Why is public sector pay such a big issue now?

994

Been hearing a lot about how - apparently - the public sector is overstaffed and overpaid. But why did Fianna Fail not make an issue of this over their last 12 years in office? It´s ridiculous to say "we need to cut down on waste" - cutting down on waste is ALWAYS necessary, not just in lean times. To me it's a crude method of setting workers against each other so that they ignore the massive payouts to banks and the elites. EU countries on average secured their banks for 7.5% of GDP. Malta gave no security at all. Ireland - 214%.

eoinbn

Sorry, but that is just nonsense. How are tax increases and pay cuts going to get peoples focus off the massive bail for the banks? What would get our minds off the bailouts would be tax CUTS and wage INcreases, but that is what FF have been doing for the last 12 years- hence why we overlooked the flaws in their 'economics'.

Your 214% of GDP comes from Gene Kerrigan? During the bernie years he was one of the only people worth reading in the Sunday Indep, but he really has gone way too left lately. I assume the 214% is the bank guarantee, where as the projected cost of the bailout is somewhere between 20-50% of GDP, and 50% is only if NAMA is a total failure.

edit: And yes ideally countries/companies are constantly trying to improve, but often it's either ignored(because it's not popular), or rejected because the workers don't see why it's needed when the company/country is making profit/surplus. Good examples of this would be General Motor's where the company wanted to reduce costs(wages, pensions, healthcare) but the staff refused because the company was making big profit's from the SUV fad. Oil prices jumped, SUV fell GM went backrupt and the japanese companies that had already finished their restructuring profited.

gurramok

FF bought off the public sector with generous benchmarking and the rest of populace did't care as they believed the con that 'we were wealthy'

Darragh29

994 wrote: »

Been hearing a lot about how - apparently - the public sector is overstaffed and overpaid. But why did Fianna Fail not make an issue of this over their last 12 years in office? It´s ridiculous to say "we need to cut down on waste" - cutting down on waste is ALWAYS necessary, not just in lean times. To me it's a crude method of setting workers against each other so that they ignore the massive payouts to banks and the elites. EU countries on average secured their banks for 7.5% of GDP. Malta gave no security at all. Ireland - 214%.

Because "waste" can buy votes!

irish_bob

the source of revenue that made it possible to make our public sector the highest paid in europe is gone and isnt coming back , thats the crux of the matter

newname

Irish begrudgery is the reason why its such a big issue now.

Some people are down money so everyone else has to be down money too - share the pain and all that :rolleyes:

On principle why aren't the public sector bashers chasing down the super rich to pay their fair share of tax and for the political elite to take proper wage cuts. Thats the sort of gesture we need to see before they come looking for us to share this so called pain.

ART6

If cuts in wages and many redundancies are now necessary in the public sector, then so be it. But for those who work for the public sector losing one's job in difficult times is just as bad as it is for someone in the private sector. They also have families and mortgages, and mostly have even less chance of another job than, say, a motor mechanic or a builder. The reality is that the government should never have hired them in the first place and should never have allowed salaries to get utterly out of control. Unfortunately it's true that in the boom years no-one noticed the crass incompetence of ministers.

Sconsey

newname wrote: »

Irish begrudgery is the reason why its such a big issue now.

Some people are down money so everyone else has to be down money too - share the pain and all that :rolleyes:

On principle why aren't the public sector bashers chasing down the super rich to pay their fair share of tax and for the political elite to take proper wage cuts. Thats the sort of gesture we need to see before they come looking for us to share this so called pain.

I disagree with almost everything you say, it's not begrudgery it's plain and simple accounting, there is insufficient funds to pay their over-inflated salaries. Yes they are over-inflated salaries, they are far above the average private sector wage, and above the average in other EU countries. I'd be more inclined to think that you are the begrudger.

hobochris

newname wrote: »

On principle why aren't the public sector bashers chasing down the super rich to pay their fair share of tax and for the political elite to take proper wage cuts. Thats the sort of gesture we need to see before they come looking for us to share this so called pain.

Because the super rich don't get their cash from the public coffers.. And the super rich pay their relative proportion of tax already, asking them for more because they have more is unfair. the percentage system we currently use is a fair system.

Public sector workers are however paid through taxes on the private sector,
Its part of the governments job to see that this money is spent effectively and efficient services are provided without overspending. The problem is that their is to much being spent in the public sector finances,a lot of which is down to benchmarking if public sector workers were paid the same salary package that they would receive for down the equivalent private sector job then public sector pay would not be such a high priority issue in the public domain.

As for the propping up the banks issue that gets raised so much, If the banks collapse, so does our economy! WHICH MEANS WE ALL LOSE! despite the **** ups of the bankers, keeping the banks going was necessary for us all.

Spudmonkey

Just as a matter of interest, which would a public servant prefer?

- To have your wage cut by a large amount 25%/30%
- The possibility of losing your job?

If/When the IMF come in, wages could be slashed by up to 50%... To avoid this, the Irish government will have to do one or the other. I'm just wondering would people rather risk being un-employed than see their wage go down.

irish_bob

ART6 wrote: »

If cuts in wages and many redundancies are now necessary in the public sector, then so be it. But for those who work for the public sector losing one's job in difficult times is just as bad as it is for someone in the private sector. They also have families and mortgages, and mostly have even less chance of another job than, say, a motor mechanic or a builder. The reality is that the government should never have hired them in the first place and should never have allowed salaries to get utterly out of control. Unfortunately it's true that in the boom years no-one noticed the crass incompetence of ministers.

ah shur the public servants that are let go can look back and say , i had a good run

irish_bob

Spudmonkey wrote: »

Just as a matter of interest, which would a public servant prefer?

- To have your wage cut by a large amount 25%/30%
- The possibility of losing your job?

If/When the IMF come in, wages could be slashed by up to 50%... To avoid this, the Irish government will have to do one or the other. I'm just wondering would people rather risk being un-employed than see their wage go down.

public sector wages will not need to be cut by 30% in order for the country to get back on track although hospital consultants salarys should be cut by around 40% , so too judges and politicians , nurses , teacher , police , around 15% to start with and we will see what way the country is in a years time , if this happens , their will be no need to cut social wellfare which although high is the most sensitive area up for cuts , the public as a whole do not want cuts in wellfare , i believe they as a whole are up for public sector pay cuts

btw , i dont consider the pension levys already enforced to be a pay cut

Spudmonkey

irish_bob wrote: »

public sector wages will not need to be cut by 30% in order for the country to get back on track although hospital consultants salarys should be cut by around 40% , so too judges and politicians , nurses , teacher , police , around 15% to start with and we will see what way the country is in a years time , if this happens , their will be no need to cut social wellfare which although high is the most sensitive area up for cuts , the public as a whole do not want cuts in wellfare , i believe they as a whole are up for public sector pay cuts

btw , i dont consider the pension levys already enforced to be a pay cut

I don't either, I think this should be scrapped and an actual paycut put in place. It's nice to think it would as small as that, but even if everything in board snip was implemented, it will still only save 5 bn. There is still a shortfall of ~15 bn. This seems to be a herd of elephants in the room that no-one is talking about. And as many posts I've read here have said you wouldn't be able to keep up borrowing to run your household, why would the country be any different.

Whats more but if un-employment continues to rise, the tax intake will fall and expenditure will increase further. And this gap of 15 will increase further. But likewise, you can't tax those on the lower wages to the point where the they would be better off on welfare.

irish_bob

Spudmonkey wrote: »

I don't either, I think this should be scrapped and an actual paycut put in place. It's nice to think it would as small as that, but even if everything in board snip was implemented, it will still only save 5 bn. There is still a shortfall of ~15 bn. This seems to be a herd of elephants in the room that no-one is talking about. And as many posts I've read here have said you wouldn't be able to keep up borrowing to run your household, why would the country be any different.

Whats more but if un-employment continues to rise, the tax intake will fall and expenditure will increase further. And this gap of 15 will increase further. But likewise, you can't tax those on the lower wages to the point where the they would be better off on welfare.

you cant compare running a country to a household for the simple reason that politicians ( as useless as they are ) rely on the electorate to hold on to thier job and if the cuts are too severe , the electorate would simply not stand for it and the politicans would be out of a job , i realise the present goverment is going to loose the next election anyhow but whoever replaces them will still have to make unpopular descisions with most people , if they can save 5 billion in the next 18 mths , id be happy , as i said in my last post, judging from the reaction on radio and tv , cuts in social wellfare are the biggest NO NO , oh and i also think they should not cut the REPS scheme in agriculture , i know farmers are whingers but the west of ireland will be decimated if that goes, the west of ireland has feck all other than an agri based economy and the reps scheme was an integral party of farming in connaught , they have no dairying industry worth talking about in the west and no wheat or barley whatsover , mainly small sheep farmers , farmers in other parts of the country are better off but the west is an entriely different ball game

ps , im not from the west

markpb

newname wrote: »

Irish begrudgery is the reason why its such a big issue now. Some people are down money so everyone else has to be down money too - share the pain and all that :rolleyes:

Wrong. The government hired tens of thousands of extra public and civil servants while simultaneously agreeing to large(-ish) pay rises. Now the country is sinking rapidly so that expansion needs to be reversed. It's nothing to do with sharing the pain and everything to do with balancing the budget.

On principle why aren't the public sector bashers chasing down the super rich to pay their fair share of tax and for the political elite to take proper wage cuts. Thats the sort of gesture we need to see before they come looking for us to share this so called pain.

My boss pays almost five times more on the income levy than I do. He also pays more tax in a month than I do in a year. When the company started performing badly, my last boss was fired. What makes you think the well-paid in this country aren't being taxed enough?

newname

What makes you think the well-paid in this country aren't being taxed enough?

I said nothing about the well paid I was refering to the super rich - Billionaires paying a pittance in tax.

Its understandable when companies raise wages in good times and depress them in bad times -taking risks for profit etc. But a government should be more responsible and only pay what it believes it can sustain over the longer term.

Spudmonkey

irish_bob wrote: »

you cant compare running a country to a household for the simple reason that politicians ( as useless as they are ) rely on the electorate to hold on to thier job and if the cuts are too severe , the electorate would simply not stand for it and the politicans would be out of a job , i realise the present goverment is going to loose the next election anyhow but whoever replaces them will still have to make unpopular descisions with most people , if they can save 5 billion in the next 18 mths , id be happy , as i said in my last post, judging from the reaction on radio and tv , cuts in social wellfare are the biggest NO NO , oh and i also think they should not cut the REPS scheme in agriculture , i know farmers are whingers but the west of ireland will be decimated if that goes, the west of ireland has feck all other than an agri based economy and the reps scheme was an integral party of farming in connaught , they have no dairying industry worth talking about in the west and no wheat or barley whatsover , mainly small sheep farmers , farmers in other parts of the country are better off but the west is an entriely different ball game

ps , im not from the west

Are you sure

Yeah I get that, thats fair enough. I also would not be against cutting that towards agriculture, not because I have any alligance with it, rather that I don't see the point in cutting industries that have the potential to get us out of this situation.

I know a household is not comparable to a country, I was merely using the analagy to point out that you can only borrow for so long, eventually it has to be seriously curtailed!

Spudmonkey

newname wrote: »

Its understandable when companies raise wages in good times and depress them in bad times -taking risks for profit etc. But a government should be more responsible and only pay what it believes it can sustain over the longer term.

The problem is they didn't, instead they bought votes!

irish_bob

Spudmonkey wrote: »

Are you sure

Yeah I get that, thats fair enough. I also would not be against cutting that towards agriculture, not because I have any alligance with it, rather that I don't see the point in cutting industries that have the potential to get us out of this situation.

I know a household is not comparable to a country, I was merely using the analagy to point out that you can only borrow for so long, eventually it has to be seriously curtailed!

agree

diverdriver

It's pretty simple, newname, there are not enough billionaires in the country to fund this disastrous situation. Beside being billoinaires they would leave the country in the private jets if they get too much hassle. On top of all that you forget that for the most part it's billionaires and millionaires that run companies that provide employment for the private sector that provide the taxes to pay far too many public sector employees their inflated wages.

You seem to forget too that most if not all of the half million on the dole used to pay taxes to fund the public sector, now they contribute nothing. The companies that closed down don't pay any tax either. The people on the dole don't buy things anymore so no tax comes from that direction either. No one is buying cars, houses or anything else that generates tax revenue.

Therefore there is no longer the money to pay for it all. Something has to give.

This is a complete mess, almost entirely of Fianna Fail's making. It's tough for public servants, actually it isn't yet. But it will be.

Zambia

I sat in a lecture by Eddie Hobbs in 2006 , he stated and I quote
"We have a public sector wage bill that will cripple us"

In essence no-one cared when times where good

amacca

hobochris wrote: »

Because the super rich don't get their cash from the public coffers.. And the super rich pay their relative proportion of tax already, asking them for more because they have more is unfair. the percentage system we currently use is a fair system.

Not sure this is accurate at all, at least not according to a recent revenue commissioners report.
According to that report someone earning between 250k and 500k could shelter their income in such way that they only paid an effective rate of 5% in 2007 and previous years!


New measures introduced since 2007 mean that those on 500k+ still are only liable for about the minimum tax rate of 20%

earners between 250k and 500k have only seen their tax liability rise to about 14% since 2007

so maybe newname has a point?

if public sector conditions and wages are to be targeted (and there are valid arguments for this) then its not good enough for someone to make a blanket statement that the richest pay their fair share, from the above they certainly don't appear to.

I find it amazing that this gets brushed under the carpet when private sector groups are calling for public sector cuts etc

begrudgery or not, if someone on a wage alreading paying 21% on a portion and 42% on higher earnings + new income levy + additional pension deduction on top of that paid from 95 onwards in public sector (which Im not necessarily against) then why shouldnt earners on 250k-500k+ contribute similar proportions or at least something more than 14%.

They are all going to leave the country, to me this just seems like scare tactics? how many of these people are actually creating employment and not just exploiting this country. If this is all of the tax burden they are willing to shoulder then maybe we would be better off without them To me it seems they could just as easily be described as leeches as the antos and decos of this world who dont want to work and wont work as social welfare has become a right and entitlement handed down to them.

We wont ask them to pay because they are creating jobs? lets face it with a burden of only 14% since the changes I think they are having it very good indeed and increasing this wouldn't necessarily provoke a mass migration of benevolent billionaires whose sole purpose is giving jobs to poor witless paddy.


Besides, I presume and maybe Im wrong that people on 250k + are not michael dell types and may actually have roots here, would find it hard to just down tools and go, are embedded to some degree in the country therefore would have to shut up and put up with a rise and if they had any conscience wouldnt object to paying a bit more than what is effectively the minimum rate considering how much those lower paid than them contribute as a proportion of their income.


roll on commission on taxation report.

Shan75

Public sector pay is a big issue now because people have finally woken up to the fact that we cannot afford all the extra public servants added over the last 10 years and that some of them are being paid a salary well in excess of what they should be entitled to under normal circumstances.The problem is that people do not differentiate between those in the public sector earning well below the average industrial wage and those who are being paid a small fortune because they have climbed a couple of rungs up the ladder.There are quite simply too many rungs on the ladder and a lot of dead wood populating management positions or in departments which are unecessary.

We need to offload a sizable percentage of public servants but these must be the bureaucrats rather than the people actually doing the work.Of course we all know it will be the wrong people who are targetted as most of the bureaucrats have friends in low places looking after them.Same old story.We keep voting in the same clowns and we get what we deserve.

nesf

gurramok wrote: »

FF bought off the public sector with generous benchmarking and the rest of populace did't care as they believed the con that 'we were wealthy'

This is it in a nutshell. It doesn't matter what party you look at or what country you examine, if given an option a party in power will buy votes for the next election. Public sector workers and pensioners traditionally vote in high numbers, look at the increases in spending from the past 15 years and you'll see both these groups doing well along with others like parents etc.

nesf

994 wrote: »

EU countries on average secured their banks for 7.5% of GDP. Malta gave no security at all. Ireland - 214%.

This statistic is relatively meaningless given the huge disparity between countries over the effect of the credit crunch on their financial sectors. It's one of those nonsense numbers tossed out by one side of the debate despite it's lack of meaning. Malta didn't have to give security because its banks weren't badly effected. Spain also largely escaped problems, as did Italy etc etc.

dresden8

Zambia232 wrote: »

I sat in a lecture by Eddie Hobbs in 2006 , he stated and I quote
"We have a public sector wage bill that will cripple us"

In essence no-one cared when times where good

Was he trying to convince you to invest in property at the time?

thebman

lol TBH a lot of people in the public sector are still living in la la land and don't understand the real world or something because they don't seem to be living in the same country I am.

This isn't an attack but an observation of the people I know that work in or for the public sector that still seem to think the economy is doing fine in general and there are just minor problems going on.

The nation is bankrupt, any cuts politicians make will not be enough as they will make the bare minimum and borrow as much as possible to try to get themselves re-elected. As was said on another thread (maybe a quote from a paper), be glad its the politicians making the cuts.

We are basically crippling future generations with debt so we don't have to take the punishment now. Its actually disgraceful when you think about it and this is before and after these cuts which just won't be enough.

NatKingColeslaw

Why is everyone saying no one cared when the times were good?

It has been an issue for the last 6 or 7 years but the Unions managed to threaten their way to higher pay. Ireland Inc. is in dire trouble and the staff of Ireland Inc. will have to take their pain along with the rest of us. There used to be five people in my department and now there is just me. Me being in the private sector.

thebman

Exactly but that is why people say nobody cared. What they really mean is nobody cared enough to make it worth politicians while fighting pay increases.

Zambia

dresden8 wrote: »

Was he trying to convince you to invest in property at the time?

Actually no.

It was a financial health check talk the firm I was with paid him to do in regards to what you could do with your SSIA.

givyjoe81

dresden8 wrote: »

Was he trying to convince you to invest in property at the time?

What on earth has that got to do with a startlingly accurate prediction made 3 years ago?

Why dont we just continue to pay PS wages that the country can no longer afford, and then stick just our heads in the sands and carry on living in la la land.

Problem solved.