‘Why can’t pay go back to pre-crisis levels?’ - Siptu leader Jack O’Connor

Siptu president Jack O’Connor has denied he issued an ultimatum to the Government over talks to renegotiate the Lansdowne Road agreement.

However, he said if the Government was proclaiming that the economy had emerged from the economic crisis, and economic indicators reflected this, then “the levels of pay in the economy should reflect that”.

Asked about the feasibility of restoring pay to pre-2008 levels, Mr O’Connor said: “Why can’t pay go back to those levels? It wasn’t unsustainable then.

"What caused the crisis had nothing to do with pay. What caused the crisis had to do with the fact that the net foreign debt of our banks increased from the equivalent of ten per cent of GDP in 2003 to 60 per cent in 2008," Mr O'Connor told RTÉ's Morning Ireland.

“On top of that we had a ridiculous SSIA scheme which umped €16billion into an over heated economy in 2006 into 2007 in order to enable the government of the day to win the general election in 2007.”

“So if economic output has returned to the level that it was at prior to the crisis by almost two years now, and if domestic consumption is now just about the level it was at prior to the crisis then the levels of pay in the economy should reflect that.

“If they don’t, and we’re getting indications of it already, is deflation. We now have a situation because spending power of the population is so suppressed by reason of wage suppression over so many years that our CPI (Consumer Price Index) figures are reflecting deflationary trend.”

Siptu meeting

When asked if he thought he may have jumped the gun last week when he issued a deadline, he said that if the Government had been about to sign a letter of invitation to talks then he was wrong, but he said there was nothing to suggest this was the case.

He said the news that the Government had been about to issue an invitation just as he released his statement last week, was “absolute nonsense.”

The executive council of Siptu, the country’s largest trade union, is to meet on Thursday, and was scheduled to consider moves to authorise ballots for industrial action among its 60,000 public service members if the Government had not agreed in principle by then to convene talks on a new public service pay accord.

Siptu president Jack O’Connor had last week urged the Government to commit to holding such talks no later than the beginning of February.

However on Wednesday evening Siptu received a letter from the public services committee of the Irish Congress of Trade Unions (Ictu) requesting it to postpone any move to ballot members for industrial action while contacts were continuing with the Government. These contacts are expected to continue for up to another fortnight.

Siptu’s executive council is expected to consider this request at a meeting on Thursday.

D-Day

Mr O’Connor on Thursday rejected the description of today as ‘D-Day’ for the Government on the issue of pay talks.

He said that an Irish Congress of Trade Union request for a deferral of a decision for two weeks would be given due consideration when the executive council of Siptu meets today.

“Describing today as D-Day misses the point. It doesn’t become D-Day until strike notice expires. Talks must get under way by 1st February. We fully intend to follow through,” he said.

“The deadline for the Government is when the strike notice expires.”

Siptu’s executive council will have to authorise any ballot, he pointed out.

“We always made it clear than when things improve we would be looking to recover lost ground. We also made it clear that we believe negotiations should be conducted under the auspices of the Irish Congress of Trade Unions,” he said.

In an interview with Newstalk, he said “the Government has made it clear on numerous occasions that it has no intention of renegotiating the Lansdowne Road agreement.”

Defer ballot

Public service union leaders have urged Siptu to defer plans to ballot its members who work for the State for industrial action in order to facilitate further contacts with the Government over pay.

The public service committee re-iterated at a meeting in Belfast on Wednesday that its affiliated unions wanted the Government to engage in talks on a replacement for the Lansdowne Road agreement to facilitate faster pay restoration for their members.

The Lansdowne Road agreement is the centrepiece of the Government’s public service pay policy and is due to remain in place until September 2018. The agreement began the process of reversing pay and pension cuts introduced for staff in the public service since 2008.

However, the secretary of the public service committee of the Irish Congress of Trade Unions, Tom Geraghty, warned onWednesday that either there were collective discussions with the Government on a replacement for the deal or individual unions would deal with the matter in their own way, something that would almost certainly lead to further industrial action.

Following the meeting in Belfast, public service trade union leaders agreed that talks with Government representatives should continue and they would meet again in a fortnight.

Mr Geraghty said that, in light of the €40 million pay offer made to gardaí following a recent Labour Court recommendation and amid the threat of industrial action, the Lansdowne Road agreement would not now run its full course to its scheduled expiry date in September 2018.

He described the pay offer to gardaí – who had refused to enter the Lansdowne Road accord – as a “game-changer”.

On Wednesday the Minister for Justice Frances Fitzgerald said the cost of the garda pay offer, as set out in the Labour Court recommendation, could cost more than €50 million.