'Bord Snip' report calls for €5.3 billion in cuts

The 'An Bord Snip Nua' report has called for swingeing measures to eliminate as many as 17,358 public sector jobs as part of its plan to cut public expenditure by an annual total of €5.3 billion.

The group, chaired by UCD economist Dr Colm McCarthy, calls for a general reduction of up to 5 per cent in social welfare rates to achieve savings of €850 million.

Given the continuing fall in prices, the report says the general cut in social welfare allowances would bring the value of payments back to the level seen in the summer 2008.

It says €513 million could be saved by reducing and standardising the child benefit rate, cutting the €2.5 billion cost of the programme by 20 per cent.

The group calls for a new benchmarking examination of public sector pay and says the process should include the possibility of pay cuts and allow from an comparison of pay rates in the Irish public sector with equivalent posts internationally.

In addition the group said the Government should consider "how best to secure an appropriate contribution" from public service pensioners.

"The group observes that the burden of budgetary adjustment both in terms of measures introduced over the past year and of the measures proposed in this report will be borne broadly across most areas of society with the exception of those people currently in receipt of public service pensions."

The health and education sectors will bear the overwhelming burden of the cuts, with 6,930 jobs to go in the education system and another 6,168 jobs will go from the health service. There would be 1,140 staff reductions from the agricultural sector, 594 in environment and 540 in the justice area.

Dr McCarthy said the reduction in jobs could be achieved without compulsory redundancies, stating that a recruitment embargo, retirements and an existing voluntary redundancy scheme could be used to achieve savings.

However, he said the trade union movement would have to agree to changes which would facilitate the redeployment of staff between Government Departments and other parts of the public service.

In his report, Dr McCarthy says a range of outdated and restrictive working practices and allowances add greatly to the cost of providing public services.

The report says the closure of the Department of Community, Rural and Gaeltacht Affairs and the redistribution of its functions reflects the need to prioritise scarce Exchequer resources. It also calls for a critical examination of the need for a Department of Arts, Sports and Tourism.

Minister for Finance Brian Lenihan called for “considered and honest” debate of the options set out in the report.

“I recognise, and the Government recognises, that the choices facing us are not simple or pain-free,” Mr Lenihan said.

“Following them through requires a collective social effort and not one motivate by protecting one’s patch or pursuing one’s special interest to the exclusion of all else.

“That is why I would ask people to read the report carefully and critically, and avoid knee-jerk and defensive reactions to each and every suggestion raised by the special group.

“All of us, including those of us in public administration, will have to accept that the old ways of doing things need to be looked at afresh, so that we can deliver excellent public service with the dramatically lower level of resources now available.”