Ireland’s plan on reducing civil servants’ weekdays more expensive than provisioned

In December 2020, Ireland reverted part of an agreement that increased working hours for civil servants. But cost could be four times as high as originally provisioned while unions reject government’s forecasts.

emergency hospital
Government forecasts that reducing working hours in the healthcare sector would cost €300 million a year.

In December 2020, amid the Covid-19 pandemic, the Irish government revisited decade-old austerity measures affecting its public service.

The Building Momentum plan is a national pay agreement paving the ground for giving more resources to the public sector for the next two years. For instance, the government included two pay increases, of 1% or €500 whichever is higher, on the annual pay of all public servants in October 2021 and 2022.

With the plan, the government also agreed to revisit parts of the “Haddington Road agreement“, one of the strong emphases of workers’ unions to negotiate with the government.

The Haddington Road agreement was created in 2013 as an austerity measure saving €1 billion to fund pensions, cutting pays and increasing weekly working hours. People who worked 35 hours a week increased their weekly hours up to 37 hours, and those at 35 hours needed to work for up to 39 hours a week.

As such, extra hours became treated as permanent, while unions representing workers consider this was only a temporary measure and claim payment of past extra hours.

Half a billion more than what the government provisioned

An envelope of €150 million was made available for compensating the partial reversal of the Haddington Road agreement and the decrease of working hours.

Last summer, the Public Service Committee of the Irish Congress of Trade Unions, representing 90% of public servants, considered it would suffice to fund the change without negative impacts.

But the forecasts from the government are much higher.

For the Irish Department of Public Expenditure and Reform, government’s department responsible in overseeing reforms in the public sector, reducing working hours would cost €645 million a year (US $750 million), the Irish Times reported. In 2017, it estimated the cost at €600 million in order to hire and compensate extra working hours.

The forecast would account for €500 million more than what was provisioned. About €300 million would be needed for the healthcare sector only.

According to the Irish Times, the DPER calculated that the hours lost were the equivalent of almost 11,000 full-time employees.

For the Public Services Committee of ICTU, estimates are overstated as they don’t take into account improvement in productivity and changes in provided services since 2013.

As pay increases may be lower than the inflation, the roll out of the agreement reversal is not finalized. And questions therefore remain on the capacity of the government to satisfy or negotiate the reduction of civil servants’ working hours.

Read more about Ireland

The Haddington Road Agreement, Government of Ireland, 2013, Free access, PDFRemoval of unpaid hours would not lead to extra costs - ICTU, RTE, June 2021, Free accessEnding public service ‘austerity’ hours costs same as 11,000 new jobs, department says, Irish Times, October 2021, Free access

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