Michael McGrath (Cork South Central, Fianna Fail) | Oireachtas source

I am pleased to be in front of the committee today to present the 2022 Estimates for my Department’s group of Votes. I am joined by the Minister of State with responsibility for public procurement and eGovernment, Deputy Ossian Smyth. The group comprises a significant number of Votes including: Vote 11 - Public Expenditure and Reform; Vote 12, Superannuation and Retired Allowances, which covers Civil Service pensions; the Votes for a number of offices under the aegis of my Department, including the Vote 14 - State Laboratory, Vote 17 - Public Appointments Service, Vote 18 - National Shared Services Office, and Vote 19 - the Office of the Ombudsman; Vote 15 - the Secret Service; Vote 39 - the Office of Government Procurement; and Vote 43 - Office of the Government Chief Information Officer The Minister of State is happy to address questions relating to the Office of Government Procurement and the Office of the Government Chief Information Officer, and I will respond to members' questions regarding the other Votes.

I understand that a detailed briefing has been supplied to the committee by my officials, who were assisted in this task by their colleagues in a number of bodies under the aegis of the Department. Further material is also contained in the Revised Estimates for Public Services 2022, which was prepared by my Department. I also wish to take the opportunity to acknowledge last week's letter from the Chairman in respect of the joint committee’s recent Report on the Processes and Procedures Applying to the Appointment of Senior Executives in the Public Service. I will of course answer any questions members of the committee may wish to put to me on that issue.

Covid-19 has presented unprecedented challenges for us all. I welcome the recent unwinding of Covid-19 measures and the opportunity to return to what is euphemistically referred to as normal life. I would add that while this has been a long and difficult journey, I hope that we can now focus our entire efforts on improving the quality of life and living for our people.

In an overall context, the 2022 total gross allocation for the public expenditure and reform group of Votes, which comprises nine distinct Votes, has increased by 5% on the 2021 allocation. The gross figure for 2022 is in excess of €940 million compared to €895 million in 2021. This is largely driven by a significant increase in the estimate provision for Vote 18 and Vote 43, additional EU funding, targeted and minor increases for the delivery of essential services and additional recruitment, and the meeting of additional salary costs. At this point, I will briefly outline the individual Votes in a little more detail.

Vote 11 relates to my Department, which continues to have a wide range of objectives across two strategic programmes, public expenditure and sectoral policy and public service management and reform, which support the two strategic goals of the Department. These are: to manage public expenditure at sustainable levels in a planned, balanced and evidence-informed manner in support of Ireland’s economic, social and climate goals; and to drive reform and innovation across the civil and public service to improve service delivery to the public and to enhance strategic policymaking and public governance structures.

The principal element of the 10% and €4.6 million increased 2022 provision is in respect of technical assistance across the subheads that manage EU funding. Most of the €3.3 million increase in the EU subheads will be refunded directly to the Exchequer by the European Union into appropriations-in-aid. The most significant changes to the subhead budgets are: the special EU programmes body funding has more than doubled to €4.9 million following an increase in EU funding for the new programme cycle; €1.7 million for technical assistance and the provision of additional auditors to ensure sufficient auditing resources to match the increase in EU programme funding; and €1.4 million to cover the cost of a small number of extra posts, pay increases and an expectation of a reduction of vacancies at the Department.

Turning to the other Votes in the group, the provision for Vote 12, superannuation and retired allowances, accounts for three quarters of the public expenditure and reform group of Votes allocation and an overall 1% increase over the 2021 provision. The estimate I am proposing today for Vote 12 involves a gross provision of €707.6 million and primarily provides for pension and retirement lump sums for civil servants, including prison officers, and pension payments for dependents. I note that this Vote required supplementary funding in 2021 of €34 million, which was offset from appropriations-in-aid and gave rise to a technical supplementary estimate of €1,000. This was sought as a result of a higher number of retirements than expected and was approved by the Dáil last year. Year-to-year variation in expenditure on this Vote is primarily driven by the number of individuals who will opt to retire before reaching their compulsory retirement age and whose years of service, and grade and pay level, are variable and uncertain. The increase in gross expenditure is mitigated by an increase in contributions from the single public service pension scheme.

Other bodies under the aegis of the Department, such as the Public Appointments Service, the National Shared Services Office and the State Laboratory, provide important services to large numbers of clients across the civil and public service. The State Laboratory, Vote 14, is the Government’s principal analytical chemistry laboratory and provides a comprehensive analytical and advisory service to Departments and Government offices. A 3% increase to the State Laboratory’s 2021 Estimate allows the laboratory to continue delivery on their mandate, meet increased pay and recruit additional staff.

The proposed funding provision for the Public Appointments Service - Vote 17 - is reduced by 4% in 2022. This reflects the 57% reduction in capital cost requirements in 2022 given the anticipated mid-year conclusion of the refurbishment of the service's Chapter House office, and a 50% increase in payroll costs with an associated increase on current staffing levels.

Vote 18, the National Shared Services Office, NSSO, is the shared services provider for the Civil Service. The office has played an important role in the reform of public services in recent years, through the delivery of human resources, HR, shared services and payroll shared services to clients across the Civil Service and public service. The National Shared Services Office continues to be in growth and investment mode and will commence its delivery of new services for the whole of government this year. This significant growth is reflected in the additional provision of €11.9 million and a total provision of €73.45 million in 2022, a 19% annual increase in funding. The proposed increased provision in the NSSO's 2022 allocation will facilitate the continued delivery of HR and payroll shared services and enable the office to progress the roll-out of financial management shared services, which is scheduled to go online in the coming months.

The Estimate provision for the Office of the Ombudsman - Vote 19 - and the proposed modest 1% increase will enable its various constituent offices to manage their respective operations; fund the additional costs arising from the pay restoration and increased salary costs; facilitate a continued investment in ICT modernisation; and fund the establishment of the proposed new protected disclosures office. I also welcome the appointment of Mr. Ger Deering to the position of Ombudsman and Information Commissioner and I have no doubt he will build upon the excellent contribution of the previous incumbent, Mr. Peter Tyndall. I wish them both every future success.

The State procures goods and services valued in the region of €8.5 billion annually. The Office of Government Procurement, OGP - Vote 39 - leads our procurement reform programme by providing advice, guidance and systems to promote better public procurement and build capacity and capability across the public service. The proposed 2022 allocation of €19.8 million provides for the cost of staffing as well as the costs associated with recruitment of senior positions, as recommended in the organisation review. The 2022 provision will inter aliasupport the OGP in delivering value for money, quality goods and services in compliance with national and European law; develop procurement arrangements for the delivery of improved procurement capability in the public service, which will yield financial, performance and risk management benefits to the State; and further develop the overarching policy framework for public procurement in Ireland, including the promotion of social and green environmental considerations.

The State cannot fall behind the productivity gains that 21st century technology is bringing to industry. The Civil Service renewal strategy, Digital First, challenges the Civil Service to deliver 90% of applicable services that are consumed online via accessible, integrated and customer-driven solutions. The Office of the Government Chief Information Officer, OGCIO - Vote 43 - drives the digital transformation agenda across government while providing and developing pan-public service ICT infrastructure, service delivery models and cross-government applications. The widespread adoption of the full range of build to share services, delivered by a single organisation, will address, in large part, the relatively slow pace of digital transformation in government by freeing up Departments and bodies to focus on transformation initiatives rather than simply keeping the lights on. The OGCIO benefits this year from a very significant 90% increase in its €43.3 million Vote. This funding is bolstered by a €23 million EU allocation over two years in respect of the recovery and resilience programme, with some €18.5 million invested in 2022. It will deliver a network that enables all of our State bodies to reap the benefit of 5G technology.

I draw the Deputies' attention to some changes in the presentation of administrative subheads in 2022, which arise on foot of the new financial management service system being introduced in some Votes. This change will bring consistency of approach and allow for better comparisons between Votes. An implication of this is that in 2022 there is some discontinuity between 2021 and 2022 figures. I am happy to provide further briefing on any points of detail Deputies may wish to raise in this regard.

I am very pleased to present the 2022 Estimates for the Public Expenditure and Reform group, approval of which will allow the individual Votes to continue to operate and meet their responsibilities to deliver essential services. The Minister of State, Deputy Ossian Smyth, and I are both happy to respond to any questions that members may put.