Unions are probably doing cartwheels in private after jumping at the offer tabled
ASENIOR official said that unions were not doing high fives in the wake of the pay deal brokered in the early hours yesterday.
That’s probably because they are doing cartwheels. The deal will add €1.1bn to their members’ pay packets over the next four years.
But Bernard Harbor of Impact was sombre and composed as he described the great results that the unions’ crack team – Shay Cody, Tom Geraghty, Sheila Nunan and Gene Mealy – had achieved at talks with Paschal Donohoe’s officials.
First of all, 90pc of public servants will escape the emergency legislation that cut their pay by 2020.
Secondly, most of them will see gains of over 7pc to their pay over three years. And, finally, the deal mirrors some of the best ones being given in the private sector.
And all of this in the face of practically zero inflation and the unknown economic dramas that could result from Brexit. Some commentators have predicted that wages will slump by 3.6pc if there is a ‘hard’ departure.
It’s hard to imagine why anyone would not jump at it.
The main kick in the teeth is for those on gold-plated pensions who will have to keep paying the full whack of a pension levy that will be converted into a higher pension contribution.
It’s probably not idle speculation that this deal may be payback time for gardaí, who happen to enjoy these fast-track retirement arrangements.
The Government is still sore for obvious reasons about the garda threat to go on strike last November. Some unions are still seething about the €50m deal they got as a result. Although they got an extra €120m pay rise on the back of it – they still believe their members are €600 a head short. Could it be a coincidence gardaí would be down around this amount, because they would pay a higher permanent pension contribution than anyone else under the draft proposals?
But whatever the fast accrual of people’s grievances, the truth is nobody is going to end up paying any more for their pensions than they are at the moment in the levy imposed during the recession if the deal is accepted.
Someone said that the only reason there were so many people at Lansdowne House over the past few weeks was that they wanted to keep an eye on everyone else. Only a handful of those present, apart from the top table, had much detail on the pay and pensions proposals in what was by all accounts essentially presented as a fait accompli just an hour or two before the whole thing concluded.
It was hard to imagine that a 19-page document was ever typed with such speed.
Unless, of course, it has been a while in the making.
Department of Public Expenditure and Reform officials had played up the fact the fiscal space for next year would be a tight €200m and some senior sources claimed only 0.5pc would be given. But at the last minute, they decided to offer €180m of that space in the shape of two 1pc pay rises in 2018.
The deal mirrors private sector bests – but nobody knows what account was taken of the gap between public and private sector workers’ pensions when calculating the new permanent pension contribution staff will make.
It seems to have had more to do with the value of a pension levy that remains in place that is now being fully or partly converted into the new payment. The Public Service Pay Commission estimated that this gap is between 12pc and 18pc and its assessment didn’t even take account of the fact that most private sector workers don’t have pensions.
Mr Donohoe’s officials were expected to factor the value of public servants’ job security into the equation.
That too, is a mystery.