Taoiseach to proceed with pay cuts

19 Nov 09
Public sector pay in Ireland must be cut, Taoiseach (prime minister) Brian Cowen has insisted
By Paul Gosling

20 November 2009

Public sector pay in Ireland must be cut, Taoiseach (prime minister) Brian Cowen has insisted.

He was responding to the widespread public sector strike action planned for November 24, which teachers have now voted to join.

‘Ireland is in crisis,’ Cowen told a youth conference of the governing Fianna Fail party. ‘We have an economic crisis, a financial crisis and a budgetary crisis... For every €30 of income, we are spending more than €50.

‘That has to stop. We have to stabilise it, we have to correct it, and we have to do it now.’

Speaking to journalists at the conference, Cowen emphasised that he would proceed with plans to cut public sector pay. Last year, the government imposed a surcharge on public workers, earmarked to contribute towards their pensions.

The taoiseach said the government will now reduce its pay bill by €1.3bn (£1.2bn) – an average reduction per worker of about €4,300 (£3,900) if achieved without job losses.

Newly appointed Ireland Central Bank governor Patrick Honohan has called for wage cuts to be applied more widely. He said that average pay levels have made his country uncompetitive – especially with the UK, its main trading partner  – because of the fall in the value of sterling.

The influential Economic and Social Research Institute has also called for public sector pay cuts, as well as a 20% cut in child benefits and reductions in other welfare costs.

The ruling Fianna Fail and Green Party coalition has launched a campaign to support its strategy for e4bn of savings to be presented in the budget on December 9. Opposition parties accept that the deficit needs to be closed but have yet to publish their strategies for doing so.

But there is widespread opposition in the public sector to the government’s austerity programme. A ballot of primary teachers recorded 79% in favour of strike action against pay cuts, while 83% of lower grade civil servants backed the call.

Senior civil servants voted 60% to 40% to join the November 24 strike. The Association of Higher Civil and Public Servants said its members had already suffered an effective pay cut of up to 17% because of newly introduced income and pension levies.

Trade unions are urging the government to implement cost-cutting over a longer period, with less intensity. Members of the Unite union, which represents mainly craft workers in local authority health and education sectors, also voted by between 80% and 95% for industrial action.


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