Pay talks between Government and public service unions will be difficult, says Minister

Forthcoming pay talks between Government and public service unions will be “difficult”, the Minister for Public Expenditure and Reform Michael McGrath has warned.

On Friday, the Minister said he has directed officials to begin exploratory discussions with unions and staff associations regarding pay issues.

“These will be difficult discussions against a very challenging backdrop,” he said in statement confirming the move.

“The discussions must be cognisant of the multiple challenges that the country is currently facing including the impact of rising inflation and the conflict in the Ukraine.”

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Mr McGrath said he was nonetheless confident about a method of progress that could be “reasonable and fair to both public servants and taxpayers generally”.

His comments come as senior civil servants have agreed to press Government in forthcoming talks for increases large enough to tackle record levels of inflation.

At Friday’s annual conference of the Association of Higher Civil and Public Servants (AHCPS), the body representing over 3,000 employees, several motions on pay and conditions were adopted.

Future pay

They included support for a strategy ensuring future pay awards “adequately reflect the rapid cost-of-living increases that have eroded members living standards”.

The conference heard that while a 2 per cent rise is due under the Building Momentum Pay Agreement this year, the first actual increase in 14 years, it jars with a record inflation rate of 6.7 per cent.

"It is clear that there is not an immediate intention from Government to fully meet the threat of pay erosion from inflation in terms of pay increases," Trevor Noonan, chair of the AHCPS executive told the conference.

While welcome, the existing level of pay increases “are just the tip of the iceberg of what is required to meet the challenges of rising inflation”, he said.

The conference heard that on Wednesday, public service representatives received a letter from the Department of Public Expenditure and Reform regarding forthcoming talks.

The approach to pay adopted by the AHCPS is of little surprise given a groundswell of unions signalling their intention to press for significant pay increases in both the private and public sectors.

Despite an appetite to counter sharp rises in the cost of living, the pursuit or pay rises has drawn cautionary responses - in February, Taoiseach Micheál Martin advised of a need to be “careful that we don’t try to chase inflation and then end up causing more harm than good.”