Pay Restoration Con of the Politicans, Media and Union Leaders - Decade Later Far from Restoration to 2007 Levels


Details of the latest national plan agreed between the government and union leaders have appeared in the media today, as usual well ahead of the union leaders bothering to tell their membership anything. Then union leaders intention is to present workers with a ‘take it or leave it’ choice accompanied by dire warnings that there is no choice.

The deal as expected is pretty rotten and in effect ensures that the pay cuts imposed on public sector workers from 2009 will at least partially be in place for some workers a full decade and a year later in 2020. What’s even worse is that the worse pay and conditions imposed on workers employed after 2012 are being set in stone rather than overturned. This despite it seeming an essential basic demand of a union that workers doing the same work should receive the same pay.

The only resemblance of any sort of workers solidarity in the deal is the insistence that low paid workers will receive pay restoration somewhat faster. But this is the group earning below 30k and 32k, a rate of pay so low that it would be impossible for a couple on such low earnings to get a mortgage in Dublin. And the faster restoration rates are minuscule, 1% (or a max of 6 euro a week) on January 1st 1919 and an even more pathetic 0.5% (or a max of 3 euro plus change a week) on January 1st 2020.

The proposed pay restoration across the three years is structured as follows

From January 1, 1pc pay rise
From October 1, 1pc pay rise

From January 1, pay rise of 1pc for those earning below €30,000
From September 1, pay rise of 1.75pc

From January 1, pay rise of 0.5pc for those earning below €32,000
From October 1, pay rise of 2pc

Of course public sector workers were really subjected to three different forms of pay cuts. The restorations detailed above only tackle the most obvious of these.

There was also the so called ‘pension levy’ that saw a substantial cut in take home pay. This cut had an ideological purpose in addition to being pay cut, a media myth of all public sector workers having access to ‘gold plated pensions’ was one of a number of methods used to drive a wedge was driven between public and private sector workers. That wedge allowed the government and the employers to use ‘salami tactics’ where rather than risk a united working class fightback of the sort that defeated them with the water charges they were able to isolate each sector and cut it slice by slice.

The pension reality was that large numbers of public sector low paid workers and the large number who will not retire with anything like the full 40 years service will receive almost nothing on top of the state pension. This despite being forced to pay thousands in contributions every year in addition to losing pay through the pension levy. This is because before public sector workers receive a penny the state pension is subtracted from what they are due from their employers. In theory 40 years service, entitle’s you to a pension that is half your previous pay. But after this state pension is deducted this means a workers on 24k a year receive’s nothing and likewise a worker on 48k but with only 20 years service would likewise receive nothing in addition to their state pension. For many more the so called ‘gold plated’ pension only amounts to a top of a few thousand to the state pension.

The proposed deal is forced to finally recognise this but without abolishing the pension levy pay cut. Instead those who actually have a somewhat gold plated pension ( politicians, judges and screws, an interesting grouping ) will see no restoration. The other 253,000 pre 2013 public servants will only see a partial restoration of the pay cut implemented for what are in effect now recognised as not so gold plated pensions - as we outline in some cases they are in fact worthless. And the post 2013 public servants will see more of a restoration but still not a complete one.
The third method that pay was cut - which in real terms was often the largest - has not been tackled at all. Workers are to continue to be forced to work additional unpaid hours with reduced holidays and entitlement to sick pay. The additional hours were between 2.5 and 5 hours per week, in some circumstances, where someone gets a promotion, that could be as much as additional 250 hours per year. In some sectors holidays were in effect cut by 4 or more days a year. If you work out what your wages were per hour before and after these cuts they amount to large cuts in percentage terms and nothing is to be done about that.

In addition most workers now have to work three additional years before they qualify for the state pension, across many of our working lifetimes that’s equivalent to a 10% rise in total working hours. These forced extra hours are counter productive in a society that has enormous youth unemployment. Tens of millions of forced unpaid hours, and later retirement means a huge number of jobs that will never be available for younger people to take up. And even apart from the per hour pay loss it also adds greatly to the stress of those in work, longer hours are terrible for workers health and the quality of service they can deliver.

The union leaders are now going to be trying to sell us this deal as the best available. No other choice will be presented by the unions leaders and we suspect in that context that most public sector workers will end up voting for it as ‘better than nothing’. It is the logic of ‘better than nothing’ that has seen wages and conditions plummet over the last decade.

An earlier generation of workers refused to accept this ‘better than nothing’ logic in the 1960s and 1970s, and indeed earlier decades. They won increased pay, shorter hours, longer holidays, better pensions and decent entitlement to sick leave. They won that through being willing to stand together, agree demands and fight for this through strikes and other forms of industrial action. The unions leaders won’t present that as the alternative but unless you want to still be working in your 67th year it is our only alternative.