Bernard Durkan (Kildare North, Fine Gael)
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10. To ask the Minister for Public Expenditure and Reform the extent to which he expects progress to continue in regard to the restoration of pay cuts necessitated by the downturn in the economy, with particular reference to the need to recognise the impact on the workforce during the recession; and if he will make a statement on the matter. [18710/17]

Paschal Donohoe (Dublin Central, Fine Gael)
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As the Deputy is aware this Government is committed to increasing public expenditure in a sustainable way. Critically, providing for increased public expenditure in a sustainable way seeks to ensure that incremental improvements in the funding and allocation of additional resources to support delivery of public services are maintained on a long term basis. This approach will ensure we do not again have to suffer the severe reductions in public expenditure precipitated by the fiscal crises and recession which brought our country to the economic brink and impacted negatively on all our citizens.

In Budget 2017 the Government was in a position to allocate significant additional resources to public spending with a €1.9bn increase in Gross Voted Expenditure compared to 2016. This level of investment allowed for the recruitment of additional nurses, doctors, teachers, garda and special needs assistants which will improve public service delivery to citizens. It also funded the Action Plan for Housing, improvements in childcare funding and a number of increases to Social Welfare rates.

For public servants, the Lansdowne Road Agreement (LRA) provides a negotiated pathway for public service pay increases through a phased partial unwinding of the FEMPI measures at a full year cost of €844m in 2018 and represents a considerable investment in public service remuneration. A comprehensive Collective Agreement of this kind allows for strong fiscal planning, with budget allocations ring-fenced within multi-annual expenditure ceilings and pay increases taking an appropriate share of available fiscal space. This phased and sustainable programme of pay increases underpins the fiscal targets in Budget 2017 and our international commitments to a prudent fiscal policy under the Stability and Growth Pact. In addition, the Public Service Pension Reduction (PSPR) is being significantly reversed in three stages under FEMPI 2015, via substantial restoration of the PSPR cuts on 1 January 2016, 1 January 2017 and 1 January 2018. The cost of these PSPR changes is estimated at about €90 million on a full-year basis from 2018.

I expect to receive the initial report of the Public Service Pay Commission by end of Quarter 2. The Commission's role is to provide evidence based analysis on pay matters to assist the parties to the forthcoming public service pay discussions in discharging their negotiation functions on behalf of Government and public servants respectively with a view to reaching agreement on a successor to the Lansdowne Road Agreement that is both sustainable and affordable.