It is now nearly a week since we got word that the so called Croke Park proposals had been rejected. We know that close to 2/3 of public sector workers and 70% of individual unions voted against the deal.
This has to be seen as a stunning rejection of not just the Government’s proposals but also the manner in which they went about selling the deal.
For the second time in 12 months the Minister for Public Expenditure and Reform embarked on what he promised would be a major cost saving initiative on the overall public sector pay bill. This is in addition to his failure to persuade the public to support his Oireachtas Inquiries Referendum. We have a clear picture now of a Minister who talks a good game but fails to deliver on the big occasions.
In Budget 2012 he told us that he would secure €75m in savings in 2012 and €150m in savings in respect of allowance by the end of 2013.
At the time I recognised that the current system was unnecessarily cumbersome and was in need of being streamlined. However the process that was put in place failed to achieve the targets that it was set. In fact by October of last year he had to admit that the savings he had achieved to date would only be a fraction of that amount.
The Minister must bear the lion’s share of responsibility for the outcome of last week’s vote.
His words certainly did no favours to those unions who were attempting to sell the deal to their members.
In his article on April 5th in the Irish Independent he upped the ante considerably in a manner that may have been a significant contributing factor.
It is worth reminding the Minister what he said on that occasion.
“In the absence of these measures, a straight pay cut would require a greater ask to reach the same target. Public servants that under this agreement face a gross reduction in pay of, say 4pc, could potentially see that increase to 7pc in the absence of an agreement.”
“The €300m savings to the pay bill are in this year’s budgetary arithmetic. Those savings will have to be made from the pay bill – the money simply isn’t provided for. Similarly, the €1bn savings will have to be achieved by 2015.”
“If they cannot be made within the confines of an agreement with the public service unions, they will have to be made unilaterally. This will require legislation. The precise nature of that legislation will be considered if that eventuality arises.”
I have seen the Minister’s performance in the run up to vote described as swashbuckling.
Well if that is the case his appearance on Tuesday’s nights 6.01 news can only be described as extraordinarily meek by comparison.
He looked somewhat shell shocked as he told the nation:
“I will be taking a phone call from the troika tonight to explain what happened,”
It is extraordinary to find that the Labour party which was once so closely aligned with the trade union movement would now appear to be so out of touch with public sector workers.
He went on the claim that he would run out of money before the end of the year if €300m in savings were not achieved. This is despite the fact that the NTMA currently has €30bn in cash.
What we haven’t seen from the Minister as yet is any serious analysis of why the deal was rejected and what can now be done to rescue the situation and to prevent it descending in to the same level of farce to which the review of allowances last year descended.
The unions opposed to Croke Park 2 launched an Equality Audit of the proposals which focused on the impact of changes in working conditions. These issues did not receive as much attention as the pay-cut elements of Croke Park II but I believe they were in fact the decisive factor in SIPTU rejecting the agreement.
Amongst the issues that the Equality Audit highlighted was that:
The provision for additional hours would have a considerable negative impact of people with caring responsibilities be it for children or parents. In worst case scenarios this could force carers out of the workplace or put significant additional financial burdens on them.
Restrictions on job sharing and flexi time are also likely to have been a considerable factor in the heavy defeat which the proposals suffered.
I note that it was also suggested the proposals may actually be illegal.
The report claims:
‘These proposals discriminate on the family status ground because they will disproportionately disadvantage men and women with caring responsibilities in the public sector . . .The Employment Equality Acts prohibit direct and indirect discrimination on a number of grounds including gender and family status. It could further be a matter for the European Commission to adjudicate on, given the provisions of the equal treatment Directives on the ground of gender.’
Impact on Frontline Workers
One of the most disconcerting aspects of the Government’s proposals was the very harsh impact that they would have had on frontline and shift workers.
Everyone understands the critical nature of the services that they provide yet the Government felt it was acceptable to target them for a disproportionate slice of the overall savings they were looking for.
Two different workers with the same current take home pay would have seen a vastly different chance in their income depending on the extent to which they work shift and overtime.
The 24/7 alliance produced detailed analysis of the loss that would be suffered by different categories of workers.
In the case of a staff nurse the reduction in earnings allowing for the theoretical cost of having to work additional hours and the increment freeze is approximately 11.4% of pre-agreement total pay.
For a paramedic the effective loss would be 9.7% and 9.1% for a care assistant. For a Garda it would 5%.
These represented a massive additional hit to workers who have already contributed very significantly to reducing the public sector pay bill. We did not get a clear rationale from the Minister as to why he was proceeding in this way.
In fact what we did get was black propaganda from the Minister as he publicly stated that those unions who had remained in the talks had been able to get a better deal for their members while his officials briefed about a supposed €300m pot of gold which would be available to sweeten the deal for those unions who supported it.
What should happen now?
We believe it is imperative that the Government urgently engages with public sector unions to seek an agreed approach to public sector pay. The absence of widespread industrial unrest has marked Ireland apart from other countries and the Government’s approach has put this at risk. We believe it is possible to conclude an agreement which achieves the necessary savings while achieving fairness and social solidarity.
I welcome the announcement that the chief executive of the Labour Relations Commission has been asked to make contact with the parties in the coming days to establish if there is a basis for a negotiated agreement. I hope that tonight’s motion has had the effect of galvanising the Minister into action.
Unfortunately since the rejection of the agreement his words have spread further confusion.
Last week in the Dáil I asked Minister Howlin what actions he now proposed to take. In the course of his answer he indicated that most of those who would have been subject to pay cuts under the agreement would have seen their salaries restored post 2016.
However for those workers who were being asked to work longer hours or see reductions in overtime payments no such assurance was forthcoming. This is symptomatic of what can only be described as a divide and conquer strategy.
I accept the need for reform and modernisation in the public service.
The Croke Park model is the still the best one to achieve this and we support the principles that underpin it.
If a new agreement is to be negotiated and put to public sector workers it simply cannot be voted on in the absence of full disclosure of all relevant facts to all parties concerned.
Further savings are needed and an agreed framework is the best way to bring this about.
It is worth noting that the vast majority of savings achieved to date have been from measures introduced by the previous government.
Last year Minister Brian Hayes claimed:
“A totality of €2 billion has been taken out of the public sector pay and pension bill as a result of the measures since 2008 and the measures that Brendan Howlin is introducing now.”
However in reality the government has not up to now introduced any significant measures to control the public sector pay bill.
Minister Howlin’s claim that he regarded the Croke Park Agreement as “an extraordinary tool for change” and that most of his EU colleagues would give their right arm to have such an agreement rings hollow given his ham fisted approach to the recent talks and their aftermath.
The country wants and expects good public services. Good industrial relations and a shared commitment to reform and delivery are a cornerstone of delivery of such services.
The Government must learn the lessons of their failure to deliver this agreement. They need to be open to hearing what public sector workers have to say and respond in a transparent manner.