Martin Mansergh (Tipperary South, Fianna Fail)

I am pleased to be in the House today to discuss the OECD review of the public service, Towards an Integrated Public Service. The public service has served this country exceptionally well. Those involved deserve a great deal of credit for the peace process, Ireland's successful engagement with the European Union — even if temporarily disrupted — and the fantastic economic and social progress of the past 20 years, the miracle being that it was sustained for so long. The present sharp slowdown in the economy is not a recession, at any rate so far. Central Statistics Office figures published yesterday showed a 0.8% increase for the first quarter of 2008 in gross national product, which has always been regarded as a truer measure of performance than gross domestic product. A recession requires two successive falls and there has not even been one fall in GNP.

There are commentators who would, in a slightly vindictive spirit, attack the public service as the first item in an economic reform programme. It is salutary to be reminded in the report that general Government employment at 14.6% of the total labour force in 2005 is comparatively low by OECD standards. One needs to bear that in mind when one hears commentators or groups talk about the immense burden the public service puts on the rest of the economy. Naturally, we must avail of efficiencies and cost savings where possible.

The OECD review marks an important step in the ongoing modernisation of the public service. I say "ongoing", because modernisation is a continuing process in the public service which dates back at least to the strategic management initiative launched in 1994. That set the agenda for change in the public service. The objectives were to ensure on an ongoing basis that the public service would make a greater contribution to national development, be a provider of excellent services to the public, and make effective use of resources.

The report, Delivering Better Government, published in 1996, gave clear direction to the programme for change and modernisation. It expanded on the framework set out in the strategic management initiative and outlined an extensive modernisation process for the public service built around key organisational themes, including greater openness and accountability, a mission of quality customer service and the efficient and fair operation of simplified regulations. During that time our public services have been expanded, improved and reformed. There have been significant improvements in the areas of financial management, human resources management, regulatory reform, e-Government initiatives, and customer service delivery. There has been a significant step change not only in the way the public service deals with its customers but also in the manner in which it organises its internal business.

The implementation of the modernisation agenda has been, and continues to be, driven by various partnership agreements across the public service. The current partnership agreement, Towards 2016, builds on the progress made under previous agreements and ensures continued co-operation with change and modernisation initiatives as well as improvements in productivity right across the public service. The agreement provides an important framework for meeting the economic and social challenges ahead and builds on the achievements of previous agreements. The Government is committed to developing the modernisation agenda through the partnership process, which I always staunchly defended when a Member of this House.

No organisation, public or private, can afford to stand still. While significant progress has been made, many more changes are both awaited and needed. At a time when the Government had been investing unprecedented levels of resources in public services, problems remained with delivery on the ground and maximising the return on investments. After a decade of improvement there was a need to take a fresh look at the public service. That is precisely why the Government asked the OECD to undertake a review. The review was not an external audit by the OECD of the public service. Instead, the Government invited the OECD to conduct a comprehensive review of the public service as a whole. That innovative approach was new not just for Ireland but also for the OECD, which is now moving to replicate the approach in other countries. That puts Ireland at the leading edge of developments in public service modernisation and creates a model that will be copied elsewhere.

What the Government wanted the OECD to do was to examine how its priorities and decisions are translated into services and outcomes for citizens and how these processes can be improved. While much change has already taken place in the way we organise our business, there is a need to ensure delivery on the ground. The OECD review was intended to highlight what is and is not working and help the Government make better informed choices about where to allocate resources.

The OECD was given two tasks: first, to benchmark the public service in Ireland against comparable countries and to identify appropriate measures to compare the productivity and effectiveness of the Irish system, or discrete elements of it, against comparable international best practice; and second, to make recommendations on future directions for public service reform which would support the Government's drive for delivery of optimum services to the citizen, within existing resources, and contribute to sustainable national competitive advantage. Put simply, the Government wanted to know how the decisions it is making at Cabinet are translating into services for the citizen and how the process can be improved. Where things are not working properly, we need to know.

The review took place over a period of 16 months and surely must count as one of the most comprehensive reviews of the public service ever undertaken. It was conducted by the OECD's public governance and territorial development directorate through a multidisciplinary team of OECD staff members and national experts from a number of OECD countries. The review was overseen by a high level steering group, chaired by the Secretary General to the Government, and assisted by a project liaison group which was established to support the OECD's fieldwork.

As part of the fact-finding phase of the review, the OECD met a large number of key stakeholders and conducted more than 100 interviews with Ministers, Members of the Oireachtas, officials, representatives of the social partners and other stakeholders from relevant interest groups, the private sector and academia. In addition, there was a major public consultation process involving a media campaign, an invitation to the public, the social partners and other interested parties to make submissions, and a dialogue between the OECD and a representative consultative panel. More than 930 submissions were received from private individuals and organisations.

The review acknowledges the central role played by the public service in contributing to an economic success story that many OECD countries would like to emulate. It states we are on a sound trajectory of modernisation, but we could further improve the yield from reforms by renewing focus on their pace and sequencing in order to make them more mutually reinforcing.

The review concludes that there is a need for a more integrated public service. It recommends that there needs to be improved governance and performance dialogue in order to address the current disconnects between the central Civil Service and the broader public service. Rather than creating new structures, however, it recommends a networked approach to working across existing structures to allow greater connectivity between different sectors. It emphasises the need to move towards a performance focus, with more information being gathered on outputs, outcomes and what has been achieved. It acknowledges that in a tighter fiscal environment there is a need for prioritising spending within budget frameworks.

In an integrated public service it points to the need for increased flexibility for workers. A senior public service should be created to provide a single, integrated public service leadership cadre, a recommendation about which people may have hesitations and which would need to be very carefully considered. It also suggests there needs to be a strong leadership role for the centre.

An overarching theme of the review is the compelling need to adopt a more citizen-centred approach. There needs to be an increased focus on service delivery over internal reforms and a shift in emphasis from organisational inputs to outcomes for the citizen. As the Taoiseach has said on a number of occasions, the modernisation process needs to deliver results that are clear, useful and verifiable to the user. We need to put the public at the centre of our public services.

I welcome the emphasis on a more integrated public service, often described as joined-up Government. Any objective assessment will conclude that the different elements of the public service — the Civil Service, local authorities, health and education services and State agencies — all need to work together better to deliver services to the citizen. Of course, moves towards a more integrated public service will need to take place on a carefully sequenced basis to ensure that reforms are well founded and incorporate the benefits of initiatives already commenced.

We also need to reinforce a performance culture by linking performance information with decision-making processes. Recent developments in annual output statements, and value for money and policy reviews provide a sound basis for progress in this area, but we need to do more. All public service organisations need to deliver higher productivity in their areas to ensure reform of the public service and quality delivery to citizens. I support the OECD's call for improved governance arrangements for the public service. There is a need to take a hard look at the approach to agencies, why and how they are set up, and the proper reporting relationships between agencies and their parent Departments. This area is central to the next phase of public service modernisation.

Underpinning all of this there needs to be a greater use of e-Government for the delivery of services. To this end, the Taoiseach has already announced that responsibility for e-Government will be consolidated in the Department of Finance. This is in keeping with recommendations from both the OECD and from the Comptroller and Auditor General's special report on e-Government.

Much has been made in some quarters about the OECD's comments on decentralisation. However, decentralisation is not new to the Irish public service. Previous decentralisation programmes have built up considerable learning within the system, which is being applied to the current programme. The Government is highly mindful of the impacts that decentralisation could have on the delivery of services to the public, if it is not implemented with due care and attention. Challenges, such as the turnover of staff, can and are being managed in a way which minimises risk.

The Government and the decentralisation implementation group have been always aware of the business issues surrounding the relocation programme. The implementation group recommended to Government back in 2004 that a phased approach be adopted to implementation. This has had the benefit of allowing sufficient time to put in place the property, business and staffing aspects of the programme, including the intake of staff over a phased period to enable skills transfer and training to take place. In addition, organisations participating in the programme were asked to prepare detailed implementation plans, including risk mitigation plans. The implementation group has met individual Secretaries General on a number of occasions and is satisfied with the level of planning in each of the Departments. That said, the Government will take account of the views and concerns outlined in the OECD's report, and will ensure these are taken into account in implementing the decentralisation programme, and in developing and implementing an action plan for public service reform.

The Taoiseach recently announced the establishment of a task force to develop an action plan for the public service. The task force, which has already met on three occasions, is preparing a comprehensive framework for renewal of the public service which takes account of the analysis and conclusions of the OECD report, as well as the lessons to be drawn from the strategic management initiative, the organisational review programme and the efficiency review process. It is developing an action plan to guide the implementation of the recommendations set out in the OECD report. In particular it is examining how best to secure a more integrated public service and the contribution a senior public service could make to a more integrated and cohesive public service.

There are a number of key stakeholders concerned with the shape of this implementation phase, including, in particular, the public service trade unions. In carrying out its work the task force will consider how the principle of partnership with public servants and their representatives should be reflected in the course of implementation. Of course engagement with other stakeholders will also form part of the implementation strategy. The task force is chaired by the Secretary General to the Government and includes four external members as well as the heads of four key sectoral Departments. It will complete its work by the end of the summer and that work will inform the next phase of the modernisation process. I look forward to its report.

Overall the OECD review has many good items to report. Broadly speaking, we are on the right track. However, it outlines certain things we could do better. As that is precisely what we asked the OECD to do, we should be prepared to consider its recommendations. In the past decade or so, Ireland has experienced unparalleled levels of economic success and prosperity. Our economic environment has been transformed through the implementation of appropriate Government policies underpinned by stakeholder participation through the social partnership process. Our public services have made a major positive contribution to this transformation. The OECD review has already added greatly to the debate on the continued modernisation of the public service and I am sure it will be cited for years if not decades to come. As we head into more difficult times the task now facing the public service is to ensure that it remains well placed to continue to contribute to our national development.