Written answers

Thursday, 1 June 2017

Department of Public Expenditure and Reform

Fiscal Policy

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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135. To ask the Minister for Public Expenditure and Reform the degree to which each Department continues to maintain good practice in terms of expenditure in keeping with both the effects of the economic recession and the growing demands of the recovery; and if he will make a statement on the matter. [26366/17]

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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136. To ask the Minister for Public Expenditure and Reform the extent to which he remains satisfied of being able to continue to meet the targets set by his Department in the context of spending and reform; and if he will make a statement on the matter. [26367/17]

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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137. To ask the Minister for Public Expenditure and Reform the degree to which each Department achieved the targets set by his Department in the course of the past six years; the extent to which this now becomes the basis for reward throughout; and if he will make a statement on the matter. [26368/17]

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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138. To ask the Minister for Public Expenditure and Reform the scope for reforms throughout the public and private sectors which may still have a role to play in economic performance in the future; and if he will make a statement on the matter. [26369/17]

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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139. To ask the Minister for Public Expenditure and Reform the extent to which pay demands in the public and private sectors are likely to impact on the growing economy to a negative or positive extent in the future; and if he will make a statement on the matter. [26370/17]

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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I propose to take Questions Nos. 135 to 139, inclusive, together.

The effective management of expenditure was crucial in ensuring Ireland met or exceeded its key fiscal targets over the past number of years. This resulted in Ireland successfully leaving the EU-IMF Programme of Financial Support in December 2013 and exiting the Excessive Deficit Procedure at the end of 2015. Government Departments played a key role in ensuring that public services were delivered effectively during a period when significant fiscal consolidation was required to put the public finances on a sound footing.  

2015 marked the turning point where expenditure reductions were no longer required to meet our fiscal targets. An amount of €58.1 billion has been allocated to gross voted expenditure in 2017 bringing the annual average growth rate in expenditure to c.3 per cent over the period 2015 to 2017. The expenditure increases over this three year period have provided for additional spending on key public services and on social and economic infrastructure.

As the Government looks to continue with its policy of providing for prudent and sustainable increases in expenditure, once account is taken of calls on expenditure relating to demographics, the Public Capital Plan and the Lansdowne Road Agreement, there are limited resources remaining to address a variety of competing demands. In this context the Spending Review currently underway will support prudent fiscal management and assist with prioritising between policy initiatives to ensure resources are allocated to areas where they can have the greatest impact in terms of social and economic gain.

Looking at pay in the public and private sector, data released by the CSO recently highlighted modest growth in private sector average weekly earnings in the year to 2017.  The Government Expenditure Ceiling for 2018 includes a provision of €0.3 billion relating to pay commitments arising under the Lansdowne Road Agreement. As the Deputy will be aware, negotiations are currently taking place with the Public Service Unions on a successor to the Lansdowne Road Agreement.

On an ongoing basis, managing the delivery of public services within Budgetary allocations is a key responsibility of each Minister and their Department, and important measures are in place to help ensure that these budgetary targets continue to be met.  My Department is in regular communication with all Departments and Offices to ensure that expenditure is being managed within the overall fiscal parameters. The drawdown of funds from the Exchequer is monitored against the published expenditure profiles.  There is regular reporting to Government on these matters, and information is published monthly, as part of the Exchequer Statement. Gross voted expenditure of €17,849 million to end-April was €282 million (1.6%) below profile, with gross voted current expenditure €247 million (1.4%) below profile and gross voted capital expenditure €35 million (3.6%) below profile.

A new phase of public service reform, to cover the period 2017-2020, is currently being developed and last September I invited the members of the Oireachtas Committee on Finance, Public Expenditure and Reform, and Taoiseach to input to this process.  This new phase will place the customer's needs at the core of every decision from policy formulation to service design through to the service delivery. It will set out a series of actions to be delivered out to 2020 which will both build on the achievements of the last six years and respond to new challenges.

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