Patrick O'Donovan (Limerick County, Fine Gael) | Oireachtas source

The summer economic statement clearly sets out the Government’s determination to ensure our budgetary strategy is based on steady increases in public expenditure underpinned by stable and predictable tax revenue. Rather than a feast-or-famine approach to funding public services, we are committed to providing incremental and sustainable improvements that serve our people. This has not always been the approach taken to expenditure and fiscal policy. Over the past 20 years, average gross voted expenditure on public services increased in line with economic growth. This period was characterised by significant expenditure growth up to 2008 which, ultimately, proved unsustainable and was followed by significant expenditure reductions from 2009 to 2014. The scale of the increases in the pre-crisis period necessitated the scale of the reductions later on.

This pattern of unsustainable growth funded by high levels of economic and tax growth, followed by significant expenditure reductions, had an impact on the delivery of services and made long-term planning for expenditure on services and infrastructure difficult for Departments. While protecting the most vulnerable people in our society was a priority in the crisis years, it cannot be denied that the scale of the crisis resulted in hardship for many citizens. The goal of our expenditure policy now, therefore, must be to strive to avoid a return to expenditure shocks in the future. If we are to do this, the increases in expenditure that are provided for in the short term must be sustainable in the long term. Growth in public expenditure has been considerably more modest in more recent years. There has been a key focus on ensuring there are ongoing sustainable improvements in public services and infrastructure. This policy is aimed at ensuring the core functions of the State are sufficiently funded and sustainable improvements to public services are delivered. It also means that Departments can plan for long-term developments in public services and infrastructure. The development and maintenance of high-quality public infrastructure is at the forefront of budgetary policy. There is an increased focus on capital expenditure, particularly through the NDP, which seeks to reform how we plan and deliver capital investment in Ireland. This ambitious strategic plan signals a shift towards greater integration of regional investment plans, stronger co-ordination of sectoral strategies and a more rigorous selection and appraisal process for projects.

Reforming how we provide services has been an important element of the recovery. The fiscal consolidation of the crisis period was accompanied by a programme of public service reform to maintain public service delivery in the face of necessary reductions in staff numbers at a time when demand for public services was increasing. Although we are no longer in that difficult position, the reform of the public service remains a key priority for the Government. The first public service reform plan, which was in place from 2011 to 2013, was primarily driven by the need for fiscal adjustment and had a focus on efficiency and cost containment. The following iteration, which was in place from 2014 to 2016, maintained a focus on efficiency and had an overarching objective of delivering better outcomes for stakeholders. The current framework, Our Public Service 2020, was launched in 2017 and aims to build on the achievements of its predecessors while setting a path for reform beyond 2020. It focuses on supporting sustainable, continuous progress to build a stronger public service and deliver better quality public services to the people of Ireland. I am proud that the framework has been designed to promote and support a citizen-centred approach to public service delivery and has developed with input from the public and the public service. Prudent expenditure growth, strategic capital investment and a focus on reform will allow us to stay on a sustainable path and continue to deliver high-quality and effective public services to our citizens.

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