Notes on the Front

Billy Kelleher, TD, has done a service by asking each Minister the cost of implementing a living wage of €11.90 per hour for all employees directly employed in his/her Department, including agencies funded by the Department.  And thanks to the ever vigilant Tomboktu (@Tomboktu) for bringing this to our attention (working through his/her concerns over the recently designed Oireachtas website).

Here are the Ministerial responses.

The Departments of Education & Skills and Children & Youth Affairs reported no one in their departments earning below the Living Wage.  The Department of Transport, Tourism & Sport is still collating the answer.

In total, it would cost €5.7 million to implement the Living Wage in Government departments.  That the figure is higher for some departments is not due to different pay treatment (they are all covered under the same pay agreements) but, rather, due to the number employed in different grades.

The response to Deputy Kelleher’s question on public agencies funded by the various Departments was patchy, with almost all Ministers stating that they would respond to him directly when they get the information.  Hopefully, the Deputy will publish this data when he receives it.  However, Public Expenditure & Reform did respond:  the cost of implementing the Living Wage in the Public Appointments Service, State Labs, the Office of the Ombudsman and the Office of Government Procurement is €308,000.

The Irish Times reports that just under 1,000 civil servants are paid below the Living Wage.  It further states that 6 percent of all public sector workers – 19,000 – are paid less than €25,000 per year.  The annual Living Wage for 2018 was €24,200 – so not all those workers would be below the Living Wage.

This raises three points.  First, the cost of implementing the Living Wage for the employees covered under the Parliamentary Questions would be a fraction of a fraction (less than 0.1 percent of the public sector payroll).  To bring all public sector employees up to the Living Wage would cost €38 million and probably less (assuming an average of €2,000 per year for the 19,000).   Bringing all employees in Government departments and agencies above the Living Wage could provide an example to the private sector – what is called the ‘demonstration effect’.

Second, this shows the benefit of collective bargaining and negotiated wages.  Wage inequality in those sectors which are covered by collective bargaining is less than sectors where employers refuse to acknowledge workers’ desire to bargain together. Indeed, that relative few employees in the public sector are currently below the Living Wage and the cost of addressing this would be so minimal is a testament to that (back in 2013 NERI estimated 26 percent of the total in work earned below the Living Wage).  And recent examples of this egalitarian approach are the flat-rate pay increases public sector unions negotiated in pursuit of pay restoration.  Such strategies provide extra benefit to those on low-pay.  

Third, if we had a strong cross-party Living Wage campaign (the Living Wage Technical Group is not a campaigning group; they focus on calculating the Living Wage), a short-term focus would be the wider public sector and publicly subsidised organisations – departments, local authorities, public agencies, hospitals, schools, subsidised organisations.   This could also be extended to companies that contract with the Government – public sector procurement.  This is how many Living Wage campaigns got off the ground in the US.  The advantage here is that there is more accountability in these organisations and, again, would provide a demonstration effect to the private sector.

This would be a small but important step in implementing the Living Wage.  And the more success we have with each small step, the stronger we will be in pursuing a Living Wage for all employees.