The Government expects to save €50 million a year by centralising routine work done by parts of the civil and public service.

As part of a shake-up of State spending, the new National Shared Services Offce is taking over the management of pay, holidays and other entitlements for staff in Government departments, education, local councils and health.

A report published on Thursday shows that the move will cut spending by €50.5 million annually when it is fully implemented over the next four years.

According to Hilary Murphy-Fagan, chief executive of the new office, up to 2012, individual departments did this work themselves, which meant it was duplicated across the civil service.

Work began on centralising this three years ago. Ms Murphy-Fagan predicted that it would take a further four years to implement fully across areas such as local government, health and education.

She confirmed that the Department of Public Expenditure and Reform spent €30 million on putting the programme in place.

Free capacity

Implementing it allowed the Government to move 500 civil servants to more productive jobs, which helped it cut spending. “It frees up capacity and allows the staff to do other work,” Ms Murphy-Fagan noted.

The savings in the civil service alone come to €34 million a year. Work on the programme began in 2012, when public spending minister, Brendan Howlin, approved it.

Robert Watt, secretary general of the Department of Public Expenditure and Reform said that the number of civil servants has fallen to 35,000 from 39,000 in 2007.

His department published the report, An Examination of Shared Services in the Irish Public Service and Internationally, on Thursday morning.