Brendan Howlin (Wexford, Labour)

I genuinely thank colleagues from all sides of the House for what was by and large an informed and thoughtful range of discussions on what is largely a technical piece of legislation. It is not intended to be a blueprint for reform. It is simply an enabling structural Bill that will allow the new Department of public expenditure and reform be created and to give it a legal presence.

It is part of a broad-ranging reform agenda that we had a chance to debate in Private Members' time earlier this week that will involve a substantial change in the public service, the Civil Service, politics, the Constitution and in governance in this country. I am determined that the expenditure element of my Department which, unfortunately, is a downward pressure on expenditure that I am required to deliver upon, will be done in tandem with the reform agenda which, and I agree with my colleague, Deputy Maloney on this, must be from the top down. We must have a new mindset on it. It is not the old way of making the reforms that were done in the past.

I was in the Chamber for the latter part of Deputy Calleary's contribution and all of that of Deputy Donnelly. If I may say so, they are two of the people on the Opposition benches most able to make a constructive contribution. I acknowledge Deputy Calleary's significant role in breaking ground for the Department that I am now proposing to create. He left a fine legacy behind in that regard in trying to begin the process of fundamental reform.

In reply to Deputy Donnelly, I have said on every occasion I have spoken in this House that I have an open door to ideas and I am looking forward to inviting Deputy Donnelly to meet groups like the Croke Park implementation committee for an external experienced intervention on that. It is not business as usual on any scale in terms of issues I propose to do.

The main purpose of this Bill is to establish structurally the Department of public expenditure and reform and establish me in a legal entity as Minister. There will be a Minister of State in my Department, Deputy Brian Hayes, who is already undertaking a great deal of work in that regard.

I wish to comment on some of the observations made by my colleagues during the course of the debate to date. I apologise that I was not present for all of it but I have ensured that careful notes were taken of all contributions. We will be having careful regard to everything that was said, particularly between now and Committee Stage where, if possible, any useful contribution can be addressed.

In his opening comments Deputy Fleming tried to characterise my contributions in a negative way. I will not be drawn into that because we should try to leave that behind us. The leader of the Fianna Fáil Party's idea about constructive Opposition has been largely held to by Members opposite and I will not allow myself to be drawn into a cul-de-sac of mischaracterisation that represented some of Deputy Fleming's comments yesterday.

On his view on the control of appropriations-in-aid, Deputy Fleming is not correct in his assessment. The Minister for public expenditure and reform will have all the existing powers of the Minister for Finance in regard to appropriations-in-aid. That is implicit in the Bill.

Deputy McGrath referred to the functions listed in Schedule 2 of the Bill. This Schedule refers primarily to the authority to borrow. In the current climate, it is appropriate that the decisions on borrowing by State bodies should be subject to the consent of the Minister for public expenditure and reform, as the Minister with responsibility on a sectoral basis for each line Department, and the Minister for Finance who has responsibility for overall Government finances.

This is a new way of doing business. I have just come from a Cabinet sub-committee on infrastructure and there is a new cohesion to try to pull the strands together. The synergies between the Minister for Finance, Deputy Noonan, and myself in terms of our new roles have been creative and good and they have stress-tested significant ideas in a much better way. That is how we intend to advance.

Deputy Boyd Barrett expressed a very different view of the role of the public service and the size and scale of the public service this country can afford. I appreciate Deputy Boyd Barrett's aims, which I understand are to achieve excellence in public services, but we do not have the luxury at present to commit the type and scale of resources Deputy Boyd Barrett's policies would require.

I noticed in this morning's newspapers that Deputy Shane Ross managed to spin a headline - fair play to him - by characterising my actions to date in three months as pussy-footing, whatever that means. I will get a chance later this month to present the first tranche of findings from the Croke Park agreement, and I believe they are significant. We must acknowledge the engagement with the process across all sectors of the public service.

I am minded to refer to Deputy Donnelly's comment that the disentanglement of pay is an issue. For most people pay is a significant issue, and I take what the Deputy said seriously, but people who now feel economically pressured must have some sense of security in their own planning, even if it is for the basic economic reason that we want people to spend now. That level of assurance is predicated on radical reform. What we have got to date is significant, but we have to go further. People know that and I am engaging at every level, and not just with the unions. In fairness, every line Minister is doing the same. The Minister for Education and Science engaged with the teacher conferences and this was a start in the process. People understand how bad things are. They want certainty, as far as we can give it, on the path forward and on their own income. Even if it is a bad prognosis, people will buy into it if it is a clear prognosis. They want fairness so that everybody is sharing and there are no excluded sectors who are onlookers. We are in the business of regenerating not only the economy, but our society. There can be no onlookers in that. Everybody has to be fully engaged in the process and it is my job to do that.

A number of Deputies, including Deputy Healy, expressed concern that the reform process was nothing more than an attack on the public service and a cover for indiscriminate cuts. That is representative of an old mindset that everything is as is. I think people are getting the message that we are in a dire situation. We do not have the resources to do all the good that we know can be done. We have to try to do that good in a different way. The majority of people understand that, are engaging with that and are bringing about change and reform, even in the workplace. I will provide mechanisms for that to be heard and acted upon. However, there are people who listen but at the end of the day still demand more resources. I heard a medical consultant on a news programme last night coming to the conclusion that what we need is more doctors, more nurses, more equipment. We cannot have that. People will have to think differently about how to achieve objectives without the demand being that we can only achieve more with more. We must get a mind frame that achieves more with less. We must be more productive and do all the things that I, my Department and the Minister of State assigned to my Department have to achieve in respect of supports, IT, human resource management, procurement and so on.

We are in an unprecedented crisis. Even without the added burden of the banking crisis, which added to the fiscal problems of this nation, we would have to make radical changes. In good times, the sort of changes that we have laid out would be required, but in light of the financial situation in which we find ourselves, they are not only required, but are an absolute imperative. Savings will have to be secured in all areas of public activity and resources will have to be redirected to priorities that we now set. I hope this happens in an open, democratic and realistic way. I invite everybody to be part of that discussion.

The programme for Government has set priorities for public expenditure and we are reshaping our spending focus to mirror that. There must be an element of realism about it. We will not be able to continue to do all that we are doing at the moment, and we will not be able to do all that we would like to do within the resource envelope that is available to this country in the foreseeable future. These are real challenges. People know that we have established the comprehensive review of expenditure. I am driving that in a new way across Departments and line Ministers have received early winds on it. By September, we want both the current and capital review to be completed so that they will inform not only next year's budget but also the presentation of a new capital plan from 2012 to 2016.

The key question to be asked of all public bodies is whether they are now performing tasks that are essential to the economic and social recovery that we require. We need to ask ourselves that. When I was involved in my own party's programme of reform during the run up to the election, I was very conscious that we needed to put the political system under the same microscope as everything else. For example, I approached the issue of the survival or not of the Seanad with an open mind. I probably had a predisposition to saying that we could make a case for its reform. However, if we use the yardstick that we need to apply to everything, then we should ask if Seanad Éireann is doing a job that is absolutely essential and that no other organisation can do. I came to the conclusion that we could do without it. We will have to apply that yardstick everywhere. When I met the chief executives of the semi-State bodies, I told them they were all doing a fine job and working very hard, but that we cannot afford them all anymore. I told them they would have to examine their own functions at the outset, rather than undergo an external review. I told them to examine whether they could merge, hive back their core function to their parent Department and so on. That level of fundamental questioning of all activities of government, public service and public policy must get under way.

Reform is essential to this endeavour. Members have spoken about the Croke Park agreement that commits the social partners to work together to find new and efficient ways of delivering public services. It is not an end in itself. There will have to be a review of it to achieve the ambitious targets we have set out. I am struck by Deputy Donnelly's comments about negotiation and engagement. This will not be a coercion-based reform. If we are to have fundamental reform, it must be by negotiation and engagement, and not necessarily by agreement. We will not always get agreement and the Government must make decisions at the end of the day, but certainly it should do so following negotiations and engagement, so that people have a chance to have their views aired. If there are different ways of doing things, they should be tested.

Deputy Donnelly also mentioned doing things fundamentally differently in respect of education. That is why the issue of literacy is at the core of education policy in the programme for Government. The resources devoted to education in the last three decades have increased enormously, but the literacy rate has not. We have to look at outcomes and test why these things are happening. The question is not simply about whether we need smaller classes, more resources, more teachers, more special assistants and so on. We need to figure out what we are doing with all these resources and what is the outcome and value from them when preparing the next generation. That model has to be applied to health and other sectors as well.

I disagree with the contention that the establishment and make up of the new Department, and its relationship with the Department of Finance, will increase duplication and will serve no meaningful purpose. That is a knee jerk reaction for people who are resistant to change. Both political parties in the Government did much research separately in advance of the election. We in the Labour Party had an expert group working with us on how to bring about reforms. The diagnosis of both parties separately was that reform could not be pushed unless a Cabinet ranked Minister was put in place with control of expenditure. That was not going to happen in an economic crisis with a Minister for Finance whose first priority had to be to deal with the macro-economic situation of the country. The diagnosis for solving this problem was reached by both the Fine Gael Party and the Labour Party separately. That is why the programme for Government contains proposals for fundamental change to the Department of Finance, which is now evident in this Bill.

I ask people to engage with this new, radical change, which is a signal that we are open to change in and of itself. The knee-jerk reaction of some contributors, who said the new system involved duplication because it is different from how we have done things since 1928, misses the point. I would like people to give the new structure, and the Department I head up, fair wind. This Department will have an enormous responsibility to ensure success in bringing about economic changes and reform of our political system, our public service and our Constitution.

I look forward to lots of debates with my colleagues opposite in the committee. I believe it was Deputy Calleary who suggested an established sub-committee of the joint finance committee, which is a good idea and one I welcome. However, that is a matter for the committee itself to decide. There must be a high level of engagement. When the committee is established, whether it is a sub-committee or a full committee, I will endeavour to ensure it is fully briefed and engaged in all the processes that will fall under my remit when this legislation is finally enacted.

I thank all Deputies for their involvement in this debate, and I look forward to its speedy enactment so that my quasi-legitimate status can be resolved.

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