1. Croke Park Agreement – Challenges Ahead Local Authority HR Annual Conference 21 st October 2011 PJ Fitzpatrick, Chair - Implementation Body Implementation Body

2. 1. Origins of Agreement 2009 – non payment of general round pay increases, reduction in variable pay, pension levy & pay reductions, recruitment moratorium Average 14% reduction in take home pay, up to 24.5% for top grades Annual savings from pension levy and pay reductions alone - 1.8bn pa saving Difficult environment for Unions to sell need for and content of Agreement to members

3. 2. Implementation Implementation Body – established July 2010 Supported by sectoral Groups Annual Action Plans First Annual Review of savings and progress published in June 2011 Next report – October 2011 Significant events – interim reports

4. Sustainable paybill savings - 289m in Year 1 (Mar 2010 to Mar 2011) – exceeded target Driven primarily by numbers reduction (down by 5,349 in the period and down 17,600 since end 2008) …but also overtime (down 5.2%), changed work practices, rationalisation, extended working day in Health, etc. Climate of Industrial peace Solid start – but – much remains to do 3. First review

5. 4. Status of Agreement New Government decision to abide by it Not without conditions Must deliver what it says and new Programme for Government public service reform plans Agreement – a tool kit New Department of Public Expenditure and Reform New Reform & Delivery Office in Dept

6. 5. Some examples of progress to date More significant redeployments – e.g. ̶ 1000 CWOs from HSE and 700 Fás staff to D/SP ̶ Redeployment/re-assignments in the Health Service post early retirement/voluntary redundancy schemes ̶ 1000+ Primary teachers, 100 secondary teachers Productivity increases and efficiencies ̶ Extra hours for teachers ̶ Single student grant scheme & online – 4 schemes with 66 providers replaced by 1 scheme, 1 provider ̶ D/Agriculture local offices – close 41, retain 16, redeploy 380

7. 6. Some examples of progress to date (contd.) ̶ Shared services centre for medical card processing – less staff, more work and quicker turnaround times ̶ On line 44% or 5,400 per month ̶ 300 services online including new range of new epayment options, e.g. NPPR, fines, waste bills Changes to work practices, flexibilities across the public service, e.g. ̶ Standardisation of annual leave across public service – work advancing ̶ Modernisation of laboratory services in the health sector (5m in savings) - radiology next ̶ Agreements on work practice changes in certain hospitals e.g. Holles St., St. Michaels House (3m) ̶ Efficiency reviews of all Prisons (21m savings through new work practices) ̶ Organisational reforms in Fingal Co. Co.(3.7m in 2011)

8. 7. Economic and fiscal challenges 2011 – 18bn Exchequer Borrowing Requirement Not sustainable - gap must be reduced to 8.6% next year – 3.6bn or 4bn Comprehensive Review of Expenditure –Difficult decisions expected –Low-hanging fruit gone –Painful but vital –Not business as usual –Protect frontline services –Will have significant IR impacts

9. 7. Challenges ahead Further significant reductions in staff numbers –Programme for Government commitments –Reduction of between 18,000-21,000 by 2014 over end 2010 levels and a further 4,000 by 2015 Some decisions made e.g. –VECs reduction –Merging of employment rights bodies –Amalgamation of Local Authorities: North and South Tipperary Limerick City and County

10. 7. Challenges ahead (contd.) Flexibility & capacity to respond to needs of citizens More for less Better for less Real value for money Improved organisational and personal performance

11. 7. Challenges ahead (contd.) Need to advance key cross-sectoral challenges including: –Shared services – back office (e.g. shared payroll) and end-user (e.g. single student grant scheme) –Online services – more services online – incentivise users –Greater information sharing – means testing

12. 8. Local Government Sector challenges Maintaining local services with fewer staff Local Government efficiency review a priority for the sector Management staffing review Dublin City Council, etc Delayering management grades Further restructuring to include: –Greater sharing of functions and exploiting full potential of shared services and joint procurement approaches –More online services –Additional productivity measures

13. 9. Challenges for Managers and Unions More ambition and urgency? – yes Support role of middle managers Task of you all – not just top management or the person in the next office Persistence & stamina - stay the course You & Local Authority Management – vital role - can make the agreement succeed & transform the citizens experience of public services

14. 9. Challenges for Managers and Unions (contd.) Unions – engage positively and constructively – opportunity to influence and contribute is essential Leadership needed on both sides to deliver real change and reform Implementation Body and Labour Court have emphasised consultation & involvement

15. 10. What is Required? Improved HR/Leadership/Change skills and strategies Ability to manage in a recession Communications vital – to date good & bad First line & middle managers – role vital & more delegation to them Disseminate good practice - no time to reinvent

16. 10. What is Required (contd.)? Leadership & management development Much improved performance management & measurement Outsourcing – thorny but part of solution if approached correctly and in line with Agreement

17. 11. Scrutiny & Next Steps Savings & Reforms – must be verifiable & transparent – external verification Progress Reports on Action Plans due to be submitted to the Body next week Must show much further progress Scrutinised as never before – ECB & IMF, Government, Media & the public Revisit Action Plans later in the year to factor in relevant developments post-Comprehensive Review Further Savings Report next Spring

18. 12. Conclusions Recent McKinsey survey on organisational redesign Only 8% added value, completed on time and fully met business objectives Lessons – most successful involved staff and explained to staff changes planned Clear communication plans and consistent Ensured HR, ICT, Financial and other systems/processes in place to support

19. 12. Conclusions (Contd.) Can challenges be met? - Experience to date suggests they can Will it be easy? - Certainly not Difficulties ahead? - Without doubt Can they be overcome? – Yes if approached correctly by managements & Unions

20. Thank you Any Questions? For more information visit our website at: www.implementationbody.gov.ie www.implementationbody.gov.ie Implementation Body