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Civil Service exit scheme to save £88m in Northern Ireland during first year, claims minister

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Finance minister Simon Hamilton said Northern Ireland needs to "reduce significantly the number of people working within the public sector" (Press Eye/PA)

Finance minister Simon Hamilton said Northern Ireland needs to "reduce significantly the number of people working within the public sector" (Press Eye/PA)

Finance minister Simon Hamilton said Northern Ireland needs to "reduce significantly the number of people working within the public sector" (Press Eye/PA)

Around £88 million will be saved from Civil Service budgets in the first year after a voluntary redundancy scheme is introduced in Northern Ireland, Stormont's Finance Minister has said.

The measure is to be rolled out next month, with the first staff leaving by September.

Simon Hamilton said: "I don't think there will be any escaping the need to reduce significantly the number of people working within the public sector in Northern Ireland."

Around 20,000 jobs are to be slashed from Northern Ireland's public sector following the Stormont House Agreement to safeguard power-sharing, which was struck before Christmas.

The posts will go over the next four years after money was set aside in Stormont's budget for a voluntary exit scheme and freeze on recruitment.

Mr Hamilton told the Assembly future budgets could fluctuate negatively or positively for Northern Ireland.

He said savings were to be produced by freezing recruitment and promotions.

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"This will save an estimated £30m. It is perhaps less painful than some other interventions, but £30m is not going to deal with the pressures."

He added: "The objective is a permanent pay bill reduction in the context of trying to deal with significant pressures on our budget next year."

The DUP minister said the redundancy scheme will be launched on March 2 and will be open to virtually all civil servants.

"We anticipate that those selected to leave under the scheme will do so in tranches between September 30, 2015 and March 31, 2016," he said.

Mr Hamilton said he had been advised that the pay bill savings departments need to make via the voluntary exit scheme in 2015-16 equates to approximately £26m, and around £88m a year thereafter.

This is based on the equivalent of 2,410 full-time posts going.

Asked by Ulster Unionist MLA Sandra Overend if there was a "plan B" if not enough people take up the voluntary redundancy offer, Mr Hamilton acknowledged that the Executive had "not considered any other option".

He said there was "a degree of risk in proceeding with such an ambitious and radical scheme over such a short period", but did not anticipate problems in the first two years.

"It is something that we will have to keep under review, but I do not think that there will be much escaping the need to reduce significantly the numbers working in the broad public sector in Northern Ireland," he added.

Earlier, Mr Hamilton's DUP colleague Peter Weir told the Assembly: "From my experience of exit schemes in the past and the feedback I get at present, I would be surprised if we did not get the situation in which there were too many people looking out rather than too few."

 

The Civil Service voluntary redundancy scheme is being financed by around £700m the Executive is being allowed to borrow under the Stormont House Agreement. It allows local politicians to borrow up to £200m in 2015/16 and the following two years, then £100m in 2018-19. It's expected to save an estimated £500m annually from then on.


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