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Unions warn Government that outsourcing plans could end up costing State more




Marek Slusarczyk


UNION leaders have warned that Government plans to outsource services in the public sector could end up costing the State more.

Siptu also demanded that departments consult unions before making any decisions on the delivery of new services.

While the Government insisted that the cost-effectiveness of transferring services to private companies would be tested before outsourcing, Siptu vice-president Patricia King warned few savings can be made and that in some cases - particularly in the health service - it would cost the state more.

"Siptu has carried out its own review of outsourcing in the health service which has found that there are no real savings to be found," said Ms King.

"Indeed, in some cases outsourcing costs more than providing them through direct labour."

She claimed sub-contracting areas such as cleaning and catering would result in private companies making a profit, to the detriment of employees who tend to be paid lower wages.

Public Expenditure and Reform Minister Brendan Howlin announced the Government's plans for outsourcing as part of its overall public service reform plan.

He said the aim was to reduce costs and focus public sector staff on priority areas.

"Where services are to be brought in line, there is capacity to evaluate whether it will be done more effectively and efficiently on a cost basis as well by an external provider," Mr Howlin said.

His department revealed the four main sectors to consider the benefits of transferring services externally were health, education, justice and local government.

It also insisted that no compulsory redundancies would result from potential outsourcing, in accordance with the Croke Park Agreement on pay.

Ms King said union members expected ministers to honour the agreement - a deal struck between the Government and public servants in which the latter were guaranteed no pay cuts and no compulsory redundancies in exchange for their pledge to work within a more efficient and money-saving framework.

"Under the agreement, management is required to use direct labour 'to the greatest extent possible' and to maintain wages and employment standards in the context of its procurement policy," Ms King added.

"It also makes clear that there will be no compulsory redundancies as a result of any outsourcing and requires that consultation with unions takes place before any such procurement decisions are made."

Meanwhile, Social Protection Minister Joan Burton said the pay agreement, which is in place until next year, has resulted in savings in her own department.

But she insisted the deal must be "kept under a microscope" to ensure taxpayers continue to get value for money.