Lenihan: emphasis on cuts

THE Health Service Executive (HSE) is to lose up to 6,000 jobs as part of a major restructuring of its budget, the Sunday Tribune has learned.

It is understood that each of the regions of the HSE – West, South, Dublin North East and Dublin Mid-Leinster – will be expected to cut between 900 and 1,300 staff jobs.

And with €1bn in cuts in the HSE budget next year alone, there will likely be pressure to increase this figure to 6,000 across the entire body.

The initial focus will be on reducing the numbers by natural wastage, but it is understood there may be some element of compulsory reductions if the targets are not reached.

While there has been speculation about a voluntary redundancy package to reduce the number of management and administration staff, the Department of Finance is unlikely to be keen because of the high cost involved.

Staff in the health service will also be asked to work longer hours and provide greater flexibility in their practices and rostering, according to informed sources.

Other agencies, such as Fás – whose employment services functions are being transferred to the Department of Social Protection – are also facing job cuts.

It is estimated that as many as 30,000 jobs will have to go across the overall public sector as part of the €15bn in savings the government will have to produce over the next four years. This will bring payroll savings of around €1.6bn.

The breakdown of that four-year plan is being kept tightly under wraps by finance minister Brian Lenihan. However, the likely outcome is that there will be €5bn in cuts/tax increases next year; €4bn in 2012 and €3bn in each of the following two years.

The cabinet will begin taking the real decisions about the shape of that four-year plan and the December budget in its meetings tomorrow and Tuesday. Certain measures are already taken as a given – it is accepted that all social welfare rates, bar perhaps the old age pension, will be cut.

The real point of tension at cabinet is likely to come over the balance between spending cuts and tax increases. Some Fianna Fáil ministers are known to take a different view to finance minister Brian Lenihan who wants more emphasis on cuts.

The Greens will be insisting that education is protected in the cuts and they want high earners to be targeted to demonstrate that the inevitable increases in tax are "not only fair but seen to be fair".

They are also insisting that the Metro North project is not abandoned despite a belief among Fianna Fáil ministers that it cannot be done in the current climate. This could potentially develop into a major point of contention.