I am pleased to be before the committee to present the 2021 Revised Estimates for my Department's group of Votes. I am joined by the Minister of State with responsibility for public procurement and eGovernment, Deputy Ossian Smyth, and a number of our officials.
The group comprises a significant number of Votes, as the Chairman outlined, including: Vote 11 - the Office of the Minister for Public Expenditure and Reform; Vote 12 - Superannuation and Retired Allowances; the Votes for a number of offices under the aegis of my Department, including the State Laboratory - Vote 14, the Public Appointments Service - Vote 17, the National Shared Services Office - Vote 18 - and the Office of the Ombudsman - Vote 19; Vote 15 - the Secret Service; Vote 39 - the Office of Government Procurement ; and Vote 43 - the Office of the Chief Government Information Officer. The Minister of State, Deputy Ossian Smyth, is happy to address issues relating to the Office of Government Procurement and the Office of the Chief Government Information Officer, and I will address questions regarding the other Votes.
I note that a detailed briefing has been supplied by my Department's officials, who were assisted in this task by their colleagues in a number of bodies under the aegis of the Department. Further detailed material is also contained in the Revised Estimates for Public Services 2021, which was prepared by my Department.
Covid-19 has presented unprecedented challenges to officials, Members of this House and the general public. Arrangements for business continuity and flexible working have ensured that essential public services can continue to be delivered, while also ensuring that the general principles of safety, health and welfare are adhered to. Officials from my Department, and in bodies under the Department's aegis, have played a central role in responding to the challenges of this crisis, and I take this opportunity to thank all parties involved for their collective efforts in this regard.
In an overall context, the 2021 total gross allocation for the public expenditure and reform, PER, group of Votes comprising of nine distinct Votes shows an increase of 3% on the 2020 allocation. The overall gross figure for 2021 is approximately €858 million compared with €829 million in 2020. This is largely driven by an increased Estimate provision to Vote 12, targeted minor increases to enable the delivery of essential services such as additional HSE recruitment, and to meet the additional salary costs associated with the Public Service Stability Agreement.
I will touch on the individual Votes in a little more detail. The structure of Vote 11, the PER Vote, remains unchanged in 2021, with two strategic programmes focused on the two main strategy goals of the Department, namely, to manage public expenditure at sustainable levels in a planned, balanced and evidence informed manner in order to support Ireland's economic, social and climate goals and to drive reform and innovation across the civil and public service to improve services to the public and enhance strategic policymaking and public governance structures. The Department has kept its overall 2021 budget flat and has reallocated resources across a number of expenditure subheads to meet 2021 priorities.
The most significant changes to programme subhead budgets are as follows. Subhead A9 funding for pensions for bodies under the aegis of the Department increased by €700,000 to €1,150,000. This will assist with additional pensions costs incurred by the Economic and Social Research Institute, ESRI, and the Institute of Public Administration, IPA. Subhead A3, the ESRI grant subhead, has increased by €225,000 to €3,000,000 to support the institute in carrying out additional social research in 2021. The allocations for subheads A8 and B5, the programme consultancy subheads, have reduced by €383,000 in total. Subhead B7, the reform agenda subhead, was reduced by €542,000 to €648,000, which is sufficient to meet its requirements this year.
In relation to other Votes, the Estimate for Vote 12 - superannuation and retired allowances, which is the largest Vote, accounts for the vast majority of the envisaged increase in PER Vote group expenditure in 2021. Year-to-year variations in the expenditure of this Vote are primarily driven by the number of pensioners on the payroll, the number of individuals who will opt to retire before reaching their compulsory retirement age and whose years of service and grade or pay level are variable and uncertain.
The Estimate I am proposing today for Vote 12, involving a gross provision of €666.268 million, represents an increase of just over €26 million, or 4%, on the 2020 gross Estimate. This increase reflects an increase in the number of pensioners on the payroll and the number of civil servants reaching retirement age in the year.
Other bodies under the aegis of the Department, such as the Public Appointments Service, PAS, the National Shared Services Office, NSSO, and the State Laboratory, provide important services to large numbers of clients across the civil and public service. A modest increase to the State Laboratory's 2021 Estimate will allow the laboratory to meet additional forecasted demand for tariff classification advice in 2021, and also enable the laboratory to provide an analytical service to the HSE in relation to e-cigarettes. The Public Appointments Service - Vote 17 - has received a modest once-off increase in the current year to assist the HSE with increased recruitment demand arising from the pandemic. The NSSO has played an important role in the reform of public services in recent years through the delivery of human resource shared services and payroll shared services to clients across the civil and public service.
The 2021 NSSO allocation will enable the continued provision of HR and payroll shared services and also enable the office to progress the roll-out of financial management shared services.
The Estimate provision for the Office of the Ombudsman will allow the various constituent offices to deal with their respective workloads and enable continued investment in ICT modernisation, which will support the office to meet the challenges of delivering essential services to the public remotely at this time.
Procurement is a key element of the Government’s public service reform agenda. The State procures goods and services costing in the region of €8.5 billion each year. In this context, it is essential that the public service operates in a co-ordinated and efficient way and delivers sustainable savings for the taxpayer. Some of the key OGP initiatives supported by the 2021 Estimate include: improving procurement capability in the public service; further developing, implementing and actioning a medium-term strategy for construction procurement, including the capital works management framework, CWMF; supporting Future Jobs Ireland and the climate action plan through focused procurement policy initiatives; the development of a new national eTenders system; and the delivery of commercial skills training across the public service.
Finally, 2021 marks the second year of the Office of the Chief Government Information Officer, OGCIO, as an independent Vote - Vote 43. It was established in 2020 with an Estimate of €21.7 million net, all of which came from Exchequer neutral funding transfers from other Votes. The Estimate for 2021 will rise by 5%, which is largely funded via Exchequer neutral transfers of €1.1 million from other public sector bodies. This Vote serves to drive the digital transformation agenda across Government while providing and developing pan-public service ICT infrastructure, service delivery models and cross-government applications. The OGCIO is facilitating a sustained and wider spread adoption of the build to share suite of services as set out in the public service ICT strategy and endorsed by the Civil Service Management Board, CSMB, with Departments contributing to the funding of services received. This approach to Exchequer-neutral funding means that ICT costs can be suppressed across the wider system as a result of labour specialisation, economies of scale and the elimination of duplication.
I am happy to present the 2021 Estimates for the public expenditure and reform group, approval of which will allow the individual Votes to continue to meet their responsibilities and deliver essential services. The Minister of State and I are both happy to answer any questions that arise.