Public Service Pay Commission: Private, public pay ‘on a par’

After years of debate as to the perceived public-private sector pay differential, the Public Service Pay Commission has concluded the two sets of workers are relatively on a par.

Public Service Pay Commission: Private, public pay ‘on a par’

That is when a number of factors including educational qualifications and experience are taken into account.

In fact, the commission has found that earnings of a number of higher-paid public servants are significantly lower than what they could expect in a similar role in the private sector.

The opposite is the case for low-paid civil servants whose earnings were found to be higher than their private-sector equivalents.

Despite speculation it was liable to propose pay restoration of 6% for public servants over three years, the commission has shied away from a specific recommendation.

However, it does point out that, in recent years, private sector pay settlements have been between 1.5% and 2.5% per annum depending on the sector and ability to pay, while for large companies, the average increase over the last two years was 2.5%.

“Average public service earnings declined from 2008 to 2014 and in 2016 were some 8.1% below the 2008 level,” the commission also said.

However, the commission does base its recommendations around an ability to pay and says the Government will need to take account of the pressures on the public purse.

It said control of the public service pay bill is a central determinant of government budgetary policy adding “it will be a matter for the parties to negotiate a timeframe that will provide for the orderly unwinding of the FEMPI (Financial Emergency Measures in the Public Interest) legislation having regard to:

  • Maintaining sustainable national finances and competitiveness;
  • Other government spending priorities;
  • The public service reform agenda;
  • Equity considerations on public service pay.

In its submission to the commission, the Department of Public Expenditure and Reform had warned that “a recovering economy is not a recovered economy” and that the fiscal position of the State remained exposed.

However, the Irish Congress of Trade Unions argued that the ability of the State to pay its employees is dependent on its ability and willingness to raise revenue. It said in the context of a growing economy, revenue will be generated.

The State is already facing a €50m bill in 2017 for Garda pay increases as well as a €120m bill as a result of the accelerated pay increases for public servants, which kicked in last April.

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