Government offers 10.5% public pay deal as unions weigh strike before EU summit

The revised offer

The Government tabled a revised pay offer to public sector unions over the weekend of 7 and 8 November, up from an initial offer of 6.75%. It would guarantee cumulative increases of 10.5% (11% compounded) for public servants over a deal running into early 2029. Lower-paid staff would receive a larger package, with some gaining up to 17.8% over the life of the deal. An extra back payment of €1,200 or 2%, whichever is higher, would be made in 2026, lifting pay rises for that year to 4% once the earlier 2% increase is counted. Sources say the offer includes an element covering local bargaining.

Strike and summit

Unions have called a second national strike for Thursday, 12 November, and work-to-rule action remains in operation. That day coincides with a summit of European leaders at the Convention Centre in Dublin, part of Ireland's EU presidency, with reports putting the visitor count at 45 and at around 50 world leaders. A security cordon is planned from early Thursday until the visitors leave on Friday evening, 13 November, when an informal gathering of 27 EU leaders follows. Senior government sources said the offer would be taken off the table if unions proceed with strikes and rallies on Thursday, although Harris would not confirm this publicly. Speaking in Brussels on Monday, 9 November, Harris said:

“I don't want to say anything that's provocative or escalatory, while I'm asking others to de-escalate.”

Cost to the exchequer

The latest offer is estimated to cost up to €2 billion next year, against the €1.2 billion Budget 2027 allocates for the first year of the pay deal. The total cost of the proposed deal is put at about €4 billion, although the distribution across lower civil service grades and the start date of the backdated element, June or November, remain unclear. Each 1% rise in the public sector pay and pensions bill costs the exchequer roughly €370 million, which would mean about €1.3 billion on a recurring basis in 2027 and about €2 billion in cash terms. The Parliamentary Budget Office estimated that a deal similar to the last one would cost between €3.6 billion and €4.7 billion by 2029, including projected increases in headcount. According to a recent PBO report, the public sector wage bill is €31.2 billion, or 27% of gross spending this year.

Departments warn of savings limits

Several department heads warned in submissions earlier this year that the savings targets would be hard to meet. Enterprise secretary general Declan Hughes said the department could not find €8m in savings and would have to cut funding to the IDA, Enterprise Ireland and Fáilte Ireland. Defence secretary general Jacqui McCrum wrote that a €12m levy would add significant pressure to the Commission on the Defence Forces transformation programme. The Department of Higher Education plans to deliver its €53m levy through reduced grant funding, and secretary general Colm O'Reardon warned of hiring restrictions and caps on apprenticeship programmes. The Department of Finance submission confirmed that €8.89m of its required €10m levy would be achieved.

Higher Education levy53

Defence levy12

Finance levy required10

Enterprise savings target8

Higher Education levy

53 €m

Defence levy

12 €m

Finance levy required

10 €m

Enterprise savings target

8 €m

Data from the article text

Positions on both sides

Taoiseach Micheál Martin told reporters the Government needs a sustainable budget to keep recruiting teachers, nurses, special needs assistants and gardaí, and called the offer 'a very fair offer'. Harris cited a tax cut on pay that takes effect from January as evidence that the Government has moved, and said there are 'limitations to what any government can do'. Harris said talks are in a 'very different space' from when unions balloted members for industrial action, since no formal offers had been made at that time. Union officials were unhappy after details of the offer were reported late on Sunday, 8 November, and believed the Coalition was trying to undermine them. Union representatives had resolved to make 'one more attempt' on Monday to get the Government to improve its offer.