Ireland will need to do more to control its government payroll numbers and costs this year—a condition of the bailout loans it secured with the European Union and International Monetary Fund—the Irish Budget Minister said, The Wall Street Journal reported.
Brendan Howlin, appointed to a new Ministry of Public Expenditure and Reform in the new Irish coalition government that took power in March, said the first review of an efficiency deal struck with public-sector unions last year showed "solid and measurable progress" in implementing savings and efficiencies of €289 million ($417.3 million).
"Nevertheless, in view of the severe fiscal constraints we face, the reality is that further significant cuts in expenditure, coupled with further substantial reductions in the numbers employed in the public service are unavoidable," Mr. Howlin said.
The former government struck a deal with the public-sector unions early last year—known as the Croke Park agreement for the Dublin stadium where it was agreed—that seeks to make savings through 2014 without enforced job losses.
However, Ireland's severe financial crisis has since worsened, forcing the country to agree to €67.5 billion in EU and IMF bailout loans last November after markets refused to lend the government and Irish banks more money.
The new government—which includes the center-right Fine Gael party, led by Prime Minister Enda Kenny, and by the Labour Party, which draws support from trade unions—has said it will assess the savings made by the Croke Park deal.
The review of the deal published Wednesday showed 5,349 people had been cut from the government payroll numbers in the past year, while efficiencies had provided other savings, including reducing overtime costs.
Analysts say the government wants to keep the pressure on public-sector unions in case more savings will be required. Read more. (Subscription required.)
