Brendan Howlin (Wexford, Labour)
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I would be very happy to do that as well. I am preparing legislation on the capacity of inquiries generally. There are issues of objectivity with any inquiry. It is important that people are not compromised by any utterances they make in advance regardless of the issue. I believe members of this committee are very mindful of that.

A variety of issues were raised and I will be as comprehensive as I can. Deputy Donohoe asked some insightful questions.

The Croke Park agreement, as I said, is the most useful device for bringing about change, but, like any device, it is only as useful as its utilisation. We have a very complex, multi-layered and disparate public service. During my time at the Department of Health I saw that services were built in a topsy-turvy fashion, whereby voluntary services were subsumed into the main health sphere, for example, which makes reform very difficult. The most difficult challenge for us is to engage management at ground level to utilise the capacity of the Croke Park agreement to change skill mixes, rosters, working arrangements and so forth. We have been desperately pushing that agenda. There is full engagement at the top level, but it has not filtered down to every level. As I have said previously, there are some who will use the agreement as a shield in claiming they cannot do what they patently can do. We need to break through this. Deputy Derek Nolan made a point on a particular hospital where a new manager is like a new broom and has brought about significant change. We need to drive this change everywhere, but it is a daunting and difficult task.

I wish to be very direct with the committee on the task facing us. Public pay accounts for a large proportion of all that we spend, but, in relative terms, we do not have a huge public service. There are 1.8 million people working, approximately 1.5 million of whom are in the private sphere. There are now less than 300,000 in the public sphere, within which there are large groups such as gardaí, teachers and nurses. We need to motivate them because we have already taken significant money from them through a direct pay cut of 7%, on average, and up to 30% at the top levels. We have also imposed a pension levy of 7% on them. We are driving them to deliver services differently and most of them are working much harder.

On the question of allowances, as I have explained previously, this is very complex, although I know some might want to portray it as being simple. If one looks at the structure of public service pay, one sees that some allowances have been subsumed into core pay, although they are still called allowances. We must disaggregate them in order that we can determine what is considered pay and an allowance. If there is an allowance payable, we must determine what is the direct function. An allowance meets an additional cost to the individual, for example, where he or she pays the cost of travel for work purposes, or there is a premium payment for working out-of-hours or for being on-call during the night or at weekends, or where there is a definable, additional workload. That is the criterion used to evaluate the business cases submitted. In the appendix we have produced it is stated there are 180 classes of allowance for which we have determined, politically and objectively, there is not a sustainable business case. However, we could not take the bulk of them away instantly because we would be taking away a core pay element. The bulk of the money is paid in three areas - education, the Army and the Garda Síochána. If, for example, we were to take the rent allowance of €4,000 from the pocket of every garda, it would account for a large proportion of the money he or she earns. That is how his or her core pay was built. We want to make sure that is not the way he or she will be paid into the future and that we will have a different way of paying him or her.

We have identified 88 allowances that do not form such a huge part of core pay. The rule of thumb is that allowances up to the value of approximately €1,500 annually are not deemed to form a significant part of core pay and can be bought out under the Croke Park agreement. Deputies will know that there is a facility under the agreement whereby, for a payment of 150% of the annual cost of an allowance, we can buy it out. However, this must be done through agreement. As I said in September, one of the complexities is that if I decide, arbitrarily, to abolish the 180 classes of allowances that I have identified, every one of the workers affected, by right, will be able to go to the Labour Court for independent arbitration. To be blunt, that would mean the Labour Court would do nothing else for the next year and that the reform division in my Department would do very little else except prepare these cases, all in respect of a sum of €75 million. That would not be the right thing to do. I made my determination in that context and took a political hit for it. However, we want to phase out these allowances and I want to use the mechanisms of the Croke Park agreement to do it, while also reforming the way pay scales are structured, particularly in the education sector and the Garda Síochána. I have spoken in detail to the Minister for Education and Skills and the Minister for Justice and Equality about these matters.

On the issue of voluntary redundancies, the first exit package-----