Public Sector Pay: Where are we now?

The speech below is from Minister for Public Expenditure and Reform, Pascal Donohue. He was speaking at the IRN Conference in Dublin on Thursday 9th March on “industrial relations in a time of heightened expectations’

I find the theme of this year’s event — ‘Where are we now? Industrial relations in a time of heightened expectations’ — both apt and timely in the current context. But before getting into that in more detail, I’d like to ask you all to take a minute to reflect on where we are coming from.

This country has come through a deep crisis over the last decade — but it has done so in a climate of widespread industrial relations peace across its public service.

To my mind this is a huge achievement — especially when we see the unrest that other countries have endured — and one that probably doesn’t get enough credit.

There is little doubt that industrial peace during those difficult years contributed in a very tangible way to restoring Ireland’s international reputation and creating the conditions for economic recovery to take root and for jobs to return.

It is easy to take this for granted and we should take care not to do so. It took a huge investment of time and effort by all concerned to deliver and sustain industrial peace during this challenging period.

This deserves to be acknowledged.

Three collective agreements have provided the framework for that to be achieved — the Croke Park Agreement, the Haddington Road Agreement and the Lansdowne Road Agreement.

Together these agreements have enabled the delivery of an ambitious agenda of public service reform, together with significant savings and efficiencies in the public service pay bill.

Ensuring that both formal and informal lines of communication between the parties were fully utilised was critical during these very difficult times, as well as proactively using the dispute resolution mechanisms provided for within the agreements to overcome problems as they arose.

More recently, for example, we have re-invigorated the oversight structures under the Lansdowne Road Agreement and this has helped us to respond effectively to the challenges faced in recent months.

THE CASE FOR COLLECTIVE AGREEMENT

As I speak to you today, we are preparing the ground for negotiations on a further collective agreement. So a valid question to ask at this juncture is: Do we need a new agreement? I believe we do.

Why? Because a collective agreement encompassing as many parties as possible is the surest way to guarantee a stable and fair industrial relations environment into the future.

More broadly speaking though, an agreement and the stability it brings is, I believe, important for successfully managing a small, open economy such as Ireland’s which has a high level of external economic challenge: it furthermore provides clarity and certainty around the management of the Exchequer pay bill which accounts for over a third of all public expenditure.

Industrial relations stability also helps Ireland to continue to attract foreign direct investment, delivering much needed employment.

I think you will agree that stability is essential in a time of such global flux and uncertainty as we now face.

An agreement is positive too for those workers within that agreement. Remember, a natural response to the fiscal crisis we faced might have been compulsory redundancies, but we didn’t go down that road.

Sacrifices were undoubtedly made, but through the various collective agreements, we made every effort to minimise the burden of pay cuts on the lower paid and to prioritise these groups in the restoration of pay.

What the agreements give to public servants is a fair deal and a level playing field.

They ensure no lay-offs but they also ensure no leap-frogging.

For me, the inherent fairness of this approach is really important. We shouldn’t set public pay based on a reactive response to those who shout loudest or who are better placed to exert influence.

We have to ensure an equitable approach that considers all of our public servants on equal merit.

An inclusive collective approach is the best way to do that in my view.

Step outside of that framework and you are stepping into an “I win — you lose” negative and perverse type of situation in which there will inevitably be more losers than winners.

And one group guaranteed to be losers in that ‘win — lose’ scenario is the public who cannot afford to be used as pawns in this way.

MANAGING EXPECTATIONS

To return to the theme of the conference — we are at a time of heightened expectations. Of that there is no doubt.

In many ways though, this is a by-product of a growing economy that is emerging from a difficult period.

So, in that sense, rising expectations are an indicator of success — it shows that people generally are confident that things are moving in the right direction.

However, we need to temper these expectations or we will end up right back where we began.

We have to ensure that the huge sacrifices of our citizens, including the public servants who have worked longer hours for less money, are not lost.

Thanks to prudent planning, we are in the relatively better position of having escaped the fate of many of our neighbours in Europe: we are a country in recovery, with steadily declining unemployment and steadily rising economic growth.

With recovery taking hold, it would be unforgivable, therefore, to seek to return to the type of decision-making which necessitated the very difficult sacrifices in the first place.

Nor is it realistic to think that we can meet every present demand or every past grievance that surfaces.

If we want to see the end of financial emergency legislation for good, then we can’t make reckless fiscal choices.

I believe a collective agreement encompassing public service pay and further reform will be key to ensuring that we grow expenditure and pay in an affordable and sustainable strategic way.

It will allow Government to strike a balance between affordable pay increases for public servants and other social priorities including improvements in housing and health care.

An agreement can also ensure that we continue to deliver further public service reform and service improvements for citizens.

I have made the case for a collective agreement, but I would like to sound a note of realism about what is possible from a fiscal perspective.

And here I am very anxious to avoid any suggestion that I may be commencing the negotiations process in public — which is a matter for a later time.

But nevertheless, there are fiscal realities and constraints within which we as Government must operate and I would like these to be better understood — which is not easy given their complexity!

In simple terms, even if we didn’t have obligations under the EU fiscal rules, there would be an onus on us to manage our pay policy in a disciplined and prudent fashion.

The current rules mean, however, that notwithstanding heightened expectations and strong economic growth, resources remain significantly constrained over the medium-term.

We are still running a deficit for example — in 2016 we were still borrowing close to €7m a day to fund the delivery of public services. And we are still working to meet our Medium Term Objective under the Fiscal Rules by 2018 which, if achieved, may provide Government with more latitude in future years.

So constrained resources mean difficult choices have to be made.

A growing but ageing population means we face increased demand for public services, whether in health, education or social protection.

Investment has to be made in these services to meet this demand, as well as in other areas where pressures are emerging as a result of a growing economy — childcare, housing and infrastructure for example.

In a public service context, our frontline services are under immense pressure, with staffing levels still in the process of being consolidated.

Government recognises this and is working to address these pressures by investing in the recruitment of additional front-line staff.

Increasing staff numbers, however important and worthwhile, add to the costs of the Exchequer pay bill.

As do pay improvements for public servants which is a sign of a normal functioning efficient economy and rightly aspired to by all interests concerned.

So a balance has to be struck here between these two important levers if we are to maintain control and stability over expenditure in the coming years and comply with our fiscal obligations.

PRODUCTIVITY AND REFORM

This speaks to the need to focus on further productivity and efficiency improvements in our public service in the years ahead.

I have mentioned the significant programme of savings and reform that were achieved under both the Croke Park and Haddington Road Agreements.

These savings and reforms have allowed us to legitimately say that we were ‘doing more with less’.

They have also contributed in no small measure to ensuring that the normal pay increase expectations on the part of public servants and their representatives can be realised both now and into the future.

The reform and productivity measures in the previous agreements have delivered — and continue to deliver — real results in terms of supporting the delivery of front-line services on which all of our citizens depend to varying degrees — at a time when public expenditure was reduced.

Some examples of what I’m referring to include:

The additional hours secured under the Haddington Road Agreement, which remain critical to enabling us to meet increased demand in front-line service areas and to improve services to the public generally.

The establishment of streamlined shared service operations across the public service, such as SUSI in the education sector and the National Shared Service Office.

Consolidation and re-organisation to deliver efficiencies involving the merger of agencies and creation of streamlined structures, such as the Education Training Boards and in local government.

Moving more services online, including motor tax and Revenue’s myAccount for example.

Developing integrated one-stop shop solutions for the public, such as the INTREO office network in the Department of Social Protection.

Reform is also about improving the work environment for public servants through initiatives aimed at improving our approach to learning and development and facilitating opportunities for greater mobility.

You may think the urgency has passed in relation to all of that but let me assure you it hasn’t.

Because the only way we can respond to both the increased demands on our public services and the expectations of public servants to see their pay start to grow again — within the limited room for manoeuvre we have on the public finances — is to look again at how we can further improve on productivity and efficiency gains in the public service.

This means building on the structural reforms and work practices changes introduced under previous agreements.

My Department are now in the process of drawing up a new three-year Public Service Reform Plan which will set out our vision for the next wave of reform.

We will be looking to consolidate the good progress made to date and to set out the further steps that need to be taken to realise our goals around ensuring we deliver top quality public services in a cost effective way.

Of course, public servants are taxpayers and citizens too — something often conveniently forgotten by those seeking to foster division — and will make their own minds up on how the available fiscal space should be allocated across pay, staffing, tax reductions, childcare, housing, health and other priority areas.

MOVING FORWARD

There is perhaps a feeling in the air — given developments over the last year — that we can’t continue as we have or that collective agreements in the public service have had their day. I disagree.

This is an incredibly short-sighted way of looking at things. It is effectively refusing to make choices that are necessary for the greater common good. That approach — if universally applied — would be very destructive and counter-productive.

Everyone ultimately loses in this scenario.

For all of the reasons I have outlined — not least the need for inherent fairness and balance — a collective approach is as important as ever.

We can — and must — continue to do the hard work together to maintain industrial peace, with all the benefits that brings to our public servants, our economy and our society.

And we must also collectively continue to try to balance competing priorities with an awareness of their implications elsewhere.

Those who seek to prioritise their own narrow agenda over a wider settlement are shirking this broader responsibility toward fairness and balance. These same people will criticise any agreement as a ‘sell-out’, rather than recognising that one can be pragmatic and remain principled. We simply cannot afford to listen to such people.

Before we begin negotiations, we await the report of the Public Service Pay Commission.

This report, due soon, will provide a key input to the talks process by providing evidence-based objective analysis on a number of key issues, including how the unwinding of the Financial Emergency Measures in the Public Interest — or FEMPI — legislation should proceed, as well as for example, the issue of the value attached to public service pensions.

The process of moving to a post-FEMPI world commenced under the Lansdowne Road Agreement and will be further advanced under any new agreement.

This is an important development because it signals a normalisation in our approach to both pay and industrial relations in the public service and is an indicator in itself of our re-emergence as a normal functioning economy.

For me, the priorities are simple — we need an agreement that is affordable, sustainable and fair.

However, the very real fiscal limitations we face, coupled with the many competing demands, including on pay as I’ve outlined, when set against the expectation levels that are prevailing, make these forthcoming negotiations arguably one of the most challenging.

CONCLUSION

It will not be easy to secure an agreement in such circumstances. I recognise that. I do not underestimate the challenge.

But let me conclude by saying that the Government is clear that it wants to reach an agreement and will put its best foot forward in an attempt to do so.

Pragmatism, realism and compromise will certainly be required on all sides.

If our experience with Croke Park, Haddington Road and Lansdowne Road is anything to go by though, I know there will be no shortage of these qualities on offer over the coming weeks and that should give us the confidence to collectively succeed in achieving a mutually acceptable outcome.

Planned industrial action at Oberstown deferred

IMPACT and SIPTU trade unions, representing residential care staff at the Oberstown detention centre, have accepted an invitation to attend a meeting with Oberstown management on Monday (5th September) at 11am under the auspices of the Workplace Relations Commission.

The meeting will seek to address outstanding issues in an ongoing industrial dispute concerning the safety of staff working at the Oberstown campus.

Notified industrial action, which was due to take place on Monday, has been deferred.

Residential staff to hold eight-hour work stoppage in Oberstown youth detention centre

Residential care workers and supervising staff will take part in an eight-hour work stoppage at the Oberstown youth detention centre today (Monday 29th August) in a dispute over poor safety measures and increasing assaults on the campus.

SIPTU and IMPACT trade unions have said that the action is part of an ongoing industrial dispute in response to the increase in attacks on staff at the State’s only youth detention centre.

Staff at Oberstown took part in a four-hour stoppage in May, while attempts to resolve the issue through talks at the Workplace Relations Commission have so far been unsuccessful. The unions have served notice of more stoppages due to take place on Monday 5th, 12th and 19th September.

IMPACT official Tom Hoare said: “While there has been consistent efforts to resolve this dispute, the staff are still facing the daily risk of assault and injury. Oberstown care workers are doing the work of prison staff with the facilities and equipment of a residential care home. The number of assaults on staff has continued to grow since the expansion of Oberstown to facilitate the transfer of offenders from the prison service.”

Mr Hoare has said the new campus is badly designed, with inadequate safety equipment to deal with a mix of vulnerable young people and violent offenders. “The result is a daily risk of serious assault, which leaves many of the staff literally in fear of their lives as they leave for work each day,” he said.

SIPTU Organiser, Ray Stanley said: “Recently, through a third party mediator, union representatives and senior management in Oberstown agreed a document aimed at addressing staff concerns through comprehensive structures and timeframes. We believe this document has the potential to create a platform to deal with members’ deeply held safety concerns. Unfortunately, the solutions identified by the IMPACT and SIPTU members were flatly rejected by management and union members have no choice but to take this action.”

The most recent official figures (supplied by the Department of Children and Youth Affairs) revealed over 100 violent incidents in Oberstown last year, almost half of which were classed as ‘critical’. Critical assaults and injuries necessitated a total of 3,005 employee sick days, involving 65 staff members.

Full emergency cover will remain in place during the stoppage, which will commence at 8am. The action will see residents confined to their rooms between 8am and 4pm.

The unions say:

  • The expansion and refurbishment of the complex was badly planned and implemented, resulting in a totally unsafe living and working environment
  • Subsequent stop-gap measures, which were supposed to minimise risk to staff and residents, have been both inadequate and ineffective
  • Staff are denied appropriate personal protection and safety equipment
  • Staff recruitment and retention problems, coupled with absences due to assaults, mean the facility is often understaffed and, therefore, incapable of dealing safely with the numbers of offenders
  • The unions have continuously raised urgent concerns over time delays involved in supporting colleagues in units where disturbances and violent situations arise
  • A request by IMPACT not to move existing units that are clustered together, a move which would significantly increase the response time and potential injury rate in the event of a serious incident, was dismissed by the employer.

The staff concerned work at three schools on the campus: Oberstown Boys School, Oberstown Girls School and Trinity House. Responsibility for the campus was transferred from the Department of Justice to the Department of Children and Youth Affairs in 2012. The Oberstown campus currently caters for 48 under-18s, including a mix of vulnerable young offenders and violent criminals with multiple convictions for serious offences.

SIPTU members in St Aidan’s Services protest against the non-payment of increments

SIPTU members in St Aidan’s Services, Gorey, Co. Wexford, a section 39 organisation providing day and residential services for people with intellectual disabilities, held the first in a series of work stoppages today (Wednesday, August 10th) in protest against the non-payment of increments due to them.

SIPTU member and Health Care Assistant in St Aidan’s Services, Helen Tobin said: “We have been in Workplace Relations Commission twice and subsequently to the Labour Court in 2013. The Labour Court ruled in our favour but we still have not been paid what we are owed. We have no choice but to take industrial action. It is very frustrating because we go above and beyond the call of duty yet we are not shown respect for the vital community service we provide.”

SIPTU Organiser, David Morris said: “Our members have been badly let down by the refusal of HSE management to pay them what they are owed. The workers have explored every avenue open to them to find a solution to this dispute and now feel they have no option but to take action to highlight the situation.”

He added: “In 2010, the HSE withdrew funding for salary increments. An agreement is in place that aligns salaries in HSE funded Section 39 organisations such as St Aidan’s Services with HSE consolidated pay rates. HSE workers have had their increments restored so it is only fair that workers in Section 39 organisations enjoy parity of esteem and the same respect.”

Care workers back industrial action at Oberstown young offenders’ campus

Residential care workers and night supervising staff have backed industrial action by a margin of 95% in a dispute over the safety of clients and staff at the Oberstown detention centre in Lusk, County Dublin. IMPACT and SIPTU, say staff and residents at the understaffed centre, are exposed to daily risk of violent assault.

The most recent official figures revealed over 100 violent incidents in Oberstown last year, almost half of which were classed as ‘critical’. Critical assaults and injuries necessitated a total of 3,005 employee sick days, involving 65 staff members.

The Oberstown campus currently caters for 48 under-18s, including a mix of vulnerable young offenders and violent criminals with multiple convictions for serious offences.

The industrial action is likely to include work stoppages, during which emergency cover will be provided. The turnout in the ballot was 91%.

The move comes against the background of a high and growing number of attacks on staff since the expansion of the State’s only youth detention centre to facilitate the transfer of offenders from the prison service.

SIPTU official Ray Stanley said the unions had raised safety concerns on a daily basis in recent years. “While there has been a management response, it has been wholly inadequate and totally in effective. Meanwhile, the Department of Children and Youth Affairs don’t want to know. As a result, dedicated staff feel they have been forced to back industrial action,” he said.

The staff concerned work at three schools on the campus: Oberstown Boys School, Oberstown Girls School and Trinity House. Responsibility for the campus was transferred from the Department of Justice to the Department of Children and Youth Affairs in 2012.

IMPACT official Tom Hoare said: “A series of policy decisions has left Oberstown care workers doing the work of prison staff with the facilities and equipment of a residential care home. The campus is badly designed and understaffed, with inadequate safety equipment and procedures to deal with a mix of vulnerable young people and violent offenders. The result is a daily risk of serious assault, which leaves many of the staff literally in fear of their lives as they leave for work each day.

The unions say:

  • The expansion and refurbishment of the complex was badly planned and implemented, resulting in a totally unsafe living and working environment
  • Subsequent stop-gap measures, which were supposed to minimise risk to staff and residents, have been both inadequate and ineffective
  • Staff are denied appropriate personal protection and safety equipment
  • Staff recruitment and retention problems, coupled with absences due to assaults, have left the facility understaffed and incapable of dealing safely with the numbers of offenders in the unit.