Dáil Éireann Debate, Wednesday - 23 March 2011
9 Deputy Brian Lenihan asked the Minister for Finance if he will provide the precise arrangements for the division of the Department of Finance into two Departments; the proposed distribution of the current business of the Departments between the two new Departments and the implications for staff; and if he will make a statement on the matter. [5517/11]
Amharc ar fhreagraIt is intended to establish a new Department of public expenditure and reform which will have responsibility for all public expenditure as well as the modernisation and reform of the public service. The Minister for Finance will retain responsibility for overall budget, tax and spending parameters while the Minister with responsibility for public expenditure and reform will be responsible for managing public expenditure within the overall envelope set by the Minister for Finance.
The setting up of the Department of public expenditure and reform and the transfer of public expenditure and reform functions from the Department of Finance to the new Department will require primary legislation. The functions and responsibilities which are being transferred to the new Department and Minister need to be clearly identified in the legislation to ensure that there is a sound legal basis underpinning the new Department and ministerial responsibilities, as well as ensuring there is clarity of roles and responsibilities. Work on the legislation has commenced and is being given top priority. The public expenditure and reform functions will formally transfer to the Minister, Deputy Brendan Howlin, and the new Department of public expenditure and reform when the necessary legislation has been put in place.
Broadly speaking, the sectoral policy division and the public service management division of the Department of Finance will transfer to the new Department, as will the modernisation functions from the Department of the Taoiseach. Precise arrangements in relation to functions, responsibilities and staff are being finalised at present.
I thank the Minister for his reply; I wish him well in his office and congratulate him on his appointment. I had not done so in the Chamber yet. He has an onerous task before him.
I take it the Vote officers in the sectoral policy division will be transferred to the new Department so that the detailed supervision of expenditure on an ongoing basis will be the responsibility of the new Department.
I would like to probe the question of the overall envelope, which will be set by the Minister for Finance. I take it that overall envelope will be subject to a Government decision collectively agreed by the Government and implemented by the new Minister. At what stage in the budgetary cycle will that matter come before the Government?
I thank Deputy Lenihan for his good wishes and congratulations.
The manner in which responsibilities are now being allocated in the Department is new. However, it is not entirely new. Deputy Lenihan will recall that it was quite common, over the years, to have a Minister for the Public Service with full Cabinet rank. It was also the practice to combine that portfolio with the functions of the Minister for Labour. Labour and the Public Service was quite frequently the designated ministry. Social partnership brought about a situation where everything was rolled together into the Department of Finance. The Department of the Taoiseach then seemed to take a primary role in relationships with the social partners. There were advantages and disadvantages in this procedure.
In opposition, when we began looking at the situation Deputy Richard Bruton, who is now Minister for industry and commerce, produced a document. That is probably not the correct title, but I am old-fashioned in my titles.
I wish we all were.
Deputy Bruton produced a document containing the analysis that public service reform had failed over a series of Governments for two reasons. First, the person responsible, whether a public servant or a Minister, did not have full Cabinet rank. Second, even when the Minister with responsibility for public service reform had full Cabinet rank he did not have the influential policy levers to deliver the reform in Departments. Two decisions were made in the documents we developed in opposition. One was to vest full responsibility for reform of the public service in a Cabinet Minister. The second was that the Cabinet Minister would have the supervision and allocation of the expenditure within Departments so that he would have the influential levers to encourage Departments to reform along the lines he indicated. That is the background to it.
The functions will be divided along the lines Deputy Lenihan has suggested and in accordance with the legislation. The Minister for Finance will draw on the expertise of the staff who are experienced in public expenditure in drawing up the budget. When the legislation has passed and rolls are clear, legally, we will look at the budgetary cycle to see at what point these things will come before Government. It is intended that both Ministers will operate very closely on the budgetary cycle.
What is the timescale for the legislation? I welcome the appointment of two Cabinet Ministers at the Department of Finance. However, my principal concern is with the Department itself and the transferability of staff within the Department. We will be left with two very small Departments when one Department has been divided in two. The number of public servants of high quality will diminish in each Department and promotional opportunities will be reduced. The reform agenda will have to start now in the Department itself.
