Update on Government announcement on the abolition of public service allowances

18th October 2012

Government departments and offices have been instructed to open talks with unions about the abolition of some allowances currently paid to existing public servants.

The 88 named allowances are drawn from a list of over 100, which were abolished for new entrants when the Government announced the outcome of its review of allowances last month.

A number of the allowances identified for abolition are currently paid to IMPACT members.

The union’s divisions, which negotiate on behalf of members in the various sectors (health, local authorities, the civil service, education and non-commercial state bodies) will now consult with branches that represent the members concerned before talks commence at departmental level. This approach is in line with the position adopted by the union when the Government announced its review of allowances last December.

This will be the first time the union has been involved in talks on the allowances. IMPACT was not involved in the Department of Public Expenditure and Reform (DPER) review, but told the department that it would contest the proposed abolition of any allowance if there was a case for its continuation.

The DPER has set 28th February 2013 as the deadline for talks to conclude. IMPACT will trigger the Croke Park third party adjudication process in any case where agreement cannot be reached. This process is time-limited and, ultimately, binding on both sides.

Third party adjudication decisions are likely to boil down to:

  • Whether the abolition of an allowance would be cost-saving
  • Whether the purpose for which the allowance was introduced continues
  • Whether it forms a significant element of the overall remuneration of the beneficiary and
  • Whether it can be defined as ‘core pay’, in which case it is protected by the Croke Park agreement.

The minister has also accepted that there should be negotiations to allow the incorporation of significant allowances into proper pay structures for certain grades including IMPACT members like firefighters and civil service support grades.

Fast track?

With the exception of the civil service and non-commercial semi-state organisations, Croke Park adjudications are normally handled through the Labour Relations Commission and Labour Court. However, the department has indicated its desire for a ‘fast-track’ process, not least because of fears that adjudications on allowances would represent a huge additional workload for these already-stretched institutions.

IMPACT and other unions have said they will consider this when full details of the proposed fast-track process are tabled.

Last month, the department said it would apply standard Croke Park ‘loss of earnings’ compensation for any allowances abolished for existing staff. In previous ‘loss of earnings’ cases, this has meant a once-off payment of 1.5 times the lost income calculated over 18 months.

When the department announced the outcome of its review of allowances last month, it listed allowances under three headings:

  1. Allowances to be abolished for new beneficiaries (new entrants, promoted staff, and staff newly assigned to the relevant duty)
  2. Allowances to be approved for new beneficiaries, but which will be subject to review and/or moderation
  3. Allowances to be approved for new beneficiaries (as well as existing staff).

Some of the most costly allowances to be abolished for new beneficiaries included teachers’ qualification allowances and the Garda rent allowance. The decision on The Garda rent allowance will also have implications for prison officers and fire fighters.

Some IMPACT members also currently benefit from allowances in the second category, which the department has said will be “reviewed and amended as appropriate by their parent department, following due consultation and engagement with the respective staff representative bodies, over the course of the next year.”  The union would be able to invoke the time-limited and binding Croke Park adjudication procedures in these cases too.

At the end of last January, allowances were frozen for new entrants, promoted staff, and staff newly appointed to relevant duties. Allowances that have now been approved for new beneficiaries will be backdated for any staff concerned.

Read the list of allowances that the department wants to abolish for current staff.

Read the DPER Outcome of the Review of Public Service Allowances.

Read the DPER FAQ document.

Read the Business Cases put forward for allowances by public service departments and agencies.