‘Save €1bn under new deal or face pay cuts’
Mr Kenny’s comments come ahead of a memo going to Cabinet tomorrow on voluntary redundancy plans for 2,300 workers and ahead of talks resuming this week on a new deal between management and unions.
Management have proposed pay cuts to some grades, extended working hours, and reduced overtime payments in the talks. Some union chiefs have reacted angrily to the options so far.
However, Mr Kenny said the Government reserved the right to introduce legislation to force pay cuts on workers if a deal could not be agreed.
“We’ve made it perfectly clear that the Government have the right to legislate for changes that we need to achieve these savings,” said Mr Kenny.
Public Expenditure Minister Brendan Howlin wants talks on a Croke Park extension wrapped up by the end of February and agreement on €1bn in savings for the next three years in place by the middle of the year.
His memo to Cabinet tomorrow will outline where a targeted redundancy package will be taken up by workers in health, agriculture and education.
Mr Kenny told RTÉ’s The Week in Politics yesterday the Government wanted agreement with unions on a new deal partially to protect frontline services.
He said increments, cuts to which form part of talks, would amount to €200m for workers this year.
Any option to benchmark public service pay could also be considered in the future, he admitted.
Mr Kenny also stressed the importance of getting a deal on repayments of the promissory notes used to bail out Anglo Irish Bank.
Ireland is due to repay €3.1bn at the end of March but is piling pressure on European colleagues to support Ireland’s case for a redrawing of the repayment scheme.
Mr Kenny said the Government wanted to change the type of repayments from a “serious overdraft to a long-term mortgage”.
The promissory notes issue is expected to be raised informally again this week with European ministers as well as with institutions.
Finance Minister Michael Noonan will be in Brussels today as he assumes the chairmanship of Ecofin, the powerful committee of European finance ministers.
Ministers at home and abroad are also expected to press their European counterparts on the matter during other EU presidency meetings.
Meanwhile, a legal challenge to the promissory note deal and arrangement will be heard in the High Court this week. Mortgage arrears advocate David Hall is challenging the constitutionality of the previous administration’s decision to pay the promissory notes without first having a Dáil debate or a specific vote on the issue.
Any defeat for the Government may result in the need for emergency legislation on the Anglo deal.
