Dáil Éireann Debate, Monday - 11 September 2023
716. Deputy Ivana Bacik asked the Minister for Education the amount paid to consultancy firms in each of the years 2015, 2016, 2017, 2018, 2019, 2020, 2021, 2022 and to date in 2023, in relation to the establishment and roll-out of the Education Shared Business Services (ESBS). [38807/23]
View answer717. Deputy Ivana Bacik asked the Minister for Education the cost to date of the establishment and roll-out of Education Shared Business Services, aggregated by rent, salaries, ICT and consultant fees. [38808/23]
View answer718. Deputy Ivana Bacik asked the Minister for Education the cost savings achieved to date by establishing and rolling out the Education Shared Business Services; and if she will make a statement on how such savings are measured. [38809/23]
View answer719. Deputy Ivana Bacik asked the Minister for Education the number of people who are employed in the Education Shared Business Services; the number of those who are employed in the service on secondment; the number of those who are employed in the service on a temporary contract; and the number of those who are employed in the service are on an agency contract. [38810/23]
View answerI propose to take Questions Nos. 716 to 719, inclusive, together.
Education Shared Business Services (ESBS) is a stand-alone section which forms part of my Department’s Major Operations Division. The ESBS Centre is based in Blanchardstown and provides shared services to both the Higher Education and the Education and Training Board (ETB) sectors. Some of the Services currently provided include:
• Payroll and Travel & Subsistence (Expense payments) Shared Services for the ETB sector;
• Payroll and Travel & Subsistence (Expense payments) Shared Services for the Higher Education sector (HEPSS);
• Finance Shared Services for the ETB sector;
• Sectoral Pensions Improvement Team;
• Apprenticeship Payroll;
• Learners Payments – (e.g. YouthReach, VTOS etc.);
• Data Analytics and Reporting Project;
• Programme Management Office Implementation Team.
As an example of the scale of one of the operations in ESBS, since the commencement of ESBS-ETB Payroll Shared Services in July 2019, 870,368 payments have been made through to the end of 2022 totalling over €1.252 Billion.
Staffing:
The ESBS has been established as a section within my Department with staff moving to the ESBS Centre in the Liberty Building, Blanchardstown on Monday 08 January 2018. At the time there were 14 staff employed in the ESBS Centre but that has now significantly ramped up and as at 01 September 2023 there are 169.2 FTE staff working for the Department of Education in the ESBS Centre. In addition to this, 6.8 FTE staff in ESBS are on secondment either from an ETB; another Government Department or from a Higher Education Institution. There are no Agency staff employed in ESBS and there are no temporary staff employed in ESBS.
Benefits Realisation / Cost Savings:
The main rationale for the setting up of ESBS was to bring about a transformational change for both the ETB and HEI sectors by the implementation of new technologies and systems. Payroll and Finance were operated in institutions using outdated systems which resulted in inefficiencies and duplication and was a contributory factor to the delays in ETBs in completing their accounts on time. In many instances, these systems were at end of life and were no longer supported, which presented a significant and unsustainable risk. The following table is provided to outline the major anticipated benefits that are expected from the establishment of ESBS. The focus is not solely on cost savings as outlined by the table below, however; annual savings are expected. To take an example in relation to one of the ESBS areas, namely ESBS-ETB Payroll Shared Services, annual savings compared to prior annual costs are expected to be €1.8M. The Net Present Value outlined in the Business Case (i.e. the return on investment at today’s values) calculated over a 15 year period is €13.1M. Payback for the investment is expected in 8 years from the full commencement of ESBS-ETB Payroll Shared Services. It is also anticipated that once the payroll and T&S functions are consolidated and standardised, there is potential to achieve greater improvements and efficiency savings in the future. In addition to this, the shared services model is being used to facilitate and enable ETBs and HEIs to further focus on their core education & training functions.
It is also important to highlight that there have been significant costs avoided by the ETB sector in particular because of the introduction of Shared Services. Two examples are given which highlight these areas of significant cost avoidance:
1. Apprentice Payments: It was a Revenue requirement that Apprentice payments be made taxable and if this was not introduced then significant penalties and fines would have been incurred by my Department for non-compliance. The existing payment system for Apprentices in the ETB sector was 38 years old and could not be modified to deduct tax or other statutory deductions and also was at a very high risk of imminent system failure. Accordingly, ESBS introduced Apprentice Payroll Shared Services for all 16 ETBs with effect from March 2020 and a team in ESBS is now managing the overall process for Apprentice payments since that time. This ensured that no penalties or fines were incurred by the ETB sector in relation to these Apprentice payments. Additionally, ESBS ensured that all ETBs complied fully with their legislative responsibilities and the Revenue taxation requirements.
2. SPS Benefit Statements: The Pensions Authority had outlined that fines and/or penalties would be levied on the sector if SPS Benefit Statements were not produced for members in the ETB sector. Accordingly, ESBS have implemented a Pensions Improvement Programme team and have now commenced the co-ordinated delivery of SPS Benefit Statements for ETB staff members which should mitigate the risk of fines and/or penalties being imposed on the sector.
Benefits Table:
|
Benefit |
Description |
Measurement Criteria |
|
Reduced Staffing Costs |
Staff Reduction based on Process Reform: |
FTE Counts; Salary costs ; Running costs The business case anticipates an NPV of c. 8 years from full implementation of payroll shared services for all 16 ETBs. Based on current staffing numbers and projections it is anticipated that these savings will be achieved in line with the timeline envisaged in the business case. |
|
Focus on Payroll Core Activity |
The development of Payroll Shared Services will allow for a comprehensive analysis of the payroll centre activities and the elimination of non-value added activities. |
This standardisation of approach will free up ETB staff to be assigned to other core ETB activities and will allow for synergies to be achieved in terms of overall ETB payroll operations. |
|
Technology enabled solutions: |
Employee self-service has eliminated the requirement for any paper payslips. The helpdesk generally operates on an email only basis thus reducing the time spent in resolving queries and also providing an enhanced customer service for each customer. |
Reduction in number of calls from employees and quick turnaround of queries. KPIs are in place to measure the performance of ESBS in this regard. |
|
Process standardisation |
Standard processes and automation will drive process efficiencies |
Volumes processed by employees will be greater and it will also allow for a significant reduction in errors due to the implementation of standardised processes and procedures. |
|
Improved management information: |
Timely and accurate management information supports decision making and will support ETBs in budget management and reporting. |
Standardised reports have been created and are available to all ETBs. Training is also provided to ETBs to enable them to write their own ad hoc reports as necessary. An overall revised Reporting Strategy is also being worked through in conjunction with the HEPSS project. |
|
Improved Business Continuity Planning |
Business Continuity Planning that meets with industry best practice standards will be central to the shared service centre design. |
Review and test of Business Continuity plans which have proven very effective in dealing with the remote working scenario brought on by the COVID-19 pandemic. |
|
Employee Satisfaction |
The development of a customer centric shared service centre is anticipated to improve customer satisfaction |
Employee satisfaction with the service will be measured by way of surveys in due course however, it is notable that very few complaints have been received in respect of the ESBS and positive feedback has been received from the senior management teams in both ETBs and HEIs. |
Expenditure including Consultancy Expenditure:
As the ESBS provides shared services for both the ETB sector and the HEI sector, funding for ESBS is allocated both from my Department and also from the Department of Further and Higher Education, Research, Innovation and Science (D/FHERIS). The expenditure detailed below outlines the overall expenditure incurred by ESBS since its establishment in January 2018. The figures are broken down by year since 2018 and includes a breakdown of the expenditure relating to consultancy incurred since the establishment of ESBS in 2018. This expenditure has been broken down into the following categories of expenditure: Contractors; Staff Pay Costs; ICT Equipment and Software; Grants to Aegis Bodies; Rent and Refurbishment; Consultancy; Utilities and other miscellaneous expenditure.
|
Categories of cost |
2018 |
2019 |
2020 |
2021 |
2022 |
YTD 2023 |
Grand Total |
|
Contractor * |
69,529 |
1,921,385 |
4,278,510 |
8,552,215 |
8,357,598 |
5,346,619 |
28,525,856 |
|
Staff Pay costs |
1,806,998 |
2,152,290 |
3,672,046 |
5,389,971 |
7,366,003 |
4,610,085 |
24,997,393 |
|
ICT equipment & software |
743,066 |
3,527,640 |
3,012,315 |
1,876,992 |
4,148,341 |
3,459,485 |
16,767,839 |
|
Grants to Aegis Bodies |
(196,841) |
210,795 |
849,170 |
2,652,300 |
1,729,471 |
1,919,299 |
7,164,194 |
|
Rent and Refurbishment |
914,353 |
733,474 |
806,413 |
732,666 |
823,308 |
521,630 |
4,531,844 |
|
Consultancy |
1,012,007 |
856,327 |
802,851 |
1,152,547 |
326,602 |
312,259 |
4,462,593 |
|
Utilities |
- |
3,716 |
30,033 |
54,448 |
84,666 |
55,900 |
228,763 |
|
Other |
41,426 |
95,852 |
185,429 |
177,959 |
210,966 |
225,050 |
936,682 |
|
TOTAL |
4,390,538 |
9,501,479 |
13,636,767 |
20,589,098 |
23,046,955 |
16,450,327 |
87,615,164 |
* A contractor is defined as a person or company that performs work on a contract basis. Contractors are engaged for specific and defined pieces of work at the conclusion of which the engagement ceases. There are a number of contractors in place in Major Operations Division, engaged by my Department under the terms of specific contracts put in place between my Department and those companies. These contractors provide specialist skills required, particularly in the context of large scale transformation programmes and projects. My Department actively manages the complement of contractors that are employed by my Department to ensure that only the minimum necessary amount of contractors are employed at all times. It is generally the case that contractors are solely used where there is a capacity gap in a section that cannot be filled without the utilisation of a contractor for a finite period of time.
