Budget: IMPACT welcomes planned public service recruitment and acknowledgement of Haddington Road savings

Ireland’s largest public service trade union today (Tuesday) welcomed the Government’s acknowledgment that payroll savings delivered by the Haddington Road agreement will be worth around €500 million in 2014 – in the region of 20% of next year’s budgetary adjustment.

IMPACT also welcomed the signalled easing of pressure on public service staffing and the Budget announcement that a “reform dividend,” in the form of limited public service recruitment, was now planned. The union said it would seek consultation with the Department of Public Expenditure and Reform, and other Government departments, to highlight areas where new recruitment was needed. It said enhanced staffing was urgently needed in the health and social care professions, primary and mental health services, special needs provision and a number of other areas.

IMPACT general secretary Shay Cody said Minister Howlin’s statement that Haddington Road would save €500m next year was a timely reminder of the substantial and ongoing contribution public servants are making to Ireland’s deficit reduction. “These substantial additional savings are arising because many public servants have had less in their pay packets since July 2013, while all public servants are working longer, and the vast majority are waiting longer for increments,” he said.

Mr Cody said the Haddington Road measures come on top of 14% average pay cuts since 2009, a 30,000 reduction in staffing, and major cost-saving reforms delivered under the Croke Park deal, which together had delivered a €3.3 billion (17.7%) reduction in public service payroll costs between 2009 and mid-2013. “Like all other workers, public servants have also experienced increased taxes and charges, plus public service cuts, in this and previous budgets,” he said.

The Croke Park agreement delivered verified savings of €1.8 billion, net of additional pension costs, between 2010 and 2013. The Haddington Road deal will add almost €1 billion to this figure, while further savings are targeted from additional measures in the original Croke Park deal. The number of public servants has fallen from 320,000 in 2008 to 290,000 today.

Commenting on the overall Budget package, Mr Cody said that, while its limited stimulus and employment measures were welcome, they were insufficient to deal with the unemployment crisis.  “We should not continue to take billions out of an economy that badly needs a serious stimulus to create jobs and consumer confidence, which would generate exchequer revenue and help deal with the deficit,” he said.

IMPACT supports the alternative ICTU budget approach, which calls for:

  • No further cuts in day-to-day public spending
  • The full proceeds of the promissory note deal to be used to reduce the budgetary adjustment by €1 billion in 2014 and 2015
  • An investment stimulus of €4.5 billion over the next two years, which would generate jobs and exchequer income
  • Targeted tax increases for the richest 10% of households, along with an increased contribution from the corporate sector.