Public Service Pay Cut 2%

OMD · 23-11-2009 3:54pm #1

There was an article in yesterdays Sunday Times suggesting that the pay cut for public servants earning less than 60K would be 2%. Is 2% cut in gross pay, a little over 1% cut in take home pay worth all this stress?

http://www.timesonline.co.uk/tol/news/world/ireland/article6927052.ece
"As 200,000 public sector union members prepare for a one-day strike on Tuesday, government officials are examining plans for a three-tiered pay cut.
One source said this could become a 2% cut for those earning less than €50,000-€60,000 a year, a 4% cut for those up to €100,000 a year, and a cut of 6% or more for those above that amount"

Riskymove · 23-11-2009 3:57pm

obviously it does not say but I would imagine gross-pay

this is the main issue with the strike tomorrow....its a strike to make a point rather than being against anything concrete

Dr Galen · 23-11-2009 3:58pm

any workups on how much that would raise from a revenue point of view?

OMD · 23-11-2009 3:59pm

Mystik Monkey wrote: »

any workups on how much that would raise from a revenue point of view?

An avewrage 4% cut would save about 800 million I think.

Dr Galen · 23-11-2009 4:01pm

see what shot this for the government as the pension levy. They messed it up and missed the chance to get people onside. Rightly or wrongly, it's seen as a con-job. I hate saying this....but i know plenty of people in the PS who have said that if it had just of been called a cut, and not packaged up as a levy, then they'd have little issue.

I think I'm understanding you right, in saying that a 1% drop isn't much to be getting the knickers in a twist about?

Riskymove · 23-11-2009 4:04pm

Mystik Monkey wrote: »

I think I'm understanding you right, in saying that a 1% drop isn't much to be getting the knickers in a twist about?

I agree that if this is what the Governemnt proposed, its unlikely we'd have a strike tomorrow...but......

....its a paper quoting a source...nothing more than that

the Govt wants a saving of €1.3bn and this would not cover that so there must be other things as well

Dr Galen · 23-11-2009 4:05pm

i should edit that

what i mean is that :

am i understanding the OP in that he is saying that 2% isn't much to be getting riled up about?

Riskymove · 23-11-2009 4:07pm

Mystik Monkey wrote: »

i should edit that

what i mean is that :

am i understanding the OP in that he is saying that 1% isn't much to be getting riled up about?

yes i think that is what he is saying

P. Breathnach · 23-11-2009 4:17pm

Mystik Monkey wrote: »

... I think I'm understanding you right, in saying that a 1% drop isn't much to be getting the knickers in a twist about?

Nice to see that the proposed cut has already been halved.

BC · 23-11-2009 4:21pm

I don't think people would be striking if they were told it was 2%. The unions have been throwing around figures of 7% which is why people are up in arms.

The_Conductor · 23-11-2009 4:26pm

Assuming the bulk of the workers are on the higher band (which should be set a lot higher- but I won't go there) if a 2% cut is projected to save EUR800m in pay- you have to remember it will also result in a 480m loss in income tax and levies- so for a lot of aggrevation- you're only 320m better off at the bottom line.

By rights the pensions levy malarky should be abolished- and a straight line deduction factored into gross salaries too.....?

The_Conductor · 23-11-2009 4:28pm

BC wrote: »

I don't think people would be striking if they were told it was 2%. The unions have been throwing around figures of 7% which is why people are up in arms.

The Sunday Indo was suggesting 12% and 2 weeks enforced unpaid leave.......

Who knows what the proposal is- the unknown is worse than anything else.......

ardmacha · 23-11-2009 4:39pm

2 weeks enforced unpaid leave.

I'd vote for that. Hopefully at a time when flights are reasonably priced.

Riskymove · 23-11-2009 4:48pm

ardmacha wrote: »

I'd vote for that. Hopefully at a time when flights are reasonably priced.

no public servant i have discussed this with would be against it as an alternative to a straight cut

FGR · 23-11-2009 4:56pm

Riskymove wrote: »

no public servant i have discussed this with would be against it as an alternative to a straight cut

It's the approach being taken in the US and other countries - it makes sense and doesn't feel as unjustified.

OMD · 23-11-2009 4:57pm

P. Breathnach wrote: »

Nice to see that the proposed cut has already been halved.

1% in take home pay. A little less than that if you are top rate tax payer, a little more if standard rate.

mikemac · 23-11-2009 4:59pm

smccarrick wrote: »

2 weeks enforced unpaid leave.......

An excellent idea

OMD · 23-11-2009 5:00pm

BC wrote: »

I don't think people would be striking if they were told it was 2%. The unions have been throwing around figures of 7% which is why people are up in arms.

Surely that is the problem with the strikes. Unions do not know real figures but still want to strike. The figure was never going to be 7% as far as I know. The government said it wanted cuts of a little over 6% in pay bill but a lot of that would come from job losses and reduction in overtime etc.

Riskymove · 23-11-2009 5:02pm

OMD wrote: »

1% in take home pay. A little less than that if you are top rate tax payer, a little more if standard rate.

a 2% cut in gross pay would not result in 1% loss in take home

OMD · 23-11-2009 5:03pm

Riskymove wrote: »

a 2% cut in gross pay would not result in 1% loss in take home

what would it result in?

Riskymove · 23-11-2009 5:05pm

OMD wrote: »

what would it result in?

very little

The_Conductor · 23-11-2009 5:05pm

OMD wrote: »

what would it result in?

Allowing for the reduction being at the higher rate, and levies etc- between 56 and 62% of gross pay gets swallowed up by taxes and levies. So- a 2% cut in gross would be a .8 to .9% cut in net......?

Dr Galen · 23-11-2009 5:06pm

P. Breathnach wrote: »

Nice to see that the proposed cut has already been halved.

my mistake P Breathnach, that should read 2% and I've edited accordingly.

OMD · 23-11-2009 5:06pm

Riskymove wrote: »

very little

Well I was thinking. 2% less pension contribution, less pension levy, less tax. For top rate tax payer that brings reduction to 0.6% of gross pay coming off net pay. So should be roughly a little less than 1% of net pay.

Riskymove · 23-11-2009 5:09pm

smccarrick wrote: »

Allowing for the reduction being at the higher rate, and levies etc- between 56 and 62% of gross pay gets swallowed up by taxes and levies. So- a 2% cut in gross would be a .8 to .9% cut in net......?

as I said very little

other things like prsi are also salary related amounts and would be slightly reduced

in some nice round figures, if you arned €1,000 a week you would lose €20 a week gross probably resulting in about €7 a week loss in net pay

nothing to get worked up over

Riskymove · 23-11-2009 5:10pm

OMD wrote: »

Well I was thinking. 2% less pension contribution, less pension levy, less tax. For top rate tax payer that brings reduction to 0.6% of gross pay coming off net pay. So should be roughly a little less than 1% of net pay.

yes I was implying that it would not even be 1% of take home

OMD · 23-11-2009 5:13pm

Riskymove wrote: »

as I said very little

other things like prsi are also salary related amounts and would be slightly reduced

in some nice round figures, if you arned €1,000 a week you would lose €20 a week gross probably resulting in about €7 a week loss in net pay

nothing to get worked up over

So you are saying a 2% reduction in Gross pay would lead to a 0.7% cut in gross pay for a top rate tax payer. Isn't that more or less what I was saying. Yet a little more than 1% if basic rate tax payer. Or on average 1% cut in takehome pay.

So back to the point. Why strike over 1% cut in take home pay.

jimmmy · 23-11-2009 5:15pm

Talking about 2% or 1 % or 0.6% of public sector pay is a bit like re-arranging the deckchairs on the Titanic. Public servants in this country are paid 40% more than the average in the eurozone, according to Eurostat. Talking about cutting about 2% or 1 % or 0.6% of public sector pay is a bit like trying to save Aer Lingus by getting the Aer Lingus staff to work 1% harder. Its time for proper cuts, instead of a 2% or 1% cut which may save a few hundred million . - the sooner the better. Michael O'Leary said he would slash 20 billion of govt expenditure. Now theres a leader.;)

Riskymove · 23-11-2009 5:17pm

OMD wrote: »

So you are saying a 2% reduction in Gross pay would lead to a 0.7% cut in gross pay for a top rate tax payer. Isn't that more or less what I was saying. Yet a little more than 1% if basic rate tax payer. Or on average 1% cut in takehome pay.

as above, I was saying that it would not even be 1%

I wasn't arguing, actually reinforcing what you said

So back to the point. Why strike over 1% cut in take home pay.

the answer is still the same as my first post

this is just a media story

there were other stories in other papers mentioning higher cuts

Riskymove · 23-11-2009 5:18pm

jimmmy wrote: »

Michael O'Leary said he would slash 20 billion of govt expenditure. Now theres a leader.;)

did he say how he would do it?

The_Conductor · 23-11-2009 5:22pm

Riskymove wrote: »

did he say how he would do it?

On previous form- by slashing anything that couldn't be justified inside of 2 sentences. The public sector paycut would be the very least of anyone's worries- knowing Michael O'Leary- its entirely possible that social welfare could be abolished in its entirety........ Michael O'Leary represents extreme capitalism. The problem in this country is an unhappy marriage of capitalism with socialist ideology. It works when there is plenty of money to round- there isn't at the moment.........

Public Service Pay Cut 2%

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