Written answers

Wednesday, 25 March 2015

Department of Public Expenditure and Reform

Public Sector Staff Remuneration

Photo of Ruth CoppingerRuth Coppinger (Dublin West, Socialist Party)
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12. To ask the Minister for Public Expenditure and Reform if he will reverse pay freezes and changes to terms and conditions for workers in the public sector; and if he will make a statement on the matter. [11695/15]

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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The  Haddington Road Agreement (HRA) underpinned by the Financial Emergency Measures in the Public Interest (FEMPI) Acts 2009-2013, forms the cornerstone of pay policy in the public service until 2016 when it is due to expire.  The Agreement, which contains a number of measures directly affecting the pay of staff, is delivering and is making a significant contribution to the achievement of the Government's fiscal consolidation deficit target of below 3% of GDP for 2015.  The ongoing recovery in the economy is in no small part due to the contribution of public servants to keeping the cost of the public service paybill at sustainable levels and the recovery has facilitated the reinvestment by the Government in 2015 of some €300m in frontline services mainly in Health, Education and An Garda.

The  FEMPI Acts govern the €2.2bn direct reductions in public service remuneration and pensions. Notwithstanding our improving economy, because of the magnitude of these reductions, the economy could not sustain the immediate restoration of such reductions. I believe that public servants understand that position.

However, I have indicated that, following receipt of the 1st Quarter Exchequer returns and engagement with my Government colleagues, it is my intention to engage with Public Service Unions regarding the gradual unwinding, in parallel and consistent with our improving economy, of the emergency measures implemented under the FEMPI Acts. This is consistent with the approach adopted in securing agreement on the HRA through engagement with those directly affected.  The public service unions have also indicated their intention to submit pay claims this year. Any discussions on pay will, of course, take place in the context of the State's fiscal position and the pace of financial recovery for this year and 2016. Any proposed changes to the FEMPI legislation will be subject to Government approval and will be brought before the Houses of the Oireachtas.

The legality of the Acts is predicated on there being a financial emergency.  In fact, I am required to review these Acts annually. My next review of the Acts is due to be carried out, and a report laid before the Houses of the Oireachtas, before 30 June this year.

Public servants, in common with all employees, will have seen benefits this year to their take home pay arising from the tax reductions the Government has been able to introduce following its prudent management of the economy.  I have, however, made it clear that public service pay rates will continue to be frozen in 2015 the 7th consecutive year in which there will have been no pay increases for public servants and, as we know, there have been 2 or 3 actual cuts in wages over that period.  It is now appropriate for the Government to plan  for the development of a sustainable public service pay and pensions policy that will continue to support our ongoing economic recovery over the medium term. Having worked over the last number of years to restore the health of the public finances I am determined that any outcome of discussions with unions is consistent with our overall financial position.

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