Written answers

Tuesday, 3 November 2015

Department of Public Expenditure and Reform

Legislative Measures

Photo of Tom FlemingTom Fleming (Kerry South, Independent)
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348. To ask the Minister for Public Expenditure and Reform if he will review and reverse all cuts under the Financial Emergency Measures in the Public Interest Act 2009 and similar emergency cuts imposed because of the imposition of the bank debt onto the public finances for all sections of society that were effected by these draconian cuts; and if he will make a statement on the matter. [38019/15]

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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The Irish economy entered recession in 2008 and it became necessary to introduce legislation, predicated on the fiscal emergency, to provide significant and immediate reductions in overall Government expenditure to meet the catastrophic fall in Government revenues from 2008 on. The Financial Emergency Measures in the Public Interest Act 2009, the Financial Emergency Measures in the Public Interest (No. 2) Act 2009, and the Financial Emergency Measures in the Public Interest Act 2010 were introduced unilaterally by the previous Government to deal with the fiscal crisis. The current Government introduced the Financial Emergency Measures in the Public Interest Act (Amendment Act) 2011 on foot of a referendum of the people and the Financial Emergency Measures in the Public Interest Act 2013 following the negotiation and agreement of a Collective Agreement.  These Acts are collectively known as FEMPI Acts 2009-2013.

Underpinned by the FEMPI legislation, in the period from 2010 to 2015 two major Public Service Agreements were put in place: the Public Service Agreement 2010 to 2014 (Croke Park Agreement) and the Public Service Stability Agreement 2013 to 2016 (Haddington Road Agreement).  These reflected agreements reached between public service employers and staff on a comprehensive series of radical measures such as pay cuts,  numbers reductions, moratorium on recruitment, voluntary redundancy programmes and so on. From 2009 to 2014 the cost to the Exchequer of public service pay was reduced by €3.7 billion, or more than 21%.

In my statutory role under the legislation, I am required to carry out a review and report to the Houses of the Oireachtas on the operation, effectiveness and impact of the FEMPI Acts, and to consider whether or not any of the provisions of the Acts continue to be necessary. My most recent report was completed and laid before the Houses of the Oireachtas in accordance with the legislative requirements on 29 June. In my report to the Oireachtas I noted that the expenditure reductions and savings generated by the legislation remain an integral and necessary part of the financial adjustment required to meet our international commitments but that I proposed to bring forward legislation to ameliorate the impact of those measures on public servants and others affected. That legislation, the Financial Emergency Measures in the Public Interest Bill 2015, is currently before the Oireachtas for consideration and  reflects the terms of  the Lansdowne Road Agreement which has been negotiated and accepted by  the Public Services Committee of the Irish Congress of Trade Unions, following a ballot among members of staff associations and unions. That we are able to consider reversing the pay reductions reflects the encouraging improvements in the public finances that have resulted from the necessary but extremely difficult fiscal consolidation path which this Government has pursued since 2011. The provisions of the legislation provide for pay restoration to all public servants while focussing on those at the lower levels of pay, and are to be implemented on a phased basis from January 2016 to September 2018. The pay restoration measures provided for in the Bill are consistent with the current fiscal space available to the Government and the requirement to manage public expenditure in accordance with the EU's Stability and Growth Pact.

The proposal made for a total reversal of the measures as provided for under the  FEMPI Acts 2009-2013 would simply recreate the fiscal crisis and reverse the significant improvements secured to date. 

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