Allowance cuts hit home for new entrants to public jobs

Much of the controversy over recent weeks about low pay for new teachers, gardaí has stemmed in effect from a Government decision in September 2012 to scrap dozens of allowances paid to staff recruited from that point onwards.

The previous Fianna Fáil/Green Party administration had earlier reduced new entrant salary rates by ten per cent. However the subsequent Haddington Road accord contained mechanisms for these pay scales to merge, albeit over time.

The cabinet decision on allowances in 2012, in essence, set a time bomb to go off in the future. The move attracted limited attention at the time - much focus was on the corresponding decision by ministers to back away from much-heralded plans to curb allowances for serving staff - as due to the general recruitment moratorium, outside of education, there were very few people being taken on at the time.

However with the ending of the recruitment restrictions the impact of the allowance cuts has hit home with a vengeance.

New entrant teachers lost out on qualification allowances of up to €6,500 per year. Gardaí recruited in the last year or so have not been receiving more than €4,000 traditionally paid as rent allowance.

Non-consultant hospital doctors lost an accommodation allowance.

The controversy over low entrant pay has dominated the public service union conferences over recent weeks and put significant pressure on the Government.

The general secretary of the teaching union TUI John MacGabhann told his annual conference at Easter that new entrant teachers will lose about €300,000 over their careers as a result of lower pay levels put in place by the government for those who came into the profession in recent years. He contended young teachers were being treated as “galley slaves”.

Productivity

Last month the secretary general of the Department of Public Expenditure and Reform Robert Watt told journalists at a briefing that there were no plans to look again at the cuts to allowances.

However in a very significant policy change on Tuesday, just as they prepare to leave office, the Labour Party Ministers Brendan Howlin and Alan Kelly signalled the Government was prepared to abolish the controversial two-tier pay structure in return for productivity concessions.

In a deal that will benefit about 90 fire fighters in local authorities who were recruited since 2012, a new revised salary scale for the entire grade, irrespective of when they were taken on, will be developed.

Sources said the this will incorporate the value of the rent allowance which was scrapped for new entrants in 2012.

However the announcement was not solely aimed at fire fighters.

Highly placed sources said the Government was signalling that it prepared to deal with groups in the public service if they were agreeable to enter into productivity arrangements and work within public service agreements such as the Lansdowne Road accord.

The initiative could perhaps go a long way towards addressing what could otherwise potentially be a summer and autumn of serious industrial unrest across the public service.

Clearly the Government has gardaí and teachers in mind in makings its announcement on Tuesday.

Garda and teacher organisations have rejected the Lansdowne Road deal and face the loss of increments as a result from July.

However a reversal of the cuts to allowances will not come cheap.

In his statement in September 2012 Mr Howlin said the annual value in allowances that would not be paid to new beneficiaries was in the region of €475million.