My appendix surgery aims to take some excess fat out of the system

SEPTEMBER 15. That’s the deadline the Taoiseach and the Minister for Finance have given all their colleagues.

By that date, each member of the Government must have come up with cuts in their estimated spending for next year. And if they can’t, or won’t, the Government as a whole will be asked to adopt recommendations from Finance Minister Brian Lenihan. If ministers can’t cut their own budgets, Lenihan will do it for them.

That’s his job, of course, at times like this. And he’s in a no-win situation. He’s going to be branded as either heartless or weak as a consequence of the measures he takes in the next couple of months.

There is always the possibility that he could emerge with a reputation as imaginative or daring, but his senior civil servants, who don’t think that way, will go a long way to try to prevent him doing anything they don’t regard as safe.

He has to reconcile himself to the fact that whatever advice he might get, it’s his reputation that is going to be affected.

But in reality, there’s a lot more at stake than one man’s reputation, or even the Government’s reputation.

Every year, the hoopla surrounds the budget in December. But it’s the process underway now, resulting in the book of estimates, which lays down the real marker about our quality of life next year. That’s quality of life as individuals and as a community.

For thousands of people, the decisions about public spending are the key to their health, wellbeing, education, even human dignity.

That tends not to weigh on the minds of ministers and civil servants as they trudge their way up and down to the Department of Finance during the process when the estimates are under negotiation.

For many of them, the health they have in mind is the health of their own department. Senior civil servants have a habit of reminding their ministers that how well they do in the fight to protect the department’s budget will affect how they are seen in the department.

And of course, any cut they agree to is the worst possible cut. Every government department has some fat built into its budget, but no civil servant is ever going to tell the minister, or the Department of Finance, where it is.

Even at the end of every year, they will work around the clock to try to ensure every penny they have is spent.

You and I might think there’d be a sense of triumph in saying at the end of the year that we managed to save some money from what we were allocated. But for civil servants that is the ultimate failure because they know they’ll be told “if you didn’t need it last year, you won’t need it next year”. A saving in one year’s allocation immediately becomes a permanent cut.

So anyway, last week I told you to download the book of estimates and have a bit of a read of it.

This week and next, we’re going to be Dave, the citizen who got to run his country. By the time the Government reaches its deadline of September 15, hopefully we will have found enough bits and pieces in this year’s estimates to give them a head start.

Actually, we could start at the end of the book of estimates. For a number of years now the Department of Finance has helpfully included a last appendix to the estimates. It is Appendix 8, and it’s called Expenditure on Consultancy.

Usually, when the Department of Finance publishes details of spending like this, it means they don’t really approve of it. Appendix 8 details what the Government is spending on hiring in expertise across all sorts of areas of activity. It adds up to a staggering €88 million.

An awful lot of that is for advice on information technology, and a lot too is for advice on public awareness campaigns and the like.

I’ve always been firmly of the view that the civil service will never be effective until it is forced to develop these skills in-house (and I think a lot of civil servants agree). There doesn’t have to be a huge number of hi-tech staff in every department, but there should be a core team, tightly run and managed, and it would save the Government tens of millions a year in hiring in expensive help from outside.

And in a time of retrenchment I also think there’s a case for serious questioning of the money spent on public awareness campaigns.

Minister Pat Carey showed last year that a busy and effective minister can do an awful lot to raise awareness about drugs, for instance, without a penny being spent on advertising.

I’m suggesting we start our cutting by slicing the money spent on consultancy services in half.

That will cause panic in the ranks, of course, but it will force the system to find new and better ways of doing the job. And it will help us to begin our task as Dave by saving €44m.

Let’s stick to the appendices for a moment. Appendix 7 of the book gives us a useful breakdown of what it costs to run the civil service (the civil service, not the entire public service). The civil service is essentially the staff of the government departments and this year it will cost €2.3 billion to run the organisation. Of that, €1.5bn is spent on salaries.

There is no doubt the Government has the whole issue of public service pay high on its agenda, and the pay (and size) of the civil service is at the heart of that issue.

So let’s not go there because whatever happens will involve not just Government decision, but a lot of negotiation.

But the civil service alone spends nearly €500m — imagine that figure for a moment — on the following items: travel and subsistence (€68m); postal and telecommunications (€76m); office machinery (€242m) and something called “incidental expenses” (€96m).

THEY also spent, incidentally, a cool €7m on what are called “value for money exercises”. And nearly €113m a year is spent on office premises expenses, for the civil service alone. A lot of that, of course, comes from the failed decentralisation experiment.

At a time when we are all being told to tighten our belts, I can’t believe it isn’t possible to make savings on all those headings.

A 20% cut in those running costs would be a real value for money exercise and would easily generate savings of €100m. Of course there would be some pain — or at least inconvenience — in maintaining quality on reduced running costs. But it can be done.

Between consultancy and running costs, we’ve already saved €144m (and let’s add another €6m by implementing a value for money approach rather than buying in outside services). So that’s €150m.

Next week we’ll have a look at the detailed estimates for each government department and at the public capital programme.

And before you know it, we’ll have solved the Government’s problem for it!