ANALYSIS:The big question now is will trade union leaders be able to sell this reform agreement to a sceptical membership?
IF THE deal reached between Government officials and trade union leaders yesterday morning is accepted in union ballots, staff in the public service will be guaranteed that they will face no further pay cuts up to 2014.
It will also allow for the implementation of most, but not all, of the ambitious public service reforms sought by the Government.
However, the deal provides no more than a route map or a platform for the reimbursement of money lost to staff in the public service as a result of the pay cuts of between 5 and 15 per cent introduced in the December budget. There is no cast-iron commitment set out in the document that the money will be returned.
The scope for any reimbursement of the money lost under the salary cuts will be conditional on the reform measures proposed in the various parts of the public service – health, education, local authorities and the Civil Service – not only being delivered on the ground but also generating considerable levels of savings.
Unfortunately, the document is rather vague on how such a reimbursement scheme would operate. There is no indication as to whether specific targets will be set for the amount of savings to be generated, nor whether all of the savings that materialise will actually be given back to staff. Moreover, while it spells out that there will be annual reviews of public sector pay starting next spring – and based on the savings generated as a result of the reforms – it is silent on when workers would receive the money back.
In deciding whether to accept the deal, individual public sector workers are likely to examine not only whether it meets their objectives set out in advance of the talks but also how they will be affected individually in their own workplace if implemented.
In reality, implementation would represent the most fundamental transformation of the operation of the Irish public services in decades, perhaps ever. The scale of the change envisaged would be felt far and wide across the system.
Firstly, future services will have to be provided by a significantly reduced number of staff. The document states the Government wants to cut “substantially” the numbers on its payroll – although it gives no details. The old demarcation lines between staff in the Civil Service, HSE and local authorities etc are expected to come down as the Government moves to eliminate existing barriers to a unified public service labour pool.
On an individual basis, the deal stipulates that merit-based competitive promotions will be the norm in future and it states that “promotions and incremental progression [will be] linked in all cases to performance”. And importantly in some areas, new arrangements for extending the core working day in the health sector could see certain grades of staff lose out on existing overtime or premium-rate earnings.
The agreement followed hundreds of hours of talks between management, in the various public service sectors, and unions over the preceding week or so. Initially, the parties took as a blueprint the reform documents which were drawn up as part of the failed talks between Government and unions on pay and transformation which took place last December.
However, it soon became apparent that the December document could not just be cut out and pasted into the new text. For example, some of the main generators of savings in the December document was the introduction of provision in the health sector to roster staff for five out of every seven days and to put in place revised rostering arrangements for nurses.
However, it is understood that some unions argued that there would be difficulties in selling such arrangements. It was these difficulties on health that had to be worked through during the first round of overnight talks which began last Sunday.
The reality of the process was that agreements on the reform programme in the various sectors would have to be more or less complete before the Government officials would set out their stall in relation to pay.
In the new agreement the unions by no means secured everything they wanted. By the same token the management side had to concede on a number of issues also.
The Public Services Committee of the Irish Congress of Trade Unions had set out to restore pay rates for staff and it is likely to argue that while there are no guarantees that this will be achieved, a process for securing this objective has been put in train. Separately, any reimbursement arrangement will also initially prioritise low-paid workers, a key aim for some unions.
The unions also wanted to keep the link between pension increases and pay rises for staff. This issue will now be the subject of negotiations next year. At the same time, the period of grace under which the existing pension calculations are not influenced by the cuts in pay for serving staff is to continue for a further 12 months.
However, the unions also had their successes in the talks. Proposals in relation to the outsourcing of work have been addressed, while in the health sector there is little reference to the controversial five over seven-day rostering proposal.
Having reached a deal in the negotiations, different challenges now face union leaders and public service management. Union leaders will have to sell it to an obviously angry membership who are still hurting from the pay cuts. But if it is accepted, public sector management will be able to implement reforms in time for the first verification assessment of the savings in a year’s time.
For the Government, one of its main concerns was that any deal should not be seen internationally as a retreat from budget measures which were generally welcomed. It would seem to have managed to put in place a process to secure long-sought reforms without explicitly giving a commitment to restore the pay rates. Moreover, it has done so in a manner which may avoid causing a scare within international markets.
Martin Wall is Industry Correspondent