The three Coalition leaders will meet Finance Minister Paschal Donohoe and Public Expenditure Minister Michael McGrath on Monday evening ahead of far-reaching decisions on fiscal strategy, public sector wage negotiations and the government’s continued response to the rise. of the cost of living.
Taoiseach Micheál Martin, Tánaiste Leo Varadkar and Green Party leader Eamon Ryan will discuss with Mr. Donohoe and Mr. McGrath the growing political pressure for another set of state supports to help those struggling with rising costs. But senior government officials played down reports that a welfare package was being prepared for July, warning that such a move would reduce their room for maneuver in the October budget.
The choice before the Coalition is to effectively divide the budget package between July and October, or to wait until the autumn to implement new measures.
Two people involved in the talks said on Sunday night that the government leadership was determined to hold the line on further spending measures until the budget.
Mr Donohoe is said to have issued strong warnings to his colleagues about the dangers of chasing inflation.
“There are four weeks left until recess,” a source said on Sunday. “We have to hold on. If we start to panic… we’re hiding for nothing.
Monday’s meeting is expected to also discuss the upcoming summer economic statement, a key step ahead of the budget that will identify the scale of resources available to the government.
On Sunday, Mr Martin said the declaration would not be accompanied by a package of measures, but that the budget measures would likely come into effect immediately in October rather than wait until early 2023.
“The summer economic statement will outline what is available in terms of funds and so on and resources to help ease the pressures on people and the goal and the goal is to do that comprehensively within the budget. himself because we can’t hunt him month for month,” Mr Martin told Newstalk’s On the Record.
“However, whatever we do in the budget regarding the cost of living, a fairly large part of it will have immediate application,” he said.
Party leaders are also expected to discuss Monday postponing pay rises for top-paid civil servants who are due in less than two weeks. Senior civil servants, who include judges, hospital consultants and senior civil servants, are due to receive the final installment of their salary restoration on July 1 – which was cut during the financial emergency a decade ago. All other civil servants have already had their salaries restored, and the decision to postpone those increases would require emergency legislation.
But political sources say giving pay rises to those civil servants while opposing welfare increases for those struggling with the cost of living would be politically unsustainable.
Coalition leaders will also have to decide whether an improved offer should be made to civil service unions after negotiations on a new pay deal for public sector workers broke down on Friday without a deal. Unions have rejected an offer of another 5% over the next 18 months, on top of 1% paid earlier this year and another 1% due later this year under the existing deal.
Unions and government will come face to face on Monday as the National Economic Dialogue kicks off in Dublin Castle.
On Sunday, ICTU general secretary Patricia King said unions “will want to hear from the government what steps they intend to take immediately to protect the incomes of low- and middle-income workers who see value in their wages erode every week given the current inflationary crisis”.