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

The National Shared Services Office, NSSO, Bill is technical in nature. It lays out the legislative basis for the establishment of the National Shared Services Office as a separate Civil Service office under the aegis of the Department of Public Expenditure and Reform. The NSSO is already in place and has been in operation on an administrative basis since 2014. This Bill seeks to formalise the existing structure, clarify accountability, and provide added assurance and robustness to its operations. The NSSO is charged with leading the Government's shared services strategy and the implementation of shared services projects and operations within the overall public service reform context across the Civil Service. Shared services is modernising how we deliver common business services in the Civil Service. We have created one dedicated team that is taking operational business functions such as finance and human resources and transforming them through the introduction of common standards and definitions, simplified processes and higher levels of automation and self-service.

This move away from costly departmental-specific custom solutions and duplicated effort across Departments to standard automated processes allows the Government to lower the cost of these services and improve the quality of management information available for decision-making.With the introduction of shared services, the same numbers of staff will no longer be required in each Department to perform these specific back-office functions. As a result, more staff will be available to work on other core service areas that are priorities in their own Departments and have a positive impact on the general public.

Since 2014, the NSSO has introduced many benefits for the Civil Service. These include the introduction of one set of standard human resources, HR, processes applied consistently and based on common HR policies. These standard processes are eliminating local interpretation, thereby increasing fairness for employees. Civil servants can now access HR services through a much wider range of channels, including online for the first time, giving them easier and faster access to important information on entitlements and services. For example, the HR portal receives more than 300,000 visits per month. HR analytics and trend analysis are becoming more readily available on a Civil Service-wide basis to inform policy and help drive improvements in the way we manage our workforce. The first online system for public service travel and expenses claims was introduced, with payments processed within a week. In 2016, more than 56,000 travel and subsistence claims were processed to a value of €20 million. Online payslips are now available to all payees, including pensioners, and there is immediate access to payroll information, including downloadable P60 forms. This is a significant change to the hard-copy payslips and paper-based receipts of the past. Insights gained through shared services have informed the development of relevant Government policies, such as those relating to addressing absence, leave and the recoupment of overpayments. Improved technology and automation give employees access to self-service in several areas, including the maintenance of their own personal information, such as address or marital status changes, and application for annual leave. This removes the need for multiple touchpoints and manual entry on the HR system. Almost 1.5 million annual leave updates were recorded in the past four years and more automation is planned. Government investment in shared services for the Civil Service has been significant, with €28.5 million capital funding provided to date. This reflects the importance of this major initiative under the public service reform programme. It is of utmost importance to the Government that our work continues to have a positive impact on our citizens.

The NSSO provides common business services to more than 40 wide-ranging public service organisations. It is staffed by civil servants who are fast becoming specialists in best-practice standards of business support services such as HR, pension administration, payroll and travel and expense processing. Due to the fact that the NSSO operates a single standard way of working, it is able to contribute to, and respond quickly to, the introduction of new policies, such as the recent paternity leave scheme, and introduce new e-HR initiatives such as e-probation and e-mobility that are currently under way.

The rationale for setting up a separate statutory office is to provide clear accountability for shared services and to separate the shared services expertise, and strong customer and service culture, from the broad-ranging policy-making functions of the Department of Public Expenditure and Reform. However, once separated, the two organisations will continue to collaborate closely. The Bill makes clear that the NSSO will be accountable to the Oireachtas through the Oireachtas committees and, from a Government point of view, will continue to report directly to the Minister for Public Expenditure and Reform and that Department.

Service delivery and high-quality customer services are most effective when implementation is separate from policy-making. For greater effectiveness, the NSSO requires the flexibility to respond to operational matters that can distract from the focus of the Department. Creating the NSSO as a separate office also provides for the independence of shared service governance. This independence ensures clear accountability structures delivered through individual service agreements with public service bodies which specify the terms and conditions upon which services are to be provided. When the new finance shared service centre is fully established and staffed, the NSSO will employ an estimated 950 civil servants and will provide payroll services to over 128,000 retired and currently-serving civil and public servants. It will account for the estimated total Vote of €50 billion and administer approximately 50% of net Government voted expenditure. This makes the office twice the size of the Department and a significant operation when compared to other offices and shared services organisations in the private sector. This requires an office in its own right.

Significant progress has been made in advancing shared services within the Civil Service in the three years since the NSSO was set up. It is important to point out that its merits have already been established in committee and in the Lower House and are being referred to by Members there. The NSSO has already established two shared services centres that provide employee shared services, namely, the HR and pensions administration shared service centre for the Civil Service, in operation since March 2013, and the payroll shared service centre, PSSC, for the Civil Service, in operation since December 2013. Recent updated analysis has estimated that €6.4 million has been saved in the annual cost of delivering transactional HR services. In 2016, the PSSC made over 2.7 million payments to the value of €3.24 billion. This figure is set to rise this year. The PSSC is in the process of replacing 18 payroll centres that had different versions of payroll systems with one shared services centre. Once payrolls migrate from Government Departments to the PSSC, the technology costs and payroll for staff who used to process payroll are suppressed. A project to integrate HR, pensions and payroll into a single service organisation has already commenced.

The development of a new finance technology solution for Government is also under way. A single finance technology platform will replace 31 financial management systems and 31 reporting systems across Government Departments and offices and facilitate transaction processing in the new finance shared service centre. This centre will be co-located with payroll in Galway, Killarney and Tullamore and will start providing financial management shared services next year. It will improve resilience and performance, increase financial control and deliver a sustainable reduction in the annual cost of finance of approximately €15.4 million through a reduction in the cost of support for finance technology and a reduction in the resources required to provide financial management processing.

Turning to the Bill itself, the legislation provides for the office to carry out business administrative functions on behalf of a public service body. The legislation will specify the chief executive of the NSSO as its Accounting Officer, and this has already been raised in committee and in the Lower House. The chief executive will, as a result, be accountable to the Comptroller and Auditor General and, in turn, to the Committee of Public Accounts. The NSSO board, which will have an advisory remit, is also provided for in the legislation.

The Bill is set out in five parts. Part 2 allows for the practical structures in the establishment of the NSSO. It confers on the office all such powers which are necessary in the performance of its functions. Part 3 is concerned with the establishment, membership and functions of the board. Parts 4 and 5 contain technical provisions dealing with transitional arrangements and consequential and miscellaneous provisions.

It has always been envisaged that the NSSO would become independent in the delivery of its functions. Shared services constitute one of the biggest change programmes the Civil Service has experienced. The statutory establishment of the NSSO will help us to meet the requirements of international best practice in this area and provide clear accountability arrangements, very strong governance structures and the operational autonomy needed to achieve the goals of high-performing shared services. It will also allow the Civil Service to lower the cost of these services, improve the quality of management information available for decision-making and ultimately assist in enhancing front-line services for the public.

I welcome Members' contributions. I apologise again for being slightly late. I thank Senator McDowell for coming to my rescue along with my officials and the usher.