Big hurdles ahead in talks to extend Croke Park deal

Analysis:Public service trade union leaders have told members that talks with the Government on an extension to the Croke Park agreement, which commence today, will be the most difficult negotiations they have ever undertaken.

They have also warned that the outcome will not be without pain.

The Government is seeking to reduce its public service pay and pensions bill by a further €1 billion (over and above the savings already achieved under the current Croke Park deal) between 2013 and 2015.

For this year it has pencilled in further savings of about €300 million as part of the extension to the Croke Park process.

It has also made it clear that it is essential that it secures these additional savings to meet its budgetary targets.

Unions have told members explicitly that if there is no agreement or if they fail to engage in talks the Government will act unilaterally.

Shay Cody, general secretary of the largest public service union Impact, warned that in such a scenario “the employer would seek to impose payroll reductions in ways of their choosing as they have done in the past”.

Under the current Croke Park agreement the Government guaranteed not to cut pay rates any further for public service staff and not to introduce compulsory redundancies in return for co-operation with a widespread reform programme.

Any move to introduce cuts unilaterally would undoubtedly end the current era of industrial relations stability in the public service on which the Government has placed considerable importance.

Whether it would lead to all-out strikes is debatable but there would certainly be ballots for industrial action, work-to-rules could be predicted and co-operation with the public service reform process would likely come to a sudden end.

Such co-operation with reform has been very important over recent years to allow for the continued provision of public services at a time of significant downsizing of staffing levels. Much of the savings realised under the current agreement came from reductions in staffing numbers which, by 2015, the Government wants to see fall by 37,000 from their 2008 peak.

Significant savings have also been generated by implementing new rosters, a curtailment of overtime provision and new working arrangements.

Existing measures

However, Department of Public Expenditure and Reform secretary general Robert Watt told unions last week that although the existing measures had proved successful, they would not deliver the increased level of savings sought by the Government.

He said it would not be possible to achieve that level of saving while maintaining adequate levels of service to the public through head-count reductions alone.

“Therefore the measures the official side propose to put on the table will have to involve reductions in payroll costs for serving staff, as well as substantial productivity and workforce reform measures for all to assist in controlling any underlying expenditure pressures that may relate to the reduction in public service numbers,” he said.

The unions have said the Government’s proposals would be tabled only when the new process starts today.

However, Minister for Public Expenditure and Reform Brendan Howlin gave some hints when he announced the Government would be seeking an extension to Croke Park last November.

He said he wanted to maintain as far as possible the current pay for the “vast bulk” of public servants.

He also said there was a need for staff to work longer, more cleverly and in a different, smart way.

If pay is to be protected for the “vast bulk” of staff it can be assumed there will be moves to reduce current earnings for at least some personnel.

However, highly placed sources said at the weekend there was an expectation that all the elements of the public service – Civil Service, health, education, local authorities, the Garda, Defence Forces, prison service, etc – would face proposals that would involve workers making sacrifices .

Howlin’s comments also added to the view of unions that the Government would ask staff to work longer hours – as was suggested by the Health Service Executive last autumn.

There has also been speculation that the Government could seek changes to existing Sunday premium payments for nurses and gardaí, while teachers could face cuts in existing supervision and substitution payments.

Tom Geraghty, general secretary of the Civil Service trade union for middle-ranking personnel the PSEU, told members during the week that the priorities in the talks for his organisation would be to protect against compulsory redundancies and to maintain pay rates.

“To achieve this, and a successful outcome is not assured, will require that all other aspects that make up the pay bill will be up for discussion.

“This will include allowances, overtime, expenses, working time, etc. To pretend otherwise would be dishonest. Equally, it would be dishonest not to acknowledge that the issue of increments has been referred to with alarming regularity by senior Government Ministers,” he said.

Longer working hours

There is no guarantee that a deal can be reached. Already the union representing lower-paid civil servants, the CPSU, has said it will resist any move to change current flexitime arrangements or to introduce longer working hours.

The Irish Nurses and Midwives Organisation has said it will not agree to “any reduction of existing rates of pay, either in the form of incremental scales, allowances or premiums”. Garda bodies are likely to strongly oppose changes to overtime or premium rates.

Health unions are also likely to object to the suggestion that €150 million, or around half of the total for the year, is to come from their area.

Even if a deal is reached with union leaders, the outcome will have to be put out to ballot.

The original Croke Park agreement was rejected by some unions representing nurses and teachers and by some civil servants. However, it was carried as it was backed by the larger unions such as Impact and Siptu.

All sides agree that the forthcoming talks will be hugely challenging and many hurdles will have to be cleared if there is to be a deal put in place eventually.

Timing will be all important as the Government will want the negotiations concluded before the union conference season commences at the end of March.

However, the clock is also ticking already on the time for making the savings. The longer the process takes the less time there will be to make the savings this year.

* Martin Wall is Industry Correspondent