Key Objective from Public Service Reform Plan 2014-16:

To deliver a productive, cost-effective and affordable Public Service, including through the full utilisation of the provisions set out in the Haddington Road Agreement.

Cost reduction

Public servants have made a significant contribution to addressing the challenges that faced the economy and the public finances in recent years. In addition to the implementation of a broad range of reforms, they made a direct contribution in terms of pay and pension measures that reduced the Exchequer pay bill by over 20% between 2009 and 2014. Staff numbers were also reduced by around 10% in that period. Overall, five separate pieces of financial emergency legislation contributed €2.2 billion annually to stabilising the public finances.

Increased productivity

In addition to the direct savings effected through the Financial Emergency Measures in the Public Interest legislation, public servants have also contributed significantly to the maintenance of ongoing necessary public services through significantly increased productivity.
The productivity measures implemented include an additional 15 million hours each year, substantial reductions in overtime and other payments, changes in conditions relating to pension, sick leave and annual leave, redeployment of thousands of public servants and the provision of additional services with significantly fewer staff.

In the schools and education sector, the additional hours have been used to provide supervision of students and teacher substitution cover, maintaining smooth delivery of this key public service.

Nearly 5 million hours of additional working time have been added to the health service annually. These have helped to reduce dependency on overtime, add capacity in emergency departments and to extend clinic opening hours. The extra hours in these areas have also contributed to the introduction of a longer working day (8am–8pm) in many areas.

In the Local Government sector, an additional 1 million hours have helped to continue the provision of frontline services in the light of a reduction both in staff numbers and in the use of overtime in the sector.

Reform Dividend

Cost reductions have been delivered while meeting increased demand for public services due to the downturn and demographic factors, as set out in the Demands on Public Services infographic in the executive summary. The reform dividend from this cost reduction and the other reforms implemented, together with an improvement in the public finances, has allowed for targeted recruitment in sectors such as education, health and policing in recent years.

For example, since 2014, there has been increased staffing in the following areas: an additional 3,000 teachers; 1,300 new special needs assistants; the HSE has hired over 1,000 nurses; and, by the end of 2016, there will have been an additional 1,150 Gardaí recruited. Without Public Service Reform and the savings it has produced, including those underpinned by agreements negotiated with staff, it would have been impossible to increase staff levels in these key frontline areas.

Overall, the three Public Service Agreements to date have played a critical role in maintaining the delivery of services, reducing costs and enabling the reform programme. The Agreements have also delivered a period of unprecedented peace in industrial relations in the Public Service.

Lansdowne Road Agreement 2015-2018

The Lansdowne Road Agreement was concluded in May 2015 and ratified by the ICTU Public Services Committee in September 2015. The Agreement extends the Haddington Road Agreement and will secure a peaceful industrial relations environment until September 2018.

The Agreement reinforces the ongoing commitment of public servants to the wider reform agenda in the Public Service and will ensure that efficient and effective public services remain an integral part of that future. The Agreement specifically states that “efficiencies need to be maximised and productivity in the use of resources increased through revised work practices and other initiatives”.

The Agreement also began the process of unwinding the financial emergency measures in a prudent and sustainable fashion thereby reducing the risk to the sustainability of the public finances, targeting the bulk of available discretionary resources at lower and middle income public servants. The Commencement Order bringing into law the Financial Emergency Measures in the Public Interest Act, 2015 was formally signed in November 2015.

Delegated approach to staffing

With improving financial circumstances, it has been appropriate to return to a more normalised approach to staffing within a revised policy framework. In Budget 2015, the ending of the Moratorium on Recruitment and Promotion / Employment Control Frameworks was announced, with a move to delegation of sanction for the management of staff and pay to Departments, in line with a commitment in the Public Service Reform Plan 2014-16.

Sanction has now been delegated to all Departments, with the exception of parts of the Health, Education and Justice Sectors. The sanction gives Departments more flexibility in terms of how they manage their staffing requirements by allowing Departments to manage their own staffing levels once they remain within their agreed multi-annual pay ceilings.

The delegated arrangements shift the focus to cost management, containment, reform and efficiency. The arrangements allow Departments to recruit or promote in certain grades (up to and including Principal Officer or equivalent), as long as this can be achieved within fixed pay allocations. Departments can also implement similar cascade arrangements with agencies or bodies under their aegis.

Key Objective from Public Service Reform Plan 2014-16:

To continue to envision, launch, grow and transform public value through Shared Services Programmes.

National Shared Services Office

Shared services is a major part of the Public Service Reform programme, with the National Shared Services Office (NSSO) established within the Department of Public Expenditure and Reform to lead shared service strategy across the Civil Service. The Government approved the publication of the NSSO Bill in January 2016, which will result in the NSSO becoming a separate Civil Service Office under the aegis of the Department of Public Expenditure and Reform, with its own Accounting Officer. As well as leading shared services strategy for the Civil Service, the NSSO plays an important role in relation to policy for shared services across the wider Public Service, including setting standards, research and policy development, as well as providing guidance and advice.

An independent report entitled “An Examination of Shared Services in the Irish Public Service and Internationally” was published in December 2015. The report confirmed that Ireland compares well internationally in terms of the approach to shared services and the significant progress made on key projects in recent years; the governance and accountability frameworks put in place, including the establishment of the National Shared Services Office; and the anticipated headcount reductions and payback periods for the Irish Public Service, which are in line with international comparators.

Civil Service Shared Services

Significant progress continues to be made in advancing a number of shared services projects within the Civil Service.

PeoplePoint, the Human Resources and Pensions Administration Shared Service Centre, is in operation since March 2013 and now services over 33,000 employees across 38 Public Service Bodies. PeoplePoint manages high volume administration activities, providing various HR and pension services to customers such as leave, absence, pension and pay administration. Further Public Service Bodies will transition to PeoplePoint in phases during 2016, bringing the customer total to over 34,000 employees across 40 organisations.

A single Payroll Shared Service Centre (PSSC) for the Civil Service is now providing payments to almost 78,000 payees, including 45,000 pensioners, across 31 organisations. The PSSC, which is based in three locations (Galway, Killarney and Tullamore) currently issues payments valued at €2.7 billion when annualised. By early 2017, the PSSC will provide payroll and travel and subsistence services to 120,000 payees, including pensioners from 54 sections of Government.

The implementation phase of the Civil Service Financial Management Shared Services project has now commenced, following Government approval to proceed to the next phase of the project in January 2016. The project will transform the approach to the delivery of financial management and support across central Government. It will include centralising transaction processing, refocusing Public Service Body finance teams as finance business partners and establishing a Financial Management Shared Services Centre and the transferring of transaction processing activities from Public Service Bodies to a Shared Services Centre.

Sectoral Shared Services

Progress has also been made on shared service projects within the key sectors of Local Government, Education and Health.

The rollout of a Local Government payroll and superannuation shared service known as MyPay is continuing. This is led by Laois County Council, and twenty Local Authorities and the Local Government Management Agency are now ‘live’ in the MyPay Shared Service Centre.

A number of shared service projects are being advanced in the Education and Training Sector. These range from the upgrade of the existing Department of Education and Skills Teachers Payroll Shared Service to the introduction of Payroll Shared Services for the Higher Education Sector. In the Further Education and Training Sector progress continues on Payroll, Financial Management and ICT Strategy Shared Services for the 16 Education and Training Boards.

In the Health Sector, a number of shared service projects are being progressed by the Health Service Executive through the Health Business Services unit. These include areas such as Payroll, Pensions, Recruitment and Financial Management.

Recognition of Good Practice

PeoplePoint won the Customer Contact Management Association (CCMA) Shared Services Centre of the Year Award at the 2015 Irish Customer Contact and Shared Services Awards in November. The awards were hosted by CCMA Ireland who noted “the Judges congratulate the PeoplePoint leadership and teams on their work to date in demonstrating the value of the shared service model and ultimately achieving better public service value”.

The Payroll Shared Services Centre won the award for “Leading Civil Service Renewal” at the first Civil Service Excellence and Innovation Awards in December 2015. The award recognised the value of the payroll shared services project and highlighted how unified shared service approaches can lead to greater efficiency and service improvements.

Key Objective from Public Service Reform Plan 2014-16:

To reform procurement across the Public Service in order to deliver significant savings to the State, modernise and professionalise public procurement, align policy development with operations, improve the consistency of policy implementation and reduce risk for the State.

Public Procurement Reform

During 2015, the Office of Government Procurement (OGP) continued to lead the implementation of the programme for procurement reform, bringing increased levels of collaboration and consistency to public service procurement. In the three years to the end of 2015, the OGP and its partner sector sourcing organisations in Health, Education, Local Government and Defence enabled procurement savings estimated as in excess of €160 million.

In 2015, a review was undertaken of the Procurement Reform Programme and a re-baseline exercise was carried out. This exercise identified a number of factors which had an impact on the objectives that were set when the OGP was established. In particular, the time taken to build up the staffing resources of the organisation was longer than anticipated resulting in constrained capacity in the initial years. The context of the programme had also changed since its commencement, with economic recovery already putting upward pressure on prices for goods and services. Notwithstanding these factors, the review concluded that substantial benefits for the State remain by continuing the programme. The re-baseline exercise set new targets for the years ahead and the projected savings for the next three years (2016-2018) are now in the range of €80 million to €100 million per annum for the programme as a whole.

A key objective of the programme is to strengthen spend analytics and data management. In March 2015, the OGP published its first public report – Public Service Spend and Tendering Analysis for 2013 – analysing €2.742 billion of expenditure data gathered from 64 large Public Service Bodies.

In recognition of its work to date, the OGP was awarded the Public Procurement Excellence Award at the National Procurement and Supply Chain Awards 2015.

OGP Sourcing Activity

The 2015 OGP Target Schedule of Frameworks and Contracts, first published in December 2014, was aligned to the gathered requirements of the larger Government Departments and Agencies. The OGP continued to gather and review information on the requirements of Public Service Bodies throughout 2015.

In view of the enormous volume, value and complexity of requirements across the State, the OGP constantly reviews its sourcing programme to prioritise activity that will best serve requirements, enable savings and ensure compliance with proper procurement processes. The target schedule is updated quarterly and published on www.procurement.ie to give clients and the market a nine month forward view of the OGP service delivery plan. This move brings transparency and affords SMEs time to construct consortia and bid for public service contracts.

Throughout 2015, the OGP worked to develop comprehensive specifications in areas such as professional services, ICT, facilities, travel services, HR, utilities and managed services. It is notable that some of these expenditure areas such as legal costs, software, catering and cleaning have not previously been addressed at a whole-of-government level. It is expected that work on these areas which commenced in 2015 will enable the relevant arrangements to be put in place in 2016.

Public Procurement Policy

The High Level Group on SME Access to Public Procurement continues to develop and monitor strategies facilitating SME access to public procurement. Working in conjunction with Enterprise Ireland and InterTradeIreland, the Local Enterprise Offices (LEOs) continued to deliver Procurement Seminars to SMEs in 2015. Established in 2014, the network of 31 LEOs operates as an integral part of local authorities across the country, providing a first-stop shop service for SMEs while working to identify and address their training needs.

The OGP also launched the Tender Advisory Service on a pilot basis in 2015, providing an informal outlet for potential suppliers to raise concerns in relation to a tender process where perceived / real issues may remain after the clarification process set out in the Request for Tender document has been exhausted.

These initiatives address stakeholder concerns and ensure that SMEs can access public procurement opportunities. This is vital to the Irish economy as SMEs account for 99.7% of all enterprises and 68% of all employment. The importance of the link between market opportunities for SMEs and public procurement is reflected in the Government’s Action Plan for Jobs.

In 2015, work also continued on the process of transposing three EU Procurement Directives into Irish Law.

Raising awareness of Public Procurement

The OGP actively engaged throughout 2015 in a number of communication events including ‘Taking Care of Business’, designed to help small and start-up business. In addition, ‘Meet the Buyer’ is an opportunity for suppliers to meet major public sector buyers. ‘Go-2-Tender’ workshops are designed to provide tailored advice and guidance and assist with tender development. In 2015, approximately 4,000 people attended events where the OGP was actively involved. These events help to foster awareness of, and enable participation in, the public procurement process.

The volume of queries into the OGP Customer Helpdesk tripled during 2015, reflecting growth in OGP’s operations. Averaging 115 queries a week, the percentage of queries closed within 24 hours stood at 93% at the end of 2015.

Key Objective from Public Service Reform Plan 2014-16:

To manage the Public Service property portfolio in a professional, coordinated and efficient manner that maximises value for money and facilitates business needs and service provision.

Implementation of the Property Asset Management Delivery Plan

‘Accommodating Change – Measuring Success’, the Government’s Property Asset Management Delivery Plan, was published in July 2013 with the key objective to “manage the Public Service property portfolio in a professional, co-ordinated and efficient manner that maximises value for money and facilitates business needs and service provision”. The Plan reflects that the strategic approach to the management of State property requires all State property holders to view public property from a ‘State’ perspective rather than individual ownership. The Office of Public Works (OPW) is leading these changes across the Public Service and progress is overseen by a cross-sectoral Steering Group.

2015 saw the publication of the first progress report on the Plan, which sets out the main areas of progress during its first two years. These include the formation of the high level Property Asset Management Steering Group, population of data on the State Property Register, improved processes for intrastate property transactions, the adoption of ISEN 15221 Standard for Facilities Management and improved management of the Civil Service estate.

State Property Register

The Intra Public Service State Property Register is an online map-based register which was developed by the OPW and is available to all Public Service Bodies. The Register is facilitating a more strategic approach to property based solutions on a State-wide basis. Significant progress has been made and there are now over 26,000 properties registered on the State Property Register.

Streamlining Property Transactions

Collaborative approaches to the use of State property include the identification of opportunities for different State organisations to share office accommodation and to transact with each other as their accommodation needs change. During 2015, this collaborative approach was illustrated by the completion of the Intreo programme for the Department of Social Protection, when public bodies shared property to ensure the optimum result for this important reform initiative.

Protocols on intra-State property asset transfer and sharing have been finalised. These protocols simplify the processes for organisations and include the principle of single, independent valuations on intra-State transfers and more streamlined administrative and legal processes. There has been increased activity in the area of intra-State transfers using the protocols. Co-ordinated policies for property disposal and acquisition are also currently being finalised by the Steering Group. All of these measures will significantly help reduce property transaction costs.

ISEN 15221 Standard for Facilities Management

A common language, the ISEN 15221 Standard for Facilities Management, has been introduced to a number of properties in the OPW portfolio. This is a European standard that provides a framework for measuring and analysing the space usage in buildings. The standard will support the collection of the data needed to produce management information and key performance indicators for office accommodation. The data will be used to compare and benchmark the performance of similar property types in the State portfolio with a view to identifying opportunities for space efficiencies and will also feed into the Office of Government Procurement Facilities Management Frameworks.

Communication Strategy

The Property Managers’ Network was established during 2014 and provides a forum for property managers across the Civil and Public Service to share experience and expertise, as well as opportunities for shared approaches to property solutions. The network membership has been established on a regional basis. A number of information workshops were held during 2014 and 2015 and there are further events planned for 2016.

Property Registration

As part of the property reform programme, the Steering Group has emphasised the importance of ensuring that all properties owned by the State are registered accordingly with the Property Registration Authority. To this effect, the OPW, amongst others, has commenced an active programme of registering properties.

Building Expertise and Capacity

To ensure that State property is managed efficiently, it is recognised that staff must be suitably skilled. An intra State training and development programme is currently being developed to enhance the competencies, skills and expertise of personnel working in the public property asset management area. In 2015, the OPW hosted a two-day pilot course on property-related Option Appraisal and a further course is planned to take place in May 2016. In 2015, a pilot training course on property-related VAT was held for OPW staff.

Better Management of the Civil Service Estate

Through rationalisation of the Civil Service Estate, around €41 million in annual rental savings has been achieved from 2008 to 2015. The OPW has practically completed the Office Accommodation Design Standards for Civil Service accommodation, which is in line with a move to provide more flexible work spaces to meet changing demands.

The OPW is continuing to rationalise its owned portfolio through its property disposal programme. In 2014, 74 state properties were disposed of or reassigned for alternative State or Community use. The proceeds received in 2014 from the sale of 20 of these state properties was €3.66 million. A further 29 state properties were disposed of during 2015 and the proceeds received from these sales was almost €3.6 million. It is expected that a further 40 state properties will be brought to market in 2016.

Other property holders that have realised savings through property rationalisation include the Department of Defence, which sold 22 of its properties at a total value of €3.5 million in 2014. In 2015, the disposal of surplus military properties continued and approximately a further 10 military properties were sold to a value of €1.9 million.

Making more efficient use of existing office space has generated significant savings in the OPW’s annual rent bill since 2009. The value of savings delivered under the lease rationalisation and re-negotiation programme from 2009 to 2015 was €150 million approximately and it has yielded a surrender of over 1.4 million square feet of office accommodation, giving substantial ongoing annual savings.

Energy Efficiency

The “Optimising Power @ Work - Public Sector Campaign” is progressing well, with over 30 public bodies now participating in the campaign (5 large hospitals, 2 Universities, 3 Institutes of Technology, 13 Local Authorities, 2 Prisons and various HSE Estates buildings). The total energy spend in the buildings currently participating in the programme is approximately €28 million per annum. The OPW is now working with the HSE National Sustainability Office to coordinate the roll out of the campaign into additional large acute care hospitals, with annual energy savings targets of 8% in Year 1, rising to 18% in Year 3.

In relation to its own property portfolio, the OPW is currently achieving savings of approximately 22% through its Optimising Power @ Work campaign. The total annual energy spend for these buildings is currently in the order of €22 million per annum (net of savings). The current annual savings are €5.14 million per annum.

Key Objective from Public Service Reform Plan 2014-16:

To enhance the resource allocation decision making process by improving ongoing scrutiny and evaluation of public expenditure.

Public Expenditure Reform and IGEES

As part of the Public Service Reform programme, there has been a focus on performance and accountability improvements to allow the Public Service to be more effective in managing expenditure and in showing that well-informed decisions are guiding how public money is being spent. There has also been a focus on building the institutional capacity for the implementation of budgetary and expenditure management reform.

The Irish Government Economic and Evaluation Service, or IGEES, was established in 2012. IGEES is an integrated cross-Government service aimed at supporting better policy making and better policy evaluation. IGEES has a particular focus on the role of economics and value for money in policy analysis and its members have greatly enhanced the analytical capacity of the Civil Service.

During 2015, IGEES staff contributed to the formulation of the Budget and Review of Capital Expenditure, supported the National Economic Dialogue and produced a range of analytical and policy papers, some of which are available on the IGEES website. In 2016, IGEES will agree and publish a work programme which will provide more detailed information on the planned work outputs of the new service for the year ahead.

Value for Money Review Programme for 2015-2017

Value for Money and Policy Reviews (VFMPR) are an important aspect of Irish public sector policy evaluation. Value for Money Reviews are long established and aim to ensure that the maximum impact of public spending is achieved. In recent years, value for money reviews have been supplemented by more focused evaluations called Focused Policy Assessments. These are typically carried out in a much shorter timeframe.

A new round of VFMPR is now underway covering the period 2015-2017. This is aligned with the multi-annual budgetary cycle and the Comprehensive Review of Expenditure process. The current round of reviews covers over 40 areas of expenditure across all sectors. The full list of VFMPRs with an update on progress on each will be published on the IGEES website in the coming months.

Public Spending Code

Since 2013, a new Public Spending Code has been in place. The Public Spending Code sets out the rules and standards for appraising and evaluating expenditure in all public bodies before, during and after spending. Support for public bodies in implementing Public Spending Code requirements continues to be provided centrally by the Central Expenditure Evaluation Unit in the Department of Public Expenditure and Reform, as well as by IGEES units in the relevant Departments.

Twenty-four training and awareness sessions were delivered by the Central Expenditure Evaluation Unit in 2015. Additional guidance material is being developed to assist Departments in undertaking appraisal and evaluation.

Performance Budgeting

Performance budgeting is now well established within the budgetary framework, with performance information now included for almost every Vote in the Revised Estimates Volume. This is supporting the Houses of the Oireachtas in implementing the whole of year budgeting process.

IrelandStat is a citizen-focused public service performance information website which has been extended to all Departments during 2015. IrelandStat now contains data for 51 programmes across 14 Vote groups and the data collection process continues.

Fiscal Transparency

Ireland continues to progress a range of actions to improve fiscal transparency following on from the IMF’s 2013 Fiscal Transparency Assessment for Ireland.

The Department of Finance and the Department of Public Expenditure and Reform jointly hosted a National Economic Dialogue in July 2015, as part of the new budgetary framework. It was arranged to promote a genuine, two way dialogue on the available options in the lead up to Budget 2016. The event had an independent chair and representatives of community, voluntary and environmental groups as well as the Opposition, business, unions, rural groups, research institutes, the academic community and the diaspora attended.

In 2015, the Department of Public Expenditure and Reform continued the examination of the move to accrual accounting for Government Departments and Offices. This is being considered in the context of the Financial Management Shared Service project and in line with developments at EU level around the future implementation of harmonised accounting standards.