Paschal Donohoe (Dublin Central, Fine Gael)

I welcome the Bill. I want to put it in the context of some of the issues that have been raised in the House during the week concerning the great difficulty being experienced by people who are caring for people who are vulnerable or ill. The real tragedy is not just that this terrible social difficulty arises now but that it also arose when the State was flush with money. During the so-called tiger economy years, in spite of expenditure across so many different areas we continued to see high levels of social need and evidence of money not being spent well on delivering on the target for which it was authorised. Everybody in this House will have experience of the various areas of expenditure to which I refer.

All of us on the ground noted how much of the money spent by the Department of Education and Science during the period in question was spent on paying for additional prefabs and rented accommodation. It was supposed to be spending it on something sustainable and delivering an asset the people would own. In the health sector, which presents the clearest example of what I am referring to, the money being invested when funding was abundant in the State increased by almost a factor of two. During that period, however, we still saw people on trolleys and waiting lists for those seeking operations lengthened. We received considerable feedback in our communities from people who were finding it very difficult to access services that would make a considerable difference to their health and well-being.

Social welfare expenditure increased greatly when money was available but so much of this money was being obtained fraudulently. People were receiving money who should not have been receiving it and they were receiving it in ways that were not proper for our country. At a time when we had so much money, we saw waste, and social need was not being alleviated. It should be no surprise to us all that we see an intensification of the need to which I refer at a time of real difficulty. However, this should not blind us to the fact that the need existed when so much money was available to the State. This is the rationale for the new Department.

I was struck by the comments of Deputies McGuinness and Coffey. Many of the points Deputy McGuinness made were included in his book The House Always Wins. Many of the reasons for the House always winning, Deputy McGuinness believes, comprise the justification for the putting in place of the Department. It is a case of having a soulless Minister and Department whose job is to tackle the forces that ensure systems do not use the money invested therein in the most efficient way and ensure it is managed to miss the target. The target is often the vulnerable, the people who experience terrible difficulty when the country is in crisis.

As we talk about the need that exists, we must bear in mind that between 1997 and 2004-05 taxpayer-funded expenditure in the State nearly doubled. The increase was unparalleled in Irish history and is nearly without parallel in many countries across Europe and the developed world. Despite the unparalleled increase, social need was not being addressed and there was unacceptable waste.

When the new Department gets up and running, there will be four areas in which it would do well to spend its time delivering a return for the taxpayer. The first is a soft area but it is very important to the success and leadership of the public service. I refer to training. The Wright report, which considers the capacity of the Department of Finance to carry out its role, contains very clear figures regarding the level of training for staff in that Department. It states:

However, 39 economists in the Department of Finance is extraordinarily low by international standards. Even excluding the public service cadre of 135 people, this represents less than 10 percent of the total staff complement in the core of Finance. In contrast, 60 percent of the Canadian Department of Finance are economists trained to Masters level or higher; and about 40% of staff in the core areas of the Dutch Finance Ministry are trained to Masters level or higher.

This is an extraordinary point of difference. I hope that as we put in place a Department that is focused on public service reform and expenditure, it will allow its staff to develop their skills, education and qualifications so they will be able to do their job exceptionally well. We must bear in mind that the challenge of obtaining good value for expenditure is as old as the first nation state. There is considerable learning available on what can be done and I hope the new Department will tap into it.

The second area on which I want to touch, which was referred to by Deputy Coffey, concerns the role of semi-State bodies and the salaries of some of their staff. The Minister, Deputy Howlin, commented on this area yesterday and they were reported on today. I want to touch also on the level of wages for very senior staff in the public service. It is evident but essential to note that there should be very few examples of public service staff earning more money than the people elected to lead the public service, namely the Taoiseach or Minister of a Department.

The lack of coherence on the aforementioned point was brought to light in two different areas in the past 12 months. The first concerns the application of the wage cuts and the pension levy. Staff at the top of the public service saw their wages decrease by a smaller percentage than those in the middle and lower ranks. The second concerns the application of the pension levy. Many organisations were exempt from having their staff pay the levy because of the nature of those organisations.

Let me consider the salaries of staff at the top of the semi-State organisations. The ten chief executives of the main semi-state organisations are paid €4.4 million between them. If we are to have a sense of national solidarity as we pull through the collapse – it is a sense that is fraying greatly already – we must tackle these inequalities. I hope the new Department will play a lead role in this regard.

The third area on which I will touch is the role of social partnership. I very much hope the Croke Park agreement can play a role in delivering costed savings to ensure the number of staff in the public service and their wages do not have to be examined further. Deputy McGuinness gave an example of when we will know when the Croke Park deal will be working: it will be when the answer to the question as to how much is being saved within a Department by a particular plan being either implemented, changed or cancelled can be given on the floor of this House through that Department.

My final point concerns the comprehensive spending review, a new initiative announced by the Government. This process, on which the Government wants to deliver, should be ongoing. It should involve an ongoing, strong, detailed review of how taxpayers' money is being spent because the length of the budgetary process that leads to the budget in December has proven to be too short. The report on the capacity of the Department of Finance states the Department did not provide enough time and space for a rigorous process.

This legislation and the new Department can make a very important contribution to our State navigating its way out of its difficulty and, if it does so, to a very important softer element of our society, our national solidarity. They will do that by ensuring big and tough decisions are made in a fair manner.

See this speech in context