The Government’s approach to public service pay over many years has been to engage through an established framework of collective bargaining with public service unions and associations. This is a tried and tested approach that has supported sustainable improvements in pay for public servants and orderly management of the public finances, while also facilitating public service reform and changes to work practices.
Before expiring at the end of June 2026, the Public Service Agreement 2024-2026 delivered headline pay increases of 9.25% and provided for up to 1% of basic pay costs for local bargaining. Importantly, like previous agreements, the public service agreement was weighted towards the lowest paid, who received increases of 17.3% inclusive of local bargaining. The final increase under the agreement was on 1 June 2026. The Government is committed to continuing to be a good employer and to providing competitive terms and conditions for public servants. This commitment is reflected in the significant investment made in public services in recent years. Since 2020, the public service pay bill has increased by €12 billion, reaching €34 billion in 2026, an increase of 55%. As well as providing for increases in pay rates, this investment has supported substantial growth in the public service workforce, with employment now exceeding 420,000, an increase of more than 70,000 employees since 2020.
Against this backdrop, and in advance of the agreement's expiry, my officials met with public service unions and staff representative associations to initiate exploratory discussions on a successor agreement. Officials remain available to continue engagement, with Government seeking to progress talks as quickly as possible through constructive dialogue. As the Deputy will appreciate, it would not be appropriate to comment on the detail of discussions, which should remain confidential to the parties. They take place against an increasingly uncertain environment. Suffice it to say, therefore, that in an increasingly uncertain economic environment, a new public service pay agreement can play an important role in providing certainty and stability for public servants while supporting the effective delivery of public services. That is why I believe every effort should be made over the period ahead to engage and try to reach agreement.
As is always the case, any agreement will have to be balanced, affordable and capable of being accommodated in the context of other expenditure priorities within the fiscal framework.