What is the best way to reduce the PS wages?

NewDubliner

ardmacha wrote: »

Inflation is an average, some people have mortgages, some do not. Are you suggesting a customised pay cut based on everyone's individual inflation rate?

Just pointing out that the banks and their economists want everyone to have their wages cut to post-boom levels, but still demand repayment at boom levels. A selective rewinding of the economy with Joe public getting the worst from both directions.

As for paying PS incentives based on performance, this assumes you can measure performance. For example, with the Gardai would it be number of speeding tickets issued or number of lives saved?

Riskymove

Dannyboy83 wrote: »

Well, I grossly underestimated the PS wage
Its €20billion:eek:, not €10billion, according to Page 14 here.

the total Public Sector pay bill is around €20bn but it is made up of more than just gross pay of workers

it includes pensions for retired, overtime, allowance, expenses etc

so the actual gross wage of current workers is only a certain percentage of that €20bn

then tax is also included in it (which in this case is a notional amount which does not actually cost the state anything)

jimmmy

Riskymove wrote: »

so the actual gross wage of current workers is only a certain percentage of that €20bn

its quite a high percentage of the 20 billion....close to 85% I gather. That would be consistent also with the number of public servants x average wage.

ardmacha

its quite a high percentage of the 20 billion....close to 85% I gather

No doubt. So the cost of pensions isn't so high after all.

anonymous_joe

Why not be fair and just cut all wages in the Public Sector by 10%?

jimmmy

ardmacha wrote: »

No doubt. So the cost of pensions isn't so high after all.

As people live longer and public servants retire earlier ( eg many Gardai retire in their early fifties, with a pension pot costing over a million ) and as the population gets " greyer", yes the cost of p.s. pensions is high.
If you think its not high / they are micky mouse, why not scrap them altogether.

jimmmy

anonymous_joe wrote: »

Why not be fair and just cut all wages in the Public Sector by 10%?

That would only save about 2 billion a year....when we are borrowing 20 to 25 billion. P.S. Wages would need to be reduced by much more than 10% on average to bring them in to line with the European average.

NewDubliner

jimmmy wrote: »

P.S. Wages would need to be reduced by much more than 10% on average to bring them in to line with the European average.

And by how much should mortgages repayments be reduced to bring them into line with European average?

Clare_Guy

NewDubliner wrote: »

And by how much should mortgages repayments be reduced to bring them into line with European average?

To be honest this is a major point that needs to be addressed, I believe that public spending has to be cut, mainly through cutting pay or numbers in the public sector.

The fact is, the country has been cheated by this bank fuelled, government facilitated housing "boom". People are living in vastly overpriced houses with huge mortgages. These mortgages are the main expenditure for any household. This drain on incomes means that they can only be cut by so much. Is it not possible, now that we the people have so much influence over the banks, come up with some solution whereby the loans on peoples homes could be devalued so that the mortgage repayments come down to more affordable levels?

This would then allow more extreme cuts in pay levels, in both the public and private sectors. Returning competitivity to the labour market in Ireland too...

Firetrap

I think cutting wages is better than cutting numbers. You put more people on the dole and you're then taking money out of the economy and threatening the jobs of people in the private sector.

ardmacha

Is it not possible, now that we the people have so much influence over the banks, come up with some solution whereby the loans on peoples homes could be devalued so that the mortgage repayments come down to more affordable levels?

How can we do that? Also reduce deposits by an equal amount? Since the government now has a large stake in banks, any relaxation of loans is just as much a charge on the national debt as any salary in the public service.

You put more people on the dole and you're then taking money out of the economy

You are taking money out of the economy either way, that's the whole point.

Clare_Guy

ardmacha wrote: »

How can we do that? Also reduce deposits by an equal amount? Since the government now has a large stake in banks, any relaxation of loans is just as much a charge on the national debt as any salary in the public service.

I didn't say I have the answer, I'm asking the question. But if you're asking me if I think it would be possible to do something? I believe it would be, yes.

On the question of national debt, the government are happy to double it to help out their mates in the banks and the developers, I'd be much more comfortable if increasing the national debt was at the benefit of the ordinary tax payers rather than that shower. Especially if it tackles one of the core issues regarding getting the economy started again. The high cost of labour in Ireland relative to other countries.

And before you say it, I'm aware that the lack of credit is another problem at the moment, and I'm aware that NAMA is being sold to us as the solution to that problem, but seeing as the NAMA legislation has nothing in it to force the banks to release the new capital into the Irish market, I'm fairly confident that the banks will simply sell this cheap money out onto the international bond markets rather than risk it in an unstable economy here.

Helix

anonymous_joe wrote: »

Why not be fair and just cut all wages in the Public Sector by 10%?

coz the people at the bottom cant afford it and would likely be better off claiming benefits instead

the top can afford it, so they should pay far more

AMK

A genuine and transparent benchmarking exercise would certainly make clear 'what the job is worth'. However, if it is genuine and the benchmarks are 'like with like', it may not yield the drastic reductions people expect, particularly in the case of the middle ranks. This may be one of the reasons government hasn't jumped in to such an exercise - the results might not be what they want.

Regarding the lower ranks, I doubt very much if the Government/Dept. of Finance would mind if a pay reduction drove many of them out of the Public Service. Benefits claimed would be lower than pay so there would still be a saving to the Exchequer. Hard, I know, but that is the way it is going to be looked at.

Addressing performance related issues, desirable and all as that is, cannot be done quickly. A reduction in public expenditure i.e. pay, is an immediate necessity. The most efficient way is by an over the board reduction, effective immediately, of a certain % with a higher % for the most senior grades in order to help the medicine go down. This would no doubt result in inequities but the more glaring could be tweaked afterwards as was done with the Pension Levy.

I should make clear that I am a Civil Servant. Naturally, I do not like the prospect of further reductions in pay. I know I am not by any means overpaid for the responsibilities and workload I carry and I am confident that any benchmarking exercise would agree with me in this. However, I do not consider this to be the issue at this point in time. The appropriateness of my rate of pay must give way to the bigger issue of closing the gap between Exchequer income and expenditure. Right now one of the most obvious and easily implemented tools available to do this with is a reduction in Public Sector pay.

However, reductions cannot solve the problem of this years deficit on their own because even the most drastic of measures will not result in a high enough yield. The best they can do is form part of a series of further harsh but necessary measures many of which will hit public and private sectors alike.

Amhran Nua

Riskymove wrote: »

then tax is also included in it (which in this case is a notional amount which does not actually cost the state anything)

This is an important point, the public sector gets paid out of the same coffers that tax them, so someone on €250,000 is probably only costing the state €150,000 in real terms.

NewDubliner wrote: »

And by how much should mortgages repayments be reduced to bring them into line with European average?

Everybody gets to pay tax, mortgages are not and were not mandatory. And while we're on the subject, how much did public sector workers, much favoured by the banks when handing out mortgages because of job security, contribute to the rapid rise in house prices and mortgages? Not just PPRs but unwise "investment" purchases which accounted for 40% of demand at the peak of the boom. I'd be very interested to see some numbers on that.

Diarmuid

with regards to the op question. Why can't we just pay market prices? ie if you need 50 nurses to do a job you pay the minimum amount to get the 50 you need. Then you pay the mimimum raises to keep those 50. And raises/bonuses are not "across the board" but performance related.

Boskowski

Its really very amusing to witness with what ease and liberty people throw figures around when they're talking about other peoples wages.

I wonder are these the same people who are screaming 'murder' when those ridiculous child benefits or dole payments are being discussed?

Boskowski

anonymous_joe wrote: »

Why not be fair and just cut all wages in the Public Sector by 10%?

How would that be fair? You think a 2.5k wage cut affects someone on 25k equally as a 12k wage cut for someone on 120k?

Boskowski

AMK wrote: »

The best they can do is form part of a series of further harsh but necessary measures many of which will hit public and private sectors alike.

Which will of course only make the situation worse. If you take more money out of the economy how is the tax intake going to recover ever?

ardmacha

And while we're on the subject, how much did public sector workers, much favoured by the banks when handing out mortgages because of job security, contribute to the rapid rise in house prices and mortgages? Not just PPRs but unwise "investment" purchases which accounted for 40% of demand at the peak of the boom.

Whatever you might say, there is no evidence of the public sector particularly driving the boom in house prices. The job security of the borrower was a big issue in traditional banking, quite rightly. But when there was traditional banking there were reasonable mutiples for mortgages. But in the boom banks just gave out money, people in the private sector with bonuses and overtime could borrow against this largely transitory income.

Amhran Nua

ardmacha wrote: »

Whatever you might say, there is no evidence of the public sector particularly driving the boom in house prices.

So why are the unions talking constantly about their members paying mortgages? If there is a higher percentage of public sector workers with mortgages than private sector workers, I'd say thats all the evidence you'd need, should you look for it.

BroomBurner

As I have posted before on a few occasions in the past:

How to save money in the PS, without cutting pay:

1. Remove current incremental increases

2. Upgrade the PMDS system to make each person that completes a PMDS form for themselves/others are held accountable for their decisions (have some ideas on this, but post is lengthy enough as it is)

3. Retain base salaries for everyone. This will increase in times of inflation, and remain unchanged in times of deflation (I know people will argue against this, but lets not be too hasty to cut it back)

4. On receipt of a 4 grade on PMDS, employee receives a % payrise and a once-off bonus added to their salary (~€1,500 ?)

5. On receipt of a 5 grade on PMDS, employee receives a % payrise and a once-off bonus added to their salary (~€2,500-€4,000 ?)

6. Anyone receiving a 2 or a 3 is given the usual inflationary increase

7. Anyone receiving a 1 is put on a 6 month probation term. If there is no improvement by the mid-year review, they are let go

8. Make EVERYONE, regardless of their grade, personally responsible for whatever expenditure they make with State money, and EVERYONE, regardless of their grade, MUST have their expenses signed off by a Line Manager. I was shocked to find out this doesn't happen. The only reason I can see is that Line Managers, the further up the ladder they go, feel it's beneath them to either ask for permission, and/or sign someone else's permission. Well, it's State money, not yours, so start taking some responsibility.

ardmacha

So why are the unions talking constantly about their members paying mortgages?

People in the PS live in houses, which have been expensive, so some of these have big mortgages. Unions inevitably point out the hard cases when seeking increases, what do you expect them to do?
Do you base your analysis on what the unions say?

Amhran Nua

ardmacha wrote: »

Do you base your analysis on what the unions say?

I base it as much on hard facts as possible, which are genrally thin on the ground in these sorts of discussions. The question doesn't arise over PPRs, its over second and subsequent properties, within Ireland, although you could make a case for top up mortgages which are responsible for most of the nice big cars we see on the streets as well.

Riskymove

BroomBurner wrote: »

1. Remove current incremental increases

I dont see much point in this generally as I believe there are solid enough reasons for its existence; however I note that you are really suggesting some sort of revamped increment system at 4 and 5 below

2. Upgrade the PMDS system to make each person that completes a PMDS form for themselves/others are held accountable for their decisions (have some ideas on this, but post is lengthy enough as it is)

I dont really get this point - what are you trying to say?

is the point of PMDS note that you set out your targets/objusctives and are accountable?

3. Retain base salaries for everyone. This will increase in times of inflation, and remain unchanged in times of deflation (I know people will argue against this, but lets not be too hasty to cut it back)

I think bas salaries will be kept but the levies used to make savings

4. On receipt of a 4 grade on PMDS, employee receives a % payrise and a once-off bonus added to their salary (~€1,500 ?)

5. On receipt of a 5 grade on PMDS, employee receives a % payrise and a once-off bonus added to their salary (~€2,500-€4,000 ?)

6. Anyone receiving a 2 or a 3 is given the usual inflationary increase

7. Anyone receiving a 1 is put on a 6 month probation term. If there is no improvement by the mid-year review, they are let go

I don't see any general problem with this which is basically a performance related pay increase but given the experience to date with PMDS I would not be too confident it would work properly

8. Make EVERYONE, regardless of their grade, personally responsible for whatever expenditure they make with State money, and EVERYONE, regardless of their grade, MUST have their expenses signed off by a Line Manager. I was shocked to find out this doesn't happen. The only reason I can see is that Line Managers, the further up the ladder they go, feel it's beneath them to either ask for permission, and/or sign someone else's permission. Well, it's State money, not yours, so start taking some responsibility.

In my experience all expenses are approved and cleared by a manager

BroomBurner

RIckymove, I'll try to answer all the questions, but forgive me if I leave any out (and for the length):

1. PMDS
I'd like to keep the PMDS system, as everyone should be given awards based on their performance. However, there are problems with it, in that it can be up to personal preference on how it is marked. Perhaps a more detailed system could be drawn up, with everyone having to mark themselves on a range of topics, including examples of where they performed well, which is then commented on, and added to, by both their line manager and their LM's line manager. It may be more time-consuming, but accountability always is. Also, if a LM is found to be signing off on someone without a basis (i.e. someone consistently getting 2's or 3's all of a sudden getting 4's without any examples), than this will affect that LM's ability to receive a bonus. Ergo, forcing everyone to be honest and do it properly.

2. Expenses
The higher up you go, the less you are questioned. This has to stop. Mainly as the higher up they are, the more frivulous they can be with money (see recent scandals - Fas, John O'D, etc. with more to follow, no doubt)

jimmmy

ardmacha wrote: »

People in the PS live in houses, which have been expensive, so some of these have big mortgages. Unions inevitably point out the hard cases when seeking increases, what do you expect them to do?
Do you base your analysis on what the unions say?

Interest rates have come down, as have the cost of many other things. Many of the the "hard cases" in the p.s. with reference to people struggling to meet mortgage properties are on their 2nd + 3 properties eg the Guard/civil servant with the empty apartment in Leitrim ( ask any auctioneer there what segment of the workforce bought many of the now empty buy-to-let propertes in the boom ) , or the school tacher who was whining on the Joe Duffy show a few months ago about finding it difficult to pay the mortgage on her propert in Croatia as well as her house in Ireland.;)

optocynic

realcam wrote: »

How would that be fair? You think a 2.5k wage cut affects someone on 25k equally as a 12k wage cut for someone on 120k?

This is the main issue now... what is FAIR?

I would say that not many og them on 120k are in fact EARNING 120k..
Hit them HARD...

The lower earners.. hit them softer.. but in the end they are (I hate to say this).. living way beyond their means... If the cut means they can only go out once a week to the pub, and have to cut their sky package to a basic... so be it!!

This is what happens in a recession!

Let's b!tch slap the selfish/childish unions.. and sort out the pay bill now.. in a fair fashion..

Then lets sort out the welfare farce!!

Boskowski

optocynic wrote: »

This is the main issue now... what is FAIR?

I would say that not many og them on 120k are in fact EARNING 120k..
Hit them HARD...

The lower earners.. hit them softer.. but in the end they are (I hate to say this).. living way beyond their means... If the cut means they can only go out once a week to the pub, and have to cut their sky package to a basic... so be it!!

This is what happens in a recession!

I know this is going to sound like 'but not me please' but I can provide some anecdotal evidence here.
My GF is for over twenty years in the PS and eventually she made it into lower middle management and she's actually doing a job, not like copying stuff or sitting on her arse all day or whatever some of the jimmys and irish_bobs are telling us what basically all PS people do all day long.

So after twenty years she slowly went to about just over 30k and was hit twice recently. How is she for example living way beyond her means when for instance teachers and nurses start on that? Would you call it fair if she was hit hard? After all she was on crap money for all those years when we all made significantly more and she stayed on it for job security and a pension - which by the way is not 'fat' by any means (again reference to jimmiys and irish_bobs here), its just a pension.
Who are we to tell her now that the job security thing wasnt really meant like that and she better go back to crap money?

optocynic

realcam wrote: »

I know this is going to sound like 'but not me please' but I can provide some anecdotal evidence here.
My GF is for over twenty years in the PS and eventually she made it into lower middle management and she's actually doing a job, not like copying stuff or sitting on her arse all day or whatever some of the jimmys and irish_bobs are telling us what basically as PS people do all day long.

So after twenty years she slowly gone to about just over 30k and was hit twice recently. How is she for example living way beyond her means when for instance teachers and nurses start on that? Would you call it fair if she was hit hard? After all she was on crap money for all those years when we all made significantly more and she stayed on it for job security. Who are we to tell her now that the job security thing wasnt really meant like that and she better go back to crap money?

Quiet simply... we are her dissatisfied customers!
What is 'Lower middle management' anyway..?
I'm guessing she does the work that the lazy half-wit she reports to should be doing!!!
I am not as militant as Jimmmy, but I do believe the PS is a place for lazy feckless cheeky a55holes to hide behind union clowns!!

This is what needs to be sorted... I have no idea how productive your GF is.. she may be a stellar worker... if so, she should be fighting to purge the lazy feckers from her office...