We need to impose on ourselves as a political establishment the sort of discipline we lack, not least because of our present electoral system which has an inbuilt propensity to induce promises at election time which is the source of so much of our trouble.
This Bill before us is an opportunity, if it is taken by the Minister, to set targets for our debt in relation to the GNP. It is still extremely high by international standards and I hope, now we have the Minister and other Members of the Government present momentarily, that they will consider that. This is not a totally new idea. The US have the Gramm Rudman Act. It has not been especially successful there, so the fact that it is put in legislation does not guarantee success, but it would make it more difficult for a Government to ease up on the targets we all know are highly desirable.
The main purpose of this Bill, is, in effect, to retain highly skilled personnel in the services of the State. Unfortunately, we are losing highly skilled personnel from most Departments of State. We have an excellent Civil Service. In my experience those in the Civil Service who get to the top do so because of their ability, yet frequently we might have, for example, an assistant secretary on a very low salary being responsible to the Minister and Government for perhaps three, four or five State companies where the salary of the chief executive is considerably higher than that of the assistant secretary. If you think that is bad, bear in mind that the remuneration of the chief executive of the State company is almost invariably a great deal less than what a person with equivalent responsibility in the private sector would get in terms of salary, conditions, perks, etc. That is a very short-sighted approach. I know there would be a great fear that if we were to start remunerating our top civil servants properly to enable us to retain in and recruit into the Civil Service people of the top class and if we were to pay them such salaries, this would have such a "gi-normous" knock-on effect on the entire public service pay bill that it is just not feasible. I do not think that is necessarily the case.
A major player in this issue, just as they were a major player in the transformation of the semi-State companies from loss making to profit making, are the trade unions. We have later this year the prospect of negotiations for a second Programme for National Recovery, and it seems the Government would be well advised to put on the agenda for the negotiations the whole question of top pay in the public service sector.
If the Government could get a gilt edge guarantee from the trade union movement to a policy of properly remunerating top executives in State companies and top civil servants which would not lead to relatively claims from the rest of the public service, it would be a very major achievement and contribution to the State.
I am sure that the trade unions would not be unsympathetic to such a proposal because, as I said earlier, the leading light of the trade union movement, Mr. Bill Attley, joint president of SIPTU, the biggest union in the country, is one of the new thinkers and has led the way in transforming the attitude of trade unions to the role of the State sector. He has played no small part in transforming the State sector from a totally loss making sector into a relatively profit making one. The trade unions have a strong commitment to State enterprise. They realise that if State enterprise is to have the best chance of succeeding it needs the best possible leadership.
It is true that despite the low salaries in the State sector and the Civil Service we have managed to get people of very high calibre who are clearly motivated by very high national ideals. However, it is wrong that they and their families should be at such a financial loss because of their patriotism.
In a sense this Bill is too narrow because it seeks only to deal with the problem in one small important area of the public service, that is the national debt. It is well known that the extremely skilled people who have worked in that area for years have served this country extraordinary well. While the Civil Service are often derided for trying to be the permanent Government, I can well understand the frustration civil servants, particularly in the Department of Finance, felt when they saw politicians making a mess of the economy, against their advice, from 1977 to 1981. The debt which built up was not contributed to by the civil servants but was built up consistently against their advice year in, year out. If that Government had listened to the civil servants we would not have the debt problem we have today, and we might not need a national debt agency.
The Bill is too narrow in its focus because there are many areas of the public service where civil servants of very high quality and frequently of high academic achievement are being paid much less than they could earn outside. There has been a drift by these people out of the public service — a surprisingly small drift when one considers the gulf in their earnings compared to their potential earnings — and it would be wrong to assume that this trickle will not develop into a flood. I should like to see a totally new approach being adopted to remuneration at the top level of the public service.
When I was Minister, following the circulation to Government Departments of the draft White Paper on reform of the public service by my former colleague and then Minister for the Public Service, Mr. John Boland, I strongly advocated the inclusion of a complete new section in the White Paper on merit pay in the public sector. This would have given us a way of rewarding conspicious achievement and commitment in the public sector. The principle of my proposal was accepted and a paragraph was inserted into the White Paper before it was published, but while it genuflected to the idea of merit pay, unfortunately its provisions were very restrictive.
I should like to see extensive merit pay becoming the norm at the top level of State companies and the Civil Service. I know that if merit pay is introduced without careful guidelines on its implementation, we could eventually end up having to pay everybody merit pay, thereby dramatically increasing our total pay bill while at the same time removing the incentive to work. We should set up a board and appoint three successful business people from outside the Government service — for example, a former secretary of a Department and two top businessmen — who would have available to them a specific sum each year, say, £4 million or £5 million, and to whom a case would have to be made in respect of senior civil servants and top State company executives. For example, in the case of the senior civil servants the case could be made by the Minister for the relevant Department. We would also have to confine the number of people in any Department who could be awarded merit pay in any one year. I am not talking about buttons; it would have to be significant merit pay, perhaps thousands of pounds, would have to be made available to reward conspicuous achievement and commitment in the public sector. This is the only way in which the State sector will be as motivated as the private sector. It should be possible to do that without adding enormously to the public service pay bill. I am aware that is the only consideration standing in the way of remunerating properly those at the top of the Civil Service commensurate with their ability.
In a supplement to today's issue of The Irish Times, “Working and Living”, there is an article by Lorna Siggins entitled “The flight from the public sector proves lucrative for most”. The article refers to people who have left the State sector such as David Kennedy, former chief executive of Aer Lingus, Padraic White, former chief executive of the IDA, John Kerrigan, former secretary of the IDA and Sean Condon, former chief executive of Córas Tráchtála. However, there are many people in the public sector who would earn a great deal more tomorrow if they went to a private industry. If they left the State would lose millions because there would be a great loss of leadership and, undoubtedly, the performance of State companies would fall. I have in mind people like Paul Conlon, the chairman and chief executive of the CIE group, an outstanding public servant. He has managed to bring down the level of the CIE deficit in each of the last six years. It is worth recalling that the CIE deficit rose from £2.5 million in 1969 to £109.5 million in 1982, seven times the rate of inflation at a time when inflation was rampant. In each year since 1983 the real level of the deficit in CIE has reduced in accordance with the formula I introduced as Minister. That success was presided over brilliantly by Paul Conlon and it was achieved without any public irritation.There were no strikes in CIE as a result of the reductions or any diminution in the company's services to the public. We did not have any parades in the streets or lobbies from any constituency. Paul Conlon executed the changes in a brilliant fashion. He cut out the fat and brought in more efficiency. He is being paid one-third to one-half what he would earn in the private sector. Paul Conlon is an example of the dedicated public servants we have.
The second reservation I have about the Bill is that it is too narrow, it deals with only one area of the public service and does so in a way that people will be pushed out of the public service. Have the Government, or the Minister, reflected on the effect on morale in the public service following the passage of the Bill? I should like to refer to the air navigation services office in the Department of Tourism where highly qualified officials are being paid salaries in accordance with Civil Service limits. However, they deal with airline employees who do not have the same responsibility but are paid higher salaries. It is not surprising that the Department have difficulty filling some of the technical jobs. As a result approvals for air worthiness and so on take longer to obtain here than under other civil aviation administrations. What can take two weeks in Britain can take six months here. There is a delay in getting aircraft on to registers, having them approved and so on. Is the Minister aware that the private sector have offered to pay for the employment of extra staff in the air navigation services office? They offered to pay those officials higher salaries but the Government have had to turn down that offer although it would not cost them anything and would benefit the State.
Eolas, formerly An Foras Forbartha and the IIRS, have an extensive remit under law but it takes Irish industry longer to get approval from them for televisions, telephones and so on than it takes in Britain due to a shortage of staff. Again, industry has offered to pay for the employment of more staff but the Government cannot accept that offer because such a move would breach public sector norms. The same applies in most Departments. We could employ people profitably in the Department of Communications to deal with electronics. We would reduce industrial costs dramatically if approvals were issued as quickly as in Britain. However, because it takes so long to get approval industrialists go to other administrations. Our unemloyment is very high, there are many vacancies in the public sector and, although industry is prepared to pay to fill those vacancies, the Government cannot take up the offer.
I have no doubt that, following the passage of the Bill, there will be a lot of envy in the public service that the prince of Departments, the Department of Finance, are able to establish the Agency. The Department of Finance are responsible for the finances of the country and for our public service. The Minister for Finance has established an agency for his Department but other Departments will not get a look in. I hope this move does not have a demoralising effect on other areas of the Civil Service. The debate on the Bill should lead the Government to put the question of pay for top public servants on the agenda for the next programme for national recovery. The Government should reach a deal with the unions to allow an iron circle to be drawn around the pay of top public servants so that relativity claims will not follow.
In recent years in the United Kingdom the fixed pay level for top civil servants has been abandoned. Their equivalent to our Secretary of the Department of Finance is paid a certain figure while the Secretaries of other Departments receive a little less. The salaries of all top civil servants apply to the person holding the post at the time. It does not mean that the next person who takes up the job will necessarily get the same salary, it depends on their attributes and whether they are badly needed in that area. That is a more sensible approach than to say that the secretary of every Department must be paid at the same level, although there are a number of exceptions. Some Departments are more important than others and their work-load can be greater than in others. It is obvious that at certain times some Departments are crucial although that can change. Sometimes particular attributes are needed to deal with certain issues and problems.
I remember very well the transition of the Department of Posts and Telegraphs to Telecom Éireann and An Post which needed very astute management and leadership because it was a major reform of the public service: half the Civil Service were transferred to two semi-State companies. The legislation was drafted and prepared over a period of years and the transition was managed without the slightest ripple or hiccup. That is a tremendous tribute to the then Secretary of the Department, Mr. Seán Ó Ceallaigh and the Deputy Secretary, Miss Ita Meehan. They both retired early, I regret to say, although I heard that they are enjoying life and they deserve to. All the assistant secretaries, principal officers and assistant principal officers were involved in planning and executing that major change and they deserve more than just praise in this House. We were not able to financially reward those people for an extraordinary brilliant job, over and above their normal day-to-day work. They had to continue running the service while they were planning and executing this major transition. There were no bonuses — apart from token ones — awarded for merit. A Minister can make a case to the Minister for Finance for making an exceptional payment but the limit is very small. I hope, therefore, that before the end of this year we will address the question of top pay in the public service which should be on the basis of reward for achievement or commitment instead of narrowly focusing on one, admittedly vitally important, area.
On Committee Stage I hope the Minister will insert a new Part in the Bill dealing with the question of capping — the "in" word — the proportion of debt to GNP on a descending scale for each of the next five years. Our debt represents no more than 60 per cent of GNP and it should be capped on that basis for ever. That is the only way in which the political establishment will discipline itself, and the fear of the polls should not push us into making attractive offers at elections because it would mean that the electorate would have to repay a very hefty bill, with interest, for years to come.
