Fasten your seat belts

BERNARD HARBOR predicts a bumpy ride ahead on the road to pay restoration.

Almost a fortnight ago, public expenditure minister Brendan Howlin told the Irish Independent he expects to be negotiating the beginning of pay restoration with public service unions next year.  The political response was pretty muted, but that was mainly because the Dáil is in recess. Now that Howlin has spoken, public service pay will be a major political issue over the coming months and into the general election campaign.

The business response was measured too. IBEC resisted dismissing the idea out of hand. Instead it emphasised its preference for tax cuts over pay rises and said the so-called ‘pension levy’ should remain in place. Expect to hear more.

Media response

The initial media response wasn’t exactly overwhelming either. IMPACT’s analysis featured strongly on RTÉ and Newstalk radio – and across the national print media – in the days following Howlin’s statement. But that was more or less it, except for the Independent’s titles, which milked the Howlin interview for well over a week.

This will also change. The rest of a powerful and largely hostile press corps will argue hard against public service pay restoration once there’s clear blue water between the issue and the Indo’s scoop. The closer we come to a negotiation, the louder they will be.

Unsurprisingly, last weekend’s Sunday Independent (17th August) was the exception to the relative media quiet. It published at least six articles on the issue, mainly fact-free rants from the likes of Eddie Hobbs, Marc Coleman and Colm McCarthy.

Battle lines

Its front page piece was a strong indication of where the PR battle lines will be drawn. The public-private pay gap and, by implication, the ‘divide’ between workers in the public and private sectors, was its central theme.

IMPACT will continue to engage on the public-private pay issue with the facts. These are that economists disagree on the size and significance of the pay gap, but the most balanced and comprehensive study of recent years (by the CSO in 2012) concluded that, depending on how it’s measured, it could be as little as zero or as much as 12% once the pension levy is factored in.

Bigger challenge

A bigger challenge for unions will be to avoid feeding the notion of a public-private workers’ divide, which our detractors have rightly identified as the most effective political lever in their toolbox. Back in 2009, we spectacularly failed in this regard. In the shock and hurt of public service pay cuts, we allowed ourselves to repeatedly come across as ignorant or dismissive of the hardships – particularly unemployment – being experienced in the rest of the economy.

Even today, some seem reluctant to acknowledge, let alone promote, the most important benefit of the Croke Park and Haddington Road agreements – the protection against compulsory redundancy (which has been a feature of the public service in all the other troika programme countries) at a time when 382,000 people are still stuck on the live register.

Recovery for all

Unions must argue the case for public service pay restoration in the broader context of recovery for all.  Virtually everyone is worse off now than they were a few years ago, but it has happened in different ways depending on where you work and what your personal circumstances are. IMPACT’s strategy for pay restoration reflects this by highlighting the need for continued action on unemployment, along with pay restoration in the public, private and community sectors – including the restoration of effective statutory wage-setting mechanisms for the lowest paid workers in the private sector.

In 2009, a media-orchestrated backlash against public servants made it relatively easy for politicians to cut pay. Times and austerity-weary attitudes have changed and Brendan Howlin’s statement two weeks ago has not provoked a similar backlash. Our detractors will move heaven and earth to change that.

Public servants and their unions will have to work hard – in words and deeds – to win and maintain public support. And that means working and arguing for income restoration across the economy.

Bernard Harbor is IMPACT’s head of communications.