FF plan to repeal pay Act ‘naive’, says Howlin

Fianna Fáil’s plan to repeal the Financial Emergency Measures in the Public Interest Act (Fempi) would cost more than €1 billion a year and undo many of the public service reforms of recent years, according to Minister for Public Expenditure and Reform Brendan Howlin.

Mr Howlin said that the Fianna Fáil proposal demonstrated that the party was profoundly incompetent and had no idea how to run the country.

Mr Howlin said that his strategy on taking office was to have an honest conversation with the public service unions about how to deal in a rational way with the unilateral cuts in public service pay introduced by Fianna Fáil and underpinned by Fempi.

Reforms and reductions

He said that under the Haddington Road agreement a range of reforms and reductions in pay and pensions were agreed, on the basis that the financial emergency still existed.

“The pay cuts were upheld by the courts because they were accepted as emergency measures,” he said. “Once the emergency was over we were obliged to review the position, otherwise another court challenge would have been inevitable.

“I set out to have an orderly unwinding of the Fempi measures on an agreed basis.”

Mr Howlin added that the Lansdowne Road agreement emerged from that process.

The Minister said he had got agreement from his Cabinet colleagues for a package of pay and pension restoration worth almost €1 billion over the three years 2016, 2017 and 2018.

“I ensured this would not be swallowed up in the budgetary process and we were able to provide €300 million a year for the restoration of pay and pensions, and that involved an 80 per cent restoration of pension entitlements,” he said.

“That still leaves us with another €1 billion accruing under Fempi and what Fianna Fáil doesn’t seem to realise is that by repealing the legislation that amount would be immediately restored automatically. That would clearly be unaffordable and is unaccounted for in the Fianna Fail projections.”

Mr Howlin said another immediate effect of the repeal of Fempi was that all reforms and changes in working conditions that had been agreed as part of the Haddington Road and Lansdowne Road agreements would be immediately set aside.

“If you simply repeal Fempi, it would be impossible to continue the reform process and you would have no cards left for the negotiations that will inevitably take place.”

Public services valued

Mr Howlin said that the Labour Party had always made it clear that it valued public services and that, in government, it worked to restore the pay and pensions of public servants as speedily as possible.

“Without Labour in government, we would not have had the restoration of pay and pensions,” he said. “We intend to continue the process until we have full restoration in an orderly unwinding of Fempi.”

He described the Fianna Fáil strategy outlined by the party spokesman on public expenditure and reform, Seán Fleming, as simplistic and unworkable.

“It is profoundly naive and foolish to pretend that you can simply repeal Fempi and then proceed to negotiate an agreement with the unions that will cost the exchequer very little,” he said.

Earlier in the week, Mr Fleming said Fianna Fáil’s position on public sector pay was clear. It involved the full implementation of the Lansdowne Road agreement and the repeal of the Fempi legislation over the next two years, with a return to normal industrial relations mechanisms to set pay and conditions for the public service.

He said Fianna Fáil would ensure that improvements in the take-home pay of public servants were in line with general wage improvements.