The problem here is much like the situation that used to pertain in the north, the rich landed and business class worked tro ensure that the loyalist community who were working class was constantly in fear of the working class Catholics.

Social solidarity should mean that your No.1 priority is to ensure that no one loses their job that is really standing together, instead the public sector unions set out their stall that their priority was that terms and conditions should be unaffected. They preferred that there would be cuts in staff and services over pay cuts. Those staff would be those on contract that is the choice the unions preferred so why do they think they can talk about solidarity? Why are public sector worker not making any references to those who are very well paid in the public sector outside of the Taoiseach and ministers? Is it because they hope to attain those positions some day and they prefer that they be as well paid as possible? The language has to change from public vs. private to the underpaid vs. the overpaid, they exist in both the public and private sectors and they have to be dealt with by separate means.

The state can’t cut the salaries of the well paid in the private sector as it does not employ them, it can and should crawl more money back from them in the form of increased taxation.

But the state can and should cut the salaries of those on high salaries in the public sector. Sarah Carey pointed out on Q&A last week that we have 5,000 in the public sector earning over 150K per year, doing what exactly that needs paying so much?

I personally think that we shouldn’t have anyone who outside the tax net and that does include those on minimum wage. I’d have a 10% tax rate for those on up to 125% of the minimum wage. For those on the minimum wage this would mean little as the PAYE tax credit would cover it but people would be aware of paying towards the state services and some when it comes to the use of state services.

I would go for new tax bands of 25% and 45% and even 65% for those on the top as temporary measures until the books are balanced. And I would prioritise reductions on the bottom band over the others as things improve.

As for the constant refrain that public sector workers already pay for their pension, they don’t. They pay a contributions towards their pensions but their pensions are not related to the contribution they make but are in fact guaranteed to be significantly more than what their contributions have paid for. No one on the same salary in the private sector can remotely afford to pay the contributions necessary to guarantee themselves at the level as the public sector get. It is also a rip-off that increases in pay to public servants automatically results in increases in the current pension pay out to retired public servants. That is wrong and if we were really talking about solidarity those working in the public sector would tell those retirees to take a hike.

Mr. Cowen reckons that our collective standard of living will drop by 10% in the next year. I didn’t think this was possible! We have, as a nation, been constantly fed the party-line of belt-tightening and ‘civic patriotism’. I, along with many of my contemporaries, can barely afford the belt in the first place! A generation of people like me are worried about the outcome of this whole mess. No amount of feigned solidarity will cover up the inequalities in our society and the underlying motivations of privilege protection driving the current reactionary tactics of our government.

In many respects, I feel that the morality and hard-working ethos instilled in most of us by our predecessors is an inhibiting factor in our own progression. It is at times like this that I would gladly play the system for all it is worth, if I knew where to start! Transparency and accountability seem to be dirty words in the current climate and unfortunately, it will be the people who placed us in this predicament who will experience the least negative impact. If not upgrading the Range Rover this year was my only setback, I’d be a far happier man!

A 5% decrease in take home is unpleasant, but hardly a catastrophe. Certainly not for those with mortgages and who use petrol or oil. Since last year some mortage monthly repayments have decreased by a full 20%. The same applies to the price of oil. And there are predictions that other commodities this year, perhaps most, will be down at least a few percentage points. In that context a five percent drop in take home pay is certainly not a huge blow to standard of living.

But as the title of the post suggests – it’s the regressive nature which is unfair. After deducations, tax etc, surely if those on lower incomes are down 4% then those on higher incomes should be taking a bigger hit, say 10%. Or put it another way, those on the very lowest salaries could have been spared altogher and hit those on higher salaries a bit harder.

Jack O’Connor of Siptu is reported as saying that widespread industrial action will be required to defeat this conspiracy to “drive down wages in the private sector” whilst the “wealthy (are) not contributing a single cent.” Ballots for a ‘day of action’ to campaign against the pensions’ levy are now in progress amongst public sector union members, the result of which presumably, given the genuine and justified anger amongst lower paid public servants over the unfairness of the measure as currently proposed, will be overwhelmingly in favour.

So what are the facts here?

Even before they went into talks with the government and employers last month, the trade union leadership ruled out any pay cuts in the public sector. Yet they signed up to a document that accepted that 2bn euro needed to taken out of public spending this year. It appears their preference was for this amount to be raised from increasing income taxes, especially on the higher paid – highly laudable considering the basic salary packages most of them enjoy (about ten times the annual wage of their lower paid members and that’s not including other salaries for Board memberships, expenses, perks etc. deriving from the Social Partnership quango gravy train.) The compromise offered by the Government was the pensions levy. And then the unions ran for the hills.

So has the requirement to reduce public expenditure by 2bn euro this year changed? No. Will the government change its mind on the mechanism of a pensions levy? Yes it can, but the alternative might be a 10% pay cut across the board in the public sector as was originally proposed, plus a requirement for probably as many as 30,000 jobs losses across the public sector over the next couple of years.

Are immediate increases in taxation – some economists estimate that the requirement would be for 30% as the base rate and 60% for the higher rate – an option for the government? No, not right now, if ever. Besides, everyone knows we need to widen the tax base, increase the rates and raise new forms of taxation (property and carbon taxes) in 2010 to raise an additonal 3bn euro. (Raising taxes any further now would only accelerate the increase in unemployment. Generally the hope is that the US and other stimulus packages and banking recapitalisation will show some result in the next year to eighteen months and therefore ease the situation in our own economy, so that the introduction of penal and possibly self-defeating tax increases can be avoided.)

Meanwhile, can the pensions levy proposal be ‘tweaked’ to make it more fair in its impact on lower and middle paid public servants? Yes, it can.

So it seems that what the union leaders are about is creating a means for allowing members let off steam – a bit like the 250,000 strong tax marches of the late ‘seventies, a great day out for us all marching along behind our colourful union banners on Leinster house and drifting off home again, feeling good; though nothing happened in consequence.

After the steam release, they will get down to the real business of negotiating with the government on the implementation of its unpalatable measures under the umbrella of social partnership. Won’t they?

So if these figures are correct you will not lose 10% of your take home, but significantly less.