Any bets on the size of Public Sector pay cuts?

[meriwether2]

How do you come to such a conclusion. As a community we can only provide services that we can afford but the key here is afford. We need to intoduce a fair and progressive tax system and to ensure that all income generated is within the net. We also need to look at our capacity to generate real wealth, not the stuff that was doing the rounds during the smoke and daggers period.

I came to that conclusion, because if you spend money on one thing then you cannot spend it on another.

Is this week daft argument week?

[hopi watcher]

I cam e to that conclusion, because if you spend money on one thing then you cannot spend it on another.

Is this week daft argument week?

What are talking about? I have outlined what I am talking about. This nonsense that public sector pay has to be gutted or we must have wholesale redundancies or public services must be abandoned is outdated PD clap trap. We need to start behaving again as a community and not a bunch of greed merchants who rip each other off and glout over the misfortunes of others.

[polcol]

No problem here (in fact I suspect you are more than familiar with what is actually being discussed behind closed doors), except point three should be qualified or expanded a bit more.

Increments account for approx 1.5% of the over all wage bill. Freezing them is a pay cut in real terms. The longer you freeze them the higher the pay cut in effect.

If they are frozen for 3 years thats a 4.5% pay cut for everyone in the public sector.

Are increments not part of the employment contract? If the govt freezes increments it penalizes the employees lower down the scale and does not affect individuals on the max surely this is discrimination.

[Kevin Doyle]

Are increments not part of the employment contract? If the govt freezes increments it penalizes the employees lower down the scale and does not affect individuals on the max surely this is discrimination.

That’s the nitty gritty of it. Combine this with the anomalies that will be thrown up by introducing pay cuts subject to a cut off point and it demonstrates the complexity of the issue at hand.

Yet we have arbitrary rhetoric thrown at it by many on this forum who are utterly clueless to such complexities.

[sparkey321]

No problem here (in fact I suspect you are more than familiar with what is actually being discussed behind closed doors), except point three should be qualified or expanded a bit more.

Increments account for approx 1.5% of the over all wage bill. Freezing them is a pay cut in real terms. The longer you freeze them the higher the pay cut in effect.

If they are frozen for 3 years thats a 4.5% pay cut for everyone in the public sector.

Stopping increments will not result in a drop in the public sector pay-bill. It will result in it not increasing which I would have assumed was a foregone conclusion but will not result in a reduction in payroll costs.

[sparkey321]

What are talking about? I have outlined what I am talking about. This nonsense that public sector pay has to be gutted or we must have wholesale redundancies or public services must be abandoned is outdated PD clap trap. We need to start behaving again as a community and not a bunch of greed merchants who rip each other off and glout over the misfortunes of others.

You are talking rubbish and you know it.

Unless the bond market can be convinced that the loans to Ireland can be repaid we will be charged a higher cost for these loans to compensate for the proposed risk.

A Tax and spend solution will go down like a lead balloon on the bond markets and could make it impossible to raise funds on the bond markets. If that happens we will have to go cap in hand to the IMF and then the trouble will really start.

[Kevin Doyle]

You are talking rubbish and you know it.

Unless the bond market can be convinced that the loans to Ireland can be repaid we will be charged a higher cost for these loans to compensate for the proposed risk.

A Tax and spend solution will go down like a lead balloon on the bond markets and could make it impossible to raise funds on the bond markets. If that happens we will have to go cap in hand to the IMF and then the trouble will really start.

Here we go with the IMF boogey man again.

I'll tell you what, I'll postpone any further comment on that particular issue save to say if the IMF are called in I'll run down O'Connell St stark bollock naked.

[dub14]

*shakes head* benchmarking or not IT'S STILL ILLEGAL!!!!!!!!!
Its not a public or private sector issue - you simply, legally, can't do it. If major private sector companies have tried it and been told its not legal, then you can assume, notes in the attic or not, YOU CAN'T DO IT!!!!!!

Theres no point going on about what the gov should or shouldnt do if it aint legal. The minute THAT becomes legal, then contracts have no binding powers and the whole foundation of contract law becomes moot... big can of worms!

Sure then every private secotr company in the land would slash all ther staffs salaries over night, on the basis of - well, go find a better employer? is that the country you really want? I'm sure the socialist leaning people here (not me I add) wouldn't be mad on that imbalance.

The solution is limited to: (and not proposing, just here is the legal options)
Drop the current pay agreement.
Inititate redundancies where appropriate.
Freeze pay and increments in Public Sector.
Dont replace people when they retire/contracts expire
Slash mileage expenses - knock on effects across private sector and consultancy costs too - which benchmark against DoF rates
Drop all decentralisation plans with less than 80% take up rate.

Deep sigh (as opposed to a shake of the head)

It is possible to renegoniate contracts of employment - I even gave you a real life example of it happening. Spell out the alternatives, i.e. we need to save x amount of money and we can save it by a) a pay cut or b ) compulsory redundanices. Then start negotiating. I shouldn't have introduced benchmarking but in this context it is really hard to resist - i retract it.

Talking your points

Drop the current pay agreement. Agreed
Inititate redundancies where appropriate. Agreed
Freeze pay and increments in Public Sector. - Freeze pay but not increments (this discriminates against workers who are not on max of scale)
Dont replace people when they retire/contracts expire Agreed
Slash mileage expenses - knock on effects across private sector and consultancy costs too - which benchmark against DoF rates - very few actually do in reality - in over 20 years I have never been paid anything even close to CS rates. Having said that by all means reduce the rates to the levels that the rest of us get paid. Do you still have the ridiculous situation the bigger the car the higher the rate and the nonsense that gives you a higher overnight rate if you travel with a PO as opposed to say a HEO ?
Drop all decentralisation plans with less than 80% take up rate - its this not a given ?

[sparkey321]

Ok Kevin

Lets leave the IMF out of it.

Can we agree on the following

Ireland has to raise at least 20 billion on the bond markets this year. Without significant changes to resolve our deficit there is a very real possibility that we will be unable to raise this money and even if we can the cost of the this lending will be extremely high.

This will result in even larger sums from the shrinking exchequer funds being spent on lending costs leaving an even smaller pot for essential services.

Assuming we can..

What do you think the reaction of the bond markets would be if the government started raising taxes and increasing (or even maintaining) spending ?

Also applies to Hopi.

[Kevin Doyle]

Ok Kevin

Lets leave the IMF out of it.

Can we agree on the following

Ireland has to raise at least 20 billion on the bond markets this year. Without significant changes to resolve our deficit there is a very real possibility that we will be unable to raise this money and even if we can the cost of the this lending will be extremely high.

This will result in even larger sums from the shrinking exchequer funds being spent on lending costs leaving an even smaller pot for essential services.

Assuming we can..

What do you think the reaction of the bond markets would be if the government started raising taxes and increasing (or even maintaining) spending ?

Also applies to Hopi.

The same it is for other countries who are at present borrowing but injecting massive amounts of public money into their economies.

We are not a unique or stand alone case with regard to our deficit or our management of it.