The Minister for Finance and Public Expenditure & Reform, Paschal Donohoe TD, today (Monday) welcomed the decision of the Public Services Committee of the Irish Congress of Trade Unions to endorse the terms of the recently negotiated extension to the Lansdowne Road Agreement on pay and reform in the public service. The Public Service Stability Agreement will run from January 2018 to end 2020.
Commenting on today’s news, the Minister said: ‘This Agreement, voted on and endorsed by ICTU, achieves the right balance between addressing the legitimate expectations of public service workers for increases in their pay while ensuring that the Government continues to exercise a prudent approach to the overall management of our public finances’.
“I recognise the significant contribution that our public servants and their unions and associations have made to Ireland’s economic recovery. The improvements in pay provided for in this Agreement mark another important step in the gradual normalisation of our collective bargaining approach to pay arrangements in the public service through the process of unwinding the FEMPI legal framework on pay that has been in place for the last number of years.
“At the same time, this Agreement will enable further reform in the way we deliver our public services, improve the sustainability of public service pensions and deliver industrial peace – all of which will play a key role in supporting our country’s further growth over the coming years.”
ENDS
Notes for Editors
The Agreement runs from 2018- 2020 and has a cost over that period of €887 million – (this is approximately equivalent to the cost of the current LRA at €844 million)
The benefits to different income groups range from 7.4 per cent to 6.2 per cent over three years. Once again these proposals are progressive.
They include restoration of pay cuts and the conversion of the existing FEMPI Pension Related Deduction (PRD) into a permanent Additional Superannuation Contribution while providing modest increases in the threshold providing some relief.
At the end of this Agreement pay cuts will be restored to all public servants earning up to €70,000 which is equal to almost 90 per cent of public servants.
The PRD measures will ensure that over 70 per cent of public servants will be making a further permanent contribution to their pensions.
The yield from PRD will fall from over €700 million at present to some €550 million in 2020 which will now become a permanent additional pension contribution.
This will make a major contribution to the future sustainability of public service pensions.
The additional hours worked under previous agreements have been retained.
The Agreement allows for on-going co-operation with change and productivity improvements and industrial peace until 2020.
After this Agreement most of the outstanding €1.4 billion of pay cuts and PRD relief will have been addressed through pay increases and retention of PRD as a permanent measure.
Principle Features of the Agreement:
Pay Measures
2018
1 January 2018 annualised salaries to increase by 1%;
1 October 2018 annualised salaries to increase by 1%.
2019
1 January 2019 annualised salaries up to €30,000 to increase by 1%;
1 September annualised salaries to increase by 1.75%.
2020
1 January 2020 annualised salaries up to €32,000 to increase by 0.5%;
1 October 2020 annualised salaries to increase by 2%.
Public Service Pensions
| Public Servants who are Members of pre-2013 Pension Schemes with Standard Accrual Terms
1 January 2019 |
|
| Band | Rate |
| Up to €32,000 | Exempt |
| €32,000 to €60,000 | 10% |
| €60,000 plus | 10.5% |
| 1 January 2020 | |
| Band | Rate |
| Up to €34,500 | Exempt |
| €34,500 to €60,000 | 10% |
| €60,000 plus | 10.5% |
| All Public Servants who are Members of the Single Public Service Pension Scheme
1 January 2019 |
|
| Band | Rate |
| Up to €32,000 | Exempt |
| €32,000 to €60,000 | 6.66% |
| €60,000 plus | 7% |
| 1 January 2020 | |
| Band | Rate |
| Up to €34,500 | Exempt |
| €34,500 to €60,000 | 3.33% |
| €60,000 plus | 3.5% |
| Public Servants who are Members of pre-2013 Pension Schemes with Fast Accrual Terms
(Unchanged) |
|
| Band | Rate |
| Up to €28,750 | Exempt |
| €28,750 to €60,000 | 10% |
| €60,000 plus | 10.5% |