Economists question public sector reform plans

THE ability of the Government to cut the numbers of public sector workers and drive efficiencies in the sector, as envisaged in the National Plan, is being questioned by economists.

Goodbody Stockbrokers chief economist Dermot O’Leary concedes that, while a new government in the new year is likely to alter the plan, he expects the broad parameters within it are likely to remain.

“We are somewhat sceptical of the ability to introduce efficiency measures in the public service that will yield real results, while there is uncertainty as to how the required reduction in numbers is to be achieved. Markets too are likely to remain sceptical until real results begin to be seen. Furthermore, actions on the banking sector are now arguably more important in the short term,” he said.