It would be a waste also to continue to pump more money into the public service without extracting greater value from the sector in the first instance.
In an address at the annual lunch of the SFA its chairwoman, Angela Kennedy, said it was imperative the budget maintain balance between increasing spending and the need to boost lost competitiveness in the economy.
Kennedy told the audience of 1200 members and guests: “Our challenges in relation to health, education, housing, infrastructure and planning are even more pressing now that we know that we can create the resources to tackle and overcome them,” she said.
Resources are just one part of the answer and more imagination and determination was required to get to the fundamentals of inefficiency in the overall public sector, she said.
Solving the problems of public service delivery will not be achieved simply by cheque book economics or, as one commentator recently put it, ‘Craggy Island’ economics. It requires much more. Lavish funding of health and local authority spending have not delivered a better health service, she said.
In that sector spending has shot up from €3.6 billion to over €11bn, but the problems are continuing to mount she said.
It is vital any increases in health spending are matched by real gains to the customers who use the services.
That discipline has to be applied across all categories otherwise the economy will be dragged down by the burden of funding a highly inefficient public sector, she said.
“Spending more money on public services is not a panacea for solving the problems. This can easily be demonstrated in relation to both health and local authority spending.
“Health spending in recent years has increased from €3.6bn to over €11bn but, up to now, the problems in health delivery appear to be mounting rather than disappearing.
“It is vital that any increases in health spending are matched by real gains to the customers who use the services. No business would invest €10 to get €3 extra output in return.
“Yet this is exactly the proposition the health sector expect the taxpayer to fund. Invest €2bn and get €600m in extra service.”