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Monday 20 November 2017

Coalition 'on course' to meet IMF public-sector jobs target

Anne-Marie Walsh Industry Correspondent

THE Government will today tell the IMF it has cut the number of public servants by up to 3,000 so far this year and will meet targets dictated in the bailout deal.

But the savings made to date to the pay and pensions bill, which stood at €18.6bn at the end of last year, is unclear due to the cost of incentivised exit schemes and an increase in the pensions bill.

IMF and EU officials are closely monitoring the pay bill -- which represents a third of state spending -- to ensure the terms of the €85bn bailout are met.

A saving of €309m must be made this year, as part of a total €1.2bn reduction in payroll costs by 2014.

Sources told the Irish Independent last night that the first quarterly review to be sent to the IMF today will show that public servant numbers went down by between 2,500 and 3,000 between January and last month.

This would bring the workforce down to roughly 302,000, close to the 301,000 target for this year in the National Recovery Plan.

However, figures being finalised by the Department of Finance last night show the reduction this year includes 1,626 workers in the health service who departed under exit schemes that cost the State €101m.

The rest of the reduction was achieved by the ongoing ban on hiring across the public sector, which means those who retired were not replaced.

The latest figures prior to today's quarterly report showed that previous savings in the pay bill were mainly due to the €1bn pay cut and pension levy rather than cuts in numbers.

The previous Government slashed €2.3bn off its €19.3bn pay bill between 2008 and last year. The pension levy introduced in February 2009 made up €945m of this, and the remaining €1.4bn was down to the Budget pay cut and cutting the workforce by 14,500.

The new Coalition has set an even more ambitious target to cut numbers by up to 25,000 by 2015. However, it has not yet outlined how it will achieve this, or how much it plans to spend on voluntary redundancy or early retirement schemes.

It is understood it will be guided by the Minister for Public Sector Reform and Expenditure, Brendan Howlin's spending review, which is expected to lead to the axing of many quangos.

This is not due to be published until September or October, when the IMF returns.

Irish Independent

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