressure in terms of their staff. We have a situation where the HSE is trying to poach staff from these organisations to make up for the gaps in its own service. I know the Minister is working on it and that a report is being prepared but I want to emphasise that we must address this issue. We cannot expect section 39 organisations to do the work while nobbling them with these rules.