How do you fix a problem like the PS wage bill?

The Clown Man

Thread title got your attention?

OK, so the Public/Private divide is in full force on these forums and there have been several threads (increments/pay gap/teachers unions etc) where the threads have pretty much decended into tangents and sniping.

I don't think that anyone would like to see anyone else treated unfairly for any reason. However, at the moment I personally believe that the private sector are angry at being forced to "cover the bill" for a sector where there is obvious inefficiencies, little or no risk of losing payrises never mind jobs, and where wages tend to be higher, holidays longer, and hours shorter in general (though there are always exceptions). All this in stark contrast to their own situations.

In my opinion, the reason discussions get so heated is that it all seems to be argued in terms of black and white, yes or no. I think for those in the private sector, the public sector champions are not proposing any real solutions, nor condoning any real change, therefore seemingly either misunderstanding or straight ignoring the problem we are facing as a country. I don't think this is actually the case.

I do think that everyone on both sides acknowledge that there is certainly room for improvement and change within the PS, and that change could have a massive effect on our recovery as a nation, so why don't we all start suggesting change rather than simply agreeing or disagreeing with individual newsbytes?

So to people in the private sector and public sector, what would you propose to cut the overall PS pay bill to something we can actually afford?


I'll start with my suggestion:

Since the PS have already (to my knowledge) implemented a performance tracking system aimed at performance management but, (inexplicably, since it is the base foundation of any performance management system) not yet tied to career progression or pay, why not just flip the switch and start taking this next step now? Increments based on performance, not simply guaranteed. Career progression based on merit where performance is considered in job applications. The right people continue to progress and the poor performers must choose to work to a higher standard or face a pay freeze.

This should also improve management and efficiency within the PS over time and cut around 50% of the cost of annual increments assuming that, in a very basic model, the top 25% get full increments, the middle 50% get half and the lower 25% get none. Next step would be to remove anyone consistently falling into the lower say 10%, maybe over 2-3 years.

I know the CPA bars this as a solution right now but it could be prepared for 2014.


And please, if you don't agree with a proposal, tell us why but then suggest your own. How would you seek to reduce the pay bill?

bbam

The Clown Man wrote: »

Thread title got your attention?

OK, so the Public/Private divide is in full force on these forums and there have been several threads (increments/pay gap/teachers unions etc) where the threads have pretty much decended into tangents and sniping.

I don't think that anyone would like to see anyone else treated unfairly for any reason. However, at the moment I personally believe that the private sector are angry at being forced to "cover the bill" for a sector where there is obvious inefficiencies, little or no risk of losing payrises never mind jobs, and where wages tend to be higher, holidays longer, and hours shorter in general (though there are always exceptions). All this in stark contrast to their own situations.

In my opinion, the reason discussions get so heated is that it all seems to be argued in terms of black and white, yes or no. I think for those in the private sector, the public sector champions are not proposing any real solutions, nor condoning any real change, therefore seemingly either misunderstanding or straight ignoring the problem we are facing as a country. I don't think this is actually the case.

I do think that everyone on both sides acknowledge that there is certainly room for improvement and change within the PS, and that change could have a massive effect on our recovery as a nation, so why don't we all start suggesting change rather than simply agreeing or disagreeing with individual newsbytes?

So to people in the private sector and public sector, what would you propose to cut the overall PS pay bill to something we can actually afford?


I'll start with my suggestion:

Since the PS have already (to my knowledge) implemented a performance tracking system aimed at performance management but, (inexplicably, since it is the base foundation of any performance management system) not yet tied to career progression or pay, why not just flip the switch and start taking this next step now? Increments based on performance, not simply guaranteed. Career progression based on merit where performance is considered in job applications. The right people continue to progress and the poor performers must choose to work to a higher standard or face a pay freeze.

This should also improve management and efficiency within the PS over time and cut around 50% of the cost of annual increments assuming that, in a very basic model, the top 25% get full increments, the middle 50% get half and the lower 25% get none. Next step would be to remove anyone consistently falling into the lower say 10%, maybe over 2-3 years.

I know the CPA bars this as a solution right now but it could be prepared for 2014.


And please, if you don't agree with a proposal, tell us why but then suggest your own. How would you seek to reduce the pay bill?

I could see this working at some levels where pay is moderate already..
However in areas where pay already exceeds the value of the position giving additional incriments isn't on..

Also, having worked etensively in a MN where a similar type of performance pay evaluation system worked it was a monster to administer for 6000 employees, scale that up to cover the PS and you have created a real beast which would require serious time and energy.. Never mind that many managers, middle and upper have no experience in it.. I would have had 30+ employees and spent 30% of my overall time on PM.

Personally I think that a benchmarking process needs to be again rolled out, looking to equate PS positions here with similar EU countries ANd the private sector. Whe we are sure pay levels are realistic at ALL levels of the PS, then performance managment would be a very useful tool...

Sleepy

Unfortunately, I think the unions existence prevents anything nuanced from being put into play so it'll have to be broad stroke cuts, abolishment of allowances and, ultimately, redundancies.

It'll be unfair on those that are earning their keep and even more unfair on those few that are underpaid compared to private sector equivalents as it stands but as long as PS workers support their unions and engage in collective bargaining, it's simply impossible to pay them fairly (as no two workers are ever equal).

frankosw

Keyboard warriors can suggets what they like..PS paycuts have not been asked for by the Troika.

Its increased income tax for all workers..and thats the fairest way...barring of course the private sector workers keeping teh black economy afloat by not paying tax at all.

Sleepy

frankosw - I think you'll find many PS workers do nixers in the black economy too: we all know of teachers doing grinds or working cash-in-hand on their summer holidays or council workers that have part-time farms where they're not declaring all their income etc.

Increasing income tax not only encourages this, it increases the incentive to give up working, sign-on and find cash-in-hand work to supplement one's welfare and makes it harder for employers to create jobs. It's the last option we should be taking, not the first.

Jaysoose

You simply cant fix the problem as the people within the system that have the capacity to enforce change don't see that its a problem.

Godge

The Clown Man wrote: »

Thread title got your attention?

OK, so the Public/Private divide is in full force on these forums and there have been several threads (increments/pay gap/teachers unions etc) where the threads have pretty much decended into tangents and sniping.

I don't think that anyone would like to see anyone else treated unfairly for any reason. However, at the moment I personally believe that the private sector are angry at being forced to "cover the bill" for a sector where there is obvious inefficiencies, little or no risk of losing payrises never mind jobs, and where wages tend to be higher, holidays longer, and hours shorter in general (though there are always exceptions). All this in stark contrast to their own situations.

In my opinion, the reason discussions get so heated is that it all seems to be argued in terms of black and white, yes or no. I think for those in the private sector, the public sector champions are not proposing any real solutions, nor condoning any real change, therefore seemingly either misunderstanding or straight ignoring the problem we are facing as a country. I don't think this is actually the case.

I do think that everyone on both sides acknowledge that there is certainly room for improvement and change within the PS, and that change could have a massive effect on our recovery as a nation, so why don't we all start suggesting change rather than simply agreeing or disagreeing with individual newsbytes?

So to people in the private sector and public sector, what would you propose to cut the overall PS pay bill to something we can actually afford?


I'll start with my suggestion:

Since the PS have already (to my knowledge) implemented a performance tracking system aimed at performance management but, (inexplicably, since it is the base foundation of any performance management system) not yet tied to career progression or pay, why not just flip the switch and start taking this next step now? Increments based on performance, not simply guaranteed. Career progression based on merit where performance is considered in job applications. The right people continue to progress and the poor performers must choose to work to a higher standard or face a pay freeze.

This should also improve management and efficiency within the PS over time and cut around 50% of the cost of annual increments assuming that, in a very basic model, the top 25% get full increments, the middle 50% get half and the lower 25% get none. Next step would be to remove anyone consistently falling into the lower say 10%, maybe over 2-3 years.

I know the CPA bars this as a solution right now but it could be prepared for 2014.


And please, if you don't agree with a proposal, tell us why but then suggest your own. How would you seek to reduce the pay bill?

In 2008, the public service pay bill was €17.097 bn and the social welfare bill was €17.809 bn.

In 2011, the public service pay bill was €14.737 bn, a cut of 13.8%.
Can't find figures for 2011, but for 2010, the social welfare bill had increased to €20.848 bn, an increase of 17.1% with 2011 showing another increase.

So the question I have is that if public service pay has gone down by 13.8% (and is forecast to decline further with no policy change) while social welfare has gone up by 17.1% (and is forecast to continue to rise with no policy change), why are we calling the public service pay bill the problem?

Jaysoose

Godge wrote: »

In 2008, the public service pay bill was €17.097 bn and the social welfare bill was €17.809 bn.

In 2011, the public service pay bill was €14.737 bn, a cut of 13.8%.
Can't find figures for 2011, but for 2010, the social welfare bill had increased to €20.848 bn, an increase of 17.1% with 2011 showing another increase.

So the question I have is that if public service pay has gone down by 13.8% (and is forecast to decline further with no policy change) while social welfare has gone up by 17.1% (and is forecast to continue to rise with no policy change), why are we calling the public service pay bill the problem?

Its only one of the problems.

Itchianus

Looks like the slide towards the typical pattern for a PS thread is well underway... I agree largely with what the OP has said.

I'd also suggest that people who are calling for drastic cuts like 20-30% in pay, need to realise the cataclysmic effect that would have on demand (and jobs) in the domestic economy, as it would reduce/eliminate the discretionary income of a lot of people in the PS.

It would also cause a surge in the numbers of mortgage defaults by PS workers who are already struggling resulting ultimately in further capital to be pumped into the banks by the taxpayer.

Careful what you wish for...

Head The Wall

Godge wrote: »

In 2008, the public service pay bill was €17.097 bn and the social welfare bill was €17.809 bn.

In 2011, the public service pay bill was €14.737 bn, a cut of 13.8%.
Can't find figures for 2011, but for 2010, the social welfare bill had increased to €20.848 bn, an increase of 17.1% with 2011 showing another increase.

So the question I have is that if public service pay has gone down by 13.8% (and is forecast to decline further with no policy change) while social welfare has gone up by 17.1% (and is forecast to continue to rise with no policy change), why are we calling the public service pay bill the problem?

Well hopefully the bloated social welfare bill is a temporary problem while overpaying on the pay bill is a long term problem as it feeds into pension deficits also

frankosw

Godge wrote: »

In 2008, the public service pay bill was €17.097 bn and the social welfare bill was €17.809 bn.

In 2011, the public service pay bill was €14.737 bn, a cut of 13.8%.
Can't find figures for 2011, but for 2010, the social welfare bill had increased to €20.848 bn, an increase of 17.1% with 2011 showing another increase.

So the question I have is that if public service pay has gone down by 13.8% (and is forecast to decline further with no policy change) while social welfare has gone up by 17.1% (and is forecast to continue to rise with no policy change), why are we calling the public service pay bill the problem?

Because it's trendy to do so..somethinng to do with jealousy and spite masquerading as economic expediency.

Riskymove

Head The Wall wrote: »

Well hopefully the bloated social welfare bill is a temporary problem while overpaying on the pay bill is a long term problem as it feeds into pension deficits also

well there's also a problem down the track with funding welfare pensions!!

its all connected to more people retiring and less working....both areas require a lot of work

why not just flip the switch and start taking this next step now? Increments based on performance, not simply guaranteed. Career progression based on merit where performance is considered in job applications.

this should be the case because increments are not automatic and performance is linked to career progression

unfortunately the implementation of the system on the ground has failed thus far. However, this is the first year of a reformed system and it will be interesting as to how it works.

Sleepy

Godge wrote: »

In 2008, the public service pay bill was €17.097 bn and the social welfare bill was €17.809 bn.

In 2011, the public service pay bill was €14.737 bn, a cut of 13.8%.
Can't find figures for 2011, but for 2010, the social welfare bill had increased to €20.848 bn, an increase of 17.1% with 2011 showing another increase.

So the question I have is that if public service pay has gone down by 13.8% (and is forecast to decline further with no policy change) while social welfare has gone up by 17.1% (and is forecast to continue to rise with no policy change), why are we calling the public service pay bill the problem?

Because Labour have been voted into power by PS union members and represent the non-working classes more than those who actually vote for them?

Godge

So it seems nobody can really answer the question as to why the public service pay bill is a bigger problem demanding priority action while the social welfare bill is not even though the public service pay bill is on a downturning spiral while the social welfare bill is on an increasing one.

Going back to the OP's question, the simple answer is that you can't fix a problem like the PS wage bill. A further pay cut will at the very best mean that PS unions and employees will stop all reform efforts, a work-to-rule type engagement. At worst, you will see strikes etc.

Using solutions as proposed by the OP will not work if they hit large sections of the workforce as the result will be the same as the last paragraph. If they don't take increments off a lot of people, they won't save much money so a lot of fuss for very little.

Creative ideas that will be hard for public sector trade unions to fight are what is needed. Look at this article.

http://www.independent.ie/business/personal-finance/pensions/budget-cuts-will-force-us-to-pay-another-800-a-year-for-pensions-3266789.html


A few quotes: "Public servants are set to be the biggest losers" and "Public servants would lose on the double, as they get tax relief on their pension contributions and on the controversial pensions levy, so cutting the tax reliefs would mean a big pay cut for them."

A measure like that could not be opposed by public sector unions as it would be seen as special pleading even though it is a measure that affects all even though it affects public servants more. The PS bashers on here who only have social welfare pensions rather than the "gold-plated pensions of the public service" would be delighted as they wouldn't be hit at all.

So to sum up, cutting tax relief on pensions gets my support as a good way to reduce the net public service pay bill in a way that cannot be resisted by the unions as it only affects better-off public servants (those in the higher tax bracket). Remember it only affects better-off private sector workers too.

frankosw

Sleepy wrote: »

Because Labour have been voted into power by PS union members

Is that so?

Well why didnt the non-union non PS workers vote against them?

antoobrien

frankosw wrote: »

Because it's trendy to do so..somethinng to do with jealousy and spite masquerading as economic expediency.

The PS pay bill for 2010 was €15.93bn (305,532 "whole time equivalent" staff) and the PS pension bill was €2.73bn (116,363 pensioners).

In 2010 the total national income of those in the tax net was €77.73bn (2,088,443).

Income tax in 2010 was €11.27bn (including the income levy).

Paying the PS 141% of the income tax take is economic lunacy.

frankosw

antoobrien wrote: »

Paying the PS 141% of the income tax take is economic lunacy.

And paying 400,000 people the dole to do nothing isnt?

Godge

antoobrien wrote: »

The PS pay bill for 2010 was €15.93bn (305,532 "whole time equivalent" staff) and the PS pension bill was €2.73bn (116,363 pensioners).

In 2010 the total national income of those in the tax net was €77.73bn (2,088,443).

Income tax in 2010 was €11.27bn (including the income levy).

Paying the PS 141% of the income tax take is economic lunacy.

Not really, as some of the public service pay bill is covered by service charges and other taxes.

If that is lunacy, how do you describe paying 200% of the income tax bill in social welfare payments?

frankosw

Godge wrote: »

If that is lunacy, how do you describe paying 200% of the income tax bill in social welfare payments?

PS pay is lunacy..the dole is entitlement apparantly.


Then of course the PS dont pay tax at all....

antoobrien

Godge wrote: »

If that is lunacy, how do you describe paying 200% of the income tax bill in social welfare payments?

Same, but Jayoose has already answered that in post #8 and it's not part of the o.p.

frankosw

antoobrien wrote: »

Same, but Jayoose has already answered that in post #8 and it's not part of the o.p.

But it's relvant because its considerably *more* of aproblem than what's being paid to people who work for a living..doing jobs,in many cases that very few people are cut out to do.

im invisible

Godge wrote: »

In 2008, the public service pay bill was €17.097 bn and the social welfare bill was €17.809 bn.

In 2011, the public service pay bill was €14.737 bn, a cut of 13.8%.
Can't find figures for 2011, but for 2010, the social welfare bill had increased to €20.848 bn, an increase of 17.1% with 2011 showing another increase.

So the question I have is that if public service pay has gone down by 13.8% (and is forecast to decline further with no policy change) while social welfare has gone up by 17.1% (and is forecast to continue to rise with no policy change), why are we calling the public service pay bill the problem?

frankosw wrote: »

Because it's trendy to do so..somethinng to do with jealousy and spite masquerading as economic expediency.

what was the unemployment rate in 2008 vs 2011? the amount of people employed in the PS in 2008 vs 2011?

Idbatterim

the first thing that should be scrapped is the lump sum on retirement, or at least subject it to tax!

Jaysoose

frankosw wrote: »

And paying 400,000 people the dole to do nothing isnt?

And any credibility you had just went wooshing out the window.

mrsoundie

Yes OP we will do that and to keep prices down in future all Private Sector pay will now be capped at appropriate levels (we cant have for instance wages at times being at two and a half times the median of public sector wages can we). :rolleyes:

bbam

Godge wrote: »

So it seems nobody can really answer the question as to why the public service pay bill is a bigger problem demanding priority action while the social welfare bill is not even though the public service pay bill is on a downturning spiral while the social welfare bill is on an increasing one.

I by no way think there need to be big cuts in the PS pay... However just to comment on what you have said..

Some PS pay levels are definitely "odd" considering the positions, these are hard to explain and foolish to defend as doing so discredits all PS pay discussions.

The current reduction in PS pay bill is substantial indeed, but the means this is being achieved by is not really acceptable. It is being achieved by culling enormous numbers of front line and near front line staff from essential services. the result is a backwards trend in services for us all in an attempt to defend pay levels, the end result is poorer services all round, this hasn't even hit completly yet as more and more are to leave, these will not be the inept middle and upper managers as it hasn't even been a targeted effort.

In contrast the SW bill has increased substantially as the number of people who had no choice but have their employment taken from them altogether. We now have huge unemployment 400,000+, probably a half million if the poxy "schemes" are taken into account...

So the crux of the thing is that SW is a huge issue, this government promised jobs and delivered essentially none, its a shame and they need to be helt to account over their broken promises.
I have no idea how PS pay rates can be addressed without major impact to the workers and their families, perhaps a 3-4% annual reduction over a few years?? PS pay has already been reduced significantly but I fear more is needed.. It would be better to make subtle reductions in pay rates and keep the service than slash the numbers, protect pay rates and loose the services. There is no simple answer, but that doesn't mean we don't look for one.

So after all that, BOTH need addressing, urgently !

mrsoundie

What needs to be addressed is not the PS wage bill or the Social Welfare being paid out (well not yet).

Whats required right now is to get people spending their money, this will get the economy going because right now nobody is spending except on essentials. Every penny (or cent) is being watched because there is nothing on the horizon to give confidence.

When there is no confidence there is only worry and fear, with both of these everyone is entrenched in their own position and nothing is being given away (unless with a fight). If some kind of hope can be established then moving people out of the PS to the Private Sector will be a lot easier and therefore reducing the wage bill (this should have been done during the boom, but alas no).

How do we give hope a leg up?

A simple way may be to reduce the current level of the high rate of VAT from 23% to 18%, do this now and give the Christmas spend some hope and continue it for Six months. I understand this is a simple solution but giving consumers confidence to spend is perhaps the simplest of all solutions.

So any ideas?

woodoo

Godge wrote: »

In 2008, the public service pay bill was €17.097 bn and the social welfare bill was €17.809 bn.

In 2011, the public service pay bill was €14.737 bn, a cut of 13.8%.
Can't find figures for 2011, but for 2010, the social welfare bill had increased to €20.848 bn, an increase of 17.1% with 2011 showing another increase.

So the question I have is that if public service pay has gone down by 13.8% (and is forecast to decline further with no policy change) while social welfare has gone up by 17.1% (and is forecast to continue to rise with no policy change), why are we calling the public service pay bill the problem?

That is a great post. The levels of outrage we see against the PS is unfair i think. Savings are being made but nobody seems to want to accept that.

Welfare is the biggest problem we have in this country.

Gumbo

Sleepy wrote: »

Because Labour have been voted into power by PS union members and represent the non-working classes more than those who actually vote for them?

Im PS, not in a union and i didnt vote Labour

Farmer Pudsey

Head The Wall wrote: »

Well hopefully the bloated social welfare bill is a temporary problem while overpaying on the pay bill is a long term problem as it feeds into pension deficits also

No the SW problem will be with us for ever we will find it hard to get work for 300K+ workers (with job schemes and self employed joblessnes the no out of work is over 500K). We need to get control of SW spending without transferring cost to employers who are under pressure to keep cost low.

frankosw wrote: »

Because it's trendy to do so..somethinng to do with jealousy and spite masquerading as economic expediency.

Where do you get the jealousy and spite bit from the reality is that we need to reduce cost drastically in 2000 we spend 8 billion on public service pay and pensions at present this is 17.5Billion approximetly that is nearly a 120% increase since 2000.

Riskymove wrote: »

well there's also a problem down the track with funding welfare pensions!!

its all connected to more people retiring and less working....both areas require a lot of work
.

Not just Social welfare but also public service pensions. The government should set a maximum PS pension of 40-50K and if high paid PS ( such as consulatants , judges and politicians) want a higher pension they should fund it themselves.

frankosw wrote: »

Is that so?

Well why didnt the non-union non PS workers vote against them?

In main they more than likly did but 300KPS and 400K on SW is nearly half the voting population

Godge wrote: »

Not really, as some of the public service pay bill is covered by service charges and other taxes.

If that is lunacy, how do you describe paying 200% of the income tax bill in social welfare payments?

Yes it is lunancy we are paying 360% of our income tax take on public service pay and welfare.

Idbatterim wrote: »

the first thing that should be scrapped is the lump sum on retirement, or at least subject it to tax!

This could not be implemented just at PS so it is a non runner it is very important to workers in the private sector with low pensions as anunity rates are crazy at present they are at around 4-5%

mrsoundie wrote: »

Yes OP we will do that and to keep prices down in future all Private Sector pay will now be capped at appropriate levels (we cant have for instance wages at times being at two and a half times the median of public sector wages can we). :rolleyes:

Yes there are high paid workers in the privare sector and you have the crazy situtation of the pay at the top level of PLC where top management staff are paid crazy money as well as top brass in the banks.

However as long as private pension fund continue to take no active part in the management of these companies it is hard to prevent.

Middle management in the private sector however often earn there money often have to travel abroad regularly or put in long hours. Very few middle managers in the private sector have 35 hour weeks and are often on 2-3 year contracts and if there preformance is poor there contract will not nre renewed

mrsoundie wrote: »

What needs to be addressed is not the PS wage bill or the Social Welfare being paid out (well not yet).

Whats required right now is to get people spending their money, this will get the economy going because right now nobody is spending except on essentials. Every penny (or cent) is being watched because there is nothing on the horizon to give confidence.

When there is no confidence there is only worry and fear, with both of these everyone is entrenched in their own position and nothing is being given away (unless with a fight). If some kind of hope can be established then moving people out of the PS to the Private Sector will be a lot easier and therefore reducing the wage bill (this should have been done during the boom, but alas no).

How do we give hope a leg up?

A simple way may be to reduce the current level of the high rate of VAT from 23% to 18%, do this now and give the Christmas spend some hope and continue it for Six months. I understand this is a simple solution but giving consumers confidence to spend is perhaps the simplest of all solutions.

So any ideas?

This is the Kensyanian theory however the reality is that the Trioka made us raise VAT to 23% they will not allow us to change it. The priavte sector in the form of small sole traders is decimated as are family's working in the private sector. There disposable income has droped from an already low base due to wage cuts, unemployment, cost of transport to work and higher income and indirect taxes.

Self Employed workers have been decimated most are lucky to have 30+ weeks work a year and there income has suffered a huge cut. Some of them have already one member of the family abroad. Most are dreading the after christmass cut back of spending as people pay bill and adjust form the budget.

However if you are in the PS it is ok in January 2013 you payslip will arrive and the money will be deposited in the bank. This is not the case in the private sector in mid late January small buisness will again start to close and lay off workers as the relias that they have not made enough to survive another year

But the PS and Johnny Logan have the same song

What another year

woodoo wrote: »

That is a great post. The levels of outrage we see against the PS is unfair i think. Savings are being made but nobody seems to want to accept that.

Welfare is the biggest problem we have in this country.

RichardAnd

The Clown Man wrote: »

Thread title got your attention?

OK, so the Public/Private divide is in full force on these forums and there have been several threads (increments/pay gap/teachers unions etc) where the threads have pretty much decended into tangents and sniping.

Tribalism will never die in the emerald isle . . .

Pottler

How do you fix it? You don't. Nor will you fix the welfare payments costs. There is no stomach for it and too many vested interests. Nothing will be done until the bill just can't be met any more, and then somthing else will be cut so that it can. In the meantime, much fingering around the edges will happen. Realistically, nothing will happen until the states finances really hit a final buffer, and this being Ireland, there's always another loophole, so again, this will never happen.

gerryo777

Godge wrote: »

Not really, as some of the public service pay bill is covered by service charges and other taxes.

If that is lunacy, how do you describe paying 200% of the income tax bill in social welfare payments?

Social welfare payments will decrease as employment increases.
The PS pay and pensions bill will increase into the future.

I'd suggest a cut in welfare across the board of 10% and a cut in PS pay and pension entitlements of 10%.
That would save the exchequer around the €3.5 billion per year that's required.

Idbatterim

How do you fix it? You don't. Nor will you fix the welfare payments costs. There is no stomach for it and too many vested interests. Nothing will be done until the bill just can't be met any more, and then somthing else will be cut so that it can. In the meantime, much fingering around the edges will happen. Realistically, nothing will happen until the states finances really hit a final buffer, and this being Ireland, there's always another loophole, so again, this will never happen.

this pretty much, unless the government are forced to take drastic action...

gerryo777

frankosw wrote: »

PS pay is lunacy..the dole is entitlement apparantly.


Then of course the PS dont pay tax at all....

If you've paid your PRSI all the time that you were working then the dole is an entitlement.
PRSI = Pay Related Social Insurance.

Godge

gerryo777 wrote: »

Social welfare payments will decrease as employment increases.
The PS pay and pensions bill will increase into the future.

I'd suggest a cut in welfare across the board of 10% and a cut in PS pay and pension entitlements of 10%.
That would save the exchequer around the €3.5 billion per year that's required.

But public service pay has already been cut and social welfare has not. That is part of the reason for the figures I posted already in the thread.

gerryo777

Godge wrote: »

But public service pay has already been cut and social welfare has not. That is part of the reason for the figures I posted already in the thread.

PS pay was brought to an artificially high rate by FF in order to buy the PS vote so the cuts that have happened so far, while welcome, are not enough and more is required to bring the PS pay bill more in line with the rest of europe.

I agree that welfare should be cut too by around 10% as I've said already.
The welfare bill will reduce further as employment grows.

Idbatterim

PRSI Classes and people insured in each Class
Class A is the most common PRSI class. It applies to people in industrial, commercial and service type employment who are employed under a contract of service with a reckonable pay of €38 or more per week from employment. It also includes civil and public servants recruited from 6 April 1995. In fact, most employees in Ireland pay PRSI Class A.

Class A does not apply to people in insurable employment and over 66 years of age. They are insurable under Class J.

You can get more details about social insurance classes and the occupations covered by each class in 'Further information' below.

How much social insurance (PRSI) must I pay?
The amount of PRSI you pay will depend on your earnings and the class you are insured under. Here is an example for employees insured under Class A:

If you are earning less than €352 gross per week (before tax is deducted), you will not pay any social insurance. This does not mean that you are not getting a contribution. You are still covered by Class A social insurance. Your employer is paying social insurance on your behalf. Your employer will pay a contribution of 4.25% on your earnings. (This was 8.5% up until 1 July 2011 and will be restored to 8.5% in 2014.)

If you earn between €352 and €356 per week, the first €127 of your earnings will be ignored and you will pay 4% on anything over that amount. Your employer will pay 4.25% on your earnings up to €356. (This was 8.5% up until 1 July 2011 and will be restored to 8.5% in 2014.)

If you earn more than €356 per week, the first €127 of your earnings will be ignored and you will pay 4% on anything over that amount. Your employer will pay 10.75% on your weekly earnings.

For people insured under other classes, the amount of PRSI they pay will vary.

In 2011 the PRSI ceiling of €75,036 was abolished and the health levy was replaced by the Universal Social Charge.

If you've paid your PRSI all the time that you were working then the dole is an entitlement.
PRSI = Pay Related Social Insurance.

as you can see, you can earn up to E352 gross per week and pay nothing in, the bottom line is that your average earner, is probably contributing E900 per year in PRSI, equivalent to about 4 weeks dole per year if he or she is laid off... The way i see it, far too many at the bottom contributing nothing in DIRECT taxes...

Itchianus

Idbatterim wrote: »

as you can see, you can earn up to E352 gross per week and pay nothing in, the bottom line is that your average earner, is probably contributing E900 per year in PRSI, equivalent to about 4 weeks dole per year if he or she is laid off...

The employer pays a contribution regardless of the level of the employee's contribution.

(And surely the point of insurance generally is that a large pool of people pay in, and only a fraction claim against it - if all you could/should receive from insurance was the amount paid in you'd be better off just saving your money.)

gerryo777

Idbatterim wrote: »

PRSI Classes and people insured in each Class
Class A is the most common PRSI class. It applies to people in industrial, commercial and service type employment who are employed under a contract of service with a reckonable pay of €38 or more per week from employment. It also includes civil and public servants recruited from 6 April 1995. In fact, most employees in Ireland pay PRSI Class A.

Class A does not apply to people in insurable employment and over 66 years of age. They are insurable under Class J.

You can get more details about social insurance classes and the occupations covered by each class in 'Further information' below.

How much social insurance (PRSI) must I pay?
The amount of PRSI you pay will depend on your earnings and the class you are insured under. Here is an example for employees insured under Class A:

If you are earning less than €352 gross per week (before tax is deducted), you will not pay any social insurance. This does not mean that you are not getting a contribution. You are still covered by Class A social insurance. Your employer is paying social insurance on your behalf. Your employer will pay a contribution of 4.25% on your earnings. (This was 8.5% up until 1 July 2011 and will be restored to 8.5% in 2014.)

If you earn between €352 and €356 per week, the first €127 of your earnings will be ignored and you will pay 4% on anything over that amount. Your employer will pay 4.25% on your earnings up to €356. (This was 8.5% up until 1 July 2011 and will be restored to 8.5% in 2014.)

If you earn more than €356 per week, the first €127 of your earnings will be ignored and you will pay 4% on anything over that amount. Your employer will pay 10.75% on your weekly earnings.

For people insured under other classes, the amount of PRSI they pay will vary.

In 2011 the PRSI ceiling of €75,036 was abolished and the health levy was replaced by the Universal Social Charge.

as you can see, you can earn up to E352 gross per week and pay nothing in, the bottom line is that your average earner, is probably contributing E900 per year in PRSI, equivalent to about 4 weeks dole per year if he or she is laid off... The way i see it, far too many at the bottom contributing nothing in DIRECT taxes...

People at the 'bottom' would be spending almost all of their wages in the economy too so they are paying their fair share in VAT and other taxes.

Good loser

gerryo777 wrote: »

Social welfare payments will decrease as employment increases.
The PS pay and pensions bill will increase into the future.

I'd suggest a cut in welfare across the board of 10% and a cut in PS pay and pension entitlements of 10%.
That would save the exchequer around the €3.5 billion per year that's required.

Like your idea but would 5% per annum over three years not be better?

The advantage in your suggestion would be the surprise element!

The very best gainers in this recession though have been the ESB and BGE workers. The Govt should take a permanent special dividend off these companies equal to 10% of the pay bill - and not to be allowed a price offset.

Also if 1500 bank employees in pillar banks earn over €100k these should be addressed.

The problems are too large for tinkering around.

Idbatterim

People at the 'bottom' would be spending almost all of their wages in the economy too so they are paying their fair share in VAT and other taxes.

thats why i highlighted the direct taxes bit. anyway, well probably disagree on this, but FF took far too many out of the tax net, the same way they bought elections term after term, coming back to bite us in the a*s now big time!

Head The Wall

frankosw wrote: »

But it's relvant because its considerably *more* of aproblem than what's being paid to people who work for a living..doing jobs,in many cases that very few people are cut out to do.

What the hell are you on about? Are you implying that there are no clerical officers, doctors, cleaners, groundsmen, nurses, engineers in the private sector. Please do explain

mrsoundie wrote: »

Yes OP we will do that and to keep prices down in future all Private Sector pay will now be capped at appropriate levels (we cant have for instance wages at times being at two and a half times the median of public sector wages can we). :rolleyes:

Welcome to communist Ireland. The PS didn't seem to have a problem with the private sector when they were "supposedly" trying to catch up to it with Benchmarking. If the Private sector wage was kept low what "tactic" would they have used to get more money?

Godge wrote: »

But public service pay has already been cut and social welfare has not. That is part of the reason for the figures I posted already in the thread.

Social welfare has been cut, maybe not last year but previously it has been. I will agree that it is still a major issue that needs tackling also, especially the allowances system as the JSA/JSB only makes up 25% of the bill.

Sleepy

frankosw wrote: »

Is that so?

Well why didnt the non-union non PS workers vote against them?

kceire wrote: »

Im PS, not in a union and i didnt vote Labour

What other section of society votes labour in significant numbers? Sinn Fein have been hoovering up the welfare class votes, the naive young socialists of college going age don't translate their keyboard warrior / drunken revolutionary diatribes into significant votes, the pensioners tend to have family loyalty to (or have been bought by) FG or FF.

Conversely I heard PS shop stewards and union stalwarts using the phrase "sure he's probably going to vote for Fine Gael" as an insult. When I joked that "sure isn't this Fianna Fail country?" I was curtly informed that Labour were "the only sane choice" :rolleyes:

Luckily, as numerous as they are that they elect enough Labour candidates to have them form part of the government, there's more of us (at the present) that understand enough about economics to know that the most-often-used adjectives used to describe the Irish economy know that their proposals for Keynesian stimulus can't work here.

I agree with many of Labours social policies: marriage equality, a right to state funded healthcare, decriminalisation of marijuana (well, it's a Labour Youth policy) but unfortunately their economic thinking is about at the level of a first year Arts student with a penchant for too much Buckfast...

frankosw

Farmer Pudsey wrote: »

Where do you get the jealousy and spite bit from the reality is that we need to reduce cost drastically in 2000 we spend 8 billion on public service pay and pensions at present this is 17.5Billion approximetly that is nearly a 120% increase since 2000.

Really?

Did it not occur to you that the population may have increased a little bit since then?

In particular huge amounts of people from overseas requiring everything from social welfare to emergency accomadation to new driving licences,housing,tax certificates,school places,medical cards,interpretors and all the other baggage that goes with it.

Who do you actually think has to do all this extra work?

frankosw

Sleepy wrote: »

I agree with many of Labours social policies: marriage equality, a right to state funded healthcare, decriminalisation of marijuana (well, it's a Labour Youth policy) but unfortunately their economic thinking is about at the level of a first year Arts student with a penchant for too much Buckfast...

So you agree the "taxpayer" should be funding a public service?

So what's your problem?

Either privatise it and let everybody pay OR continue to have it free and let the people who work in the service be paid form the Govt coffers.

I dont see what your point in all this has been..

Sleepy

frankosw wrote: »

So you agree the "taxpayer" should be funding a public service?

That's what my post says. Nowhere on boards will you ever find a post from me in favour or privatising healthcare, education or the Gardaí.

So what's your problem?

Mis-management of state resources (overpayment of staff, inefficient organisational structures resulting in huge duplication of effort and wastes, unelected bodies having too much say in the running of state bodies etc.)

Either privatise it and let everybody pay OR continue to have it free and let the people who work in the service be paid form the Govt coffers.

I dont see what your point in all this has been..

I was offering part of the answer to Godge's question below:

If public service pay has gone down by 13.8%... while social welfare has gone up by 17.1%... why are we calling the public service pay bill the problem?

My chief point being that in a majority government, Fine Gael would be more likely to tackle the welfare bill than they are when they're saddled with Labour as a coalition partner and that Eamon Gilmore's Labour seem more interested in representing the welfare classes than the very people who elected them.

There are, of course other answers as to why the PS bay bill is a problem:

• it being such a large percentage of government spending when we're running at a deficit leaves few other areas to look to in order to reduce that deficit.
• all evidence suggests that many public sector workers receive higher wages than the free market determines them as being worth - this is a waste of the nations resources
• Regardless of one's position in Irish society, we all know of utterly useless state employees that should have been sacked years ago but are kept in a job at our expense because of cronyism or union protection - further waste
• The inflexibility of the unions means that much of the spend is generating little value for money: we have huge duplication of effort caused by an inability to use targeted compulsory redundancies via consolidation of departments / business functions / local government etc.

frankosw

Sleepy wrote: »

There are, of course other answers as to why the PS bay bill is a problem:

• it being such a large percentage of government spending when we're running at a deficit leaves few other areas to look to in order to reduce that deficit.
• all evidence suggests that many public sector workers receive higher wages than the free market determines them as being worth - this is a waste of the nations resources
• Regardless of one's position in Irish society, we all know of utterly useless state employees that should have been sacked years ago but are kept in a job at our expense because of cronyism or union protection - further waste
• The inflexibility of the unions means that much of the spend is generating little value for money: we have huge duplication of effort caused by an inability to use targeted compulsory redundancies via consolidation of departments / business functions / local government etc.

Every bit of the highlighted posts is hearsay.

The PS functions as an arm of the state...

The staff are serving the public in often unenviable jobs ie
Prison officers
Nurses
Ambulance staff
Teachers
Dole office staff
Gardai
etc

They are dealing with people every day,not sitting in front of a computer designing software for multinational companies that dont care about the staff or the country they're involved in.

Working with people especially irate people,or drunk people,or armed crimimanal people or mentally ill people is a demanding job,no matter how easy you think it is.

You try getting an alcoholic to calm down after he's been stabbed and stabbed somebody at 4am when sorrounded by a gang of his friends in a hostile housing estate for 32k per anum.


Who do you telephone when you see a gang trying to break into your car? A private company or the gardai?

If you want public services they must be paid for,cutting wages wont bring the national deficet down by very much..there's no job creation in this country,the dole is a lifestyle choice for many,NAMA has written off the debts of specualtors to the tune of billions of euro,the black economy costs the state 27 billion in missed revenue etc etc

These are things that can be addressed before paycuts for normal working people are to be countinanced...the PS didnt cause this mess yet we're the ones dealing with it and being villified at the same time.

It is my belief that people like you arent actually concerned about the economy at all...you're merely concerned that you might be called on to pay a couple of extra % in income tax..that to me is selfish,understandable but selfish.

Godge

Sleepy wrote: »

That's what my post says. Nowhere on boards will you ever find a post from me in favour or privatising healthcare, education or the Gardaí.
:

Can't disagree with you there, as often as I disagree with some of what you say, there are parts I am in agreement with.

Sleepy wrote: »

Mis-management of state resources (overpayment of staff, inefficient organisational structures resulting in huge duplication of effort and wastes, unelected bodies having too much say in the running of state bodies etc.)

The devil is in the detail, how much is the current situation a work in progress? Some staff remain overpaid but others are now underpaid. Some changes have taken place but not others.

Sleepy wrote: »

My chief point being that in a majority government, Fine Gael would be more likely to tackle the welfare bill than they are when they're saddled with Labour as a coalition partner and that Eamon Gilmore's Labour seem more interested in representing the welfare classes than the very people who elected them.

A good point, it amazes me that Labour have let the media bashing of the public service continue. This is being shown up as a mistake in the polls.

Sleepy wrote: »

There are, of course other answers as to why the PS bay bill is a problem:

• it being such a large percentage of government spending when we're running at a deficit leaves few other areas to look to in order to reduce that deficit.

http://per.gov.ie/wp-content/uploads/Analysis-of-Exchequer-Pay-and-Pensions-Bill-2006-2011.pdf

Not true, look at the link, Public Service Pay as a percentage of net non-capital Exchequer spending declined from 49% in 2006 to 41% in 2009. The decline will continue over the next two to three years. This demonstrates that public service pay is being cut at a greater and deeper rate than other areas of non-capital public expenditure.

• all evidence suggests that many public sector workers receive higher wages than the free market determines them as being worth - this is a waste of the nations resources

The recent CSO report shows that this gap has virtually closed with the arguments now coming down to whether the pension for the public service is worth more than the BIKs and bonuses in the private sector. With the gap so close, it proves my point that some public servants are underpaid - the report suggests those at the top - which makes it difficult to cut pay for all.

Sleepy wrote: »

Regardless of one's position in Irish society, we all know of utterly useless state employees that should have been sacked years ago but are kept in a job at our expense because of cronyism or union protection - further waste

We all know of utterly useless private sector employees, whether it is in insurance companies, UPC or Eircom, SKY, Currys, read some of the threads on these boards relating to these private sector companies and the complaints about staff. Priory Hall and the pyrite scandal are down to the incompetence of construction workers. Ask anyone who bought a house in the nineties or noughties whether their snag list was ever fully corrected? The waste is everywhere, it is not as easy to sack people as you might think which explains the incompetence across the private sector as well as the public sector.

Sleepy wrote: »

• The inflexibility of the unions means that much of the spend is generating little value for money: we have huge duplication of effort caused by an inability to use targeted compulsory redundancies via consolidation of departments / business functions / local government etc.

This is being addressed, VECs being cut to 18? from 32, Town councils gone and city and county councils being merged, various other quangos being merged as well. This cannot happen overnight, legislation is needed in many cases but there is some progress.

antoobrien

frankosw wrote: »

Every bit of the highlighted posts is hearsay.

Quite a lot of it is libelous hearsay too.

Clerical worker definiton:

A person employed in an office or government agency who performs various tasks such as keeping records or accounts, filing, letter writing, or transcribing.

I'd describe that as administrative support.

Clerical Officer Standard grade salary from 2010 on (subject to pension levy, increments): 37,341 (715.62 p/w)

Administrative and support services 2010: 488.55 p/w = 25,404.6

frankosw

antoobrien wrote: »

Clerical worker definiton:


I'd describe that as administrative support.

Clerical Officer Standard grade salary from 2010 on (subject to pension levy, increments): 37,341 (715.62 p/w)

Administrative and support services 2010: 488.55 p/w = 25,404.6

Well then go for the job that pays more money..thats the nature of freedom of choice.

Of course,you might not actually get the better paying job..you might not be good enough.

This is nothing to do with unions btw..the PS employs a much higher standard as a rule than the private sector.

I know the last round of interviews we had there were over 1100 applicants for a few hours a week.

One of the applications from a graduate was practically written in textspeak.