Brendan Howlin (Wexford, Labour)

Most other Departments will also experience reductions and the details are set out in the expenditure report. Selected measures include those taken in the Department of Agriculture, Food and the Marine amounting to savings of €105 million; the Department of Transport, Tourism and Sport amounting to €45 million; and the Department of the Environment, Community and Local Government amounting to €34 million. Of course, other Departments, as Deputies will see in their Estimates booklets, are making a contribution to lower spending.

Overall Spending Ceiling

These measures are significant. Taking account of offsetting spending pressures, the Government's decisions will reduce public spending to €55.8 billion in 2012 compared with €57.7 billion in 2011. As part of a new approach to budgeting, I am setting out the overall expenditure envelope for each year to 2014, with spending ceilings of just under €54 billion for 2013 and just under €52 billion for 2014. Full details of the allocations for each Department are set out in Part 2 of the expenditure report.

Correcting our public finances inevitably involves very difficult decisions for the Government but this year's comprehensive review of expenditure has not just been about identifying cutbacks. There is a much more fundamental problem that we are now tackling. Ireland's traditional system of budgeting no longer works for us. The old budgeting system we inherited from our past is secretive and opaque. It has not led to sustainable spending policies, proper value for money or good outcomes for our citizens. Under our programme, the Government is committed to bringing about a major transformation of Ireland's old-fashioned budget system. The key elements of the reform agenda have been outlined in the plan for public service reform that I announced on 17 November. In the comprehensive expenditure report I am presenting to the Dáil and to the public, I am pleased to announce that these expenditure reform measures are being implemented across all fronts.

In brief, the main features of the new budgetary architecture are as follows. First, the Government will plan for sustainable public expenditure. The Government's spending plans, along with its tax plans, are anchored in a clear vision of how the public finances will be managed over the coming years. A sustainable expenditure plan will build confidence, at home and abroad, about our commitment to deliver our public services in a reasonable and achievable way.

Second, we will introduce a modern, multi-annual expenditure framework. The annual Estimates campaign that we have heard about for years, conducted privately within the system of public administration, will be replaced next year by a medium-term framework with transparency about the allocations available to each Department over a three-year period. This will open the way for proper structural planning based on priorities and reform, with full public input and Dáil oversight.

Third, we will introduce evidence-based expenditure policy. In a time when resources are exceedingly scarce, old expenditure lines are no longer sacrosanct and all areas of spending must be subject to rigorous scrutiny. As part of this year's comprehensive review, all areas of spending have been examined. The momentum from this process must be maintained. A tough, clear, new value for money code is also being launched today, to redouble the processes for ongoing scrutiny and evaluation across the entire Irish public service.

Fourth, we will build performance information into the annual Estimates. This year, for the first time, most departmental Estimates will be presented in a new format, so that performance information can be scrutinised by Dáil committees at the same time as public money is being requested. It is not just about the money but what the Government does with the money. We will be able to evaluate that.

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