Priority Questions

Legislative Measures

Barry Cowen

Question:

1. Deputy Barry Cowen asked the Minister for Public Expenditure and Reform when legislation to increase the compulsory retirement age for public servants will be introduced; and if he will make a statement on the matter. [29059/18]

In May the Minister assured us the legislation to cater for the increase in the compulsory retirement age for public servants would be introduced but it has not happened. Why is it taking so long? Is it a priority for the Government or is it not? I am sure the Minister will agree it now looks certain, in the absence of such legislation, that the public sector will lose valuable people who do not wish to retire at this juncture. The current situation is simply unfair. Now that we only have a week left in this session and considering the Minister has made a commitment the legislation would be available during this session, will it be published next week?

I acknowledge the fact Deputy Cowen has raised this issue with me on a number of occasions. I want to inform both him and the House that I will be bringing a memorandum to the Government meeting on Thursday seeking approval for the publication of the relevant Bill, which is to be entitled the Public Service Superannuation (Age of Retirement) Bill 2018. Subject to Government approval, which I am hopeful I will receive, my intention is to publish the Bill after the Government meeting.

The Bill will provide that any public servant reaching the age of 65 who is covered by the legislation will be in a position to remain at work until they reach the new compulsory retirement age of 70. The main provisions of the Bill drafted are as follows. The vast majority of public servants recruited prior to 1 April 2004 will have a new compulsory retirement age of 70. Those public servants will continue to accrue retirement benefits up to the new compulsory retirement age of 70, subject to a maximum of 40 years' service. The so-called uniformed pension fast accrual group, that is, gardaí, firefighters and so on, will be unaffected by these changes.

When the Bill is enacted, public servants will no longer need to avail of the temporary interim measures which allow affected public servants to retire and be rehired only until they reach the age of 66, which is the age of eligibility for the State pension. The new compulsory retirement age will not come into effect until the necessary legislation is commenced. In the meantime, the Government has approved some limited interim arrangements to apply in the period between the Government decision and the commencement of the legislation.

I thank the Minister for his response. I welcome the fact that, even at this late stage, at least we can expect publication of the Bill on Thursday, subject to Government approval. As he alluded to, however, the measures in the Bill cannot come into effect until such time as the legislation is passed through the Houses. Towards the end of his response, the Minister said he will be bringing forward some interim measures. Will he expand on those to see if they cater for the unfortunate people who had expected, based on the commitment made, that even allowing for the fact the Minister might forgo pre-legislative scrutiny, the Dáil might be in a position to enact such legislation as provided for in the Bill. In the absence of that, and I am sure the Minister will apologise for it, he might enlighten us as to what interim measures might be forthcoming.

I always said it would be my intention to publish this Bill and see it enacted this year, and we are going to deliver against that. If no interim measures were in place, I would understandably have been criticised for the lack of such interim measures, given the interest many public servants have in accessing the provisions of this scheme.

To answer the Deputy's point, the interim measures enable pre-2004 public servants who reach the age of 65 to remain in employment only until they reach the age of eligibility for the contributory State pension, which is currently 66, subject to certain conditions. Existing retire and re-hire mechanisms are being used by public bodies to facilitate affected staff for the interim period. Payment under the interim arrangements at the minimum point of the relevant payscale is in line with current arrangements.

To date, 100 members of the Civil Service have availed of the interim measures. As I have just said, if we had no interim measures, the level of anxiety with regard to the introduction of this Bill would only have increased.

To clarify, it is merely at the discretion of the relevant employers, who can allow an extension, rather than the obligation of the relevant employers. Am I correct in stating that? In the absence of any discretion being shown and in the absence of legislation that is not applicable to anybody who wishes to extend the period of employment beyond the retirement age that is provided for under existing legislation, is there an unfortunate failure to honour the commitment that was made?

I have honoured the commitments I gave recently in regard to publishing the legislation and bringing it forward. It has taken time to draft this Bill because of the complexity involved in evolving the terms and conditions of the many people who work within our public service and Civil Service.

To answer the Deputy's question in regard to whether it is at the discretion of the employer, given that the legislation we are bringing in will give a further right to the employee, my expectation of the interim measures is that they allow anybody who wants to avail of them to access them. I am not aware at the moment of any cases where those interim measures were not made available to anybody who was looking for them.

Departmental Budgets

Jonathan O'Brien

Question:

2. Deputy Jonathan O'Brien asked the Minister for Public Expenditure and Reform the way in which departmental deficits and overruns accumulated throughout 2018 will be addressed as carry-over costs in 2019; and the way in which this will impact upon budget 2019 and the fiscal stance for 2019. [29111/18]

Managing the delivery of public services within their budgetary allocations is a key responsibility of Ministers and their Departments. Given the scale of overall voted expenditure, the cash basis of Government accounting and the funding implications that unexpected events can have on expenditure requirements, variances or changes from spending profiles can occur for a number of reasons that may result in a requirement for Supplementary Estimates.

The summer economic statement sets out a general Government deficit of 0.2% of GDP in 2018, reducing to 0.1%. To remain within these deficit targets, any overrun in a particular sector would need to be offset by additional revenue or offsetting underspends in other areas.

The driver of any overrun would also impact on the extent of any carry-over cost into 2019. For example, an overrun arising from faster than anticipated progress on a capital project may result in expenditure being brought forward from the following year, whereas an overrun arising from additional unplanned recruitment, not provided within a Department's allocation for the year, would result in an increased carry-over impact in the following year.

The 2018 expenditure report sets out estimated carry-over costs of certain budget measures in the areas of social protection, education and justice. The 2018 summer economic statement provides an updated assessment of €300 million in respect of these costs. This assessment takes into account the budgetary policy as set out in the Revised Estimates Volume, REV, of 2018. To the extent that the Government decides to allocate additional resources this year, it will impact on this policy and potentially on the carry-over costs into 2019, depending on the underlying reason for the overrun.

I want to discuss the Department of Health. The reason for the overspend last year as well as this year is, as we know from statements issued by the Department, the demand for services. As such, these are not once-off costs but are costs which will continue to apply in the next and subsequent years. The Department estimates that we are looking at an overrun to the end of June of €300 million with some suggestions that the Department may seek a Supplementary Estimate at the end of the year of close to €600 million. Surely, that will have an impact on next year's budgets. While I acknowledge that most of the costs have to be borne by the Department itself and that other Departments may not spend all of their budget allocations, I would like the Minister to outline whether this will have an impact in any way on the fiscal space of €800 million for next year. Is it possible it could impact on that?

It will depend on the reason for the overrun. If one looks at the structure of the summer economic statement, one of the major reasons for carry-over costs is the impact of costs generated in the previous year where there is a reasonable expectation that those costs will carry forward into the next year. We are now documenting that more publicly than has been the case in the past. If the Department of Health, or any other Department, incurs a cost and there is a reasonable expectation that it will carry forward into the next year, it can affect the budget calculations for the following year. That is the answer to the Deputy's question. I am now working with the Minister for Health, Deputy Harris, on the drivers of the HSE spending level and seeking to understand forensically what the reasons for it are. As the Deputy knows, we allocated more than €15 billion to the health services for 2018. While the June figures will be published later this evening, expenditure was up 10% at the end of May versus the previous year. The Minister, Deputy Harris, and I are working on the causes of this.

The director general of the HSE is coming before the Committee of Public Accounts on Thursday and today he provided us with the opening statement he intends to make. In that statement, he outlines some of the reasons for those overruns. In the acute hospitals area, the figure last year was €139 million and the director general provides a breakdown in that regard. There were income shortfalls of €73 million, while the main driver of the rest of the figure was the additional activity in service demand, which he expects will continue year on year. While I understand that the Minister is discussing these matters with the Minister, Deputy Harris, when will he have a better idea of whether there will be an impact on the fiscal space available next year? Will we just have to wait for the budget to find that out?

It will be later on in the year because we have to better understand all of the causes of the overspend versus the figures the HSE has published to date. We will have to know what those are in advance of the budget. As such, it will be known before that. I will be working closely with the Minister, Deputy Harris, on that. The director general of the HSE will no doubt put forward a comprehensive view as to the causes of the current spending levels. What is very striking to me is the current change in recruitment levels within our health services. Between the start of January 2018 and the end of April, the HSE has recruited an additional 1,519 whole-time equivalents. This translates as an average of 318 new people being hired to work in our health services every month. That does not sit with some of the narratives that are at times painted about the recruitment difficulties we have with our health services. I am working closely with the Minster for Health on this and we will have to be clear as to where this matter stands in advance of the budget.

Summer Economic Statement

Barry Cowen

Question:

3. Deputy Barry Cowen asked the Minister for Public Expenditure and Reform the projects that make up the €1.5 billion in pre-committed capital expenditure highlighted in the summer economic statement; and if he will make a statement on the matter. [29060/18]

My question relates to the national development plan expenditure outlined by the Minister in his summer economic statement. He stated that €1.5 billion is pre-committed in capital expenditure for the forthcoming year. I am at a loss to know what is contained in that commitment that has not already been published. In written replies to previous parliamentary questions I have put down, the Minister has said that €700 million extra was dedicated to capital expenditure in the national development plan other than the allocation set out in the economic statement of the previous year. Can the Minister inform me and, by extension, the public of what exactly is contained within that, what impact it will have and on what regions and what benefits will accrue to those for whom it is intended?

In my role as Minister for Public Expenditure and Reform, I am responsible for setting the overall capital allocations across Departments and for monitoring monthly expenditure at a departmental level. I do not have a direct role in respect of project selection. Decisions on how departmental allocations are invested and what projects are selected are matters in the first instance for my ministerial colleagues. I can, however, inform the Deputy that capital expenditure allocations by ministerial Vote group for the years 2018 to 2022 were published in the first annexe of the national development plan, NDP, and these allocations remain valid. Capital expenditure will increase by €1.5 billion between 2018 and 2019, which is a sizeable increase of approximately 25%. The total capital expenditure allocation for 2019 is €7.3 billion, which will result in capital expenditure increases across almost every Department. For example, the Department of Housing, Planning and Local Government's allocation will increase by approximately €400 million next year.

In direct answer to the question the Deputy put to me on what this increased capital allocation is delivering, I note that while I am not responsible for the individual projects, I have sought information on them to share with him now. Across 2018, more than 80 large-scale school projects will be delivered while 140 additional accommodation projects will be at construction phase. Much of that work will begin later this year and continue into next year. As to roads projects, I point to progress on the Portlaoise southern distributor road and the improvement scheme at the Grange Castle Business Park. There is also a target to build 6,385 social housing units next year from the allocation I detailed a moment ago.

I thank the Minister for his response and his efforts to bring some light to the darkness that is contained within what has been already outlined. I take in good faith the commitments that have been made by Government in the Project Ireland 2040 document that has been produced and much talked about in recent months with regard to the extra allocations that are provided for, notwithstanding what was already announced and in this instance up to 25% of which the Minister refers to. However, when I and my party are seeking to inform the public as to what might be contained within a budget package of €3.5 billion, €1.5 billion of which is written off as previously committed, it is incumbent on me and those who I represent to ensure they are made aware of what this actually contains, what it entails and what benefits might accrue to those for whom it is intended. I hope and expect that the Minister would bring about a situation whereby it is laid out in black and white, not what is promised by 2040 but what is provided for in 2019. I simply ask that the Minister elaborate on the examples he has given in response to this question on there being 80 large-scale developments relating to the provision of education capital expenditure that will run from this year into next, on the roads project he mentions in Portlaoise and regarding the Grange Castle Business Park. If the Minister can produce those three, he can produce them all and I would hope the Minister would do so as soon as possible.

That is a fair point. One of the reasons I announced the capital allocations for many years in advance as early as I did is experience has taught me, particularly when I was Minister for Transport, Tourism and Sport, that telling a Department in October what capital expenditure it will have available the following year for constructing new projects inevitably means that such funding is not drawn down in the way that it is needed. The reason we announced the capital envelopes for the larger Departments for three to four years in advance is in order that they can better plan. What I will do well in advance of the budget is ensure that every Department can identify what it is delivering behind the massive increase in capital expenditure for next year.

I welcome that final sentence that the Minister has committed to and would expect that his colleagues in Cabinet would be forthcoming with that information at the earliest possible opportunity. Notwithstanding my recognition of the need to have multi-annual funding envelopes for various Departments and commitments, I am well aware of Fianna Fáil's commitment to the disability sector and a multi-annual funding envelope being provided for that many years ago, for which there was not a great deal of representation made by others and which, thankfully, has set in train a process that has been followed. In these times, having come through the difficult period we all have come through and considering a previous Government was successful in bringing about two thirds of the adjustment that was necessary and that the Government has now spent seven years completing the other third, as well as considering that there is potential for increased expenditure across various capital expenditure programmes, I would say to the Minister that when it is in the order of €1.5 billion in the forthcoming year, especially as we are about to complete the three-year agreement we had, we would like to know in advance what exactly will be laid out before the public regarding the commitments from a capital expenditure perspective that will be made in the forthcoming year.

In my time in both the previous Dáil and this Dáil, I have never heard anybody argue that we should have completed the deficit correction quicker. If Deputy Cowen is arguing that, it is a new departure.

The Minister was glad two thirds were done before he arrived.

If Deputy Cowen is arguing it, then it is truly-----

We paid the political price. They need not tell me anything about that.

It is truly a new departure in economic policy this afternoon if Deputy Cowen is arguing that we should have done the deficit reduction quicker.

Is the Minister not damn glad two thirds of it was done before he was there?

Of course, I am aware of the political price that Fianna Fáil paid but, as the Deputy will be equally aware, that is paltry in comparison with the price the people of Ireland paid for the ruination we all went through across many years.

No recognition of the programme that changed it.

As I stated, I am happy to look to ensure that further detail is provided to the House as we move through the rest of the year.

I insist on it.

Regardless of whether Deputy Cowen insists on it or not, I have already given a commitment to do it.

Exactly. The Minister gave me a commitment to the previous response that he has not adhered to.

Deputy Cowen asked a question and I stated that I will do it.

We will move on. I call Deputy Burton.

I would make the point that when I started off in this role I heard so many people say that what we need to do is increase capital expenditure. I have now increased capital expenditure, by €800 million this year and by €1.5 billion next year.

The signs of that are evident across the country-----

Just tell us where.

-----for example, in the new figures that have come out today that further point to the rate of unemployment in the country falling.

Not in housing. I would agree with the Minister if I could use housing as an example we could follow.

Gender Balance

Joan Burton

Question:

4. Deputy Joan Burton asked the Minister for Public Expenditure and Reform if he will provide a gender analysis of the various grades of staff in his Department and the Department of Finance at grades (details supplied); the existing gender pay gap; the way in which he plans to address same; and if he will make a statement on the matter. [29228/18]

I ask the Minister what is he doing to address the gender gap in his Department. The Civil Service has not only a gender pay gap but a gender promotion gap. I ask the Minister what proposals he has to provide for women's equality in all positions in the Department, which is dominated by men except at the lower grades.

The gender breakdown of staff in the Department of Public Expenditure and Reform and the Department of Finance is as follows. There is a tabular format for all this information being shared with Deputy Bruton separately but the following are the key points.

The percentage of female staff in the Department of Public Expenditure and Reform stands at just over 54%. In the Department of Finance this figure is just below 43%. The average is, therefore, 49%.

There is a clear majority of female staff at temporary clerical officer, clerical officer and executive officer, EO, grades in the Department of Public Expenditure and Reform equal to 70.9% of the total number employed at these grades. In the Department of Finance, the equivalent figure is 62% or 57 out of a total of 91.

The percentage of women filling the senior management roles of assistant principal and principal officer, PO, in the Department of Public Expenditure and Reform stands at 47%. This is above average levels seen across the Civil Service as set out in the recent ESRI report. The corresponding figure for the Department of Finance is 39%.

There are nine positions at very senior level within the Department of Public Expenditure and Reform. Four of these are filled by women, which is also above the Civil Service average. The seven equivalent positions in the Department of Finance are all currently occupied by men.

As to what I am doing about it, in the Civil Service Renewal Plan, which was published by me in January 2017, I announced a range of initiatives to help improve gender balance in the Civil Service, particularly at senior level. In particular, a target of 50:50 gender balance in new appointments at senior levels is now in place. While the merit based approach of "best person for the job" continues to apply, in cases where candidates who compete for Top Level Appointments Committee, TLAC, positions are of equal merit, then priority would be given to the female candidate where they are under-represented on the management board of the Department or office in question.

While I appreciate the Minister's sentiments, 100 years after women got the vote one must say when one looks at the Department of Finance that the old cliché, "male, stale and pale" comes immediately to mind. Both Secretaries General of the Department - admirable persons, I am sure, in their own right - are men. As the Minister stated, when one adds up the totality of staff in the Department, the men occupy a disproportionate number of the senior positions while women are congregated in the lower pay scales and grades.

The issue with this is the Department of Finance, if we are to have it reflect the lived experience of people in Ireland, needs to have, both in its leadership and at all levels of the Department, a roughly proportionate equality between men and women. I know what it is like to sit in a Cabinet where only four persons around the table of approximately 18 persons are women. The Minister should believe me when I say that for every extra gain one makes in a women, one changes the conversation and the lived experience of those who are making the decisions.

The points the Deputy has made on the composition of leadership within my two Departments do not reflect the reality of where we are at assistant principal and principal officer level. In the Department of Public Expenditure and Reform it is 44%. It is lower in the Department of Finance at 39%, which I acknowledge and I have shared the figures with the Deputy. It is not where it needs to be in the Department of Finance and this is why I have brought in the change on provisions for senior posts via the top level appointments committee, TLAC, because I agree with the Deputy that the leadership of our Departments needs to reflect the diversity and strength of our country. In one of my Departments, namely, the Department of Finance, we clearly have a lot of progress to make in that regard at a senior level. That is not the case in the Department of Public Expenditure and Reform, but where the Deputy wants to get to and where I want to get to on this is the same place.

Taking the Department of Finance as being the leadership Department of the public service, as opposed to all Civil Service positions, would the Minister agree that women who have professional careers in the public service at all grades are paying a penalty in this day and age in their ability to get promotion, status and the pay that comes with promotion for taking time out to have children? They are penalised by public service norms on promotion, largely as a consequence of taking time out at a certain point in their career to have children.

It should be borne in mind that if somebody has two or three children and ends up taking three to six years of maternity and parental leave in a 40 year career, that is a relatively small amount of time, and as we know, many men take time out to take a career break or pursue studies. Our system has to play catch up in the proper reflection of women at different grades.

I agree with the Deputy. Within any organisation, the amount of time that might be taken for maternity leave, or to a far lesser extent for paternity leave, is a sliver of an entire working life. Both of my Departments and other Departments from what I have seen are working hard to ensure that the necessary working arrangements are in place to ensure that nobody is penalised in any way for taking maternity leave and that we have the right flexible working arrangements in place to recognise family life and all of the challenges that come with looking after children. I am determined to make sure that continues to happen while I am here and we will look at new ways of doing it better. That is why we made the change across the Civil Service on TLAC appointments because I was determined to ensure that the diversity at a senior level within our Civil Service was addressed and improved.

The Deputy has identified the Department of Finance for the reasons she has said. While I have said that where we are at a senior level is unacceptable to me, I believe that will change and expect it to change over time in the diversity we have there. If I go to where we are at principal officer and assistant principal officer level, I see signs of change happening there and I expect and want to see that happening at these senior levels in the Department.

Public Sector Pay

Barry Cowen

Question:

5. Deputy Barry Cowen asked the Minister for Public Expenditure and Reform the progress in negotiations on pay equality; and if he will make a statement on the matter. [29055/18]

On this question on pay equality for new entrants, the Minister said on 17 May that negotiations had begun and that there was a further meeting intended for June. Did that meeting take place? Is agreement close on the matter? Will the Minister assure the House that this remains a priority for Government, that it will not fall off the radar and that it will be provided for within the expenditure and budget package we talked about earlier?

The short answer is yes, it remains a priority for me. Further engagement is taking place on the matter. As to whether it will be included in the budgetary package and budget 2019, there are many different competing demands on it but I am entering into discussions with the union leadership on this matter in good faith to see if we can find some way of dealing with it. We have published a report on this that was a consequence of an amendment to the recent Finance Bill. This report shows that we are continuing to make progress in recruitment in our public service. We have employed more than 60,500 new entrants since 2011, including 16,000 teachers, 10,000 nurses and 5,000 special needs assistants. The report also indicated that a two point adjustment on this matter via the application of increments across the entire public service would cost €200 million and would deliver a benefit to each individual of €3,300 per year. Clearly that cost of €200 million is very significant and my Department is working with the union movement on this to see if there is a way in which this issue could be dealt with.

I welcome the fact that it is a priority. I note that the Minister did not specifically state that he honoured the commitment he gave me in May that he, on behalf of the Government, would meet the unions in June to advance this matter. I am well aware of the report that followed the amendment as proposed by Fianna Fáil on the financial emergency measures in the public interest, FEMPI, legislation. I am well aware of the costs associated with that being implemented in full, but I am also well aware of the commitment the Government gave, in the full knowledge of that, to meet the unions to seek to resolve this issue and allow a recommendation that would be achievable and agreeable to both parties. Irrespective of what that might be I stood aside and allowed that process to proceed and would have supported a resolution on the basis that there was good faith, as the Minister rightly said, and on the basis that the priority would be honoured, as the Minister alluded to.

I ask the Minister again if they met in June and if he is committed to resolving this issue prior to the budgetary package being agreed, irrespective of what that might entail or what implementation it would require within that budgetary package, whether it is in a full-year term or a two to three-year term, but ultimately a decision and agreement that would be reached between both parties.

Yes, we did meet in June. My Department has met the unions on the matter across June and before then. The Deputy asked me if I am committed to dealing with the matter in budget 2019 and he went on to ask if this would be irrespective of how it would be implemented or the costs involved. I cannot give that commitment irrespective of costs or implementation, as the Deputy knows, but as I have said, I am approaching the matter in good faith as I have approached many other issues of pay in our public services. I am engaging with the unions on it but I also have an array of other competing demands from the Exchequer at the moment and I have to see if this can all be put into a single framework to pass the third budget which I am committed to passing.

Of course the Minister has the responsibility to ensure that the requirements of competing interests are met in how he presents a budget that this House might support. There is no problem whatsoever with that and there are underlying issues associated with that budget which we spoke about three years ago that we would expect to see as part of that.

I simply say to the Minister that when we put that amendment forward, it was done to honour a commitment that was made within that same agreement that provided for three budgets. That agreement was that this Government would seek to address the pay inequality for new entrants within the public service. The amendment to the legislation put a report in place that laid out clearly the costs associated with achieving that goal. The Government then entered into negotiations on good faith on foot of what was contained within that report on the understanding that agreement would be reached between both parties prior to the budget, irrespective of what might be contained within the budget.

Of course the Minister has a duty and an obligation to ensure that competing interests are met.

The Minister has an obligation and a duty too to recognise the commitments and the obligations and the agreements that have been reached between parties relevant to the issues I have mentioned.

On the one hand the Deputy acknowledges that I have an obligation to make sure that everything adds up and fits into the same framework-----

It is the duty of Government and it is the job the Minister has.

-----and on the other he is asking me to give a commitment today, irrespective of cost or how we might implement it.

Not irrespective of cost.

I cannot do that. I have to continue to engage with the union movement on the matter to see if an affordable resolution can be reached. While the Deputy is correct to point to the fact that this was a commitment contained in the supply and confidence agreement that reflected the faith I have in seeing whether we can make progress in the matter. In addition to that, the commitment was there to see how could unwind financial emergency measures in the public interest, FEMPI, legislation for all who work in our public service and Civil Service and provide a framework by which they can gradually and affordably get their money back, and we did that. I did that.

The Minister accepted an amendment on the day that he did that.

It was enormously complicated legislation and an enormously intricate negotiation and despite the expectations and the prophesies of many that we would not be able to get that agreement, that was achieved.

That did not come from us.

I will continue to work now on the new entrant part in the way I have identified.