I thank Members of the Seanad for giving me the opportunity to update the House on the progress of implementation of the public service agreement known as the Croke Park agreement. I last spoke to Senators on this topic on 13 May. I will begin by reviewing what has happened since then and set out some of the challenges that continue to face us in that context.
Last May, we were in a very different space in terms of debate on the agreement. Many unions were still conducting their ballots and it was uncertain whether union members would accept the agreement. There were arguments about whether that was the right approach for the civil and public service. At the time I said:
The making of this agreement between the public service committee of ICTU and the Government is a key step in addressing the immediate fiscal and economic challenges facing the country. A vote in its favour would show our European partners, and those watching around the world, that we are facing our problems and setting about putting our house in order.
At that time I asked public servants to decide on the agreement on its own merits. A majority of public service union members have responded and heard the calls from their representatives and from the Government. Public servants are practical people. Of course they were concerned and angered at the impact of the decisions already taken by the Government in 2009, including the application of the moratorium and incentivised exit mechanisms, the pension levy and finally, the pay reduction implemented through the Financial Emergency Measures in the Public Interest (No. 2) Act 2009. However, they understood that the Croke Park agreement acknowledges the sacrifices they have made and seeks to give a measure of security to public servants over the lifetime of the agreement. They focused on the commitments given by the Government which were, no further pay cuts, no compulsory redundancies where there is flexible redeployment, the commitments on pension rates for those retiring and the commitment to review pay in light of savings made in spring 2011 and annually thereafter. They understood that the alternative put forward by some of continuing and escalating their industrial action was not a realistic long-term plan. They knew that the agenda for change agreed in the Croke Park agreement was something they could live with and which they wouldwelcome in many cases. They understood that adoption of the agreement would itself give a measure of certainty about policy and spending that would assist in the process of economic recovery.
Although that was only a few months ago, the memories of some people are short. Having called for an urgent agreement to stop the escalating industrial action, some are now calling for the Government to walk away from the commitments made in the agreement. They are calling for this, despite the sacrifices already made by public servants and despite the consequences in terms of the delivery of major change in the public service and for industrial peace.
My colleague, Deputy Brian Lenihan, the Minister for Finance, met the officers of the public service committee of ICTU last week. He emphasised the gravity of the budgetary position and the consequent importance of the Croke Park agreement in delivering measurable savings. He also took the opportunity to reaffirm that the Government intends to comply with the terms of the Croke Park agreement, given the benefit to be gained from delivery of the significant change that will be needed in the public service to accommodate the reduction in public service numbers, in a climate of industrial peace. It is worth recalling that in the clarification of the agreement, issued in May of this year, the Government indicated that the provisions in paragraph 1.28 of the agreement, which stated that, "the implementation of this Agreement is subject to no currently unforeseen budgetary deterioration", would be applied in a bona fide manner and that similar clauses had applied in previous agreements. In the event that such a situation were to arise, the Government and unions would meet at central level to discuss the circumstances that had arisen and the implications for the agreement, prior to any decision being taken that would adversely affect the pay provisions of this agreement. The unions have made it clear that, in the event of the Government invoking that provision, the unions will cease to be bound by the terms of the agreement. The Taoiseach has made it clear that the Government wants to comply with the terms of the agreement, and I am happy to reaffirm this in the House today. It may be worth noting that the fact this discussion is happening underlines to public servants how important those commitments were in the first place and how necessary it is to deliver on the promise and potential of the Croke Park agreement.
I will now review the progress made on all sides to deliver on the promise of the agreement and to emphasise the need for greater commitment and urgency. Once the agreement was ratified by the public services committee of ICTU, Mr. P.J. Fitzpatrick, who has a long track record of leading major change in the public service, was appointed as the independent chairperson of the implementation body. That body has been given a role in driving forward the process of change and ensuring that any difficulties which may be encountered are resolved in a fair and speedy manner. I met Mr. Fitzpatrick yesterday to be briefed on his work. He has advised me that the body, which includes senior officials and trade union representatives, has been meeting regularly to address the issues raised as the agreement is implemented. He confirmed to me the very high level of commitment from all sides, management and unions, to a delivery under the agreement and there is a clear understanding that there is a lot of work to be done by all to deliver on its potential. As well as meeting with key stakeholders such as the heads of Departments and the public service trade unions, the LRC and the Labour Court, the body has been putting in place sectoral arrangements to drive forward the implementation of the sectoral plans in each area. Chairpersons have now been appointed to the sectoral bodies in health and local government and I anticipate that those arrangements will be finalised in all sectors shortly.
The Government has instructed senior management across the entire public service to accord the highest possible priority to implementing the agenda for change set out in the agreement and to working with the implementation body. I reiterate that instruction. It was disappointing that a large number of Departments missed the deadline for submission of the implementation plans but I am happy to say they have all now been submitted. I emphasise to management that the transformation agenda is essential and central to their Departments and agencies. Action plans have now been submitted by each Department to inform the implementation body on the significant changes proposed by public service management to achieve the reforms, efficiencies and savings in each sector. The implementation body will begin its consideration of the sectoral plans next week.
I will put these action plans into context. I cannot pre-empt any decisions that will be taken by the Government over the coming weeks in the lead-up to budget 2011. When the Government announces what measures it requires to restore our fiscal situation and reduce the cost of delivery of public services, these will impact upon public service managements' plans for change to their areas. Those impacts will then have to be reflected in the proposals they bring forward. The implementation body, therefore, has indicated that this reporting will be a dynamic process, with the plans being revised, added to and expanded over time, particularly having regard to decisions taken by the Government in the context of the budget.
I emphasise that the Croke Park agreement is not a cost-saving plan in itself. Cost savings will come through decisions on changing services and work practices, with the introduction of new technology and a reduction in the number of public servants. The Croke Park agreement provides the framework to manage those changes to work practices and service delivery, to boost productivity and improve efficiencies as the number of public servants reduces over time.
We can expect to see changes to the public service over the next few years as the agreement is implemented. The changes involved have already been set out in the Government's statement on transforming public services. That requires a more integrated public service that is leaner, more effective and more focused on the needs of the citizen, thereby contributing to the process of returning Ireland to economic growth and prosperity. In the context of reduced numbers and resources, the public service will have to be reorganised and public servants will need to show greater flexibility and mobility in working across traditional boundaries. Overall, we need more joined-up government to respond to the needs of citizens as they live their lives and go about their business, particularly at such a challenging time.
We have already implemented the types of changes and efficiencies that will be rolled out across the public service in the coming months and years. To give some specific examples, a national procurement service has been established and continues to leverage the public service's buying power by organising the procurement of common goods and services across the public service. Last year, in addition to achieving better value for money, savings of €27 million were achieved by public bodies with the support of the national procurement service. Savings of approximately €40 million are being targeted in 2010.
Yesterday's decision to reduce through merger the number of vocational education committees from 33 to 16 is also indicative of our agenda to transform the way in which public services are delivered. As a result of this consolidation, our VEC sector will be stronger and better placed to provide support services to schools, not just those within the traditional VEC sector but to other schools in areas which wish to avail of them. Work is under way on specific shared services proposals in the areas of human resources, pensions administration and payroll and financial management. The aim is not just to make significant savings but also to bring about improvements in the delivery of services. The Croke Park agreement will facilitate the completion of this work primarily through enabling flexible redeployment and easing the introduction of new technology.
These are changes to the back office functions of the public service. The Croke Park agreement will also enable new and existing services to be delivered in better ways to the public. We can expect new technology to be introduced to allow the public to interact with the public services in a more timely fashion. We can expect delivery of services over an extended working day and at the weekend. We can expect reconfiguration of services so they are delivered closer to the individual who needs them, obviating the need to navigate through different public offices. We can expect better performance comparisons and monitoring.
Significant improvements have already been made in performance measurement in the health system in recent years. The Croke Park agreement notes this must be continued with renewed focus and effort.
A useful example of this is HealthStat, a comparative tool in place in the HSE. It provides detailed monthly results from 29 teaching, regional and general hospitals and 32 local health offices responsible for providing health and social care services in the community with the results published online atwww.hse.ie. Hospitals and local health offices get marks on three themes: access, integration and resources. HealthStat measures whether people are receiving outpatient or day care when they should be or where it is suitable, whether people are admitted on the day of their procedure, whether the length of stay for inpatients is as should be expected, and whether patients and their families are informed about their treatment and included in discharge planning. By measuring performance on these matters, the quality of care being delivered to customers of the health service will improve.
The redeployment of staff across the public service is vital to ensuring the improved delivery of services. Some areas in the public service need improved staff resourcing while in other areas the needs are less pressing. It is important to address these imbalances and redeployment will go some way to doing this. There are already instances of successful redeployment we can point to. However, we need to break down the unnecessary distinctions between different types of public servants, through legislation if necessary, and through the use of much more flexible redeployment.
The changes being brought forward under the Croke Park agreement are part of a number of transformation initiatives being pursued by the Government. These are the establishment of the new public service board, which I chair, with a majority of members from outside the public service. Membership of the board will be announced shortly. We plan to make senior appointments, including a chief information officer, to bring greater expertise to the leadership of change in the areas of e-Government and shared services; to reconstitute the top level appointments commission with more outside members; and the announcement shortly of the details of the new senior public service. This initiative is being introduced in recognition by the Government that we need leadership at all levels of our organisations whether at the front line, at middle management or at senior levels. The new senior public service will centrally manage and deploy top public servants. This will promote greater mobility at senior levels in the public service and ensure the talent pool for filling leadership vacancies is broadened.
Under the public service agreement, the position regarding public service pay will be reviewed in spring 2011. The review will take account of sustainable savings generated from implementation of the agreement. These savings will have to be independently verified by the implementation body. The agreement states that in the event of sufficient savings being identified in the spring 2011 review, priority will be given to public servants with pay rates of €35,000 or less in the review of pay. Ultimately, therefore, it will be to the advantage of public servants that these significant changes and efficiencies are delivered because of the commitment to use savings, in an agreed manner, in the pay reviews. I recently clarified that measures put in place before the agreement, including the restrictions on the filling of public service vacancies by recruitment or promotion and incentivised early retirement, have achieved savings not attributable to the agreement. However, additional savings generated from efficiencies and other measures arising from the agreement, including those that facilitate further reductions in public service numbers by not filling future vacancies under the moratorium on recruitment, can be taken into account in the review in spring 2011.
Much of the focus has been on the need for management to press forward with proposals for change but public servants and their representative unions also have a role. We will encourage constructive and innovative ideas from all sides so we can maximise the ongoing contribution of the public service to addressing the challenges we face. I invite public servants and their representatives to come forward with those ideas. We all know the challenges we face. It is time for us all to contribute to the plans that will allow us meet and overcome those challenges.
The majority of public service unions or associations have either voted to accept the Croke Park agreement or decided that they can best represent the interests of their members by working with management on its implementation. The members and leaders of trade unions understand and accept the responsibility of all concerned to make this agreement work. Their commitment to delivery under the agreement is very welcome.
However, it will take more than just statements. We need to see commitment in deeds as well as words. Recently, there have been worrying suggestions in the media that it is business as usual in terms of trade unions. That is not the reality — the unions have agreed to the transformation agenda by signing up to the agreement. It is important that managers communicate to their staff about what this means in practice. Management must move ahead and deliver the change that we all need.
I want to consider the position of the unions that have chosen to stay outside the agreement and to maintain their opposition to its implementation. The Government considers that any party that chooses to remain outside the provisions of the agreement or that opposes its implementation cannot expect to benefit from the commitments it gave as part of the agreement.