Maurice Cummins (Fine Gael) | Oireachtas source

This Bill is one of a series of measures the Government is required to take in the public interest. The context is the continued priority given to the stabilisation of the public finances and to meeting the State's obligations in regard to the reduction of its deficit. The primary purpose of this legislation is to implement the proposed pay reductions for public servants earning more than €65,000. The legislation makes provision for the Government's preferred option, which is to reach agreement with all of its employees, but it also sets out contingency measures such as the universal freeze on increments, which will have to be implemented in the absence of sectoral agreements.

The Government is acutely aware of the substantial contribution public servants have already made to the fiscal consolidation process. However, the reality is that the public service pay and pensions bill still accounts for 35% of all spending and this further €1 billion in savings is crucial to the task we face. The State is still borrowing €12.5 billion per year, more than €1 billion per month, to fund its public services. In the absence of a desired agreement through consensus, these savings will have to be made through the measures contained in the Bill.

The Government was elected with a mandate to reform the public sector and it is determined to build on the efficiencies achieved to date under the Croke Park deal. The revised public service stability agreement, now referred to as the Haddington Road agreement, provides an opportunity to achieve the necessary savings, afford the protection of a collective agreement to public servants and contribute to the possibility of industrial peace in the public sector at a crucial time in our economy.

After the rejection of the LRC proposals, the Government asked Mr. Kieran Mulvey of the LRC to make contact with the relevant parties to investigate whether there was a basis for further engagement that might lead to an agreement. This was indicative of the Government's genuine wish to reach collective agreements and avoid unnecessary upheaval in the provision of our public services while taking real account of the clear concerns of public servants and particularly how those proposals would affect the lives of working parents in the public service and the incomes of certain key groups. The new proposals reflect these concerns while still achieving the necessary savings in the pay and pensions bill. The central fairness measures of the original set of proposals, such as protecting the core salaries of those earning less than €65,000, remain in place. Some specific measures have also been amended; for example, all premium payments for Sundays and public holidays will now be protected.

A substantive and welcome change in the new set of proposals is that a number of unions that did not engage in the first round of the discussions engaged this time and tabled suggestions. I hope that all the unions and representative associations will now be able to conclude collective agreements with their public service employers that will avoid the need to achieve the savings by way of the legislation we are discussing today. I sincerely hope we can proceed on the basis of consensus to the benefit the people working in the public service and the country as a whole.

I thank the Minister, Mr. Kieran Mulvey and the trade union leaders for concluding talks to agree a revised set of LRC proposals to be considered by trade union members. I urge public sector workers to consider very seriously the alternative to these agreed savings - imposed pay reductions by the Government and industrial conflict. This would be bad for the individual public sectors, service users and the country as a whole. The LRC has made it clear that the latest set of proposals represent the limit of what can be achieved by negotiation between the parties in all circumstances applying at this time.