Wages: The real competitiveness problem.

Complainer said:
Please come and spend one day in the school, and then you can see that there are no excess resources, and in fact, they have been dramatically underresourced for many years.
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This is true, because the increased budgets were spent on wages. That is always the choice - capital or wages, and the unions chose wages.
 
shnaek said:
This is true, because the increased budgets were spent on wages. That is always the choice - capital or wages, and the unions chose wages.
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This is true for all of the public sector, healthcare sector and education sector.
I remember not so long ago the nurses holding the sick and vulnerable to ransom in order to get a 10% pay increase and a 12.5% reduction in their working week (a 25% pay hourly rate pay increase). Within weeks of getting this massive increase they were back outside the A&E departments protesting about lack of resources. Obviously Liam Doran doesn't understand irony.

The same is true of the teachers unions who, after getting round after round of massive pay increases then protested about class sizes and school buildings.

These people are either very stupid or very hypocritical.
 
shnaek said:
This is true, because the increased budgets were spent on wages. That is always the choice - capital or wages, and the unions chose wages.
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Sorry, you don't get off that easy. That's not the choice. The real choices are something like; decent wages and decent resources, or continued tax reliefs for pension contributions, tax releifs for property investors, tax reliefs for private healthcare clinics, tax reliefs for private colleges, state subsidies to private schools etc etc. It all comes out the one pot, so if you're going to make comparisons, let's look at the big picture. Don't expect teachers to take the blame for poor funding of schools.
 

A few facts would'nt go astray .

The nurses never received this " massive increase " as you claim.

The 10 % increase was to be dealt with under the benchmarking process and was never subsequently delivered and the working week was decreased from 39 hours to 37.5 hours and as such your statement that they actually secured this massive increase is wrong.

Pay is obviously a two way street and if the employer after discussions with their respective unions decide that for example teachers are worth their salaries then who are we to argue ?
 

Personally I would find it impossible to live on 28k, particularly after tax. When you say "there are of course exceptions" would you be referring to yourself by any chance? Or are you happy to reduce your wages to 14k sterling?
 
There is no more money. When are people going to realise this? Reality will have to dawn at some stage. People all over the world deserve a decent wage for the hard work they do. But they can only be paid with the money that's available. Where do people think that money comes from?
 
Complainer said:
That's not the choice.
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That is the choice. A department, such as health or education, has a budget - just like you and I have a budget. We decide how we spend that budget. They chose to spend it on wages. You can't keep taxing people just like the old monarchs of Europe - sooner or later the money runs out and everyone ends up poorer as a result.
Our spending on health matches that of the best nations in Europe, they spent wisely, we spent poorly.
 
The pot will be empty in another few months. Sometime early next year.
When all the borrowed money has run out, and Ireland is unable to borrow any more, where will the public sector pay come from then?
 
lightswitch said:
Personally I would find it impossible to live on 28k, particularly after tax. When you say "there are of course exceptions" would you be referring to yourself by any chance? Or are you happy to reduce your wages to 14k sterling?
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My pay is related to the profitability of the company I work for. If it can make a profit and still cover the existing wage bill then wages are not too high. If it can't then wages will be cut.
As we are a private company that is 100% export focused we are benchmarked against international competition (and always have been). Therefore we charge the same as the guys in the UK, USA, Poland etc. If our wages are twice as high then our overall productivity has to be high enough to compensate for that.

My outgoings are set by my income. My income is based on my value in an open international market.
 
Strange how pretty much every economic forecast (even the most pessimistic ones) seem to disagree with your conclusion here.
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Do they? That is indeed very strange.

Okay, so we do have a bottomless pit of money. Nothing to worry about then. No need to increase taxes in the budget either because we can just borrow more.

Problem solved.
 
Complainer said:
Please come and spend one day in the school, and then you can see that there are no excess resources, and in fact, they have been dramatically underresourced for many years.
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I wasn't referring to front line education services, where I agree with you about under-resourcing at primary and secondary level. This is exactly why I disagree with the approch of blanket pay cuts and resource cuts in all services.

Absolutely right. The problem is that government has over-extended the number of services over the years, which put ever increasing pressure on the most important services. Now that money is running out it should be an approach of scrapping unnecessary services, not cutting everything back.
 

Nope, that's not the choice. You are deliberately ignoring the income side of the budget, particularly taxation and elimination of tax reliefs. The money is there, it just isn't being collected for public services at the moment. Our tax model has to change.


Chris said:
I wasn't referring to front line education services, where I agree with you about under-resourcing at primary and secondary level. This is exactly why I disagree with the approch of blanket pay cuts and resource cuts in all services.
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Sorry, I misread your post. Though (surprise, surprise) I still disagree. This simplistic approach of 'front-line good, back-office bad' is nonsense. There are hard-working, over-stressed, under-resourced front line and back office workers in all parts of the public sector and all parts of the private sector. There are a few lazy shysters in all parts of the public sector and all parts of the private sector. The techie guy/gal who is coding the IT systems to manage the X-ray results is just as important as the radiographer who is taking the xray, and maybe even more important in terms of bringing out real cost savings in the future.
 

I'll try for the 3rd time - do you think that we can extract 400m a week in taxation to pay for current spending?
 

This is certainly a valid point, to an extent. There are some ridiculous tax credits, deductions and reliefs out there that could be scrapped or curtailed. There may be some scope to increase some taxes (without doing signficiant harm to the economy as happened with the 2009 VAT hike)

However on the other hand I'm pretty doubtful that there is sufficient scope under either heading to increase the State's tax revenue by the 50-60% needed (approx €30bn to €50bn) to close the deficit.

For example, is it really feasible to expect to raise the standard VAT rate from 21% to 32% when the State couldn't manage to raise it to 21.5% without adverse effects? And is it really feasible to expect a 50-60% rise in the Income Tax yield from the elimination of property incentives etc when these are now about as fashionable as Anglo Irish Bank? And if not, can the economy and the State really sustain a rise in income taxes rates from 20%/41% to 30%/62% or the elimination of credits etc from ordinary people that would give rise to the same result?


I think it is unhelpful to label people as lazy shysters. I don't know anyone, private sector or public sector, who doesn't go into work in the morning with the intention of doing an honest day's work. I do know people who have been for a long time utterly frustrated in their jobs by a combination of grossly inefficient and outdated processes, poor and non-existent management direction, political and corporate-ladder interference at every turn, and ongoing resistance to change on the part of powerful vested interests.

An example was one of the major banks who castigated and punished branch staff for occasional mistakes in relation to retention of client ID records while encouraging them to ignore warning signs in relation to customers' credit-worthiness.

Another example is a major HSE 'Centre of Excellence' which employs hundreds of people and whose payroll is still to this day operated manually by staff who have to physically write up tax deduction cards by hand.

I don't accept for one moment that the people working under such conditions are lazy shysters, but the institutions that they worked and work for need urgent root-and-branch rationalisation and reform. The banks have already reaped a bitter harvest by resisting and delaying this process for as long as they did. Increasing numbers of private sector firms are going in the same direction. Do we want the public sector to make the same grevious mistake?
 
On the contrary - the income side is foremost on my mind. The country is spending 50bn when it earns 30bn. There is scope for tax rises in that 50% of workers pay no tax at all. There is also scope for closing off tax shelters. But there is no magic bullet. The country must live within its means. This is simple reality.
Anyone look at the 10 year bond yields yesterday? We're up to almost 6.7%. There is no way we will be out of the 6-7% range after Christmas, and we all know what that means. Higher taxes have never worked, the people who pay our bills know this, and that is part of the reason why they won't be lending us money on the cheap any time soon. We need to tackle our spending. We are way out of line with our trading partners. One way or another this imbalance will be rectified. The only choice is whether we do it, or someone else does it for us.
 

Having lazy or do-nothing workers is not the problem. The problem is that there are way too many inefficiencies without any incentive to get rid of them. During the Croke Park negotiations unions came out and said that the cuts needed could be achieved through changes in work practices and increasing efficiencies. Why was this not ongoing for the past 10 years?!?!
IT systems have vastly improved the way motor tax is collected. Has this resulted in any reduction in motor tax offices and their employees? The same is the case for the revenue offices.
There are too many unnecessary services and departments, that have every incentive to maintain old and inefficient work practices rather than introduce newer and more efficient ones.
 
shnaek said:
On the contrary - the income side is foremost on my mind. The country is spending 50bn when it earns 30bn. There is scope for tax rises in that 50% of workers pay no tax at all.
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THis is nonsense. Perhaps you haven't heard of VAT - it brings in more revenue for the state than income tax, and everyone who lives here pays VAT. There are 0% of workers that 'pay no tax at all'.
It would really help turn this into a productive debate if you did some basic research. You have clearly no idea what actually goes on in local authorities and Revenue. Local authorities have taken on a whole raft of new functions over the period that motor tax payments have moved online, and staff have been reallocated into new services, without increasing staffing levels. Similarly for Revenue, they took on huge increases in activity levels/tax collected in the boom years with no increases in staff. The Govt have also been reallocating Revenue staff to other more critical areas - particularly Dept Social Protection - since the crunch began.

There is of course lots of scope for further improvements, and there always will be.
 

Hear Hear!
 
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