Talks on an extension to the Lansdowne Road agreement (LRA) are set to commence this month. They will get underway soon after public expenditure minister Paschal Donohoe presents a report from the Public Service Pay Commission (PSPC) to the cabinet. This is expected to happen this week or next.
The talks will aim to set a timetable for the unwinding of emergency legislation that introduced pay cuts and the pension levy at the height of the economic crisis. The PSPC was been charged with addressing “how the unwinding of the Financial Emergency Measures in the Public Service (FEMPI) should proceed.”
The commission was asked to take account of public-private pay comparisons, international pay trends, security of tenure and the value of public service pensions. Recent statistics from the Central Statistics Office are useful on the first of these. Published in March, they showed that that public service workers now earn slightly less than their private sector counterparts when you take account of the so-called ‘pension levy,’ and factors such as occupation, education and length of service.
However, the value of public sector pensions and the contribution that public servants make towards their retirement income will be a major issue of contention in the talks. Unions and the Department of Public Expenditure and Reform submitted different assessments of the cost of public service pensions to the PSPC. And the minister has indicated that he will seek increased contributions to the cost of pensions as FEMPI is unwound.
ICTU’s Public Services Committee (PSC), which coordinates the union voice in talks, has argued that public servants already pay PSRI and contribute 6.5% in superannuation contributions. The pension levy represents a further 10% or 10.5% contribution, depending on earnings over €28,750 a year. Unions also point out that staff who joined the public service since 2013 have significantly reduced pension provision.
Both sides are anxious to conclude the negotiation as quickly as possible so that any agreement can be balloted and, if accepted, reflected in next year’s budget calculations.