The people are angry. An understatement you might say, but there is no doubt that the mood in the country has changed significantly in the last few months and people are annoyed, frustrated and close to despair. There is a palpable sense that the country is lurching from one economic crisis to another and that the proposed solutions are being made up on the hoof.
This is not surprising considering that the government, who got us into this mess in the first place, are drip feeding the facts to us in relation to the seriousness of our economic situation. Less than one in five of us actually want the government to continue in office, yet they do while embarking on a set of measures that will have economic repercussions for 10 or perhaps 20 years to come. Nevertheless, we are stuck with them until such time as they call an election (See Election 2010 ) or a couple of sitting TDs demonstrate that they have the moral fortitude required to vote against the government.
It is important to remember that the present administration were responsible for formulating and implementing the financial strategy that this country has followed over the last 13 years. It is quite obvious that the politics of putting the party first and remaining in government at all costs, has been largely responsible for the situation the country is in now. I stated as much in an interview that I did with Newstalk 106, prior to the last general election in 2006. (Newstalk interview – Click Here)
Okay, enough of the government bashing. Let us deal with the one fact that we must all face up to. We are bankrupt. There it is, in three simple words. There really is no need to bore you with extracts from the OECD or the Department of Finance or quotations from the so-called experts i.e. bankers, stockbrokers, economists etc (yes, the same people who could not see any of this coming!). No matter how you look at it or want to pretend things are not as bad as they are, you will have to accept the situation as it is.
It is quite obvious that if we are to reduce the long-term damage to our country we must act swiftly and unfortunately, brutally. There simply is no other way that the country can get back to work and become competitive internationally unless we take massive and immediate action. The problem that is facing us is that we are spending approximately 40% more per and than we are receiving in tax revenues i.e. we are spending €54 billion and taking in approximately €32 billion. This simply cannot go on indefinitely. So just like you or me if you spend more than you earn and you cannot get an increase in salary you have absolutely no option other than to cut spending and this is what the government must do. Most of the people in the society accept that spending must be cut but unfortunately there is a sizeable number of people who not seem to understand this. These are the majority of our public servants.
The unions are asking us all to go marching tomorrow to protest at any further reductions in pay, conditions (i.e. pensions) or numbers employed. It is worth noting that approximately 95% public service workers are members of a trade union where as in the private sector, this is approximately 15%. There are approximately 460,000 public service workers and this represents a very substantial and critical constituency of potential votes for any political party. This is the reason that Fianna Fail and their coalition partners have never tackled the issues that are facing us now , and have been facing for over 20 years. The monies that we all contributed to the economy in direct and indirect taxation throughout the years of the Celtic Tiger, were squandered on Benchmarking and on the massive increases in public service job numbers. How else do you think Fianna Fail would have managed their “historic” third term in office?
In my previous post Economic Civil War Revisited, I discussed what had to be done in relation to the cuts necessary in both public service numbers and their remuneration. While I will accept that a very large number of public servants are badly paid, there is a substantial number who are paid excessively well, particularly considering that we are in the throws of recession. Lower paid workers must be protected, regardless of their employer. Life is difficult enough for them as it is.
Some other facts to bear in mind when considering our public service are that
- The average salary is €56,000 per annum verses €43,000 in the private sector.
- Full-time employees are guaranteed a pension that will never reduce and will actually rise with inflation.
- Absenteeism is much higher than in the private sector.
- They have massive job security and limited accountability to their employer, the People of Ireland.
- 96% of all new mortgages this year, were given to public servants as a result of their job security.
- The unions refuse to implement backward benchmarking of salaries to private sector levels. Why?
I for one, will not be marching tomorrow. I believe that the unions in calling this day of action are playing into the hands of the government’s attempts to divide both public and private sector workers into opposing camps. It is the oldest trick in the book. If the unions were to actually be realistic, except the fact that we simply cannot afford to continue footing a €20 billion per year bill for the public service and demanded a change of government, I would gladly march. And when was the last time their proposals for job retention (if any) were implement ? And before any of the public servants start criticising me for my stand (which they are entitled to do ) , I would like to ask them to consider, would they turn out in the same numbers to protect the jobs of the people who work in the restaurant, pub, motor trade, building, manufacturing or retail industries and businesses ?
As always, your comments are requested and welcome, in the box below. And please please click in the ‘Share This Post’ button below, if you have a Facebook or other social media account. Thanks, Eamonn.