More than 100,000 civil servants and health service staff have been cleared to receive benchmarking pay increases next month.
Independently-chaired groups set up to monitor their work found that staff in both sectors were delivering real improvements in services to the public.
Staff including junior doctors, nurses, health board personnel and civil servants will now receive benchmarking increases, in addition to a basic 3 per cent rise, on January 1st.
With local government and education staff also likely to qualify for benchmarking, the public sector pay bill next year is set to rise by 8 per cent, to €14.2 billion.
Fine Gael, which opposes payment of the benchmarking increases, repeated its claim last night that the public was not getting value for the money.
That view is challenged, however, by the reports of two performance verification groups.
They found that staff in the civil service and health service respectively were delivering greater flexibility and service improvements, in return for the pay rises.
The benchmarking body recommended increases averaging 8.9 per cent for public servants, but insisted that the awards be conditional on staff signing up to a programme of modernisation and change.
A quarter of the increase has already been paid, and a further 50 per cent is due next month.
In his report to the Department of Finance, the chairman of the civil service performance verification group, Dr Donal de Buitléir, said he was concerned about the pace of change in some areas.
But he said his group was impressed with the extent of activity aimed at improving the levels of customer service.
There had also been "full co-operation" with the maintenance of stable industrial relations, as well as flexibility and ongoing change, he said.
Unions welcomed the report as evidence that civil servants were delivering the work practice changes required in return for the benchmarking payments.
"If we weren't, we wouldn't be getting the money.
"That's the bottom line," said Mr Tom Geraghty, assistant general secretary of the Public Service Executive Union.
Fine Gael's finance spokesman, Mr Richard Bruton, however, said the group's reports highlighted actions that boosted productivity, while remaining silent on areas of failure.
Three of the four performance verification groups set up to monitor the pace of public service change have now reported.
Benchmarking increases for almost all staff in the education sector have already been approved by the group for that sector.
However, the Department of Education general secretary, Mr John Dennehy, who has the final say, has not signed off on the payments because of a row over parent-teacher meetings.
The fourth group's report, on the local government sector, is expected within the next few days.
Public service staff, who accepted a six-month pay freeze earlier this year, are due to receive a basic increase of 7 per cent, in three phases, in 2004, in addition to the benchmarking rise.
The increases in total will add €1.1 billion to the public sector pay bill.