Minister Howlin signs Commencement Order to give effect to the provisions of the Lansdowne Road Agreement
Issued 30 November 2015
Brendan Howlin T.D., Minister for Public Expenditure and Reform, today (30 November 2015) formally signed the Commencement Order bringing into law the Financial Emergency Measures in the Public Interest (FEMPI) Act 2015. The Act gives effect to the provisions of the Lansdowne Road Agreement and amends previous FEMPI legislation, which has underpinned the various public service pay and pensions reductions since 2009.
The Minister praised the role of public servants in maintaining delivery of public services through the years of crisis in an atmosphere of industrial peace.
The Minister said:
“Since taking office this Government has made tremendous progress in stabilising public finances, reducing unemployment by over a third and bringing our national debt down towards the European average. Public servants and public service pensioners played a significant part in bringing about this recovery and taking this country off its knees. Five separate pieces of financial emergency legislation contributed €2.2 billion annually to stabilising public finances.
Now, thankfully, we are in a position to commence the unwinding of that financial emergency legislation. This Act illustrates that this Government is committed to the process of income restoration for serving and former public servants. This package is aimed at delivering particularly for the lower paid. I am pleased to that we have been in a position to recruit once again into the public service with a particular focus on front line positions like Gardaí, teachers and nurses”.
The Minister also said:
“The ongoing public service reform programme, which is underpinned by the Lansdowne Road Agreement, will ensure that efficient and effective public services remain an integral part of our future”.
The Minister noted that the phased and careful restoration of remuneration to public servants, focusing on the lower-paid, illustrates the prudent approach of this Government in managing the ongoing improvements in public finances.
Note to the Editor
The Financial Emergency Measures in the Public Interest Acts 2009 – 2013 comprise five pieces of primary legislation under which cuts in gross rates of pay and pension, and a pension related deduction, were applied to the income of serving and former public servants to assist in the process of reductions in public expenditure. The legislation enables annual savings of up to 20% in the public service pay and pensions bill.
Details of the specific measures which acted to reduce public service pay and pensions, and of the measures proposed to apply to serving and former public servants under this Act, are available on the Department’s website.
The terms of the Act, which primarily seeks to give legal effect to the Lansdowne Road Agreement as agreed with the Public Services Committee of the Irish Congress of Trade Unions, provide a number of measures that will come into effect either at end 2015 (in the case of the 2015 PRD measure) or on 1 January 2016. The bulk of the measures are focused on lower-paid public servants in the first instance. In summary the measures that will come into effect are:
•2.5% pay increase on annualised salaries up to €24,000
•1% pay increase on annualised salaries between €24,001 and €31,000
•Changes to the PRD* rates for 2015 and 2016
•Changes to PSPR** rates in 2016
•Changes to salary structure for the Judiciary.
In addition, the Act will amend the Courts (Supplemental Provisions) Act 1961 to regularise the position with regard to the arrangements for remuneration of members of the Judiciary, whose pay was also reduced in 2012. The Act will provide that persons newly appointed to the bench are not restricted from achieving pay parity with existing judges. This is the equivalent of the arrangements made for other newly appointed public servants, for whom arrangements were made to achieve pay parity in accordance with the Haddington Road Agreement.
The total additional cost arising in 2016 from the Lansdowne Road and Haddington Road Agreements is €297 million. This should be compared to public service pay and pension bill savings of €2.2 billion annually, achieved as a direct result of pay and pension reductions, and other deductions under the FEMPI legislation.
The Minister is required under the Acts to present an annual review (by 30 June each year) of the legislation to the Houses of the Oireachtas.
*PRD: Pension Related Deduction: a deduction from pay levied on the salaries of serving public servants
**PSPR: Public Service Pension Reduction: a deduction from public service pensions in payment.