What does the public sector pay deal mean for you?

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The Hard Shoulder with Ciara Kelly and Shane Coleman on Newstalk with Kiya.

Ciara Kelly (1:08)

Now, as you will have heard throughout the day here on Newstalk, a new national pay agreement was secured following talks at the Workplace Relations Commission, which concluded at half three this morning. But what does that mean for your pocket? If you're a public sector worker, and who are the biggest winners here? Indeed, what does it mean for the economy, society and the taxpayer? Joining me now to discuss all of this is economist at TU Dublin, Emma Howard. Good evening to you, Emma.

First of all, I suppose your reaction to what we have heard about the nuts and bolts of this agreement.

Emma Howard (1:43)

Good evening, Ciara. Yeah, I think the nuts and bolts of the agreement are, I suppose, broadly in line with what we would have expected to come out of the negotiation process. So it is an improvement on the last public sector pay deal, which unions were insistent it needed to be above what the deal was the last time. And one of the important parts of it is that the increases for the lowest paid public sector workers are the highest in this deal. And that again is in line with what we saw in the last deal whereby those increases for the lowest paid over the term of the agreement are just above 18 percent.

Whereas on average, the cumulative increase is just over 11 percent for that average public sector pay.

Ciara Kelly (2:31)

Yeah, and I think it was 10.5 percent in the last one. So this one is just over 11 percent and over 18 percent. So, Emma, who qualifies as a low paid worker? Up until what level of pay are you considered low paid?

Emma Howard (2:46)

So typically, it's those workers. So for each pay increase, and this is important actually because it's broken down into a 2 percent back pay increase to September of this year. Next year, there's three different points at which your pay increases, but overall next year, it's a 3.5 percent. It's another 3 percent in 2028 and the final year of the agreement up to March 29, it's 2.25 percent. So it's each year there are these increases in pay.

But for each of those percentage increases, it is either a percentage increase that you get or a flat rate figure, depending on which is bigger. So it's those workers who are earning less than 50,000 who are likely to see those higher percentage increases. So to give you an example, if you look at a S&A starting salary at the moment is about 31.5 thousand euro, by the end of this agreement that will be a 37,000 euro starting salary for an S&A. So that percentage increase is much more than some of those higher paid public sector workers or those workers who are at higher points in the pay scale and in different grades in the civil service.

Ciara Kelly (4:03)

All right, but generally speaking, those who earn up to 50,000 for the purposes of this agreement are considered low paid.

So looking back and obviously the CSO produces figures on this and the OECD do, and indeed there's much of it in the public domain. You are looking at quite sizable increases in pay for guards, for nurses, across the board. Teachers, I believe, are getting a little bit above the 11 percent that is the average out of this agreement.

Emma Howard (4:36)

Yeah, and that's the interesting thing because as you say, like there are lots of different, you know, we talk about the public sector and this pay deal for the whole sector, but of course, there's already lots of different sections that are paid quite differently across the public sector in general. And, you know, you mentioned guards, for example, over the past decade or more, guards have actually seen their pay increase at a much faster rate than any other section of the public sector. So, you know, the average pay for guards now, if you include over time, so for an average 43 hour working week, guards are paid about 92,000 on average. So there are big differences in those pay levels across different sections.