I am glad to be here. I am a witness with the same privileges as others here so I can give as good as I get. I am genuinely pleased to have the opportunity to come to the committee today to discuss and present the reform agenda of my Department. The Department was established as a Department of public expenditure and reform. Most of the focus and public commentary will be about the expenditure side and the corresponding role I have but, ultimately, all of that will not be as important as the reform agenda.
The Chairman introduced the Secretary General of my Department, Mr. Robert Watt. Mr. Paul Reid is the director of the reform unit or the reform and delivery office within my Department. It is important to have an organisation to follow through on the plan. I will offer my opening remarks and I will ask Mr. Reid to circulate the presentation we made to the Cabinet sub-committee. I will not ask Mr. Reid to take the committee through it because that would take up too much time but if the committee has questions for me or any of my officials, we will gladly engage.
I thank the committee again for the invitation to come here. Ireland has a long and noble tradition of service to the public and the State. The core values of integrity, commitment and service to all are at the core of public service in this country. In seeking to reform the Irish public service, we should recognise that contribution and value it.
While the public service can learn from the private sector, ultimately, we must recognise that public services are different. They are essential to the functioning of society and the economy. They play an important role in protecting citizens when they need it most as well as having the potential to create the environment for economic growth. We live in a difficult set of economic circumstances and, naturally, we must be careful about how we spend money. The public services are no different. We must organise ourselves better and spend smarter. While times are hard we also have an unprecedented opportunity to show real leadership and to push through resolutely the challenges of change. The saying goes that one should never waste a good crisis. Perhaps there is no such thing as a good crisis but there is an opportunity now to make changes at a pace and on a scale that would not normally present.
The Government believes in leading from the front. I have indicated to the committee previously that we have already introduced considerable change. We have reduced the pay of the Taoiseach and of Ministers. We have reformed ministerial transport arrangements. We have changed the composition of the top level appointments committee, TLAC, to include an external chair and more external members; a majority of external members make decisions now in respect of top level appointments. We have changed the TLAC terms, which, I have discovered, have existed since 1987, to apply a different regime to Secretaries General appointed from now on. We have introduced new pay ceilings for senior public servants as well as the commercial semi-State bodies. We have reduced the number of Oireachtas committees. We have cut the overall costs of special advisers to Ministers and we have introduced legislation to significantly reduce future public service pensions costs.
Enabled by the Croke Park agreement, we have seen many other significant and visible changes throughout the public service in recent months. I am keen to hear the committee's views in respect of the role of the Croke Park agreement because it has become almost a bête noire in the eyes of some. Under the agreement we have a reduction in public service numbers this year of some 5,000 staff which will bring the numbers below 300,000 by the end of 2011. We have managed the redeployment of some 750 staff internally within the health sector. We have overseen the implementation of new redeployment procedures for second level teachers, resulting in the positive redeployment of some 200 teachers together with the redeployment of some 850 surplus primary school teachers. We have managed the transfer of more than 1,000 staff to the community welfare service from the HSE and amalgamated the operation into the Department of Social Protection. Work is ongoing to transfer some 700 staff from FÁS to the Department of Social Protection. These are some examples of the developments and we can take heart from the progress being made but the Government has no intention of losing the momentum that is beginning to build up. Transferring staff might seem simple. We have the objective of establishing an integrated public service but the terms and conditions of employment of various agencies have grown up completely separately. Therefore, when one tries to move people, one often finds they have different wage scales, hours of work and leave arrangements. It is extraordinary. We have to forge them into some sort of cohesive unit, which is not without significant challenge.
As members will be aware, I announced the further reduction of public service numbers on 17 November. By 2015, we now expect to achieve a planned reduction of 37,500 staff, or 12% of the total, since 2008. The Government is expecting the gross public service pay bill to reduce by approximately €2.5 billion to €14.5 billion, which is a 15% drop on the 2008 figure. Details of the 2012 employment control framework will be announced next week.
The most significant element of the savings that will be realised from the reform plan is the preservation of critical front line services in tandem with a significant reduction in public service numbers in the coming years. That will be difficult and challenging to achieve. A stable industrial relations environment will be central to ensuring that we deliver better services with fewer resources. The Croke Park agreement is central to maintaining this positive environment.
If services to the public are to be protected and improved, it is crucial that the public service be structured, organised and managed in a new way; a way that maximises both efficiency and effectiveness in service delivery and allows us to prioritise key services. It is for that reason the Government decided to proceed with the rationalisation of some 48 State bodies by the end of next year and to review the position of an additional 46 bodies in the next six months.
We have also taken overdue and decisive decisions on the decentralisation programme that will bring clarity to ordinary workers. Some 40 projects have been cancelled. These decisions have been difficult to take in light of their implications for particular individuals and communities but our focus must remain on how best to run the public service overall. A total of 32 projects, which are already well developed, will remain in situ in decentralised locations and a further 22 will now be comprehensively reviewed. We have not finished the review on those 22 but they will be finished as soon as we can when we will announce what exactly is going to happen in those locations.
A more integrated approach in the public service to having common terms and conditions of employment for staff, as well as related human resource management policies will further develop a more flexible workforce and customer focus in our public institutions. Members may already know that my Department has sent final proposals on the standardisation of annual leave across public service organisations to the public service unions for their agreement. I am confident that agreement will be forthcoming on this important reform. This particular measure, which will see the abolition of out-of-date local leave arrangements such as festival and race days, will also eliminate many of the different arrangements that currently exist between organisations and sectors by putting in place the same cap on the leave allowances of different public service employment groups. That will enhance the fluid movement of staff between organisations across the public service and ensure that resources can be reconfigured to adjust to evolving priorities. We will also take decisive action on allowances, evaluation and sick pay. I will have a little more to say on that next week.
The public service reform plan is a detailed and action-oriented plan which includes specific commitments designed to ensure that we place the customer at the core of everything we do; maximise new and innovative service delivery channels; radically reduce our costs to drive better value for money; lead, organise and work in new ways; and maintain a strong focus on implementation and delivery. It is an ambitious plan based on approximately 70 recommendations and 200 actions. It specifically commits to implementation of a radical restructuring of how we do business by establishing shared services models for areas such as human resource management, HR, payroll and pensions; better use of technology to improve the customer experience - up to now approximately 300 public services have been accessible online and we need to expand that potential radically to allow people to do business online; further reform of public procurement processes under the direct stewardship of the Minister of State, Deputy Brian Hayes, and the national procurement service is also under way; property rationalisation and reforms to how we manage property portfolios; and reducing costs, addressing duplication and eliminating waste across the entire system.
The plan is necessarily structured and time-bound as befits good governance and organisational management. Some of the actions involve design and development phases. That is because we know it is important that we get things right. International experience teaches us, for example, that shared service approaches to back-office functions do result in cost savings but careful design will be important in ensuring cost savings are maximised. There have been one or two unfortunate international experiences from which we want to learn.
The implementation of new technology and innovative services will be prioritised, through developing and launching an e-Government strategy across the public service by the end of January 2012. We will improve the sharing of data across Government to reduce costs and enhance customer service. We also will pilot the use of cloud computing in the public service next year.
Building on already developed initiatives in procurement reform with 45 national frameworks in place to date, we will implement further initiatives in enforcement, performance measurement, mandated use of common frameworks, increased professionalism, greater use of category management and more innovative use of technology. We also intend to realise significant savings in property costs, as I indicated, in particular through leasehold and maintenance arrangements, which is not the easiest of things to do in the current property climate. We will also raise additional capital income through the sale of excess property assets, at the appropriate market time.
HR, payroll and pensions shared services projects are being initiated for the Civil Service with the intention of having consolidated operations in these areas on a phased basis commencing next year and to be completed by 2015. Sector-specific shared services implementation plans will be in place by the end of the second quarter of next year.
The new reform and delivery office in my Department, headed by a new dedicated programme director alongside of me, will take a robust approach to monitoring progress on each of the actions set out in the plan in order that any potential issues are resolved at as early a stage as possible. Within the ambitious range of actions set out in the plan, an initial number of major projects are being prioritised, including the public services card, which eventually every citizen should have; HR shared services for the Civil Service; payroll shared services across the entire Civil Service; public procurement reform, which I indicated is being spearheaded by the Minister of State, Deputy Brian Hayes; property asset management; Government-level performance management; performance budgeting; and the establishment and development of a senior public service. The list will evolve over time in line with the implementation of public service reform.
At this early stage of our reform journey, it is important to recognise that there is a long tradition of integrity, commitment and service across the public service, qualities that have served this nation well. This tradition offers us a strong foundation for delivering the fundamental reform that is now needed. It will be crucial that we all - Government, public representatives, Oireachtas Members and the public service - work together to deliver real change and create a public service that is among the very best in the world. That is our objective.
We recognise that the public and private sectors do not and cannot exist in isolation and for that reason the Government has put the reform agenda at the heart of our drive to secure Ireland's recovery. I would be happy to answer any questions members may have. I will ask Mr. Paul Reid to circulate his paper.