Joe O'Toole (Independent)

I thank Fine Gael for allowing me to speak first. I welcome the Minister of State, who knows my views on this important Bill. I am completely, utterly and implacably opposed to it. The statement of the Minister of State contains some elements that are misleading. Knowing him so long as I do, I do not believe he would do this deliberately. It is important to address the question of the breakdown of talks to which the Minister referred, suggesting failure to reach agreement did not adversely reflect on the bona fides of either party to the discussions. When people sit down to do business, they decide whether they want to do a deal. If they do not, they walk away at that point. If they do, they indicate the objectives and then identify the problems and thereby create the agenda. People work through the agenda and if, at some stage, they realise they cannot achieve their aims, people shake hands and walk away. Trust, confidence and relationships need not be broken. In this situation people understood they had done a deal with three or four Secretaries General speaking with the minds of their political masters and achieving all the Minister for Finance and the Government wanted. There is an extraordinary breakdown of trust such that people cannot see how they would get back around the table again. I say that with some regret because I have never seen it in my time but it is the fact of the matter. I want to deal with that in this particular way. If the Government had a problem with this going through it should have been disclosed. The Taoiseach referred to three criteria: that savings of €1.3 billion were made, that they would be permanent and that there would not be a diminution of public services. All three were delivered in the negotiations.

I wish to put the following on the record and I believe no one will deny it. The public service union leaders, in an act of extraordinary courage, generosity and patriotism, announced they would negotiate a reduction in salaries for their members. I never saw that before. They will never be thanked for that, either by their own members or the Government. They saw where the Government was, its difficulties and the objective of the Government in saving €1.3 billion. The public service unions decided to co-operate in doing so.

I want to explain how this was achieved. The Minister of State and I know each other long enough to know we will speak the truth to each other. People are speaking about what was and was not agreed in the public media. What I will put on the record was agreed and accepted by three Secretaries General late on Thursday night or early Friday morning when the agreement broke down. The objective was to save €1.3 billion. Ministers have said recently that this was not achieved and that a mere €750 million was agreed. I will list how the savings were to be realised. We have learned that there is no point in winning arguments if one cons people on the other side. In order to ensure everyone was singing from the same hymn sheet, the public services committee brought in an independent accountant from Mazars to sit with the Department of Finance officials, do the calculations and ensure everyone knew what they were talking about. In the early stages of negotiations, the amount to be achieved by the reduction was €750 million. It was also quite clear and accepted by the trade union movement that this was not enough. A new format was created, with bands up to €50,000 to be reduced by 4.6%, salaries from €50,000-€60,000 to be reduced by 6%, salaries of €60,000-€70,000 to be reduced by 7% and those over €70,000 to be reduced by 7.5%. This was costed and brought in €786 million. The agreement on overtime meant that one could not earn overtime without completing eight hours of ordinary time and this amounted to €80 million. The review body savings amounted to less than €100 million and there was also the moratorium carried over from last year. Adding these savings amounts to a sum closer to €1.3 billion than €1.2 billion. The savings achieved by the budget measures are significantly less than that. If that is not acceptable, I want to know precisely where the figures I have given are incorrect. There should be honesty in all of this.

The Taoiseach referred to the problem of permanency and of maintaining these savings. That was to be achieved through a heavy demand on public service workers where the public service would be reduced by approximately 15,000. This point was put forward by the Government and Fine Gael. The idea was that the cuts I referred to would be in place until they were permanently created by the reduction in numbers. This would be done by asking public servants to work harder, to work longer, to be more productive and to earn less overtime. Some speakers referred to reform of the public service as people doing their job differently. This is not the case; it was an old-fashioned request for people to work longer and for people to take on responsibility for tasks they did not have before. It brought a private sector ethos where people are asked to do more. There was an honesty and openness in the approach and an understanding of the Government's key objectives, namely a €1.3 billion reduction and a reduction of 15,000 people in the public sector. 3 o'clock

The question of unpaid time in lieu created problems for all sides. It was agreed, although this was never said publicly, that this would be done with the discretion and agreement of local line management. Someone could not walk out the door and say he or she would not be in on Monday and Tuesday of the following week. It had to be done over a period of years so it would not create disruption to the service and it would be part of a continuing process. Where did this come from? It came from the private sector where there are lay-offs a day per week, a day per month or a couple of days per month to save money. It was exactly the same as that. That is what was being brought forward. It was going to be a permanent saving because the cuts would be in place until such time as the reduction in numbers made the savings permanently. That was to be done through an agreed process where an outside group would come in and make the cuts. It was agreed that a meeting would take place in May or June to establish how much progress was made. The thinking was that the Government had made the commitment and this was how it would be made permanent. There was pressure on the Government because the cuts would be in place until the savings were permanently created. If they were not permanently created the cuts would remain. For the life of me, I cannot see how the Government walked away from that deal. It had got everything it sought. I know the Minister of State has to defend the Government position but given that the Ministers with the most difficult portfolios felt they had made huge progress in these negotiations I do not know where all this comes from.

The Minister of State referred to various groups including the ministerial 15% reduction in pay, and senior civil servants. I wish to put three specific technical points. I see Senator MacSharry smiling. He will appreciate at least one of them.