Benchmarking was the buzz word at Government Buildings as talks on pay entered their final phase. After the debacle on public-service restructuring and local bargaining in Partnership 2000, during which nurses pushed public-service pay boundaries to over 15 per cent, the Department of Finance is anxious to kill off the system.
That is where benchmarking comes in. It is an attempt to do two things. One is to resurrect the old conciliation and arbitration system that preceded restructuring. The other is to introduce a system for measuring performance, in terms of delivery of services.
Management was pressing last night for the unions to accept a new, independent pay review board that would assess progress not just against other sectors of the public sector but private-sector comparators.
Yesterday evening the public-service unions were still testing the water. But if teachers and other "early settlers" want a 3 per cent catch-up award on the nurses, on top of the 15 per cent general pay round now on offer, management was insisting they must embrace the notion of change. Far from being afraid of such an initiative, management argued that unions should grasp the opportunity it offered to seek pay increases based on private-sector rates.
In fact, some of the "early settler" grades in the Civil Service, which have embraced change more readily than teachers, are not averse to a new system. Their own ability to negotiate good deals is handicapped by the system of relativities, which means that management must factor into the price of any deal done locally the cost of knock-on claims.
At the same time even the most radically minded public-service trade unionists are nervous of private-sector comparators. They want guarantees that protect basic earnings and working conditions.
While the absence of the Association of Secondary Teachers of Ireland from the negotiating table may help to expedite talks at one level, other public-service union leaders will not want to leave themselves open to the charge of "I told you so", by agreeing a slave-drivers' charter.
In the private sector, progress on pay was less complex, but not much easier. In the early hours of yesterday morning employers conceded that the national minimum wage (NMW) could go up to £5 an hour, only to put a timetable of two years on the phasing in of the increase.
The Irish Business and Employers' Confederation also dropped its demand for "cost absorption measures" as a condition of the general pay rounds, but then ruled out any additional local bargaining clause, although private-sector unions such as MSF were still pitching for this yesterday evening.
Despite the deadlock on the NMW, the ICTU made significant progress on other aspects of low pay. It looks likely that people earning less than £200 a week will receive a minimum increase of £12 in the first phase of any new agreement, £11 in the second and £4 in the last phase.
This may be only marginally above the two 5.5 per cent annual increases and final 4 per cent pay rise on offer to the higher-paid, but it compares well with the increases of only £3.50 a week, £2.40 and £1.60 available under Partnership 2000.
Similarly, the general pay rounds will deliver increases of 15.75 per cent for all workers over the 33 months of the agreement, or 17.2 per cent on an annualised basis. In Partnership 2000 the cumulative increase over 39 months was only 9.65 per cent.
Proposals to scrap the 4.5 per cent PRSI levy on those earning less than £226 a week, as well as the health levy on those earning less than £280 a week, will more than double the increase in take-home pay of low-paid employees during the agreement's first year.
For middle and higher income groups there is the possibility of securing significant increases on top of national pay rounds through gain-sharing agreements. But again IBEC is resisting attempts to make such deals mandatory at enterprise level.
With economic growth of up to 10 per cent a year under Partnership 2000, employers know that relatively high general pay increases are necessary to secure industrial peace. Average growth of 6 per cent means most companies can afford increases of 5.5 per cent this year and next.
It is the weak, labour-intensive enterprises which are most exposed to the impact of the NMW. Many of these are experiencing growth rates of 1 or 2 per cent.