Government ready to reform proposal in public sector wage talks, says Public Expenditure Minister Michael McGrath

Public Expenditure Minister Michael McGrath has indicated that the government is ready to improve its €1.2bn wage proposal in talks to review the public sector wage agreement.

on top Morning IrelandThe minister said the government would not chase inflation and “we will need unions to meet us as well”.

The unions rejected a government proposal that would mean a 7 percent increase in salaries for public servants this year and next.

The previous proposal put forward by the government would cost an additional €1.2bn, bringing the total cost of its Building Momentum Payment Agreement to €2.3bn.

Minister McGrath’s remarks come at a time when leaders of the public sector union are due to meet tomorrow to discuss their strategy.

The strike threat came after the Workplace Relations Commission last month negotiated a review of the existing Building Momentum Agreement.

Minister McGraw said the government was prepared to be “as flexible as possible”.

“And there is a willingness on the part of the government to improve the proposal,” he said.

“But we will also require unions to meet with us. We will be guided by the Workplace Relations Commission when they believe the conditions are right to re-enter those discussions.”

He said the government is open to discussing the timing of wage hikes and the possibility of flat-rate payments for those with lower wages, and certainly wants to avoid a situation where there is any industrial action.

“I’m sure unions want to avoid that too,” he said.

“The best way to avoid this is through discussion and negotiation and both sides have to put themselves forward, that is the reality. If people go into negotiations by adopting certain positions, nothing will ever be agreed upon.”

He said the government has made a proposal which it considers a good proposal of 7 per cent wage hike in two years. This includes an increase of 1 percent paid in February this year and another 1 percent increase in October under the current deal.

“We’re ready to be as flexible as possible, but we’re not going to chase inflation and we’re not going to set wage increases that match inflation levels,” he said.

“Because we know what the lesson is from that policy. The lesson is this: inflation becomes embedded in the system as a result. This leads to second and third round effects and makes inflation even more difficult to control. So any deal has to be affordable and sustainable and it has to recognize that the government cannot completely offset the effect of inflation through wages alone, as we have other levers that we can use less in terms of budgeting. Will do in numbers. week time. ,

What we want to do here is to make a commitment to improve pay that we can sustain in the medium to long term

He said the claim was made yesterday by senior Siptu official John King that the government refused to re-engage in talks with the WRC and that the wage deal breach was “simply not true”.

“The government has continued to engage with the WRC since last month’s talks failed,” he said.

“And those discussions with the WRC have continued over the past week, and the government has indicated a willingness to re-enter the talks”.

He said there are obstacles but “we want to achieve the new pay system”. “We believe the building momentum, the current wage deal, was agreed upon at a time when inflation was at a completely different level from where it is now.” “And so we’re ready to improve in terms of the building momentum and I think the sooner we can do that the better.”

He said the government also wants a wage settlement for 2023 to be sure about the public wage bill, which accounts for about a third of the current expenditure.

“We believe that the standard of living of government employees is under real pressure as they are for fixed income people and also for private sector workers,” he said.

He said that it is his duty to ensure that the Public Service Pay Bill remains affordable not only this year and next year, but also in future.

“Because we have higher levels of inflation now,” he said. “It’s not going to go on indefinitely, but what we want to do here is to make a commitment to pay improvements that we can sustain over the medium to long term.”