Govt’s Public Sector Pay plan raises serious budgetary concerns – Calleary

Published on: 17 January 2017

Fianna Fáil Spokesperson on Public Expenditure & Reform Dara Calleary has given a cautious welcome to the Government’s latest deal on public sector pay with ICTU, but says there are a number of concerns as to how the agreement will be paid for.

Deputy Calleary commented, “The brokering of this deal between ICTU and the Government is a welcome development, which will hopefully bring to an end months of industrial unrest across the public sector.  The commitment to fully implement Lansdowne Road is consistent with our support for the agreement; however, there are a number of concerns about this latest plan.

“The Government’s delay in setting up the Public Service Pay Commission exacerbated tensions in the industrial relations sector, and was a source of frustration for my party, as it was a condition of the Confidence & Supply Agreement negotiated in May last year.

“This deal, combined with the Garda resolution negotiated last year, will result in an additional Government spend of €170m.  Minister Donohoe needs to detail exactly how he is going to honour and fund these agreements without hurting services.  I am particularly concerned that the manner in which this agreement was made undermines the budgetary process and budgetary responsibly.

“This is particularly worrying following the Fiscal Advisory Council’s recommendations that “any new increases in expenditure – such as to fund higher public sector pay – imply lower spending in other areas unless offset by compensatory tax changes”.

“Minister Donohoe needs to clarify how he is going to source an additional €170m without breaching fiscal rules, increasing taxes or impacting on existing services, and he must do so without delay”.

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