Government to reverse some Public Secor Pay cuts

Geuze · 06-10-2014 9:33am

(3) The ESRI published more work in Winter 2012.

http://www.esri.ie/UserFiles/publications/RN20120402.pdf

Here they discuss which of the CSO techniques should be used.

They argue that one of the CSO results is more accurate, so they feel the 2010 average PS pay premium is 17%.

Note that this excludes the effects of the PRD, which would mean a 10% approx pay premium after the PRD.

Rightwing · 06-10-2014 10:03am

ezra_pound wrote: »

OK what sectors of the economy would you expect to see a higher average level of pay and expertise than education and health?

The legal sector. Yes similar
Pharma. No I'd be surprised if average expertise levels were as high
It/ tech. No
Agriculture. No

Etc. Etc.

Education isn't just primary school teachers. It's research labs in universities, lecturers etc etc.
Level of expertise massive.

We're not talking about brain surgeons here. Let's see the department's own figures & I imagine this is replicated across the board. It's hard to justify this pay at any level:

http://www.irishexaminer.com/ireland/education/1500-teachers-earn-up-to-115k-a-year-189895.html

About 1,500 teachers earn between €85,000 and €115,000 a year, Department of Education figures have revealed.
At their annual union conferences this week, teachers will insist the Government meet its commitment under the Croke Park deal to protect teachers’ pay, including allowances.
Delegates to the Irish National Teachers’ Organisation, Association of Secondary Teachers Ireland, and Teachers’ Union of Ireland gatherings will also be seeking a reversal of cuts to schools and teacher numbers.
Education Minister Ruairi Quinn has repeatedly said he has little choice but to impose cuts to services and school programmes when about 80% of his €8.5bn-plus annual budget is expended on staff pay and pensions. More than 90% of the schools’ non-capital budget goes on pay and about 6% on running costs.
Figures obtained by the Irish Examiner show the averagely paid teacher earns €55,000-€60,000, with a higher proportion of second-level teachers in the higher pay brackets.
More than one-in-three primary teachers and 43% of those working at second level earn at least €61,000 a year.
Just over half of all teachers earn between €41,000 and €61,000 a year, through a combination of salary and various allowances.
Recent figures from Mr Quinn’s department showed the pay of Ireland’s 60,000-plus teachers is boosted by an average €10,000 a year in allowances.
These make up about €600m of the annual teachers’ pay bill of over €3.5bn, and are being reviewed as a public sector-wide review of allowances and additional payments.
Every teacher is paid at least one allowance in respect of their qualifications. They cost over €275m last year but changes to pay for new teachers may see that fall significantly.
However, unions insist all allowances are an integral part of their members’ pay.
Long-serving teachers who work as principals or deputy principals in large schools can earn close to €100,000, with management allowances of almost €40,000-€42,500 paid to principals of second-level schools with more than 40 teachers.
ASTI general secretary Pat King said allowances for principals and other management posts were key to the rate of pay for those jobs.
“ASTI members signed up to and are fully compliant with the Croke Park Agreement which protects their pay,” he said.
“We will consider any reduction in their pay to be a breach of the agreement by the Government.”
A spokeswoman for Mr Quinn said he was aware of the difference between teachers’ allowances as an understood part of their pensionable pay, and allowances paid in other elements of the public sector.
“He is making that case to the review by the Department of Public Expenditure and Reform,” she said.

Godge · 06-10-2014 10:05am

Rightwing wrote: »

The average PS is almost €1K a week, name another country with a figure that high.
Over to you boys.

No point in answering your questions when you continuously fail to answer questions posed to you earlier in the thread.

Godge wrote: »

Unbelievable level of ignorance.

Can you name one country in the world where the maximum teacher salary is equivalent to the average industrial salary in that country? Apart from North Korea, that is.

Now that you have discovered there are other countries, maybe you would do your research.

Godge · 06-10-2014 10:07am

Rightwing wrote: »

I'd be a big advocate of privatisation for all of them There would be an immediate return to the exchequer, and the wages would quickly come down.

And price rises for the consumer, excellent idea:rolleyes:

Geuze · 06-10-2014 10:09am

Rightwing wrote: »

We're not talking about brain surgeons here. Let's see the department's own figures & I imagine this is replicated across the board. It's hard to justify this pay at any level:

http://www.irishexaminer.com/ireland/education/1500-teachers-earn-up-to-115k-a-year-189895.html

About 1,500 teachers earn between €85,000 and €115,000 a year, Department of Education figures have revealed.

These are principals.

Any sensible person would want principals to be well-paid as they do a very important job.

Indeed, a good society would want principals to be better paid that bank managers and accountants.

A principal of a 750-1000 pupil school with 50+ staff has an incredibly demanding job - they deserve 80-100k.

Average salary for accountants is 90k.

See: https://leinster.charteredaccountants.ie/Global/Leinster/Press-Release-Leinster-Society-Salary-Survey-The-Panel-25-7-14.pdf

Who should we pay more? Accountants or principals of schools? Who has more impact on society?

What do we value more? Education or accounting? Our children's education?

So a nation should be proud to pay 100k for talented, busy, productive school principals.

Godge · 06-10-2014 10:10am

Rightwing wrote: »

Europe is effectively bankrupt. The bigger the difference in these sectors, the worse shape that economy will be in.

More rubbish.

http://epp.eurostat.ec.europa.eu/cache/ITY_PUBLIC/2-22012014-AP/EN/2-22012014-AP-EN.PDF

Eurostat figures.

"At the end of the third quarter of 2013, the government debt to GDP ratio
in the euro area (EA17) stood at 92.7%, compared with 93.4% at the end of the second quarter of 2013, the first fall in absolute terms since the fourth quarter of 2007"

Debt at those levels is entirely manageable and a long way from bankruptcy.

Godge · 06-10-2014 10:13am

Geuze wrote: »

Some points on the public-private wage premium:

(1) The ESRI have studied the public-private wage premium.

Using 2003-2006 data, the premium was found to be between 14-26%.

See here:

http://www.esri.ie/UserFiles/publications/20091102110232/WP321.pdf

(2) The CSO also did work on this topic, published 2012, using 2009 and 2010 data, see here:

http://www.cso.ie/en/media/csoie/releasespublications/documents/earnings/2010/nes_0910supp.pdf

This found a wage gap of 10-19% in 2010, with various statistical techniques applied.

Note that for permanent, full-time workers aged between 25-59, the PS premium, after adjusted for the size of the organisation, is 6.1-7.3%

NB: the CSO data does not included the effects of the PRD - Pension Related Deduction, which was substantial.

Note that the 7% pay premium found by the CSO in 2010, would have been eliminated by the PRD.

The PRD marginal rates are 0%, 5%, 10%, 10.5%, see below.

The effective rate of PRD on 40k gross is 5.625%, see below.

So with the 2009 PRD and the 2010 pay-cut, the PS pay premium has been reduced to practically zero.

PRD details

First € 15,000 of earnings: exempt
Earnings between € 15,000 and € 20,000: 5%
Earnings between € 20,000 and € 60,000: 10%
Earnings above € 60,000: 10.5%
Based on these currently applicable PRD rates, the amounts of PRD arising at a series of annual pay points up to and including €60,000 are as follows:
Pay of €15,000: No PRD
Pay of €20,000: PRD of €250
Pay of €25,000: PRD of €750
Pay of €30,000: PRD of €1,250
Pay of €35,000: PRD of €1,750
Pay of €40,000: PRD of €2,250
Pay of €45,000: PRD of €2,750
Pay of €50,000: PRD of €3,250
Pay of €55,000: PRD of €3,750
Pay of €60,000: PRD of €4,250

Excellent post that helps debunk the myth that there is a significant public sector pay premium. It should be bookmarked for the likes of rightwing, noodler and filiball who keep coming up with the same rubbish time and again despite being shown these figures.

One thing missing from all of the analysis is the fact that the absence of self-employed and directors' pay from the private sector data further distorts the picture pulling down the private sector average.

Rightwing · 06-10-2014 10:15am

Geuze wrote: »

These are principals.

Any sensible person would want principals to be well-paid as they do a very important job.

What do they do?

Afaik they don't even teach.

fliball123 · 06-10-2014 10:20am

Sheldons Brain wrote: »

Not so. The damage done by the banks was not only the money they directly required, but the damage done to business by their carry on which ruined the country.

What are you on about the World was heading into crisis at that point even if the banks had been prudent and did not phuck up we would still have been on the lamb for a debt of nearly 150billion caused by Berties ridiculous block vote buying. People seem to forget the fact that if we had not put one cent into banks or borrowed for them we would still be in massive debt and we would still be in a deficit...But the banks are pointed at as the big bad wolfe in all of this when the anger should be directed else where..I have no time for the banks..They did what they did and I hope people are brought to task for what they did..But where is the outrage and the pitch forks for Bertie or Cowen and unions for what they did in what is the biggest crisis the country has seen..The block buying of the public sector and welfare made sure bertie got voted back time after time and he is still living it up on the tax payers dime

Geuze · 06-10-2014 10:23am

Rightwing wrote: »

What do they do?

Afaik they don't even teach.

That is a very naive statement.

Spend a day with the principal of a large secondary school and you will see what they have to do.

The job is never-ending.

Managing hundreds of teenagers is a job itself, add in 50-60 staff, I'd say these are harder to manage than the kids.

Add in finance, gardens, maintenance, ICT, dealing with parents (!!), and dealing with the DES.

And if anybody thinks it finishes at 4pm they're deluded.

Rightwing · 06-10-2014 10:23am

Godge wrote: »

And price rises for the consumer, excellent idea:rolleyes:

It didn't really happen with Eircom or Aer Lingus as far as I know. But if the unions say so, it must be true.

Godge · 06-10-2014 10:25am

Rightwing wrote: »

What do they do?

Afaik they don't even teach.

I will assume for the moment that this is a genuine query but I have my doubts.

I have been on the board of management of two different schools and I can tell you that the job of principal in both those cases was onerous, required highly-developed management skills in all areas including human resource and financial management skills, an ability to work under pressure for long periods and very long hours. I would not take the job for the money offered,

Geuze · 06-10-2014 10:25am

fliball123 wrote: »

What are you on about the World was heading into crisis at that point even if the banks had been prudent and did not phuck up we would still have been on the lamb for a debt of nearly 150billion caused by Berties ridiculous block vote buying. People seem to forget the fact that if we had not put one cent into banks or borrowed for them we would still be in massive debt and we would still be in a deficit...But the banks are pointed at as the big bad wolfe in all of this when the anger should be directed else where..I have no time for the banks..They did what they did and I hope people are brought to task for what they did..But where is the outrage and the pitch forks for Bertie or Cowen and unions for what they did in what is the biggest crisis the country has seen..The block buying of the public sector and welfare made sure bertie got voted back time after time and he is still living it up on the tax payers dime

The banking cost of 64bn is a substantial amount compared to our gross debt of 200bn.

But you are correct that Ahern could not say no to welfare increases and public service trade unions.

Rightwing · 06-10-2014 10:25am

Geuze wrote: »

These are principals.

Any sensible person would want principals to be well-paid as they do a very important job.

Indeed, a good society would want principals to be better paid that bank managers and accountants.

A principal of a 750-1000 pupil school with 50+ staff has an incredibly demanding job - they deserve 80-100k.

Average salary for accountants is 90k.

See: https://leinster.charteredaccountants.ie/Global/Leinster/Press-Release-Leinster-Society-Salary-Survey-The-Panel-25-7-14.pdf

Who should we pay more? Accountants or principals of schools? Who has more impact on society?

What do we value more? Education or accounting? Our children's education?

So a nation should be proud to pay 100k for talented, busy, productive school principals.

An accountant of course. Impact on society has little to nothing to with it, or else priests would command nice figures indeed.

Rightwing · 06-10-2014 10:27am

Geuze wrote: »

That is a very naive statement.

Spend a day with the principal of a large secondary school and you will see what they have to do.

The job is never-ending.

Managing hundreds of teenagers is a job itself, add in 50-60 staff, I'd say these are harder to manage than the kids.

Add in finance, gardens, maintenance, ICT, dealing with parents (!!), and dealing with the DES.

And if anybody thinks it finishes at 4pm they're deluded.

Yes, I will give you secondary, but I'm not buying primary, I've seen it first hand from my own children.

Godge · 06-10-2014 10:27am

Rightwing wrote: »

It didn't really happen with Eircom or Aer Lingus as far as I know. But if the unions say so, it must be true.

Neither Eircom nor Aer Lingus were monopoly utilities at the time of privatisation.

There is a reason why ESB and Eirgrid have been separated and the same if happening with Bord Gais.

It is the same reason that the full sale of Eircom is now regarded as a serious mistake. The fixed line infrastructure should never have been sold.

Rightwing · 06-10-2014 10:29am

Godge wrote: »

Neither Eircom nor Aer Lingus were monopoly utilities at the time of privatisation.

There is a reason why ESB and Eirgrid have been separated and the same if happening with Bord Gais.

It is the same reason that the full sale of Eircom is now regarded as a serious mistake. The fixed line infrastructure should never have been sold.

It was just handled very poorly by Harney, with employees walking away with circa €100K

Geuze · 06-10-2014 10:30am

Rightwing wrote: »

An accountant of course. Impact on society has little to nothing to with it, or else priests would command nice figures indeed.

Well then I say society is wrong if we value principals below accountants.

Accountants have continued to get payrises over the last few years.

Principals have taken three paycuts.

We need to change our priorities.

Geuze · 06-10-2014 10:31am

Rightwing wrote: »

Yes, I will give you secondary, but I'm not buying primary, I've seen it first hand from my own children.

You may have a point here.

Note that the principals allowance varies with the size of the school, so they won't get a large allowance in the case of a small national school.

Godge · 06-10-2014 10:34am

Rightwing wrote: »

It was just handled very poorly by Harney, with employees walking away with circa €100K

You obviously are unable to understand the point I made. Either that or you are not interested in logical discussion and argument.

The selling of the fixed line infrastructure was a bad idea because there has only been minimal investment in it by the various owners since. Our broadband infrastructure remains poor by international standards because of the failure of these private owners. Our best private broadband is provided by a TV supplier company - UPC!!

fliball123 · 06-10-2014 10:38am

Monife wrote: »

The salary scale for my job in the private sector would be between €30,000 and €50,000 depending on experience. There is no shorter working year or work sharing where I work. Increments aren't worth much in the grand scheme of things, it will take me 16 years to reach the top of the scale, being approx. €37,000 if I don't succeed at getting promoted.

I have two third level qualifications.

So yeah, I would say underpaid, for the majority of new entrants.

Well my friend feel free to leave your no way of being fired from job or guaranteed pension job or your lets use sick days as leave job and roll the dice in the private sector..If its as bad as your cracking on about you would of been out of there years ago. So you will forgive me if I don't shed any tears about your predicament

fliball123 · 06-10-2014 10:40am

barneystinson wrote: »

I can't speak for Godge, but the rubbish part for me, is the use of such a broad-based average to create a tabloidesque disparity, by comparing 1.8m apples with 300k oranges.

Show me a category of PS worker who are paid 48% (or whatever was quoted) more than a suitable private sector equivalent. And then show me the next, and the next.

Barney its a pity you were not crying foul of this little nugget of wisdom when they done the benchmarking exercise twice?

Some Apples are more orangy than oranges

fliball123 · 06-10-2014 10:42am

ezra_pound wrote: »

The health and education sectors make up a huge proportion of the public sector. If you fail to see that these are very specialised sectors that should command high average pay levels then you really aren't the kind of person I'd be seeking an opinion from on economics or pay levels or any related topics.

Your last paragraph is indecipherable but I pick up from it that you don't want to debate the issue-just determine that PS wages are too high and should be cut. That's not really acceptable in a forum thread discussing PS wage cuts. It's about debating that issue.

Why should they be high level?? because you say so..Why should we pay them more than say the likes o England or Austrailia or Germany??? becasue they are worth it..

Why do we get so little service or a really bad service for the tax we pay.?? I have no bother paying taxes for a decent service but at present we get virtually nothing for what we pay..

Flex · 06-10-2014 10:44am

Geuze wrote: »

Some points on the public-private wage premium:

(1) The ESRI have studied the public-private wage premium.

Using 2003-2006 data, the premium was found to be between 14-26%.

See here:

http://www.esri.ie/UserFiles/publications/20091102110232/WP321.pdf

(2) The CSO also did work on this topic, published 2012, using 2009 and 2010 data, see here:

http://www.cso.ie/en/media/csoie/releasespublications/documents/earnings/2010/nes_0910supp.pdf

This found a wage gap of 10-19% in 2010, with various statistical techniques applied.

Note that for permanent, full-time workers aged between 25-59, the PS premium, after adjusted for the size of the organisation, is 6.1-7.3%

NB: the CSO data does not included the effects of the PRD - Pension Related Deduction, which was substantial.

Note that the 7% pay premium found by the CSO in 2010, would have been eliminated by the PRD.

The PRD marginal rates are 0%, 5%, 10%, 10.5%, see below.

The effective rate of PRD on 40k gross is 5.625%, see below.

So with the 2009 PRD and the 2010 pay-cut, the PS pay premium has been reduced to practically zero.

PRD details

First € 15,000 of earnings: exempt
Earnings between € 15,000 and € 20,000: 5%
Earnings between € 20,000 and € 60,000: 10%
Earnings above € 60,000: 10.5%
Based on these currently applicable PRD rates, the amounts of PRD arising at a series of annual pay points up to and including €60,000 are as follows:
Pay of €15,000: No PRD
Pay of €20,000: PRD of €250
Pay of €25,000: PRD of €750
Pay of €30,000: PRD of €1,250
Pay of €35,000: PRD of €1,750
Pay of €40,000: PRD of €2,250
Pay of €45,000: PRD of €2,750
Pay of €50,000: PRD of €3,250
Pay of €55,000: PRD of €3,750
Pay of €60,000: PRD of €4,250

Geuze wrote: »

(3) The ESRI published more work in Winter 2012.

http://www.esri.ie/UserFiles/publications/RN20120402.pdf

Here they discuss which of the CSO techniques should be used.

They argue that one of the CSO results is more accurate, so they feel the 2010 average PS pay premium is 17%.

Note that this excludes the effects of the PRD, which would mean a 10% approx pay premium after the PRD.

These are excellent posts, really good information.

fliball123 · 06-10-2014 10:45am

barneystinson wrote: »

By the way, I've said before I'd welcome having my pay suitably benchmarked, because then I'd get my pay increased.

Plenty of others in the PS wouldn't but then some would.

But the process would be horrendously difficult and expensive to execute and to maintain, since it couldn't just be a one-off if we go back to benchmarking. So the people who want it, need to realise it will have a cost, and the level of benefit would be uncertain.

I think you will find the majority would come down Barney....Some would come up but if you take the perks like pensions, job security, etc you would not be going up as much as you think if at all.

This is what should of happened back in 2008 but I reckon the politicians would of suffered a horrendous cut and Turkeys do not vote for Xmas..therefor Bertie, Biffo and the lads at the higher echelons in the Civil Service had a big bonfire and eradicated any evidence of the criteria that benchmarking was set on

Rightwing · 06-10-2014 10:50am

Geuze wrote: »

Well then I say society is wrong if we value principals below accountants.

Accountants have continued to get payrises over the last few years.

Principals have taken three paycuts.

We need to change our priorities.

2 points
Supply & Demand. Practically any teacher can become a principal - there will never be a shortage recruiting them.
Skills. The chartered accountant is amongst the most skilled in the world of business. The likes of M O Leary. If you don't value them, you don't value business. They'll pay the salary of many a principal.

Other accountants (technician, certified and to a lesser extent financial and management) don't have the same skillset. They are on considerably less than the chartered accountant. And rightly so.

fliball123 · 06-10-2014 10:53am

Geuze wrote: »

The banking cost of 64bn is a substantial amount compared to our gross debt of 200bn.

But you are correct that Ahern could not say no to welfare increases and public service trade unions.

And I have said that and its going up over 200bn each day..But like I say the public sector turn around in this argument time after time stating it was all the big bad banks that caused the problems..when nothing could be further from the truth..If we had the banking crisis without the crazy ramping up of welfare and ps pay and pensions in the decade preceding the bust we would of coped with a 64 billion debt for the banks..Further to that if we did not have to borrow at all for this over spend we could of turned to the IMF and told them where to go with the banking debt..But you cannot do that when at the time we were looking for 20bn in borrowing and in the same breath tell them we aint paying for our banks...

So to flip this if we had just a banking crisis we would not of had any debt..If we had no banking crisis and the parameters remained the same we would of still went into a bailout scenario..

So PS people if you are looking for people to blame..Look at Bertie, Biffo and the unions..

kippy · 06-10-2014 11:09am

fliball123 wrote: »

And I have said that and its going up over 200bn each day..But like I say the public sector turn around in this argument time after time stating it was all the big bad banks that caused the problems..when nothing could be further from the truth..If we had the banking crisis without the crazy ramping up of welfare and ps pay and pensions in the decade preceding the bust we would of coped with a 64 billion debt for the banks..Further to that if we did not have to borrow at all for this over spend we could of turned to the IMF and told them where to go with the banking debt..But you cannot do that when at the time we were looking for 20bn in borrowing and in the same breath tell them we aint paying for our banks...

So to flip this if we had just a banking crisis we would not of had any debt..If we had no banking crisis and the parameters remained the same we would of still went into a bailout scenario..

So PS people if you are looking for people to blame..Look at Bertie, Biffo and the unions..

The part in bold is not true nor is it possible to use as a stick to beat the PS with.

I do agree in general though, the main portion of the debt generated has gone to pay the bills for the country however to suggest that PS wages are entirely at fault for our 200 Billion debt ( or even 140 odd billion of it) is nonsense.

Godge · 06-10-2014 11:18am

fliball123 wrote: »

So to flip this if we had just a banking crisis we would not of had any debt..If we had no banking crisis and the parameters remained the same we would of still went into a bailout scenario..
.

We went into the bailout because of the combination of a number of factors:

(1) The domestic banking crisis;
(2) The world economic collapse;
(3) The reliance on property transaction taxes for our tax base;
(4) The sharp rise in unemployment putting pressure on the social welfare bill.

The level of public sector pay was not a factor of any significance. However, the cutting of public sector pay was the main expenditure saving.

fliball123 · 06-10-2014 11:20am

kippy wrote: »

The part in bold is not true nor is it possible to use as a stick to beat the PS with.

I do agree in general though, the main portion of the debt generated has gone to pay the bills for the country however to suggest that PS wages are entirely at fault for our 200 Billion debt ( or even 140 odd billion of it) is nonsense.

The only PS I am bashing with this are the unions , Bertie and Biffo who made it so.

Did I say PS was entirely at fault? No

The part in bold is true...If we did not have to borrow the billions (which had nothing to do with the banks at the time previous to 2008) We could of turned to the IMF and said sorry that is not our debt thats the banks debts..But they stuck it to us as they had us over a barrel because we needed to borrow from them otherwise we would of had savage cuts to both ps pay and welfare and taxes ramped up even more to shore the decifit in one go.

But my premise remains the same the banks are not to blame for the crisis, they just tipped the whole thing over a cliff but we were heading there anyway.

Government to reverse some Public Secor Pay cuts

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