Reform needed, not a reverse bubble

peasant

Original title: The government has seen the virgin Mary

...you know, like in Knock ...stare at the sun long enough and it'll burn your retina and you'll start seeing things. Listen to some blathering "visionary" long enough with your eyes burning and you'll believe it's the virgin Mary you're seeing.

First they saw the "celtic tiger". Some visionary told them if only we sold houses to each other long enough, we'd be the richest and bestest country in the whole wide world. And they belived it and fuelled the fire.

Now they're seeing "hard decisions". If only they cut everybodie's pay long and hard enough, the visionaries are telling them, everything they ballsed up previously will come right again and we will have the shortest and easiest recession in the whole wide world.

They deliberately ran the country to the ground with their first vision and they're about to do it again with the second coming.

Yes, costs have to be cut, we have to be competitive, but there is a limit.

You do not even think about cutting pay in a company that is operating competetively, especially not when the aggrieved workforce of that profit-making company has you by the painful bits and can simply turn off the lights.
Because that'll be the end of that. No lights, heat or transport for a few days in the middle of winter and we'll have riots in the streets.

Yet there are people out there saying that the governement is on the right path, that the power of "the beards" has to be broken if we ever want to come right again, if only everybody has their wages cut and cut again that we will be ok.

Rubbish .... this is just a building bubble in reverse. As much as you can't build a sustainable economy by inflating house prices, you can't restore it once it's broken by simply cutting everybodies income regardless.

We need radical reform in this country. Reform in the way we do politics, reforms in administration, reforms in regulation.

Visions of Mary won't do.

ei.sdraob

peasant wrote: »

You do not even think about cutting pay in a company that is operating competetively

wait are you saying that The Company (the government and its army of employees, and large number of pensioners, welfare etc)

is operating competitively?

compare Ireland Inc to General Motors (250K employees + ecosystem)


the later quite literally went bankrupt, Ireland Inc is bankrupt but we dont know it yet since, money is still being lend to us

if that money flow stops thats its

caput


if the money keeps coming then most of the income will go to just service the debt (almost all of the money saved in this budget will got to pay interest on money already borrowed)

peasant wrote: »

We need radical reform in this country. Reform in the way we do politics, reforms in administration, reforms in regulation.

we were promised reform with benchmarking all them years ago

it failed to materialize

...

Riskymove

ei.sdraob wrote: »

wait are you saying that The Company (the government and its army of employees, and large number of pensioners, welfare etc)

is operating competitively?

he's talking about the ESB there

Smcgie

I thought you were on about the virgin Harney

peasant

ei.sdraob wrote: »

wait are you saying that The Company (the government and its army of employees, and large number of pensioners, welfare etc)

is operating competitively?

nope, I was thinking specifically about the ESB there

Scofflaw

No offence, peasant*, but this thread is going to go nowhere with a title like that.

moderately,
Scofflaw

* surprisingly fun to say!

peasant

Scofflaw wrote: »

No offence, peasant*, but this thread is going to go nowhere with a title like that.

I fail at David McWilliams-isms apparently

Permabear

This post has been deleted.

P. Breathnach

peasant wrote: »

I fail at David McWilliams-isms apparently

Count that as a point in your favour.

Dannyboy83

P. Breathnach wrote: »

Count that as a point in your favour.

Ouch! LOL:D


OP,
I agree with what DonegalFella said.
Its going to be very difficult to have a rational discussion about this, because a large section of whatever group in society get hit, will feel that they are taking the burden, regardless of what makes economic sense or not.

On the other hand, perhaps its a learning experience?
I imagine subsequent governments will be extremely reluctant to give 'shortsighted' pay increases in future times of plenty, based on the events which are transpiring now.
Much like pensioners never get hit, based on something which happened during the state's infancy.

Scofflaw

Its going to be very difficult to have a rational discussion about this, because a large section of whatever group in society get hit, will feel that they are taking the burden, regardless of what makes economic sense or not.

Funnily enough, I think that applies to every policy discussion ever in the history of the world, right back to when Thog and Ugg debated whether to prioritise hunting trips or root gathering.

cordially,
Scofflaw

ei.sdraob

Dannyboy83 wrote: »

Ouch! LOL:D


OP,
I agree with what DonegalFella said.
Its going to be very difficult to have a rational discussion about this, because a large section of whatever group in society get hit, will feel that they are taking the burden, regardless of what makes economic sense or not.

On the other hand, perhaps its a learning experience?
I imagine subsequent governments will be extremely reluctant to give 'shortsighted' pay increases in future times of plenty, based on the events which are transpiring now.
Much like pensioners never get hit, based on something which happened during the state's infancy.

nah

once we recover (if? when??)

it be back to same old, handing out money to gain power or get reelected

no need to learn from history sure when you can have champagne in the Galway tent

peasant

donegalfella wrote: »

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A rational spending cut would be one that looks at the individual circumstances.
Certain public employees would deserve a raise, others shouldn't get paid at all.
Certain public institutions need finance, others need closing altogether.
That ..and all the thousands of shades of grey inbetween would be a rational approach.

A one size-fits-all colander-style haircut across the public sector is crude and unfair (but possibly necessary due to lack of time to do it properly), but antagonising productive ESB employees (for the sake of going after everybody in equal measure) is simply suicidal.

dan_d

Thog and Ugg...
We're regressing rapidly anyway. And those were simpler times!

Dannyboy83

Scofflaw wrote: »

Funnily enough, I think that applies to every policy discussion ever in the history of the world, right back to when Thog and Ugg debated whether to prioritise hunting trips or root gathering.

cordially,
Scofflaw

I would disagree.

A lot of people don't care about decisions that affect them and if they do, might not feel compelled to protest about it. How else can we explain the apathy/inertia surrounding Irish politics?

Almost everybody cares about money matters which affect them directly tho.

P. Breathnach

Scofflaw wrote: »

Funnily enough, I think that applies to every policy discussion ever in the history of the world, right back to when Thog and Ugg debated whether to prioritise hunting trips or root gathering.

I thought that particular debate was resolved very quickly: Thog and the rest of the lads went for the glory of hunting, while Ugg and the rest of the wives gathered the roots (along with nuts, berries, and seeds).

People ate far more plant food than meat in those days, so the metaphor holds up quite well: the glory-boys felt more important, got most attention, and contributed less to the common good.

ejmaztec

Given that un-competive energy costs here is a problem for existing businesses, and potential businesses, it's only fair that those costs are reduced.

State bodies are forced to reduce the labour costs through legislation, and private businesses do it because the market tells them that there's no other option.

Why should semi-state organisations be left out? I can't see them volunteering cuts, not with the more powerful unions on their backs.

If all costs aren't reduced, then when the rest of the world is out of recession, Ireland will still not be able to compete for business if our costs haven't dropped more than our competitors.

Scofflaw

Dannyboy83 wrote: »

I would disagree.

A lot of people don't care about decisions that affect them and if they do, might not feel compelled to protest about it. How else can we explain the apathy/inertia surrounding Irish politics?

Almost everybody cares about money matters which affect them directly tho.

Sure - and for several years nobody has been negatively affected by government decisions. Some people got larger handouts than others, but that's slightly different.

cordially,
Scofflaw

Permabear

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peasant

ejmaztec wrote: »

Given that un-competive energy costs here is a problem for existing businesses, and potential businesses, it's only fair that those costs are reduced.

I would agree 100%

However (as you can see in the other thread) in case of the ESB it's not wages that predominantly decide what the cost of electricity is ...it's the regulator.

Just doggedly cutting ESB wages because other wages were cut (and wage cuts is the current vision of the day) isn't going to bring electricity prices down enough to make a difference.

It will however antagonise the unions in the ESB enough that they'll pull the plug ...and then where will we be?

ei.sdraob

donegalfella wrote: »

This post has been deleted.

ill have to correct you there (and many other people today) with some facts

http://boards.ie/vbulletin/showpost.php?p=63507805&postcount=139

ei.sdraob wrote: »

....

now to move onto facts from http://www.esb.ie/downloads/about_esb/2007/esb-annual-report-complete-2007.pdf

Net payroll cost for employees (excluding pension): 364,643,000
Total Operating cost: 3,068,896,000

thats 11% goes to salaries (and probably fallen since the company is shrinking)

the above is only operating cost, im not including the billions being spend on retrofitting old plants, like the third of a billion Moneypoint project to scrub **** from exhausts


the above cost of salary divided by 7500 employees is an average salary of 48K, now this of course is distorted since the chairman was on a salary of 500K, while alot of people at the lower levels are on 20K and 6 months contracts

...

peasant

donegalfella wrote: »

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Dunno if your 80k figure is correct (seems a bit high) ...but anyway ....There probably are quite a few million in savings/improvements to be found within the ESB, but that should be done internally and not by governement dictat.
The big elephant in the room there is the electricity price which was hiked up by the governement (via the regulator) to bring up profit margins enough to entice private companies into the electricity sector.

Let the governement/regulator set a lower price and the ESB sort out internally how they achieve it.

Do not just jump in there and cut wages because everybody else got a cut.

Especially not when while doing so you run the risk of bringing this country from a severe recession to riots in the street within a week.

ei.sdraob

peasant wrote: »

Dunno if your 80k figure is correct (seems a bit high).

it is high (unless you count ONLY the top boardroom members) as per facts posted

peasant wrote: »

....There probably are quite a few million in savings/improvements to be found within the ESB, but that should be done internally and not by governement dictat..

agree its the government interference that lead us into this mess

and there are millions being saved with old inefficient plants closing down, and a practical ban on hiring new people, with just about everything being outsourced

also alot of assets are being wasted like the network being handed over to heanet for practically free, and empty collocation facilities

ardmacha

A one size-fits-all colander-style haircut across the public sector is crude and unfair (but possibly necessary due to lack of time to do it properly), but antagonising productive ESB employees (for the sake of going after everybody in equal measure) is simply suicidal.

The lack of time was largely manufactured. The unions actually did come up with proposals for reform, this path might not have removed the need for cut but might have reduced the percentage cut required. The talks with the unions could have started in the summer rather than being left to one week before the budget. Now post cuts it is not clear where the government goes from here, they seem to imply that if there is no reform then there will be further cuts. But it is difficult to justify further pay cuts in Revenue (for example) because the HSE is overstaffed.

As for the ESB being "productive", they are no more inherently productive than the public service. An engineer in a water treatment plant is just as useful to society as one in a power station.

peasant

ardmacha wrote: »

The lack of time was largely manufactured.

"manufactured" is too grand a word ...it implies planning and intent.:pac:

Time was dithered away through three half hearted "emergency budgets" while the governement ran around like headless chickens waiting for their next vision.

It took them over a year to reverse from "spend with both hands" to "cut everybodies wages".

But my real gripe is this: This is not new policy ..it is a 100% reversal of the old one ...same sh!t, different direction.

Permabear

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P. Breathnach

donegalfella wrote: »

This post has been deleted.

How?

peasant

donegalfella wrote: »

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That might work ...if there was a market in the first place. Currently there isn't one ...not one that would have the ability to self-regulate anyway.

Do you believe that the country should be held to ransom by threats of "chaos" from the unions?

No, the unions shouldn't have that power in the first place.
But as they do have it, they should not be approached in a confrontational manner ...not right now, not under these circumstances. This particular issue should be left for another day.

IMO the reason why the confrontation with the PS unions worked without causing riots in the street is because the PS emplyoees (despite their very public complaining) do understand the basic maths behind our current public spending vs public income.

ESB workers who produce a profit for their "company" don't. They don't see it as applicable to them.

Permabear

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ei.sdraob

donegalfella wrote: »

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i would like to see which hole did they pull these figures out of

i did the maths earlier based on the accounts figures (linked) for an average of 48K, and as mentioned the people at the top in ESB make 500K, while yes there are people there earning nice salaries of 60K+, the majority i worked with earned well bellow 30K in 2006

P. Breathnach

donegalfella wrote: »

This post has been deleted.

That's no answer, unless you accept that the ESB is really a monopoly, both as a purchaser and as a seller. Do you want the ESB to buy from providers like Airtricity on terms that it can pretty well decide for itself, and do you want the ESB to set consumer prices solely on the basis of maximising profit?

peasant

donegalfella wrote: »

This post has been deleted.

Because despite the outward appearance of having competition, the ESB really is the only show in town.
Airtricity or Bord Gais do not have the capacity or infrastructure to put up a meaningful fight.

Alas, there are too many issues in this country that have been "left for another day," sometimes for decades.

Agreed.
However, while the economy is on its knees I would deem it somewhat inopportune to gaud the unions into switching off the lights and stopping the trains and planes on top of it all.
Not only for domestic reasons, riots in the streets don't go down well with international financiers either.

Now is not the time to pick this particular fight.

View

ardmacha wrote: »

The lack of time was largely manufactured. The unions actually did come up with proposals for reform, this path might not have removed the need for cut but might have reduced the percentage cut required.

The Unions have promised reforms before and delivered very little. As such, they are like the boy who cries "Wolf!" - when the wolf finally does come, he has serious credibility issues to overcome.

ardmacha

The Unions have promised reforms before and delivered very little. As such, they are like the boy who cries "Wolf!" - when the wolf finally does come, he has serious credibility issues to overcome.

This is always trotted out on this forum. But do you seriously imagine that anyone genuinely asked unions to deliver on "promises" associated with the Bertie benchmarking. These were window dressing, the government and the management never no more intention of seeking their implementation than the unions had. The sad state of some parts of the public sector is not only the fault of unions, it is the fault of management. You only have to look at the variation on performance in the different parts of the PS, working within the same formal HR framework and the same unions. Some depts, some local authorities etc have a pretty efficient service while others are dismal.

Permabear

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P. Breathnach

donegalfella wrote: »

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If the ESB were privatised, it would be even more free to pursue monopolistic practices.

View

P. Breathnach wrote: »

If the ESB were privatised, it would be even more free to pursue monopolistic practices.

That would depend on the Regulator.

View

ardmacha wrote: »

This is always trotted out on this forum. But do you seriously imagine that anyone genuinely asked unions to deliver on "promises" associated with the Bertie benchmarking.

Most tax-payers would expect that if someone signs up a paydeal which is premised on "Reform for extra pay" that they will deliver on it. That applies to all parties involved - including the Unions.

If the Unions engaged in a "window dressing" exercise, then they have no right to expect public sympathy now from the tax-payers who were in effect defrauded by the benchmarking exercise.

Remember the net result of the exercise was that the average public servant saw their wages increase at almost double that of the average industrial worker during the early part of this decade. And, this happened despite the fact that the average public servant was paid significantly more than the average industrial worker at the start of the period.

ardmacha wrote: »

The sad state of some parts of the public sector is not only the fault of unions, it is the fault of management. You only have to look at the variation on performance in the different parts of the PS, working within the same formal HR framework and the same unions.

All civil and public services are paid for by the tax-payer. Since, Unions have consistently argued in favour of strong public (& civil) services, then there is an onus on them to push for the highest standards in the delivery of such services. Saying "It is nothing to do with us" and just adopting a "Dog in the manger" attitude to attempts to improve services (as they frequently do) just doesn't cut it. At the end of the day, it is tax-payers' money that is being wasted.

Permabear

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Eliot Rosewater

My solution to the ESB issue would be to privatize the generation stations, and privatize the consumer side of things, leaving the government in control of the actual electricity network. That way companies pay a levy to the Government on the basis of how much of the electricity network they use. In these days of modern computing, I dont see how the electricity used to power the computer I type at couldn't be traced to a station, and the distance it has traveled calculated. The company then pays a set fee per kilometer or meter.

P. Breathnach

donegalfella wrote: »

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Or if the cost of entry is prohibitive.

—in which case the monopoly may actually benefit the consumer.

How?

Daithinski

ei.sdraob wrote: »

nah

once we recover (if? when??)

it be back to same old, handing out money to gain power or get reelected

no need to learn from history sure when you can have champagne in the Galway tent

I think if the government want people to be more accepting of cuts they will have to do the following (which they won't).

1. Admit they fucced up the economy.

2. And then say say sorry.

3. Then say we have learned from our mistakes and we are taking x, y and z measures to make sure this never happens again. (Then actually implement the measures.)

As far as I can see they have learned nothing, admitted no wrong doing or incompetence and have not made any changes to systems/laws etc to prevent future fiascos.

Nobody has been made an example off. People who were sacked politely asked to step down/retire, got golden handshakes others can only dream off. No deterrent here for people to behave as they did.

Now they start wielding the axe to everybody else's wallet.

A large part of the reason the government coffers are dry is due to them buying the last few elections (PS promotions, pay rises and social welfare).

It is beyond belief that they are still in power.

The cowardly greens and the greedy fianna fail have a lot to answer for.

P. Breathnach

Eliot Rosewater wrote: »

My solution to the ESB issue would be to privatize the generation stations, and privatize the consumer side of things, leaving the government in control of the actual electricity network. That way companies pay a levy to the Government on the basis of how much of the electricity network they use. In these days of modern computing, I dont see how the electricity used to power the computer I type at couldn't be traced to a station, and the distance it has traveled calculated. The company then pays a set fee per kilometer or meter.

I suspect that is what the government (in this case, I don't mean simply the politcal institution, but the political/administrative combination) is working towards.

Mind you, computers or no, I don't think your model for funding the distribution network is the best idea. I suspect that simpler bases for apportionment would be sufficient.

Daithinski

peasant wrote: »

It will however antagonise the unions in the ESB enough that they'll pull the plug ...and then where will we be?

(in the dark?)

There is talk of Eastern European strike breakers being brought in? Would they do this?

http://www.kfmradio.com/kfm-radio/national-news/govt-told-to-bring-in-strike-breakers.html

ardmacha

Most tax-payers would expect that if someone signs up a paydeal which is premised on "Reform for extra pay" that they will deliver on it. That applies to all parties involved - including the Unions.

Which parts of a deal were not delivered on, exactly?

Since, Unions have consistently argued in favour of strong public (& civil) services, then there is an onus on them to push for the highest standards in the delivery of such services. Saying "It is nothing to do with us" and just adopting a "Dog in the manger" attitude to attempts to improve services (as they frequently do) just doesn't cut it.

It is odd here that those most against unions also want them to analyse the macroeconomic condition of the economy, propose changes in public services etc while the management and government plays a passive role.

brianthebard

Daithinski wrote: »

(in the dark?)

There is talk of Eastern European strike breakers being brought in? Would they do this?

http://www.kfmradio.com/kfm-radio/national-news/govt-told-to-bring-in-strike-breakers.html

Scab labour? How long until a general lockout is proposed I wonder?

Dannyboy83

Daithinski wrote: »

(in the dark?)

There is talk of Eastern European strike breakers being brought in? Would they do this?

http://www.kfmradio.com/kfm-radio/national-news/govt-told-to-bring-in-strike-breakers.html

Govt. Told To Bring In Strike Breakers 2009-12-15 14:25:56

The Government's being told it must gear up for a bitter fight over semi-state pay, by arming itself with so called "strike breakers".

Unions have already threatened industrial action in the event any steps are taken to reduce wages at semi-state's including CIE and the ESB.

Its feared that any action involving ESB workers could lead to widespread power outages.

But founder of the University of Limerick, Dr Ed Walsh, says the Government must not allow itself be held to ransom and if necessary should hire in agency workers from other countries:

So they are willing to shut the entire country down?
What about the people in hospital who may die?

Reminds me of this story
http://www.pcworld.com/businesscenter/article/148469/it_admin_locks_up_san_franciscos_network.html


Don't the Taliban do this? Use human shields etc.?

Sand

Id welcome the unions trying to take a hardline stance on strikes. It would political suicide - the public have absolutely no sympathy given the straits we are in. Hopefully Begg and O Connor talk themselves into a corner and are forced to put up.

It will be a tough few weeks or even months when they do but they can only lose. We do not have the money. It is just an inescapable truth and it wont matter what their contracts are when the governments cheques start to bounce as they will if we dont make cutbacks.

Once the unions are broken by the failure of their strikes, I think we need to look at banning public sector workers from joining trade unions, to fully leverage the victory. The trade unions have become bloated, corrupt cartels that dont even represent the ordinary public sector worker - if anything they are used by some in the public sector to intimidate their co-workers into falling into line with their own wishes.

It is good that people are thinking about looking abroad for assistance we can get from our EU partners - The government needs to start planning for a harsh and bitter strike right now, identify vital infrastructure and ensure they have options to ensure at least a skeleton service is maintained - if that means reaching out to those alienated from their unions, or looking abroad for cover.

Permabear

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peasant

donegalfella wrote: »

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Quality fighting talk there donegalclint

As if the unions had ever held anyone to ransom ...all they ever needed doing was furrow their brows somewhat and whatever they wanted was heaped upon them. Not because of "strong" unions but because of a useless, giveaway governement.

The same governement who wouldn't know what to do (now that the gifts have run out) if the unions played hardball for real.

This is not about the meagre paycuts that may be wrangled out of the semi-state employees ...this is about silly, childish role play by governement and union officials who both have long since lost touch with real life and reality.

I just think that the middle of winter in the depth of a recession is the wrong time for playing chicken with essential services.

Put the effort into some real recession beating measures instead ...keep the role play for when it's warrmer again.

View

ardmacha wrote: »

Which parts of a deal were not delivered on, exactly?

Given that you claimed in your previous post that the reform part of benchmarking was "window dressing", I'd have thought that you already know the answer to your own question.

ardmacha wrote: »

It is odd here that those most against unions also want them to analyse the macroeconomic condition of the economy, propose changes in public services etc

The Unions already do economic analysis. They are also happy to propose changes in public services. Some of it is actually interesting. They just don't do "Value for money for the tax-payer" analysis.

ardmacha wrote: »

while the management and government plays a passive role.

Believe me, I amn't exempting them. If you check back though, my point was saying "Oh, we'll sit down and figure out some reforms" just isn't credible at this stage.

The state's finances had gone off course by Summer 2007. There have been 2 years to figure out reforms - 8 if you start the clock at benchmarking. Meanwhile the state continues to clock up debt at an astonishing rate.