Agreement has been reached between the Government and the country's public service unions on cutting €1 billion off the public sector pay bill.
Despite four major trade unions walking out of negotiations at the 11th hour, agreement was reached after marathon all night talks in Dublin.
The Irish Congress of Trade Unions said the deal, which has yet to be put to union members, would ensure public servants are less worse off than would have been the case if the Government had instead legislated for across-the-board pay cuts.
The deal, which runs until 2016, will replace the current Croke Park agreement, which was due to expire in 2014.
Tánaiste Eamon Gilmore has said political parties should stand back from the public sector pay process while proposals for a new deal are put to a ballot of workers.
“I think all of us should now respect the fact that trade unions have to consider the outcome of these negotiations and the members of trade unions will have to reflect and make their decisions in the course of ballots,” Mr Gilmore said this afternoon. “I have always believed…that it is best if political parties stand back from that process and give to the people who work in our public services the respect and space in order to make a decision.”
Mr Gilmore was speaking after the country's largest trade union Siptu warned the deal could still be rejected by union members. "I'm satisfied the proposal is the best one that could be achieved through negotiation," said Siptu president Jack O'Connor. "But industrial action is not off the cards. The majority of union members may decide to reject this proposal."
Under the terms of the deal, high earning public sector staff face pay cuts of between 5.5 per and 10 per cent. Pay cuts of 5.5 per cent will be introduced for staff earning over €65,000. The scale of pay cuts will be increased on a gradual basis, with those earning over €185,000 facing a 10 per cent cut.
Premium rates for staff working on a Sunday will be set at 1.75 times normal pay rather than double time. Public servants will also be asked to work longer hours and have their overtime payments reduced.
Staff earning more than €65,000 face a three-year freeze on increments, while those earning up to €35,000 will have a three-month freeze. Those earning between €35,000 and €65,000 will face two three-month freezes in the course of the agreement.
Staff at the top of their incremental pay scale will be asked to contribute either six days annual leave, the cash value of these holidays or the cash value of one increment on their scale.
Broken economy
Minister for Public Expenditure Brendan Howlin arrived at Lansdowne House in Dublin shortly before 7am to deal with final elements of a the deal. Mr Howlin said proposals which “meet the targets we set out” have been sent to the unions.
“I understand how difficult this whole process has been for trade unions,” he told reporters after the deal was struck. “We are asking people to make another contribution to fixing our broken economy.”
Mr Howlin said the deal on the table was complex but when read people would see it was constructed in a way to impact on everybody in a fair way.
“No individual sector of the public service is in any way targeted,” he said. “Everybody is asked to make a fair contribution and I’ve made it clear this will be the last contribution people will be asked to make.”
Congress, the umbrella group for trade unions, also welcomed the deal. “We have achieved far more through negotiation than we could have hoped to gain through protests," said Shay Cody, the chair of the public services committee of the Irish Congress of Trade Unions. Impact said the deal ensured that there would be no compulsory redundancies in the public service, but that higher paid workers would accept pay cuts.
Savings of €1bn sought
The public service unions who yesterday walked out of the talks have vowed to vigorously oppose any move by the Government to introduce legislation to cut the earnings of their members.
The Government’s plans to secure savings of €1 billion on its pay and pensions bill by renegotiating the current deal for its staff ran into serious difficulties last night when four trade unions left the process.
The unions who walked out were the Irish Nurses and Midwives Organisation (INMO), the Irish Medical Organisation (IMO), the Civil Public and Services Union (CPSU) and Unite.
Several weeks ago two organisations representing gardaí left the process which is aimed at reaching an extension to the current Croke Park agreement. The Psychiatric Nurses Association had never become involved in the process.
Other unions representing workers in the public service remain in discussions with Government representatives.
However, the developments last night mean that unions and associations representing 80,000 public service staff are outside the talks – leaving open the prospect that the Government may have to introduce legislation to secure savings in the areas where these personnel work.
Taoiseach Enda Kenny had warned that in the absence of an agreement the Government would introduce legislation to secure the saving of €1 billion over the coming three years. The Government wants to save €300 million this year.
The INMO and the IMO both said last night they would resist any move by the Government to impose cuts to their members earnings by passing new legislation. INMO general secretary Liam Doran said: “Let us be quite clear. If the Government moves to legislate then we in turn will move to mobilise with every means at our disposal to oppose the adoption of legislation that will reduce the income that a nurse or midwife receives for working at weekends or an evening which they are required to do to maintain a 24/7 service.”
Strength of feeling
The IMO’s director of industrial relations, Steve Tweed, said the Government should not underestimate the strength of feeling that workers in the health sector feel towards the proposed cuts and should not underestimate the resistance to the imposition of pay reductions on its members.
The CPSU said its representatives were left with no choice but to leave on foot of “a series of draconian proposals from Government representatives which are designed to have a huge impact on the working lives and wages of 12,000 members countrywide”.
Unite said the scale of the cuts would be hardest felt by those on low salaries.
A spokesman for the Garda Representative Association said: “We were never in talks. We were in a twilight meeting on the outside of the talks. We’re not affiliated to Congress and as it stands we have yet to hear from the official side about any change. "As far as our members are concerned we are still in Croke Park.”
The Irish Hospital Consultants Association, whose members will see up to 10 per cent pay cuts, said it will be “even harder to recruit and retain highly specialised, internationally mobile hospital consultants”.
Government sources said the departure of the unions was regrettable but not surprising given they had had set out their positions from the start that they would not move on proposals to cut the pay bill.
