I thank the committee for the invitation to brief it on public service reform. As our short presentation has been circulated in advance, I will concentrate on three key areas. First, I will set the context in which we are implementing public service reform. Second, I will highlight some of the key aspects of the reform agenda. Without going through it in great detail, I will outline exactly what it is we are trying to do and what success will look like. Third, I will engage in a discussion on the committee's role in public service reform and our subsequent interaction.
I have been in the public service for nearly four months. My background is primarily in the private sector, where I was involved in restructuring complex, large organisations. I am now the programme director of the Department's dedicated office on reform. My colleague, Mr. Timmins, works in the programme office.
When we launched the plan on 17 November, the Minister, Deputy Howlin, outlined how comprehensive it was. It comprises a total of 200 actions, all of which have committed dates and timelines for delivery. Every element of and action within the plan has a dedicated official, owner or manager in the public service. The plan is diligent in terms of having full ownership and accountability for delivery. The governance of the reform plan is strong. For example, I report to a dedicated Cabinet sub-committee on reform on a quarterly basis.
I will briefly highlight some of the environmental factors that affect the reform plan's implementation. Our difficult fiscal position is well known to everyone. We borrow more than €1.25 billion per month to pay for public services, including pensions and payroll. This poses a difficulty in terms of funding the types of reform one would like to implement. Strict targets have been set, in that the deficit to GDP level must be 8.6% by the end of this year and 3% by 2015. In a three-year period, the State's income collapsed by one third. These would be significant factors for any organisation. In the private sector, it would be car crash stuff.
The demands for public services are stronger than ever. There are 500,000 more medical cards than there were in 2007, the level of jobseekers is three times what it was in 2006, there are more pensioners to be paid, there are more prisoners in prison and children are being born at the same rate. When private organisations implement this level of reform, they can choose to cut off some services. This is not an option for the State.
The various levels of reform place significant demands on the system, for example, Croke Park reforms and this programme's strategic reforms. When we launched the reform plan, we wanted to outline what success would look like to the citizen, the person who engaged the State for its services. We highlighted the plan's five key areas, which I will touch on briefly. First, the interaction between citizens and the State will be improved. Second, new ways to deliver services will be considered, for example, the increased use of electronic services. Third, costs in the system will be reduced radically. Fourth, we will organise ourselves differently. Fifth, public criticism of previous reforms probably focused on their execution. The plans may have sufficed, but their implementation may not have been strong enough. We are focusing on this issue. I will highlight the areas in which our delivery is strong.
The reform agenda has three key enablers. First, we have established a dedicated reform and delivery office, which I head and is well staffed. Second, each sector or Department has people who take lead responsibility for their respective elements of the reform agenda. Third, the Croke Park agreement enables some of our strategic reforms.
I will outline some of our progress since launching the plan. We have established a programme office and I recently appointed a shared services manager from the private sector, a person with global experience of implementing shared services. She joined us in recent weeks. We have assigned what we term senior responsible owners. Where one element of the plan cuts across a number of Departments, a senior responsible owner will drive it to its conclusion. We have briefed the Committee of Public Accounts and the Joint Committee on Finance, Public Expenditure and Reform. We have also received integrated plans from Departments.
I should have highlighted it on the last slide, but there are two aspects to the reform agenda. First, there are 14 initiatives that cross all Departments. Second, we provide oversight of the sector-specific or Department-specific reforms that they have prioritised. We have established a joint plan and delivery boards for all of these and are making progress on a number of actions.
I will highlight some of the aspects under each category and outline what it is we are trying to do. My slide contains a number of points, although it is not a full list of the actions we are taking to improve the citizen's engagement with the State's services. One example is the public service card, the implementation of which is being led by the Department of Social Protection. A chip-and-pin card, it confirms someone's identity and will eventually support us in implementing a single card for each citizen to engage various State services, be it health or so on. We are considering how to increase the number of online services. Currently, there are approximately 300 services on the portal.
The plan commits to a government-wide measurement system to examine key outcomes, for example, the top three outcomes at departmental level. We will establish a pilot this year before rolling out the system. This process has been used in some other states and organisations. There are also sector-specific service plans. In this regard, health and education are on the front line. In terms of maximising innovative delivery channels, we are finalising a new e-Government strategy which, in essence, will look at what other services we can make available online, how we can utilise high penetration of smart phones to make available more applications in respect of services and the potential for ICT consolidation.
In regard to data sharing in order to reduce costs, we are again looking at the feasibility of utilising data sharing between Departments and putting in place processes and controls around governance in this regard. We are also evaluating how we can make other services available online. During the course of the plan, we will evaluate if we can make the full passport service or an element of it available online. Members may be aware of the "fix your street" initiative which has been rolled out in one area. We are looking at rolling this out further. We are also looking at making other services available online, including partial application of the driving licence. Cloud computing is currently getting a great deal of public attention. We will evaluate the potential use of cloud and in this regard propose to establish a cloud strategy in terms of leveraging public and private cloud during the course of this year.
On costs, the programme for Government commits to an overall reduction in public service numbers from a high of 320,000 in 2008 to 282,500 by 2015. Members will be aware of the reduction in numbers already achieved through the pension scheme process which expired at the end of February last. On procurement, we believe there are further opportunities to leverage the State's purchasing power. The Minister of State, Deputy Brian Hayes, and the OPW are currently calling in top suppliers in terms of securing reduced prices and unit costs from them. We believe the opportunity exists to aggregate more Departments' spend into single framework contracts. We currently have approximately 45 framework contracts with a value of €450 million. We believe an opportunity exists for us to increase the number of centrally controlled framework agreements, thus achieving a better return on expenditure for the citizen.
On our property portfolio, we want to increase our utilisation of Government office space and buildings, to reduce our leasehold expenditure and to free up property and, where and when appropriate, to dispose of non-core property assets. We see opportunities to improve the mandate for the Office of Public Works to have stronger control of the total property portfolio and the facilities management overheads which accompanies that.
On business process improvement, the plan contains a specific commitment to look at some core processes within and across Departments in terms of the elimination of duplication and waste, thus reducing costs. We are also looking at whether we can, through the Croke Park agreement, outsource or use new delivery mechanisms in non-core service areas.
The plan contains a strong commitment to the implementation of new shared services operations models. We have commenced the process with a HR shared service for the Civil Service and are currently evaluating a business case for roll-out of a HR shared service. The plan commits to further shared service across the Civil Service in terms of payroll, pensions, banking, finance and other services. Along with this, each sector is currently developing its own shared services plan.
We are also looking at new governance and performance management of State agencies. Members may be familiar with our plan, which I have touched on, for rationalisation of State agencies. We are also looking at stronger framework agreements between the parent Department and agency and stronger measurement of service level agreements, SLA, between Departments and performance against those measures.
Medium-term expenditure frameworks is a whole new way of developing our budgets. This is more about changing the way we manage budgets. The way we have developed our budgets is a function of an Act of Parliament dating back to 1866. Medium-term expenditure frameworks fundamentally challenge the manner in which budgets are developed, measured and monitored. I will give some examples in this regard later.
Further development of the senior public service is largely around management capability at a senior level, including assistant secretaries and secretaries general across the public and Civil Service, in terms of the skills and competencies required for various roles. Development of a high performance culture is largely about us embedding a stronger performance management culture with the current performance management system in place. Workforce planning has largely come into its own in the context of managing some of the transition arrangements. We recently communicated a workforce planning process to all Departments which sets out the methodology for their examining their core resourcing levels over the next three to five years.
I have already touched on implementation and keeping a strong focus on delivery but I would like to make a few extra points. Oversight is by a dedicated Cabinet committee on reform, which is chaired by the Taoiseach and led by the Minister, Deputy Howlin. There are dedicated change teams in each Department. There is also a dedicated board, which I chair, which meets once a month to review overall reform. We are currently finalising a communications plan to ensure engagement and buy-in by staff in terms of the reforms being implemented. If required, legislation will be introduced to support some elements of the reform.
What we are setting out in public service reform is a significant culture and reorganisation change within the public service. There are three aspects involved which relate largely to how people are managed and their contracts of employment, how we organise people and how we manage expenditure in terms of delivering effective and efficient services. In terms of how we manage people, obviously as a result of public service number reductions we are having to do more with less. There is a commitment in place in terms of an ongoing reduction in numbers. On allowances and overtime, we have sent out a mandate to all Departments in regard to a 10% reduction in overtime for this year. We are currently reviewing all allowances paid across the system. Proposals around which ones should be sustained into the future will be brought to Government. The process of rationalisation of annual leave arrangements is currently under way. Legislation on a new single pensions scheme for all new entrants to the public service will be brought before the Dáil some time in April. I have already touched on the issues of senior management and competencies, skills and workforce planning.
There will be fundamental changes in terms of organisation within and across Departments. Shared services operations is new. Implementation of shared services across 20 to 40 Government and public services will be a challenge. As I mentioned earlier, we have commenced this process through the HR shared service for the Civil Service and are currently evaluating a business case in respect of implementation of this service. We will shortly commence evaluation of shared services in respect of payroll, pensions, finance and banking. External service delivery relates to opportunities to deliver through different methods, including outsourcing non-core processes and the redeployment of people to core work. Restructuring and reorganisation across Departments is ongoing. This year and throughout last year we moved 1,000 people working as community welfare officers from the Department of Health to the Department of Social Protection, and 700 people have also moved from FÁS to the Department of Social Protection to cope with some of the demands. There is an ongoing movement of people within the Civil Service and various public service bodies.
The areas of e-Government and ICT can fundamentally change how we deliver services and we can also examine how to take out some costs through consolidation of data, computer centres and ICT infrastructure. The committee would be familiar with our commitment regarding the rationalisation of State agencies. On 17 November we announced agency numbers to be rationalised, with further bodies to be reviewed before the end of June, and that process is on track. Similarly with regard to decentralisation, a number of projects will be left in situ as sufficient people would have moved. Others have been cancelled and there are others under review. We have completed the majority of that review.
With regard to the handling of expenditure, I will touch on some fundamental changes which have been communicated to Oireachtas committees. The comprehensive review of expenditure was new last year and it set out for Departments a process to identify the core priorities for funding of a Department for the year. It considered priorities based on the programme for Government or what the Department wanted. Multi-annual expenditure frameworks amount to a process to move away from a year-on-year budget expenditure process, which at times can drive dysfunctional behaviours in any organisation, as there may be a larger spend in the last quarter of the year. This would lead to people trying to maintain expenditure levels to sustain a sufficient budget for the following year. The new process allows Departments to consider priorities over a three-year framework. There will be certain needs and requirements to carry forward expenditure based on the agreed programme, with certain thresholds agreed for carry-over of expenditure. That will begin to exert greater control over the process.
The value-for-money code and process is largely about developing a stronger financial and business case process around every level of expenditure, having a methodology and implementing a peer review of agreed expenditure. Performance-based budgeting was communicated just a few weeks ago and with the Revised Estimates, the majority of Departments have identified a number of key output measures. The idea is how to measure the success of that level of expenditure and what will be the key deliverables. I have already touched on property rationalisation and procurement reform.
We have strong governance and discipline with this reform programme. It receives strong engagement across all Departments and has dedicated owners and officials for every action, as I noted earlier. We are accountable and report progress on this to the Cabinet committee on reform. Our plan is primarily focused on cross-cutting initiatives, with sector-specific plans and strong engagement with citizens. There are significant pieces of the plan which aim to improve the engagement with the citizen. We are happy to have this discussion with the committee today with this in mind, although I may not have all the details on some of the services and parts of the plan. We are more than happy, if the committee feels it appropriate, to engage with relevant people and bring them through to the committee.
