Union leader calls for ‘urgent’ public sector pay rises amid cost of living crisis

Public sector unions have triggered a clause in the current Building Momentum deal allowing it to be reviewed in a letter to Public Expenditure Secretary Michael McGrath.

According to the clause, there should be a “prior agreement” between the parties. Mr Callinan said talks with government officials took place last Tuesday. The Minister will be informed before any government response is issued.

Under the deal, government employees will be paid up to 3 percent over two years, of which 1 percent is due next October 1.

The previous agreement, the Public Service Stability Agreement, meant increases worth about 2 percent a year between 2018 and 2020.

“I’m saying urgent action needs to be taken in the form of additional pay rises to stabilize the deal,” Mr Callinan said.

He said the cost-of-living situation needs to be addressed in the “here and now”.

“While the various government measures are doing some bit to address the impact of the cost of living crisis, workers cannot be expected to bear the impact of the increased cost of living alone.

“All employers who can afford it must join efforts to maintain living standards through normal bargaining procedures.”

Asked about Tánaiste and Labor Minister Leo Varadkar’s warning that pay increases could contribute to inflation and make the situation worse, he said Mr Varadkar had also acknowledged there should be some increases.

“If we get caught in this wage-price spiral for an extended period of time, there’s no doubt that it could hurt national competitiveness,” he said. “But here too we have to strike the right balance so that we don’t destroy consumer confidence and inadvertently hurt jobs and treasury revenues,” he said.

He described the terms of the Building Momentum deal, which runs until the end of this year, as “very modest”.

“There was a general increase of 2 percent and a fund of 1 percent for sectoral negotiations to resolve legacy issues, many of which are longstanding,” he said.

He said a 1 percent increase equates to 0.25 percent for the full year if paid in October. “That meant we were more than 2 percent behind the annual cost of living increase of 2.4 percent.” He said the 1 percent increase for this year is 6 percent or more behind the annual cost of living increase and ” could be worse”.

“I suppose it is clear that at the time the agreement was negotiated it was not the intention of the parties, the government and the public sector unions that wage movements for public sector workers would not keep pace with prices in this way. “

He added: “From a public sector perspective, the current wage conditions are so modest. There really is an immediate impact on public servants in terms of what is happening…. There needs to be an adjustment in salary terms. The intention of the parties 16 months ago was not to lose 8 percent or 9 percent over a two-year period.”

He said he had no firm opinion on whether a successor deal should be negotiated or whether the current one should be reviewed or renewed.