A calendar quirk will bring an extra payday for thousands of workers and social welfare recipients in 2015 and add €200m to the cost of running the country.
The issue arises because of the high proportion of weekly and fortnightly wages paid on Thursday, the day on which January 1 and December 31 both fall in 2015. There will be 53 paydays for those paid weekly, and 27 for some of those paid every fortnight, on Thursdays.
In the education sector alone, around €132m more than normal will have to be paid because 30,000 primary teachers and around 30,000 retired teachers and non-teaching staff are due to receive 27 fortnightly payments instead of the usual 26. As second-level teachers are paid on alternate fortnights to their primary counterparts, their next extra payday will not be until 2020, the last having been in 2009.
The Department of Justice expects the cost of an additional weekly pay run for gardaí and fortnightly-paid departmental staff to be over €31m.
The anomaly in the calendar may benefit social welfare recipients, but could add €45m to the Department of Social Protection’s budget. That is the extra amount it expects to arise on Thursday payments of schemes like invalidity pension, carer’s allowance, one-parent family payment, and family income supplement.
In 2016, the fact that there will be 53 Fridays — rather than the usual 52 — will see an estimated €130m extra cost arise as it is the biggest pay day in the department’s week.
Almost 8,000 Defence Forces personnel, not including officers as they are paid monthly, are receiving 53 weekly payments on Wednesdays this year, adding around €6m to the paybill.
Extra payments in 2015 to around 725 Department of Defence civil servants and civilian employees, paid weekly or fortnightly on Thursdays, will amount to €850,000.
The HSE did not provide figures for extra health sector costs arising.
Some departments cited extra pay costs in 2015, above this year’s figures, to Public Expenditure and Reform Minister Brendan Howlin’s department in submissions last July to the 2015-17 comprehensive expenditure review.
Despite this, the Department of Public Expenditure and Reform claims that no extra costs arise next year.
It told the Irish Examiner that, “not-withstanding the pay day, the cost is assigned to the year in which the earnings are earned”. It said that, in a year where 27 fortnightly or 53 weekly payments arise, employees do not benefit from an additional payment.
“But rather [they] are receiving a payment to reflect the crystallisation of a liability being accrued by them over a number of years, in this case since 2004,” a spokesman said.
He said the liabilities build up over time because the 26 pay periods in a year, in the case of those paid fortnightly, do not cover the annual salary amount owed. “In other words, there are 26.09 fortnightly pay periods in any one year, averaged out to incorporate the additional leap day every four years, while employees are paid for 26 fortnights a year.”
The treatment of extra payments will not impact the Government’s deficit as DPER says it accrues annually, and technical details about the January 1 payroll will be formalised in the revised public service estimates that Mr Howlin will publish later this year. The Irish Examiner understands the costs will not be set against each relevant department’s spending allocation, but will instead be provided for centrally, which means no negative impact on budgets for other services.
© Irish Examiner Ltd. All rights reserved