TAOISEACH ENDA KENNY has affirmed that the government needs to find €300 million in savings from the public payroll this year, despite the rejection of the Croke Park 2 pay deal by public sector workers.
Kenny said the government remained “absolutely united” behind Brendan Howlin’s bid to make savings in the public payroll, affirming the need to cut €300 million this year and find savings totalling €1 billion between now and 2015.
“The bottom line here is absolutely clear,” Kenny told the Dail. “We have to, we must, and we will find €300 million of extra savings this year from payroll.
“That’s the challenge the government now faces.”
The government’s plans for payroll savings took a major dent when three of the country’s four biggest unions yesterday rejected the Croke Park 2 proposals – meaning it is certain to be formally rejected when trade union representatives meet at ICTU level today.
Kenny said an agreement with unions to cut pay was “in the interest of the Irish people and the Irish country in general”.
His comments came after Fianna Fáil leader Micheál Martin said it was “very clear that your Plan B is to reflect”, and it was “extraordinary” that the government had no obvious recourse, having apparently stalled on its plans to legislate for pay cuts of 7 per cent across the board.
Martin said he was glad to hear the government parties were united on the problem, as “some parts of the Labour Party have been speaking out of both sides of their mouth on this issue.”
Martin also criticised the ‘side deals’ offered to workers in certain sectors, such as prison workers and firefighters, as “a bit of intimidation at the end – and it backfired spectacularly”.
Sinn Féin’s Mary Lou McDonald said the rejection of the deal was a “very clear signal” from workers that they had no more to give, and said Brendan Howlin’s assertions last night – that he would run out of money before the end of the year if pay was not cut further – as “absurd”.
She urged the Government to consider the introduction of an extra tax rate for workers over €100,000, which would offer the revenue needed to reach the Troika target, while also treating public and private workers equally.
Kenny said McDonald had herself received figures on proposed pay caps from the Department of Public Expenditure in February, when she was told that the estimated net savings would be €110 million per year – while also setting the marginal tax rate at 62.5 per cent.
“I think you need to get a lot more thinking caps in that party,” Kenny said. “What you are proposing would be the ruination of this country. The ruination of it.”
Kenny also argued that the proposal to hit higher earners would meet with failure, pointing out that higher-earning civil servants had voted against the Croke Park 2 proposals solely because it would cut pay for public workers on over €65,000.
“What you want to do is tax people out of existence with some vision of yours that that’s going to sort out all our problems.”
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