As the Croke Park Agreement Implementation Body prepares to publish its first annual review, ministers and unions are insisting that it is the only way to deliver savings. However, the slow speed of reform is being questioned as an EU-IMF deadline approaches this autumn.
By the end of quarter three, the bail-out memo requires “an appropriate adjustment, including to the overall public service wage bill” to cover any “potential shortfalls in the projected savings arising from administrative efficiencies and public service numbers reductions.”
In practice, this could mean further cuts in pay, jobs and public services.
“Everybody wants to see Croke Park delivering what was promised but there would be growing scepticism about its capacity to do that,” says Brendan McGinty, IBEC’s spokesman on industrial relations and human resources.
McGinty points to the scale of Ireland’s economic challenge and “more importantly for the agreement, the lack of energy and the lack of drive on the part of the parties involved to get on and deliver those commitments.”
He describes the unions’ attitude to current employees’ conditions as “what we have we hold” and calls for “a step change in the quality and intensity of engagement.”
The agreement is “purely an enabler” and IBEC wants to see “envisioning” i.e. a clear view of how each public sector organisation will operate when the reform process is complete. “Strong leadership” is therefore needed from both management and the unions.
The agreement aims for a leaner and more integrated public service. In practice, this means a “progressive reduction” in staff numbers through voluntary redundancy, a continued moratorium on recruitment, and no cost-increasing claims or strikes from the unions, in return for no further pay cuts over its lifetime i.e. 2010-2014.
Compulsory redundancies could be introduced if the agreement is breached e.g. if unions take industrial action. The deal was also “subject to no currently unforeseen budgetary deterioration”.
Terms and conditions of employment will be standardised across the board, with staff redeployed where necessary.
Modernisation will involve organisations, working more closely together, shared services “within and across” sectors, improved collation and re-use of data and personal information, and joint inspection teams to enforce regulations.
Examples cited by the Implementation Body have included a single central unit for processing medical card applications, with online applications now possible, moving 500 staff to departments helping the unemployed (i.e. Social Protection and Enterprise, Jobs and Innovation) and longer working hours in medical labs.
In education, the Irish National Teachers’ Organisation claims that Croke Park has effectively delivered 1,000 extra primary school teachers, working 1 million extra hours, at no additional cost to the Exchequer.
Public sector numbers stood at 309,804 in January 2010, when the most recent official statistics were collected. Estimates suggest that 4,000-5,000 public sector workers have left work since June 2010, which compares to a recorded fall of 9,032 between 2009 and 2010.
Under the previous Government’s National Recovery Plan, public service staff numbers would be reduced to 294,700 by December 2014 i.e. an average annual fall of around 3,300. This would have resulted in an estimated further saving of €1.2 billion in the payroll budget.
The new Programme for Government’s commitment is 18,000-21,000 fewer public sector jobs by 2014, falling a further 4,000 by 2015. If the latest estimates are correct and that trend continued, there would be a reduction of around 12,000-15,000 jobs by 2014.
The Department of Finance has confirmed that the new Government is seeking €310 million in savings this year, no change from the previous Government’s plans. Most trade unions expect that this can be achieved within the agreement’s terms. Ministers and unions have warned of further pay cuts if the agreement is breached.
Public Reform Minister Brendan Howlin has stated that the agreement is the only way to make the required savings. Howlin and Minister of State Brian Hayes have both said that large parts of the public sector are not fit for purpose.
Since ICTU’s Public Services Committee voted in favour on 15 June last year, all but one of its affiliates has signed up to the deal. The Irish Federation of University Teachers (IFUT) is the only remaining objector after the Teachers’ Union of Ireland supported the agreement in March. IFUT has said that the deal would place its members’ contracts under binding arbitration and also claims that the Government’s hiring policy for researchers is exploitative.
The Civil Public and Services Union (CPSU), which represents lower paid civil servants, has reluctantly accepted the agreement, but claims that its members are struggling to pay their bills while senior managers continue to enjoy eight weeks’ holidays. CPSU members have claimed that the universal social charge equals a pay cut and the union voted to withdraw co-operation at its annual conference; a ballot is due to be held.
ICTU General Secretary David Begg expects Croke Park to deliver.
“From what I know I have no reason to believe that it will not do what it says on the tin or that it will not achieve the targets specified for this year,” he told delegates at the Public Service Executive Union conference.
The Irish public sector, Begg stated, is on a par with the USA (14 per cent of the labour force) and no other EU country had accepted a 14 per cent pay reduction.
He also criticised the neo-liberal thinking on reform, which assumed that people in organisations were motivated only by individual self-interest. The private sector responded to the law of supply and demand but public services were “rationed”.
The “unrelenting focus” on public service reform was contrasted with “complete inaction” on banking reform. ICTU had told the EU-ECB-IMF troika to “back off” from interfering in the labour market as it had “no legal competence, not to mention moral authority” to do so.
The Department of Finance does not want to pre-empt the review’s outcome but a spokeswoman said that the pension levy and reduced pay bill had effectively saved €2.3 billion from 2008 to 2010. Those savings “will continue as numbers fall and other reforms are delivered across the public service.”