Daniel McConnell: Pay restoration for public servants a politically delicate issue

Restoration of wages to highly-paid public servants comes at the worst possible time for the Government as the public sees their wages wiped out by rising inflation

Attorney General Paul Gallagher legally advised that there was no scope to either abandon the pay restoration or delay it to some point in the future. Picture Collins, Dublin, Colin Keegan.

Increasing the pay of the country’s highest-paid public servants is a politically delicate issue for any government at any time.

It always highlights the disparity between the haves and have-nots. And often, the nuance of the situation gets lost on the public who simply see those at the top being feather nested.

News that about 4,000 of the country’s top public servants who earn more than €150,000 a year are to have their financial crash era pay cuts restored is one such situation.

This group includes senior judges, about 3,700 medical consultants, secretaries-general of government departments, and the heads of state bodies.

They will receive increases ranging from 1.7% to 10%, which in some limited circumstances could be in excess of €20,000. The move to restore the pay will cost the taxpayer about €30m per year.

Cuts

Finance minister Brian Lenihan introduced public sector pay cuts in response to the financial crash in 2009 Picture: Mark Stedman/Photocall Ireland

Cuts to public pay were introduced by the then Fianna Fáil finance minister Brian Lenihan in 2009 in response to the financial emergency the country found itself in.

The restoration of pay has been underway since 2015 and this final instalment effectively brings the curtain down on the emergency era of pay cuts in the public service.

Back in 2017, the then government introduced legislation outlining the phased restoration of pay cuts to public servants starting with those on the lowest yearly salaries.

At that point, it was set out that the highest-paid category would see their pay cuts restored from no later than July 1, 2022.

So up to now, everyone earning below €150,000, or 99% of the public service, has had their pre-financial crash pay rates restored on the basis the financial emergency is over.

Legal advice to the government maintained that the pay cuts were allowable as long as there was an emergency in the public finances.

Legal advice

Fresh advice from Attorney General Paul Gallagher to Public Expenditure Minister Michael McGrath made it clear that there was no scope to either abandon the pay restoration or delay it to some point into the future.

Reports in other media outlets that the Government “abandoned” plans to delay the pay increases have been described as “wide of the mark” with senior sources saying there were never plans to do so.

It is understood the legal advice indicated the government had no basis not to proceed with the restoration. On this basis, the restoration will take place on July 1 in accordance with the law.

It has also been pointed out that public servants who benefit from the pay restoration are not eligible for further pay increases in the year of restoration.

Ministers and office holders do not benefit from this restoration and it has been confirmed that Robert Watt, the €300,000 secretary-general at the Department of Health does not benefit from the restoration.

Politically, on one level the timing of such pay increases may not be good in light of the cost of living crisis, but for many, it will mark the formal ending of an era of great pain for this country.