Fine Gael has proposed a €1.7 billion cut in the public sector pay bill, through a combination of pay cuts and 10,000 redundancies.
In a ‘jobs budget’ document published today, the party said the savings could be achieved in 2010 through a combination of freezing of increments, graduated reductions above earnings of €30,000, local payroll savings of 2 per cent and through the redundancies.
The pay cuts would only affect those earning more than €30,000, and would only apply to income above that amount in the case of those earning more.
Those earning between €30,000 and €40,000 would have their pay reduced by 5 per cent on earnings above €30,000, while those earning between €40,000 and €100,000 would have theirs reduced by 10 per cent. Anyone earning more than €100,000 would have a 20 per cent cut.
In other measures, Fine Gael said it envisaged a saving of the order of €400 million in the social welfare budget, net of job creation measures.
It said it did not propose any cuts to the old age pension or to the child benefit allowance.
It said, however, that given the reduction in the consumer price index there was scope for a 3 per cent cut to adult working-age payments, excluding those to carers, the disabled and the blind.
In addition, it proposed a weekly €50 cut for under 25s who refuse offers of work or training after six months on the dole. These measures would raise €257 million in one year.
Fine Gael said there was “huge scope” to reduce or eliminate ineffective programmes or agencies that are not delivering for the taxpayer and it envisaged savings of about €1.1 billion in this area.
This would be achieved through €386 million in cuts within the “big bureaucracies” such as the HSE, Fás and CIE, through the elimination or merging 150 quangos (€88 million); through cutting payments of professionals and third party procurement ( €431 million) and through €199 million in programme reductions outlined in the McCarthy report on public service spending.
“Wasteful spending on programmes and bodies that don’t deliver are the scourge of the taxpayer. It was unacceptable when our finances were in a healthy condition, it is bordering on criminal to waste such money when vital frontline services are under threat,” said Fine Gael finance spokesman and deputy leader Richard Bruton.
“Fine Gael is determined to provide an alternative approach to the failed policies of high taxation and frontline service cuts of the last two budgets.
“We are focused on job protection and job creation and will continue to seek ways to support business, give job seekers some hope and always look to protect those most vulnerable in our society who rely on the State for support.”
He said fairness had been at the core of Fine Gael’s approach to the Budget and that getting the country back to work was its ultimate objective.