Michael McGrath (Cork South Central, Fianna Fail)

I thank Deputy Fleming for agreeing to share time. I am pleased to have the opportunity of making a contribution to the debate. At the heart of this Bill is the politics of forming a coalition. It is clear the Labour Party and the Fine Gael Party reached a pragmatic compromise when it came to allocating Cabinet portfolios.

I would like to start on a positive note. I welcome aspects of this Bill. Setting up a Department to deal exclusively with the public service and which is charged with responsibility of driving through public sector reform is a positive development. Having one Minister and one Department in charge of that area will bring greater cohesion and co-ordination to the efforts to secure public sector reform.

In his opening remarks, the Minister for public expenditure and reform painted a sobering picture on the future of the public sector over the next few years. He highlighted that the cost of delivering public services must be reduced further, with fewer staff and tighter budgets, and that it must become better integrated and more customer focused, as well as being leaner and more efficient. That is a reality that we all acknowledge in this House. There will be difficult days ahead for the public service as we seek to get a better return for the investment that the State is making in our public services. As public representatives, we all have extensive experience of dealing with a wide range of public bodies and the different arms of the public service. I acknowledge that there is room for improvement. There are thousands of outstanding public servants working in this country who provide an excellent service to the general public, and to us as public representatives, but there are aspects of the system that are not working well enough. For example, it is not acceptable for us to write to public bodies and not even get an acknowledgment. Even if one receives an acknowledgment, there often can be no further response.

The issue is about using more efficiently the resources being put into the public service, working with the social partners, and bringing about improvements that will result in better public services. That is an enormous challenge and in the EU-IMF deal, there is a strict deadline for the achievement of the savings set out under the Croke Park deal. Those savings have to be achieved by the end of September and if that does not happen, the agreement is clear that compensatory adjustments will have to be made in the public sector pay bill. The truth is that it is in the interests of public sector unions, the Government and everybody involved in the process to ensure the Croke Park deal delivers on the improvements we are seeking.

Deputy Fleming highlighted the number of public servants who are going to lose their jobs, be it voluntarily or otherwise, over the next few years. This number is between 22,000 and 25,000, in addition to those who have already ended their employment in the public sector. That is a very significant number. We negotiated a complex agreement last year with the Croke Park deal. I welcome the late conversion of the Labour Party to that deal and its leadership is now highlighting it as the mechanism for achieving what needs to be achieved in the public service.

The key issue for me is about efficiency, value for money and accountability. I had the privilege during the last Dáil term of serving on the Committee of Public Accounts, and we saw examples every week of public money not being spent wisely or appropriately. One of the most frustrating aspects of that was that there were no consequences for anyone. People were coming in and giving statements that were not satisfactory. We were not happy with the answers, but there was no outcome to it. We issued our report and that is where the matter ended. In the Minister's new brief of public sector reform, the issue of accountability, not just at political level but also at senior management level across the public service, must be to the fore. At a time when resources are tighter than they have been previously, we need to ensure that every cent spent is spent wisely and that proper procedures are being employed. There must be consequences for failure to adhere to the policies that are set down.

The Government missed an opportunity by not opening the position of Secretary General in this new Department - and, in future, in the Department of Finance - to persons from outside the civil and public service. People should at least have been given the opportunity to apply and be considered for those posts. Much has been made of the intention to open up the public sector to people with expertise from the private sector, yet the opportunity to be head of a Department that is charged with the responsibility of public sector reform is closed off completely to those who have expertise in transforming organisations and leading organisational change in the private sector. They are not even being given the opportunity to apply.

Apart from the transfer of control of the public service and public sector reform to this new Department, some other aspects of the Bill, dealing with the transfer of functions from the Minister for Finance to the Minister for public expenditure and reform, are bizarre. They are a recipe for confusion, an increase in officialdom and a deterioration in accountability to the House and, through that forum, to the public. It is clear from reading the Bill and the explanatory memorandum that it is game, set and match to the Department of Finance. Any devolution of power to the new Minister for public expenditure and reform is heavily qualified and in many cases is conditional on the explicit consent of the Minister for Finance, in this case Deputy Noonan.

It is certain that the Minister for public expenditure and reform will play a subservient role to the Minister for Finance. At a time when we are trying to simplify procedures in the public service and make it more transparent and accountable, we are putting in place a system that is the antithesis of that. It does not provide the clarity about roles that should be available at first glance. It is essential that the Minister publish a timeline and clear details of the budgetary process that will be implemented in 2011 and 2012 if this Bill is adopted.

I will give some examples of what I am referring to. Sections 7(2) and (3) state:

(2) The functions conferred on the Minister for Finance by or under any of the provisions specified in Part 1 of Schedule 2 are transferred to the Minister [for public expenditure and reform].

(3) The functions conferred on the Minister for Finance by or under any of the provisions specified in Part 2 of Schedule 2 are transferred to the Minister.

That all sounds fine. However, section 18 states:

(1) The Minister shall not perform a function transferred by subsection (2) of section 7 without the consent of the Minister for Finance.

(2) The Minister shall not perform a function transferred by subsection (3) of section 7 without first consulting the Minister for Finance in relation thereto.

When one looks at Schedule 2 one can see in Part 1 a list of 78 Acts with regard to which the new Minister can act only with the consent of the Minister for Finance, and in Part 2 a further three with regard to which he can only act having consulted with the Minister for Finance. How will that work in practice? Every time the Minister proposes to perform a function regarding one of these 81 Acts, will an official from his Department need to write to an official from Deputy Noonan's Department across the corridor seeking explicit consent for the Minister to execute it? It seems to be a recipe for inertia and confusion. A whole range of the apparent powers being given to the new Minister are subject to such consent or to consultation. While on the face of it he may appear to have immense powers, when one probes the detail one sees that there are so many caveats that his real power lies only in the area of managing and transforming the public service through the reform agenda - powers that he certainly does have.

The Oireachtas Library and Research Service highlighted some of the effects of this Bill. For example, one of the 78 Bills referred to in Schedule 2 is the Inland Fisheries Act 2010. Given what is proposed in this Bill, section 43 of that Act should now read: "IFI may, for the purposes of the performance of its functions, borrow money but shall not do so without the consent of the Minister given with the consent of the Minister for Finance". It is farcical that this is what the legislation will have to say. The body can only borrow money with the consent of the Minister, who has the consent of the Minister for Finance. Why can the Minister for Finance not give that consent directly, as he currently does? I do not know, but it strikes me as an odd way to structure the business of the public service in these two new Departments.

There is a need to clarify how the annual budgetary process will work under this legislation. Who will be responsible for what, and when will that happen? Reading the research notes attached to the Bill, it is very unclear. We need more details of what the proposed legislation means in practice.

The Minister's opening speech on Second Stage mostly dealt with reform of the public service and the general economic environment. The latter was a regurgitation of the explanatory memorandum published by the Bills Office. What we need to hear are clear, concrete examples of what this Bill means in practice, particularly who is going to do what and who will be responsible and accountable for what functions. For example, when the Exchequer returns for May are published in the next few days, will we have a statement from the Minister for public expenditure and reform on the expenditure side and a statement from the Minister for Finance on the revenue side? The Minister for Finance will remain responsible for the overall budgetary framework. Is he the only person who will be commenting on the Exchequer returns, or will both Ministers deal with different aspects?

The Bill makes clear that the Minister for public expenditure and reform will be responsible for gross voted expenditure but, as Deputy Fleming pointed out, the difference between gross and net is significant. We need clarification on whether Deputy Howlin will be accountable, for example, for appropriations-in-aid, because if he is not, we will have a situation in which expenditure on passport services will fall within his remit but the fees will not; gross expenditure on school transport will be his responsibility but the fees, again, will not; and the cost of Met Éireann will be a matter for the Minister but the fees it charges will not. These are some examples of the possible confusion arising from the adoption of this Bill.

I welcome the setting up of a Department to deal exclusively with public sector reform. That is necessary and can be supported. However, the transfer of functions between the Minister for Finance and the Minister for public expenditure and reform set out in this Act is so cumbersome and confusing that it will result in less accountability and less efficiency in administration of both Departments, leading to greater difficulties than would otherwise have been envisaged. I hope we will receive some more significant answers in the closing remarks of the Minister on Second Stage and when dealing with the meat of the sections on Committee Stage.

See this speech in context