Thursday, 16 July 2009

Buttered on Both Sides, with Plenty Left in the Tub.

MPACT, Ireland's largest public service union, has displayed a complete disconnect with reality by warning that it will respond with industrial action, including strikes, if the Government attempts to impose public service pay cuts, pension reductions, or compulsory redundancies.

This is posturing, at best. As the public sector has escaped from the economic catastrophe engineered and implemented by FF up to this point, it is now inevitable for the public sector to be "benchmarked" again back into reality.

Accounting boils down to 2 things. Money coming in, and money going out. When the money coming in (taxes) falls then the money going out also has to fall unless, of course, you had the wit in the first place to put money away in the good times but that's a whole other area of incompetence. The way that the outgoing money falls is vital.

Consider, as an exapmple, a car company, say Volkswagen. If the money in (car sales) falls then what happens? They cut costs. But they can't cut costs in a way that impacts the quality of the product they're making. They can't suddenly produce cars that fall apart after 5,000km and only come with 3 doors and no steering wheel. No, they cut wages and reduce staff numbers because it's the only way to survive. The private sector understands this. Clearly IMPACT don't. IMPACT represent the public sector and the public sector are there to provide a service and the government must ensure that they get the service within the budget they have and IMPACT must support this.

If IMPACT have a solution on how to save money other than pay cuts, pension deductions, or redundancies then let's hear it. Answers like raising taxes i.e. asking car buyers to pay MORE for lower-quality cars, are simply unacceptable in this day and age.

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