Rise in public sector staff numbers raises pay costs to nearly €32bn for this year

A new report by the Parliamentary Budget Office, the Oireachtas’ independent economic analysis arm, said that there were 11,100  more  people working in the public sector at the end of June 2023 compared to the end of 2022. File picture

Ireland’s public sector and local authorities will cost €31.9bn to staff in 2024, with defence the only facet of the public service currently declining in size.

A new report by the Parliamentary Budget Office, the Oireachtas’ independent economic analysis arm, said that there were 11,100  more  people working in the public sector at the end of June 2023 compared to the end of 2022.

It noted that all subsectors of the public service, with the exception of the defence sector, now employ more people than was the case in December 2013, “when public service employment was at its lowest level in recent times”.

Meanwhile, the decline in the size of the headcount in defence services is noted as being a “capability deficiency” within the report.

Ireland’s Defence Forces has been battling an exodus of staff for several years, with complaints over pay and staffing benefits such as pension entitlements.

Between May 1, 2022, and May 1, 2023, the Defence Forces lost 932 personnel (74 officers and 858 other ranks). Some 288 of those who left actually paid to be discharged from the military, of whom 106 were recruits.

Expected payroll costs for the public sector, excluding local authorities, is projected to be €25.5bn in 2024, the PBO said, based on the staffing costs of 373,285 employees.

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Headcount across 2023 was ultimately “considerably greater than forecast”, the report said, with nearly 23,900 staff on the payroll at the end of last year compared with initial budgetary estimates.

Separately council workers, who are paid by local authorities rather than central government, increased by 873 between 2021 and 2023, to an overall labour force of roughly 32,000. Overall local authority pay for 2023 was likely roughly €2.04bn, the PBO said.

Pay within the public sector is overwhelmingly concentrated within the health and education services, which have roughly 230,000 workers combined throughout 2024, the PBO said.

Defence Forces decline

However, while most sectors — health; education; further education; children, disabilities and youth; gardaí — have seen a growth in size over the past 10 years as the country emerged from the financial crash, that trend is bucked by the defence sector.

At present the headcount within the sector is 18% lower than that seen in 2013. When compared with pre-crash 2008 levels the difference is even more stark – a drop of 3,220 from 11,265 workers.

The permanent defence forces stood at 1,825 personnel below their required strength as of May 2023, the PBO said, with that fact officially “recognised as a capability deficiency”.

By contrast, the health sector had 37,860 more employees in 2023 compared with 2013, and the education services similarly greatly expanded with a headcount of whole-time equivalents of 32,000 more than that noted a decade previously.

Early indications in 2024 are that the recruitment issues experienced by the Defence Forces over the past 15 years may be easing somewhat, notably in the navy, in light of the Government’s doubling of the navy’s patrol duty allowance in an effort to address the crisis.

The Government has now committed to increasing the Defence Forces personnel levels to a minimum of 11,500 by 2028, having accepted that expansion is needed following a detailed assessment of the military in a report compiled by Irish and foreign military experts.