No knock-on claims after €200m consultants case, Government insists

The Government has insisted the €200 million settlement with hospital consultants reached yesterday will have no knock-on effects or implication for pay elsewhere in the public service.

The consultants, which had lodged breach of contract claims against the Health Service Executive and the State, will receive corrected remuneration as well as retrospective payment of remuneration. The settlement, which will be paid next year and will cost the State €200 million and add €60 million annually to the consultants' pay bill, was welcomed by both the Irish Medical Organisation, and the Irish Hospital Consultants Association.

Government sources said the deal on consultants’ pay was structured in such a manner to avoid unions representing teachers, nurses and other public sector workers immediately lodging claims to increase pay levels of the most recent recruits.

"Given the unique nature of the dispute, its specific impact on a single group and the fact that the legal proceedings had to be addressed, the outcome to the legal proceedings would not be considered to compromise or undermine existing wider public service pay policy," the Department of Finance said in a statement issued to The Irish Times last night.

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“The settlement terms achieved, although extremely costly, represent a substantial reduction on early estimates of €700m . . . and minimises the State’s exposure to very significant legal costs for all potential claimants.”

Clause

Minister for Health Simon Harris said a clause has been included in the agreement to ensure contractual compliance by consultants, "in particular those relating to private practice".

He said it is the responsibility of hospital managers to ensure consultants are carrying out the exact amount of public work they are contracted for.

As part of its defence to the claim, the State had intended to focus on the work practices of some consultants and in particular the allegation some were not fulfilling their contracted hours for public work. It was revealed last weekend that some consultants had been placed under surveillance by private investigators as the State sought to build its defence.

Senior trade union figures downplayed the suggestions the settlement would lead to increased pressure from the unions on Government.

One figure said the trade union movement had chosen to engage in a bargaining process with the State and this is unlikely to change.

Pay increases

However, two senior union sources both stressed they expected the Government to make provision in the October budget for some pay increases for post-2013 recruits to the public service, who are on lower rates of pay than colleagues recruited before the pay scales were reduced.

Government sources acknowledged it would be difficult to ignore the unions’ demands on the issue, but stressed that no decision would be made until closer to the Budget.

However, there is a general expectation in Government that at least a partial pay equalisation for the post-2013 recruits will be part of the budget package, with commitments to fully equalise pay scales over time also anticipated.

Budget pressures are already mounting for Minister for Finance Paschal Donohoe as he begins the process of preparing the third – and final – budget under the confidence and supply agreement with Fianna Fáil.

Mr Donohoe will present his summer economic statement to the Dáil next week, setting out the Government’s initial approach to the Budget. He is expected to commit to not spending all available resources.