Tommy Broughan (Dublin Bay North, Independent)
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I am delighted to have this brief opportunity to speak on the important issue before us, namely, pay inequality in the public service. Of course, I voted against the blanket bank guarantee in September 2008 which led to the series of shocking cuts and unfairness within the public sector and caused serious damage to the services offered to the Irish public. In November 2011, I voted against the renewal of the bank guarantee. From 2011 on, budgets continued to slash public servants' pay and significantly impacted upon those on lower pay scales in particular. The Department of Public Expenditure and Reform released a report in March 2018 which showed that lower-paid staff in the public service are paid considerably less than their counterparts in the private sector. The report also found that over 60,000 people had been affected by the lower pay rates introduced for public service personnel recruited after 2011. There has been damage from decision made by the then Government in late 2010 to reduce pay rates for new entrants to the public service, including in the context of the capacity of the service to recruit and retain staff.

The policies followed by the Government in response to the financial crisis in 2008 added huge banking debts to our national debt. These policies were introduced by the then Government of Fianna Fáil and the Green Party, supported by Deputy Finian McGrath and Fine Gael, the members of which sat on these benches at the time. The years of austerity over the lost decade since have had an enormous impact on the salaries of public and civil servants at all levels as massive unilateral pay cuts were combined with significant increases in charges and taxes. There were four waves of cuts after 2008, including by way of the Financial Emergency Measures in the Public Interest Acts, the first of which imposed an 11-month pay freeze. All previous pay agreements were abandoned.

In March 2009, the pension levy on public servants was introduced and their pay was deducted, causing a drastic reduction in gross pay. The second FEMPI Act in December 2009 introduced a comprehensive pay cut from 1 January 2010. Following these cuts, a clerical officer in the civil service suffered on average a pay loss of €1,500 gross per annum. That was followed in 2013 by the Haddington Road Agreement which introduced further cuts in public service pay and pensions.

This agreement introduced increment deferrals, overtime rate changes and changes in flexible work practices. As well as these four waves of cuts, the Government also restructured two levies, the income levy and the health levy into the universal social charge. It is a shocking history of austerity that has impacted very severely on our public servants and the services they offer to the public.

During these years successive Governments cut public service employment. Overall, there was a 10% reduction in jobs across all the public sector. These cuts have resulted in huge income losses for all public and civil servants, but particularly those on lower incomes. For example, teachers who entered the profession after 2010 are on completely different pay scales to their colleagues even though they have the same duties and responsibilities. Budget 2011 slashed new teachers’ pay by 10%. In 2012, most pay allowances above the basic salary scale were abolished for those entering teaching.

While the Association of Secondary Teachers of Ireland, ASTI, has made some progress in having these cuts restored, it remains that new and recently qualified teachers are on an inferior pay scales. The joint statement by ASTI, my own union, the Irish National Teachers' Organisation, INTO, and the Teachers' Union of Ireland, TUI, about six weeks ago rightly concluded that pay inequality is having a divisive and damaging impact on teaching and education. The presidents of the three unions pointed to increasing evidence of a brain drain from teaching as well-qualified young teachers are being offered full salaries and long contract jobs abroad. As a result in the science, technology, engineering and mathematics, STEM, subjects especially, schools are experiencing serious difficulties in recruiting qualified teachers. Since February 2011, graduates who entered teaching are on reduced pay and their projected income losses over a 40 year career, compared to colleagues who began teaching before 2011, range from €70,000 to €100,000. The three unions' call for equal pay for equal work is unanswerable in fairness and justice and the Government must move urgently to completely right this wrong imposed in 2011.

The damage to public services over the last decade by the FEMPI legislation cannot be underestimated. During the period from 2008 the public service was slashed by over 10% from 320,000 to a low of 288,200 in the last quarter of 2013. Much of this resulted of course from a moratorium on recruitment and promotion in the public service introduced by the Fianna Fáil-Green Party Government in March 2009. The impact of such a dramatic slashing of public services, education, security, namely, An Garda Síochána and the Defence Forces, the public service itself and in local authorities created severe pressures on our public infrastructure which persists down to today. Many of the recent controversies that we have discussed day in, day out in this Chamber, from housing to health services, all go back to the outrageous cuts and the slashing of public services staff and the failure to recruit key staff. Recently, for instance, we discussed assessments of children with disability, early intervention assessment. That comes down to what the Minister of State's party, Fianna Fáil and the Green Party, supported by people such as Deputy Finian McGrath, did over this lost decade.

The Department of Public Expenditure and Reform should immediately commit to full pay restoration for the 60,000 public servants, including teachers, who have been affected by the lower pay rates introduced for public service personnel since 2011. The cost has been estimated at €200 million to end this two-tier pay system which has existed for nearly eight years and which affects almost 20% of public service staff. This cost equates to roughly €3,301 on average for new entrants on top of exiting benefits under the Public Service Stability Agreement. The health sector accounts for around €84.3 million of the estimated €200 million incremental adjustments needed. The education sector pay equality bill would be about €83 million, with around € 59 million for teachers. The similar cost for civil servants would be almost €16 million with an additional €12 million for the justice and defence sector and about €4 million to achieve pay equality in local authorities.

The recent Department of Public Expenditure and Reform report of course referred to the merging of new scales and the existing scales under Haddington Road which equated to adding a lower two points of the new pay scale to the existing scale and so implementing a new larger pay scale. The impact of this has produced an extraordinary unfairness where people doing the same work are not being paid the same. The general secretary of the Irish Congress of Trade Unions, ICTU, Patricia King, correctly called for an urgent pathway to remedy this wrong.

It seems ironic that the continuing refusal of the Government to address this issue coincides with a Cabinet decision to establish a so-called rainy day fund. I asked the Tánaiste, Deputy Simon Coveney, and the Taoiseach about this earlier. Our pension fund, which was initiated by the then Minister for Finance, Charlie McCreevey, was robbed and decimated by Fianna Fáil, Fine Gael and their allies in the last decade. I always favoured a sovereign wealth fund on the lines of Norway or the Gulf States for the long-term welfare of our people. I am also well aware that the NTMA is refinancing huge trenches of our national debt of in excess of €100 billion in 2018 and 2019. However, setting aside €500 million a year for the next three years, plus €1.5 billion from the Ireland Strategic Investment Fund, which is our sovereign wealth fund, seems bizarre in the context of rolling back FEMPI and creating a modern well qualified and focused public service, not to mention addressing escalating hospital waiting lists and addressing the current housing emergency.

The Committee on Budgetary Oversight has discussed this at length. The Minister appeared at the committee where he spoke about the rainy day fund but he could not explain why he needed it, other than that the European Union is asking us to establish it. He could not explain if it was an emergency fund for the bad weather period we had with flooding and snow, for instance, or if it was a counter-cyclical fund. We still do not know its purpose but the Cabinet has decided to go ahead with it nevertheless. We know that next year's fiscal space should be €3.2 billion but this has been seriously eroded by earlier spending commitments after 2018. The removal of another €500 million for the so-called rainy day fund makes the task of addressing pay inequality and other critical issues significantly more difficult. Full pay restoration for our public servants must be a key priority for Budget 2019 and the Minister for Finance should factor the additional necessary €200 million into the budget arithmetic in the summer economic statement which we expect in the next three or four weeks.

Mattie McGrath (Tipperary, Independent)
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Pay inequality in the public service has generated considerable public debate. As the Minister has often noted, the Public Service stability Agreement 2018-2020 provided that an examination of remaining salary scales issues in respect of those recruited after January 2011 at entry grades would be undertaken within 12 months of the commencement of the agreement.

The Minister, Deputy Donohoe, also says that graduates entering the public service today do so on a competitive salary. For instance, a teacher recruited in 2018 will start on just under €36,000. This will rise under the current Public Service Stability Agreement to nearly €38,000 by 2020. Across the labour market as a whole, the average starting salary for graduates is €28,554, with 40% earning less than €25,000. Some of these figures are hotly contested.

I refer to the conclusions of the Public Service Pay Commission report:

Having regard to all of the circumstances now prevailing the Commission has concluded as follows:1. A critical factor in any future pay agreement and/ or unwinding of FEMPI will be the State’s ability to pay in the context of competing pressures on the public purse.

Having reviewed the evidence presented to us in relation to pay levels and pay movements in the wider economy, we are of the view that there is a basis for parties to enter into negotiations for a further collective agreement to extend the Lansdowne Road Agreement.

The Lansdowne Road agreement is part of the problem.

We have come to a situation of yellow pack workers. I do not say that lightly. It is terrible terminology but that is what it is. That is the way new entrants are being treated. I could never understand how the trade unions signed up to the Lansdowne Road agreement knowing that was going to happen. They were all around the table. They seem to have looked after themselves and to have forgotten about the people coming in. It is a terrible situation in school staff rooms. There is inequality and it is impossible for new entrants to buy a house, to get accommodation or to live, especially for those living in Dublin city, because of the associated costs. It is awful discrimination to have within the system and within the rooms where they meet and interact, both the classrooms and the staff rooms where they are supposed to have a relaxing time. It is total discrimination.

It is the same with the nurses and many other public servants. We have huge issues in my own county of Tipperary in trying to recruit nursing staff. We just cannot get them. At a meeting with the HSE and the management of the hospital we were told they had recently gone to the Philippines and recruited 48. We are now in the process of having an extension built, a 40-bed modular unit. It is hoped that it will be built by next January or February. It will certainly be built but it requires a minimum of 75 people to staff it across a wide spectrum of roles, including nurses, doctors, cleaners, maintenance staff and the whole lot. We are not going to be able to get them. The HSE is overly fat with managers but we cannot get staff for this unit. The managers are well looked after because they have been in the system for a while. Even the new ones come in on good terms, but we cannot get the nursing staff. It is little good to provide money for the building if we cannot staff it, although it is certainly good to provide the money to get the building. The HSE will have to go off again to the Philippines and elsewhere to recruit. I have nothing against the Filipino staff. They are lovely and they are doing well but if their country's economy recovers and they are no longer available to us, what is going to happen?

Qualified people here are voting with their feet. General practitioners, GPs, are another area of concern. The cuts made in respect of GPs under FEMPI were just savage. They are self-employed people but they normally employ six or seven, and maybe as many as ten, people in a small community. Apart from providing medical care and looking after their patients, they are also employers, ratepayers and taxpayers. They pay for insurance, light and heat and provide other employment. They are a source of economic activity for a small area. They have been savagely hit. I know there has been talk about renewing the doctors' contracts, which is nearly 50 years old. The GP contract is totally out of date and must be dealt with. There is something badly wrong with the system when people are voting with their feet and leaving, including young, highly qualified nurses who we want at home. People who are highly educated, highly qualified and interested in the nursing profession are leaving and we are having to go on trawls all over the world to try to get people back in.

That kind of crisis is staring the Minister of State in the face across a wide variety of sectors. One can look to the Army or even to the Garda Síochána. I heard the Garda Síochána advertising this morning, thankfully, but new entrants are turned off because of the way they are treated. They are not treated with the respect they deserve. After all, they have gone to college and spent their money. Their parents or whoever possibly helped them They are then left to be treated as second-class citizens. It is totally out of order.

As I said, as control of the public service pay bill is a central determinant of governmental budgetary policy, it will be a matter for the parties to negotiate a timeframe that will provide for the orderly unwinding of the FEMPI legislation, having regard to maintaining sustainable national finances and competitiveness, other Government spending priorities, the public service reform agenda and equity considerations on public pay. There are huge issues here and it is time the Minister of State got stuck into them because he cannot just ignore it.

There are also issues in all Departments, including the Minister of State's own Department. For the year 2017, it spent €3.5 million on consultants. Is it that the Department's public servants are unable to do the work or that the Minister of State does not want to give it to them? He does not mind hiving off money to these consultants. Every individual Department is doing it. I had another reply back this morning. Millions and millions are being spent on consultants every year. To take the Minister, Deputy Ross's Department for example, it spent €1.6 million to have an American company look at how to organise and synchronise transport throughout the country. Some €1.6 million was paid for a report and then a paltry €460,000 was thrown out as a sop to organise a rural bus link. It has just gone bananas. The Government should respect the civil servants it has and pay them properly, especially the new recruits. The Minister of State knows the old saying. If one pays peanuts does he know what one gets? It is totally unfair. The unions have a lot to answer for, for having allowed that situation to be brought in in the first place. They have to answer for that.

It is a two-tier economy. The Government has money for everything. There is no problem at all paying consultants by the million. They get paid and go on their merry way. I have tabled parliamentary questions in respect of every Department and the figures coming back are astonishing. There are no value for money audits. What transport did the consultants organise in the Minister of State's county of Wexford or my county of Tipperary for that €1.6 million? None. It is money for jam. They can get what they want and to hell with the workers. The workers have to eat cake or whatever they like. It will be necessary for the Government to look at that issue.

The Army is another area in which staff cannot be retained, as is the Air Corps. We need and depend on these services. They do great work in rescue operations and everything else. As I said, yellow pack employment is thriving. It is horrible terminology but that is what it is. These workers are second class, they are not respected and they are not treated properly. On the other hand, community organisations in every one of our parishes are being smothered with red tape. They are now being threatened with a fine of €100,000 and jail if they do not comply with the Charities Regulator. I accept that we must ensure that there is no fraud and no misuse of funds but it is the big hand of the State coming down on the ordinary people.

The big hand of the State is mistreating younger and newer public servants and the other lads have gone off at the other end. Even when the late Brian Lenihan brought in the pension levy - with whom I must admit I had a row - a certain cohort of them escaped it. I asked the former Minister questions about it. They escaped the pension levy and except those on very low incomes, they were the only people who did. He went and checked and said that he had been told there were only 100 such cases. There were actually 797. That cohort never got hit with the pension levy. That is wrong. They are too close to power and too close to the system. They can get what they want without accountability. The ordinary people, especially the newer recruits, are mistreated that way. It all came from the same crash. The pension levy came in because of the crash but that happened and those figures are there. A total of 797 people, down as far as the ranks of chief superintendent and director of services in the councils, all escaped the pension levy, whereas the ordinary man with a shovel on the road or the ordinary clerk with the peann luaidhe or a computer in the office had to pay the pension levy. It is totally unjust and it is wrong morally, financially and in every other way. It is fact. Some people on the other benches are shaking their heads. I have the figures and can produce them. That cohort of people evaded the pension levy and that is sickening. Everyone else had to pay it.

It is time there was equality. We were here celebrating 1916 in 2016. It is time there was respect for ordinary workers who are trying to eke out an existence, who are barely surviving and who find themselves in poverty and in the associated traps. I am nearly finished and I thank the Leas-Cheann Comhairle for his forbearance. We have a big job of work to do and, as I said, it has to be done equitably and fairly.

Róisín Shortall (Dublin North West, Social Democrats)
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I am sharing time with Deputy Catherine Martin. In the few minutes I have I will just confine my comments to the report published March 16 entitled "Examination of Remaining Salary Scale Issues in Respect of Post January 2011 Recruits at Entry Grades". The purpose of that report was to lay out the options for the resolution of the unequal pay structures that were institutionalised as part of the national recovery plan and which have affected recruits from January 2011 onwards. I note that the Minister for Public Expenditure and Reform made the following assertion in a response to a parliamentary question on 22 March:

It seems to be popular in some quarters to assert that the public service no longer represents an attractive career option, that there is a crisis in recruitment and a continuing focus on the difficulties within the public service.

My concern is that much of this can be counterproductive. The truth is that the public service is a good employer by any objective measurement. Public service offers a comprehensive set of terms and conditions, flexible working arrangements, decent pension provisions, fair wages that increase over time and secure employment.

That may be correct in a number of aspects but it is not in respect of fair wages.

The Minister of State went on to say the report bore this out and that this was evidenced by the fact that more than 60,000 people had been hired as new entrants on the unequal pay scale since 2011. The Minister of State, in making this assertion, is really quite disingenuous. What he claims is not the case. That recruitment has continued apace is not because of pay inequality but in spite of it. There are many other reasons people are keen to get into the public service. We know that many realise very quickly it is very difficult to survive on the pay rates that are currently available. To try to dress this up in any other way, as the Minister of State did, is quite disingenuous. The simple fact is that in many fields graduates are voting with their feet and simply choosing to emigrate. Pay is undoubtedly a significant factor in this. The example of the nursing profession is one that immediately springs to mind. According to an INMO study, the purchasing power parity of nurses in public sector hospitals and right across our health service, both at community and hospital levels, compares badly with that in other countries. Crucially, the purchasing power parity of nurses in Ireland is below that in Australia, Canada and New Zealand, the destinations to which we know Irish nurses are most likely to emigrate.

There is a similar pattern in the teaching profession. According to the INTO, there has been a significant upswing in the number of qualified teachers emigrating in recent years. Its figures suggest that pay inequality is one of the main reasons approximately 700 primary teachers leave the primary payroll each year other than for retirement. This is the lived reality for those on pay that is lower than that of their colleagues working alongside them. It is easier for them to live elsewhere.

Hospitals and schools report dire problems with recruiting and retaining staff. Unequal pay is undoubtedly a factor in this. Our education and health services are suffering as a result of Government policy on pay. While the economic circumstances that led to the imposition of the FEMPI cuts have passed, it is not been the case that a rising tide has lifted all boats. This has definitely not been the case in regard to those on low wages in the public sector.

The report makes reference to the sectoral pay increases that have been awarded and that benefit the lower paid in the public service but these have simply not kept pace with the rising cost of living for those who have been affected by unequal pay for new entrants. A point I made previously and that bears repeating is that the imposition of these cuts has seriously and negatively impacted upon the ability of those entering the public sector to build a life for themselves. It should be the case that people who have studied hard and who have proceeded to work in the very important professions of teaching and nursing and in the Garda should be able to have a reasonable expectation of a decent life on the salary they receive. Unfortunately, that is not the case any longer. That is a shameful reflection on Government pay policy. We are paying a very significant price for that.

Catherine Martin (Dublin Rathdown, Green Party)
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I am glad to have an opportunity to speak again in this House on pay inequality in the public service. I appreciate that it is a complicated issue, rather than an easy one, but it is now 2018, seven years since the first new entrants to the public service were put on a different pay scale than that of their older counterparts. Some new entrants have been doing the same work for less pay than their counterparts for seven years and there is still no clear end in sight.

Our young people have been devalued. They are receiving a loud and clear message that their work is not worth as much as that of their older colleagues despite the fact that they are doing the exact same job and have the exact same responsibilities.

With regard to teachers, who make up a significant proportion of those affected by this inequality, a recent OECD report, Education at a Glance, found a direct correlation between teachers' pay the quality of education. The teaching profession has been devalued. This will have a detrimental impact on the future quality of education. There is a multi-tier system whereby newly qualified teachers earn more than 20% less than their colleagues.

Younger teachers play a vital role in the future direction of education and they are highly skilled, specialist classroom practitioners entrusted daily with major and far-reaching responsibilities. By allowing a differential pay scale to continue, we are telling our teachers that they do not matter and that we do not care. That is simply not good enough. They, along with so many public servants who are suffering from similar inequalities, will continue to leave our shores if this continues.

In recent weeks, the teachers' unions met at their annual conferences and backed calls for potential strike action if the Government does not properly address this issue once and for all. An unambiguous, direct and straightforward commitment that the Government will not allow unequal pay for equal work to continue is absolutely essential. For these teachers and so many in our public service, enough is enough.

This is a very complicated issue but it is also a very simple one. It all comes down to the simple principle for which activists and societies have fought for centuries for women and minority groups, namely, the principle of equal pay for equal work.

I look forward to the outcome of the talks between the Minister and the unions but I call on the Government to continue with the clear understanding that it is not sustainable in a fair, just and equitable society to pay anyone less than anyone else for the same work. That is non-negotiable.

Michael D'Arcy (Wexford, Fine Gael)
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I want to put the costs on the record of the House. The Public Service Pay and Pensions Act 2017 will cost the Exchequer an extra €1.32 billion. The cost for 2019 is €372 million. It is important that people recognise this is the cost of the pay deal.

I listened to the debate with interest and I take issue with the idea coming from some Deputies that the public service, the State, is not a good employer, that it no longer represents an attractive career option, that there is a crisis in recruitment and that there is a constant doing down of the public service as an employer. I absolutely reject that. It is counterproductive and it is not based on evidence. The truth is that the public service is a good employer. By any objective measure, the public service offers a comprehensive set of terms and conditions, flexible working arrangements, decent pension provision, fair wages that increase over time and secure employment. While public service is a career choice and people who serve are highly motivated by the public good, the competitiveness of the package on offer can be seen from the strong level of recruitment that the report has highlighted.

A teacher starts at €36,000 in 2018. According to the INTO scale, a teacher who puts in 25 years will be on €64,000. If somebody enters the profession in his or her early 20s or mid-20s, before he or she is 50, he or she can earn €64,000. That represents good value and a good salary.

Let me repeat the recruitment figures. The report revealed a figure of over 60,500. Deputy Shortall may laugh all she wants-----

Róisín Shortall (Dublin North West, Social Democrats)
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The Minister of State is just recycling a reply to a parliamentary question.

Michael D'Arcy (Wexford, Fine Gael)
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-----but that is good. I reiterate that 60,500 hired since 2011 are still serving in new-entrant grades. Included are 16,000 teachers and 5,000 SNAs.

I want to touch on some of the matters raised. Deputy Cullinane said it was wrong to do what was done but it was agreed by the unions. People seem to choose to ignore that. At the peak of the crisis, the Deputy's then leader wanted us to default on what we had borrowed to service the State. Had we defaulted, we would have had much more difficult issues to deal with and much deeper cuts to make.

Deputy Ó Snodaigh referred to necessary steps. I disagree with what he said. It is pretty good to start on €36,000. A graduate in the public sector starts off at €28,000. The average in the State is €30,000. A teacher starts on €36,000.

3 o’clock

I disagree with just about everything Deputy Bríd Smith said about this issue.

In terms of the information on the workers in section 39 bodies raised by Deputy Burton, that is being processed via the Department of Health and the Health Service Executive.

I want to touch upon the matter about income tax. In 2011, when we were at the bottom of the trough, so to speak, the State collected €11 billion in income tax. The amount that will be collected for 2018 is calculated at €21.5 billion. We are doubling the tax take. People can believe that is a terrible thing but I believe it is a good thing. I also believe that the people paying a lot of tax should be given an opportunity to have some of that alleviated. We are an unusual jurisdiction in that people in this State who are earning the average industrial wage are being caught in the higher tax net. That does not happen anywhere else. We are very clear that we want to try to give people the opportunity to earn more money, pay less tax and take home more money.

Deputy Broughan can criticise the Minister of State, Deputy Finian McGrath, all he likes but the Minister of State, Fine Gael, Fianna Fáil, the Green Party, the Labour Party and some Independents chose to participate in government rather than sit on the sidelines. It is very easy to hurl from the top of the ditch when one is on that side of the House.