How much will PS pay be cut by ?

Rabidlamb

It's looking increasingly likely that the hammer is going to fall somewhere between PS pay & the SW budget.
Most people would agree that personal taxation has reached the point of diminishing returns & further increases will only encourage non-compliance.

My question is simple as it is brutal, how much will PS pay be cut by & how will it be staggered ?.

OMD

Rabidlamb wrote: »

It's looking increasingly likely that the hammer is going to fall somewhere between PS pay & the SW budget.
Most people would agree that personal taxation has reached the point of diminishing returns & further increases will only encourage non-compliance.

My question is simple as it is brutal, how much will PS pay be cut by & how will it be staggered ?.

It won't be cut at all.

dan_d

Don't know, we'll have to just wait and see. Patience being a virtue and all that...

I could hypothesise but there's no point. It'll inevitably degenerate into a mud-slinging, public vs private match.

RichardAnd

It will be cut and I think only the most deluded and sheltered civil servant doesn't see that coming.

I don't think a blanket cut is what's needed though. Some of the lower paying public service jobs aren't much different from private sector positions of the same type in terms of pay. An administrator new to the PS would be getting about 22-25k a year which is similar to a private admin worker.

What is needed is a top down review and audit but I'm wise enough to know this probably won't happen. I'd say up to 10% across the board in addition to saving possible fromt he CPA. There will be strikes, there will be a few weeks of hassel but this isn't an issue that's going to go away so the sooner it's tackled, the better.

I just hope this can be done without any civil servants loosing their jobs.

Tipp Man

You'd be hoping for 15-20% but it is more likely to be in the 10% region, anything less is hardly worth the hastle

Welfare and social handouts need to be dramatically reduced as well

jimmycrackcorm

At the moment the issue is being raised to put pressure on the PS to implement cost saving reforms seeing as it is a couple of years now since the negotiations began on the CPA; I say "began" because the unions have been stretching out the period.

Even David Begg was on Vinnie making the point about the CPA only recently being agreed and that there hasn't been time to reform since.

There's no point in cutting PS pay.

Many get annual increments every year anyway

paddy0090

No optimisim? Finally.

It hasn't been cut that much as PS unions say it has. The pension levy is just a tax on income that you've been getting away with for years. The courts defined it as income already earned so it's only right that you pay tax on it. Even the tax breaks have been closed.

Benifits in the private sector have been treated this way since 2003.

Anyway I don't think pay will be cut, I think it will be numbers that are cut. There's a lot of quangos that have out lived there usefulness e.g Office of Tobaaco Control - job done. And we're so far off where we'd like to be that demand for some public services is dramatically down e.g Health and safety inspectors, Council architects and engineers.

The reason I don't think it will be a pay cut is because they've been pushing the PS in this direction with talk of reform and productivity gains. The logical conclusion of reform is to remove the parts of the process you don't need. So the government want more done with less overheads/staff.

It would be nice if they could do it in a manner that's fair and doesn't affect services. But ask yourself do you really belive that with so many politicians and unions fighting it out that this will be the end game. Anyone optimisitic?

irishh_bob

Rabidlamb wrote: »

It's looking increasingly likely that the hammer is going to fall somewhere between PS pay & the SW budget.
Most people would agree that personal taxation has reached the point of diminishing returns & further increases will only encourage non-compliance.

My question is simple as it is brutal, how much will PS pay be cut by & how will it be staggered ?.

the only thing you can be absolute sure of at the next budget is that the OAP wont be cut , politicans have absolute cover from the public not to touch that sacred cow

irishh_bob

paddy0090 wrote: »

No optimisim? Finally.

It hasn't been cut that much as PS unions say it has. The pension levy is just a tax on income that you've been getting away with for years. The courts defined it as income already earned so it's only right that you pay tax on it. Even the tax breaks have been closed.

Benifits in the private sector have been treated this way since 2003.

Anyway I don't think pay will be cut, I think it will be numbers that are cut. There's a lot of quangos that have out lived there usefulness e.g Office of Tobaaco Control - job done. And we're so far off where we'd like to be that demand for some public services is dramatically down e.g Health and safety inspectors, Council architects and engineers.

The reason I don't think it will be a pay cut is because they've been pushing the PS in this direction with talk of reform and productivity gains. The logical conclusion of reform is to remove the parts of the process you don't need. So the government want more done with less overheads/staff.

It would be nice if they could do it in a manner that's fair and doesn't affect services. But ask yourself do you really belive that with so many politicians and unions fighting it out that this will be the end game. Anyone optimisitic?

a lot of the QUANGO,s are professional hand ringers and talking shops of sorts but outfit which allows politicans to outsource descisions and responsibilitys will not be gotten rid off too quickly

ShowMeTheCash

I think the PS wage over the next few years will decrease by 30% plus. And i understand this might sound extreme but consider this.

Irish doctors and specialists are paid twice as much as their counterparts in Germany, Irish nurses are the 4th highest paid in the OECD. Our politicians are among he highest paid on the planet. Teachers are paid 15% more than the average in the OECD.

Now we are a kick in the pants away from defaulting on our bail out (Which we will default on), Greece have resorted to basically auctioning off airports and other public assets.

At the moment we are borrowing money to sustain our unsustainable economy, something needs to break soon!!

Raskolnikov

Health accounts for the lions share of public spending, so realistically, it will have to take a lot of cuts. The HSE already intends on cutting 5,000 administrative and support staff from the 28,000 in that group. That still leaves about 80,000 care giving staff, it's inevitable that we will lose quite a few doctors and nurses out of this. I can actually see centralisation as well with facilities. Quite a few hospitals would close, or have services moved. Dublin could probably lose the likes of Tallaght and Cappagh Hospital. Other regional hospitals could be closed (Drogheda, Mallow, Sligo, South Infimary in Cork, etc). We could probably also remove things like cancer services from Waterford and Limerick, moving them to Cork or Galway.

Education also takes a huge chunk of spending, although with class size so big, it would be another hard sector to cut in. I belive the average class size in Ireland is in the mid-twenties, we would probably need to look at bring that up to about the 30 mark, although it would be inevitable that some schools could end up with class sizes of upto 40.

hmmm

I can't see any PS pay cuts with Labour in power. They will try and cut the bill by offering a large voluntary redundancy program that we can't afford. When that fails the government will fall as the only alternative is paycuts.

ParkRunner

The health insurance is gone, the digital tv is gone, holidays are a distant memory, cycling is the preferred method of transport etc. Public servants have already been grabbed by the ankles, turned upside down and any spare change which fell out of the trouser pockets has been taken away. All that is left is for the trousers themselves to be taken away!

paddy0090

EF wrote: »

The health insurance is gone, the digital tv is gone, holidays are a distant memory, cycling is the preferred method of transport etc. Public servants have already been grabbed by the ankles, turned upside down and any spare change which fell out of the trouser pockets has been taken away. All that is left is for the trousers themselves to be taken away!

1)Not that many people could afford health insurance to begin with. Anyway it's coming back and it's going to be mandatory.;)

2)Distant? How distant? 1,2,3 years?:rolleyes:

3)Did they take the etc. out of the trousers as well. Also if you find Public transport too expensive maybe you should look at the pantsless public transport unions.:mad:

Flashgordon197

Rabidlamb wrote: »

It's looking increasingly likely that the hammer is going to fall somewhere between PS pay & the SW budget.
Most people would agree that personal taxation has reached the point of diminishing returns & further increases will only encourage non-compliance.

My question is simple as it is brutal, how much will PS pay be cut by & how will it be staggered ?.

Why did you start this thread? A bit sadistic is it not? As for taxation reaching its limit--it has not. Even if you paid Public sector workers nothing-you would still have to increase taxes. Property water etc vague statements like "Most people agree" cuts no ice with the IMF-increased taxes are in the four year plan agreed with the IMF-I dont think you have read it. Am I right?

Rabidlamb

Flashgordon197 wrote: »

Why did you start this thread? A bit sadistic is it not?

Too many existing threads just being vehicles for PS bashing.
I wanted some debate on the actual size of the cuts & the resulting savings to the exchequer.

Flashgordon197 wrote: »

As for taxation reaching its limit--it has not. Even if you paid Public sector workers nothing-you would still have to increase taxes.

PAYE tax has been pushed as far as they dare go, anything further will suffer from the law of diminishing returns.
The tax take so far this year is already below it's projection.
Remember the 80's & the prevalence of the black economy.
I've had to resort to "cash jobs" recently just to stay competitive.

Flashgordon197 wrote: »

Property water etc vague statements like "Most people agree" cuts no ice with the IMF-increased taxes are in the four year plan agreed with the IMF-I dont think you have read it. Am I right?

Stealth taxes & rates are sure to be introduced/increased, I agree.
The IMF don't care how the gap is closed, the program can be altered as long as the targets are met.

Finally a question, how do you see us closing the €20 billion deficit ?.

Delancey

At the very least the Government could freeze increments for a period of , say , 3 years - that would be a start.

Agree that a cull of the quangoes is sorely needed - I think this small country of ours has something like close to a dozen regional fisheries boards for example.

Godge

Because of the pension levy and also because of pension contributions as well as the USC and tax, there are very few public servants that are not contributing over 60% of their top decile income to the Exchequer. What I mean by that is if you cut public sector pay, you are cutting the part of the salary that at the marginal rate is being taxed at over 60%. Therefore for every 1bn cut in public service pay, the net saving is 400m. Out of that net saving of 400m, you can factor in diminished VAT receipts.


All of the above is not to say that public service wages won't be cut - it is just to say that there is little value to the Exchequer in doing so. However, pensioners don't pay a lot of tax. Change the rules to make social welfare payments subject to tax and the balance of advantage also changes.

Delancey

Godge wrote: »

Change the rules to make social welfare payments subject to tax and the balance of advantage also changes.

The maximum amount a person in receipt of Job Seekers Allowance gets is 188 Euro a week. The minimum wage is significantly above that - are you seriously suggesting that people on 188 a week ( that assumes they qualify for the full payment ) should be taxed on that ?

ShowMeTheCash

Godge wrote: »

Because of the pension levy and also because of pension contributions as well as the USC and tax, there are very few public servants that are not contributing over 60% of their top decile income to the Exchequer. What I mean by that is if you cut public sector pay, you are cutting the part of the salary that at the marginal rate is being taxed at over 60%. Therefore for every 1bn cut in public service pay, the net saving is 400m. Out of that net saving of 400m, you can factor in diminished VAT receipts.


All of the above is not to say that public service wages won't be cut - it is just to say that there is little value to the Exchequer in doing so. However, pensioners don't pay a lot of tax. Change the rules to make social welfare payments subject to tax and the balance of advantage also changes.

I think the pure mathematics of this is is flawed!

1. Civil servants that are already paying 60% I think show how far from reality the PS worker are from where they need to be.
2. I think social welfare is very high in this country, but we have basically over priced everything making it impossible for anyone to get buy on anything less.

End of the day public services cost money, it will come down to what we can afford, the money pot is now gone without pay cuts we will see mass closers of failures of public sector bodies.

femur61

Its like a cyber sport PS bashing. Personally, should be cut and reforms. Most in PS have no incentives like in the private sector. Job for life literally destroys them, they have a mantra "we work hard" newsflash so do the private sector and if they don't the company they work for will close or if self employed = no job.

sarumite

Godge wrote: »

Because of the pension levy and also because of pension contributions as well as the USC and tax, there are very few public servants that are not contributing over 60% of their top decile income to the Exchequer.

Neither the pension levy nor contributions are contributing to the exchequer. They are contributing towards your nest egg for retirement....along with a an approx. further 9% contribution from your employer.

Flashgordon197

Rabidlamb wrote: »

Too many existing threads just being vehicles for PS bashing.
I wanted some debate on the actual size of the cuts & the resulting savings to the exchequer.



PAYE tax has been pushed as far as they dare go, anything further will suffer from the law of diminishing returns.
The tax take so far this year is already below it's projection.
Remember the 80's & the prevalence of the black economy.
I've had to resort to "cash jobs" recently just to stay competitive.



Stealth taxes & rates are sure to be introduced/increased, I agree.
The IMF don't care how the gap is closed, the program can be altered as long as the targets are met.

Finally a question, how do you see us closing the €20 billion deficit ?.

You asked me a question and I will answer it. The truth is nobody knows exactly how the 18 billion (it aint 20) deficit will be bridged as its dependant on so many factors-rate of interest, economic growth etc but I think the four year pplan (which I have read parts ) outlines the following areas
1. Cutting public sector numbers- I personally favour mandatory redundancies rather than voluntary as I really dont see why I should take a pay cut again,lose my home -while we have excess staff. I think the Government hopes to lose 20,000 plus jobs but Im unsure of the figure and despite howlin's howling-I dont think he has a clue either .
2. A property tax of some sort/asset tax-there still is a huge amount of wealth in this nation and every EU nation bar us has one but politically this is tricky in Ireland
3.Water charges
4 Ending or lowering of tax write offs ie pension write off from 40% to 20 % Because of pension levy this would amount to a pay cut again for public sector if you know anything about the levy. BTW I always paid for mine(pension)
6 Cutting quangos
7 Cutting Welfare/Child benefit
8. Selling some state assets.

Anyway all of the above is in the four year plan but its much much easier to just follow what the Media have been feeding everyone and attack salaries. Dont get me wrong even with all this you might still need pay cuts but its telling that threads like this pop up all the time-stating the 'necessity' of pay cuts as if these people had the national interest in mind when I know that its really their own pockets and these people (including yourself) never reveal any pay cuts they had or their circumstances but yet feel free to discus those of others.

If we are all in this together then everyone needs to know where you are coming from-the Im a taxpayer doesn't do it for me. I pay through the nose for most things the private sector creates so your costs, wages are as relevant to me as mine are to you. High food Doctors mechanics carpenters plumbers you name it.

I wont be back on this thread as its like ground hog day here-Im just tired of telling people the basic facts-ie we have a plan(albeit a semi perfect one) ,its open to adjustment by the IMF but at least look at it first rather than following the line of Tony O'Reilly. I wish you well.

deise blue

Labour party in Government & Unions capable of paralysingly the country = no pay cuts but an increasing focus on Croke Park savings.

Flashgordon197

sarumite wrote: »

Neither the pension levy nor contributions are contributing to the exchequer. They are contributing towards your nest egg for retirement....along with a an approx. further 9% contribution from your employer.

This sort of nonsense above is why any rational public servant should steer clear of these threads-there is no public sector pension fund. The pension levy was to bridge gap in deficit-nothing else-despite its title and only someone living in a cave the last few years would think otherwise.All public sector pensions are paid out of current expenditure. The much discussed pension reserve fund is for the old age pension-which public servants dont get.

Tipp Man

deise blue wrote: »

Labour party in Government & Unions capable of paralysingly the country = no pay cuts but an increasing focus on Croke Park savings.

Paralyising the country for how long, a couple of days?? (bar maybe the ESB)

I think there is absolutley NO fear in the general public of the country being paralysed. The only thing that would do is build even more determination in people to see the public sector costs agressively reduced

sarumite

Flashgordon197 wrote: »

This sort of nonsense above is why any rational public servant should steer clear of these threads-there is no public sector pension fund. The pension levy was to bridge gap in deficit-nothing else-despite its title and only someone living in a cave the last few years would think otherwise.All public sector pensions are paid out of current expenditure. The much discussed pension reserve fund is for the old age pension-which public servants dont get.

The pension levy was to bridge a gap between the amount of money paid into pensions and the amount of money being withdrawn pensions. In otherwords the pension was underfunded. The pension levy should have been brought in during benchmarking. There is nothing rational about saying that contributing to my penions fund is contributing to the exchequer as was claimed, thats false assertion.

RobbieTheRobber

sarumite wrote: »

Neither the pension levy nor contributions are contributing to the exchequer. They are contributing towards your nest egg for retirement....along with a an approx. further 9% contribution from your employer.

Thats not true though is it, pensions are paid out of the current funds any pension contributions PS make go straight back into the excehequer not into some pension fund!

deise blue

Tipp Man wrote: »

Paralyising the country for how long, a couple of days?? (bar maybe the ESB)

I think there is absolutley NO fear in the general public of the country being paralysed. The only thing that would do is build even more determination in people to see the public sector costs agressively reduced

What on earth relevance does the ESB have to this discussion.

The ESB is a semi state operation which has suffered no pay cuts !

What I am referring to is targeted industrial action by teachers , firemen , nurses , council workers etc .

RobbieTheRobber

deise blue wrote: »

What on earth relevance does the ESB have to this discussion.

The ESB is a semi state operation which has suffered no pay cuts !

What I am referring to is targeted industrial action by teachers , firemen , nurses , council workers etc .

What do you mean by targeted?