TAOISEACH BRIAN Cowen confirmed to Labour leader Eamon Gilmore that public sector pay cuts would be extended to those in the voluntary sector and any body, which is wholly or partly funded by the State.

Mr Cowen said that the Minister for Finance would outline the provisions in detail during the debate on the legislation to allow for the pay cuts announced in the Budget, but “the categories of employees to whom it applies are as confirmed by the Deputy”.

But the Labour leader said “frankly, I find it difficult to see how this can be done given that the contracts of employees of those bodies is not with the State but the bodies which employ them”.

Mr Gilmore raised the issue during Leaders’ Questions in the Dáil and sought clarification about to whom the terms of the legislation would apply. He said the Bill would “cut their pay and unilaterally change their terms of employment”.

He referred to “speculation over the weekend that it might apply to employees of semi-State companies but that appears to have been clarified. The Schedule to the Bill excludes the semi-State employees.”

But he noted a provision in the Bill “which appears to extend the application of the pay cut not alone to direct employees of the State but to employees of any body which is wholly or partly funded by the State”.

He said: “This presumably means it would be extended to employees of voluntary hospitals, community development projects, family resource centres, Leader programmes, development organisations and charities. I want the Taoiseach to tell me if the cuts in pay will apply not alone to direct employees of the State but to all bodies, as stated in the Bill, which are wholly or partly funded directly or indirectly out of moneys provided by the Oireachtas or from the Central Fund.”

Mr Cowen acknowledged that “the categories of employees to whom it applies are as confirmed by the deputy”.

Mr Gilmore also asked the Taoiseach to outline the “impact the cuts imposed under this Bill will have on the weekly household income of a family of a clerical officer in a Government department married to a library assistant, both earning €30,000 per annum and who have three children?

Mr Cowen said “obviously, there will be a 5 per cent reduction up to a certain level in respect of the people” Mr Gilmore was referring to.

The Labour leader said the cut was €70 per week, but “the Government did not bother its barney to assess what would be the impact of its budgetary measures” on people hit by the social welfare cuts.

He said there was a requirement on Government – it is in the Cabinet handbook – that every measure before Government be poverty proofed. But the “Government has not given a second thought to what will be the impact of its budgetary measures on the lives of people in receipt of social welfare payments or in respect of cuts to the earnings of low paid people.” He claimed the Government “does not give a curse for people who are poor or in receipt of low pay”.

But the Taoiseach retorted that “we are back to the polemics again”. He said “all we are hearing is the populist notions that there is some simple way of this country getting out of trouble. There is not. It requires the Government to have a bit of gumption and determination to do it and that is what we are prepared to do.”