Department wanted more savage cuts

SUBMISSIONS made by the Department of Finance to An Bord Snip Nua show that it proposed more savage cuts in expenditure than were eventually proposed by the board.

The Special Group on Public Service Numbers and Expenditure Programmes, which was chaired by UCD economist Colm McCarthy, delivered its report to the Government in July.

The Department of Finance suggested welfare rates be cut next year to reflect reductions in cost of living in its submission to the McCarthy group. Failing that, it proposed freezing rates in 2010 and 2011. The McCarthy report proposed cuts of 5% to social welfare rates which would save €850m a year.

It was suggested by the department that inefficient hospitals should be downgraded or closed so €500m in savings could be made, while it was also proposed that older people be charged the full economic cost of homecare and home-help packages, which would save €300m a year.

However, this option was described as ‘high-risk’ given the vulnerable nature of this age group and the need for legislation.

The submission also questioned the rationale for the continued development of four major hospital projects including the proposed National Children’s Hospital at the Mater Hospital site and the new National Rehabilitation Hospital in Dublin.

The further reduction of teacher numbers through a programme of early retirement or voluntary redundancies was suggested, along with a cut in the number of Vocational Education Committees.

The department also suggested cutting funding to primary schools by 22%, while the McCarthy report eventually favoured a 10% cut. It also suggested cutting the subvention of fee-paying schools by half, while the group suggested cutting it by one quarter.

The Department of Finance also made radical proposals on third-level fees, as it suggested restoring them for all students not in receipt of a grant at present.

“If Ireland’s higher education system is to develop and meet future demands in an environment of increasingly tight public resources, then it is appropriate that the sector’s relatively high level of dependence on exchequer funding as a proportion of overall funding should come under review,” it said.