Public service pay ‘could face cut’

Public services could suffer as a result of the big numbers taking early retirement, members of the troika have warned in their latest report, calling into question the Croke Park Agreement.

The report issued by European Commission staff suggested wages could be lowered rather than having more public servants leave, a view that is at odds with the 2010 deal which trades off productivity improvements for no more pay cuts.

It comes as plans for an EU finance minister who could reject and change national budgets and set a limit to government borrowings in exchange for eurobonds has been welcomed by the Government.