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Civil Service told to make 'unpalatable' decisions in radical cost saving plan

State departments have been urged to consider taking 'unpalatable' cost-cutting measures as part of a comprehensive review of all government.

A letter has been sent to the heads of all government departments urging them to "be forthright in putting forward bold, creative ambitious and even unpalatable savings and reform measures, leaving the Government maximum scope to exercise its decision-making function”.

The letter, from the secretary general of the Department of Public Expenditure, Robert Watt, has told civil service chiefs that they should consider radical measures such as reducing grants and subsidies, abolishing agencies, charging for services, and selling off property, according to a report in the Irish Times.

They also been told to identify services that could be outsourced or transferred to the private sector.

Mr Watt has proposed that human resource or structural reforms should could go beyond the Croke Park agreement, and has said that no agency should be seen as untouchable.

The first draft of proposals for cuts are expected to be delivered within the next week, with final reports expected by the end of July.

The cost saving measures should include the introduction of “reasonable co-payment mechanisms to offset in part the costs associated with delivery of public services”. This effectively means that the public will be asked to make a contribution towards the cost of services.

Mr Watt has urged departments to examine the rationalisation, merger and abolition of agencies, particularly those that are staff-intensive. He said that plans should be devised for radical simplification and streamlining of systems and policies for applying levies, charges and taxes/reliefs.

Departments have also been told to consider the sale of land and buildings, the cancellation of leases, and to identify “self-contained areas of processing tasks that could be considered for outsourcing/transfer to the private sector”.

Mr Watt said the Department of Public Expenditure was also looking at identifying substantial savings in areas such as subsidised publicly provided transport, social housing supports, procurement policy and the implementation of shared services/outsourcing.