June 2017        

The restoration of stolen pay

Dan Taraghan

There is increasing militancy among the public-sector unions. After nearly ten years of “austerity,” with no pay increases and the so-called “financial emergency” legislation still in place, there is a growing realisation of how much they were shafted.
     Public-sector workers had their pay reduced and then, under the “financial emergency” legislation, had a specific tax imposed, called a pensions levy. This “pensions levy” had nothing to do with pensions but was another de facto pay cut.
     Some workers were forced to seek family income supplement, as their wages were no longer adequate to sustain them and their families. The deal struck with the Gardaí, who were outside the Lansdowne Road Agreement, backfired on the Government. Those unions within Lansdowne put pressure on the Government to bring forward a payment of €1,000 pro rata from 1 September to 1 April to those on salaries up to €65,000. In effect, this was a payment of €750 and was the first stage in the restoration of pay.
     The Labour Party, in its attempt to reform capitalism and save the state, was one of the main perpetrators of the war of austerity against the working class. It reaped its just reward at the last election. At that election the Communist Party was the only party to advocate the overthrow of capitalism, as it is incapable of reform. Even now the Labour Party, at its most recent conference, seemed locked into a position of defending and trying to justify its position on Irish Water. The manner in which it has behaved and, along with Fine Gael, kowtowed to the EU Commission is inexcusable.
     The Government faces a new problem in relation to the public-sector unions, and that is that the three main unions may possibly merge into one union later this year. At the time when the Croke Park, Haddington Road and Lansdowne Road Agreements were in negotiation the civil and public service clerical staff were split into three main unions: the Civil and Public Services Union (about 10,000 members), the Public Service Executive Union (about 10,000 members), and Impact (60,000 members). If the three merge, the Government will be facing a united work force of 80,000 in civil service, local authorities, libraries, airports, ports, and hospitals. In effect these unions have the ability to shut the country down.
     All these unions have seen the way the Government reneged on the “Towards 2016” pay deal and implemented arbitrary pay cuts and changes in working conditions and added unpaid hours to the working week. The bus workers have already exposed the privatisation agenda at the heart of this Government.
     The 80,000 members of the potential new union are well aware that the same will apply throughout the public sector through outsourcing. The fact is that the public sector is the most unionised sector, and consequently working conditions are better than many areas in the private sector. The neo-liberal right will therefore seek to disrupt any merger and try to prevent any restoration of either stolen pay or stolen hours.
     Already the right-wing propagandists are at work. We have Cliff Taylor (Irish Times, 22 April) stating that the “jump in pay was one of the reasons we got into such trouble in the first place.” He goes on to say that “the country was bust so public pay was cut.”
     Taylor and his like would profit from reading Cormac Lucey’s article “Independent Iceland teaches a great deal” in the Sunday Times of 19 March. Lucey is a right-wing commentator, but his article makes a number of important points that undermine the usual rhetoric from the Labour Party and others that there was “no alternative.”
     In 2008–09 both countries faced the collapse of their banking sector. Iceland, unlike Ireland, let its banks go bankrupt. In Ireland the then Government of Fianna Fáil and the Green Party decided to bankrupt the country and save the banks.
     Iceland burned the shareholders and foreign creditors. The Irish Government decided to betray its own citizens and protect the speculators.
     The Icelanders also stood up to attempts by Britain and the Netherlands to reimburse deposit guarantee payments, amounting to €4 billion. Michael Noonan, then minister for finance, gave in to threats from Jean-Claude Trichet of the EU Central Bank.
     Iceland also had the advantage of having its own currency, whereas Ireland is locked in to the euro, while our main trading partner uses sterling. Ireland, in effect, had to follow the diktat from Berlin instead of pursuing its own interests. Iceland is now booming, while the Irish bourgeoisie worry about Brexit.
     Taylor also trots out the line that the Davy Group calculates that a private-sector worker would need a pension pot of €500,000 to match an average public-sector pension. This is the usual arrant nonsense that will be used to create envy between public and private sectors. What Taylor neglected to mention was that Davy were trying to compare the pension payment of a defined-benefit scheme and the notional fund required under a defined-contribution scheme—two very different beasts.
     There will be more of this misdirection in the months ahead.

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