Social partnership talks hit pay snag

SOCIAL partnership talks on a new economic recovery plan appeared to be floundering late last night after unions rejected demands by IBEC for a pay pause to the end of 2011 and a more employer-friendly inability to pay clause.

Earlier in the day, employers’ body IBEC told a conference in Dublin that September’s transitional social partnership agreement between employers, Government and unions no longer reflected the economic realities.

It said that while in September only 15% of private sector employers would have claimed inability to pay the 6% pay increases over 21 months, as required under the deal, the reality now was that 85% would be in that position. Therefore it said the inability to pay clause needed to be renegotiated.

It also said it was unrealistic to even discuss pay increases before the end of 2011.

Last night it put those positions to the Government and unions at economic recovery talks at the National Economic and Social Council (NESC).

Unions swiftly rejected them, and while the talks did not collapse, the impasse placed serious doubt on progress in the talks.

The Government needs to have the talks wound up and any conclusions completed before the end of the weekend so that any new measures can be reflected in next Tuesday’s budget.

Even before last night’s flash point Irish Congress of Trade Unions general secretary David Begg said: “There are some things that are more troublesome than others, such as the private sector pensions,” he said going into NESC yesterday afternoon.

“Also getting any guarantees on the social welfare rates is problematic. They are saying they don’t want to go there but they find it hard to give a guarantee that they could not or would not.

“The one area that has moved a bit for us positively has been the budget parameters.

“We had a concern that if they limited borrowing to 9.5% of GDP that it could cause the economy to crash completely with such a deflationary kind of move.”

Meanwhile, RTE yesterday asked its worker representatives to accept minimum pay cuts of 5% across the board as it tries to recoup e10m in payroll costs.

Staff are being asked to accept a 5% reduction on the first e50,000 in earnings, e7.5% on the next 50,000, 10% on between e100,000 and e150,000, and 12.5% . between e150,000 and e250,000.

An RTE spokesman said the cuts were not being imposed on staff but were the opening proposal in negotiations expected to last a number of weeks.

The RTE group of unions said it would be making no comment on the proposals before considering them and consulting with the company once more.