MINISTERS WILL tomorrow agree major cuts in the running costs of Government departments and State agencies, including a ban on new recruitment, advertising and consultancy services.
The measures will form part of the Cabinet's determination to shave €500 million off current budgets, although a mooted redundancy plan for Health Service Executive managers is not expected to go ahead.
The decisions will be taken at tomorrow's Cabinet meeting, and Taoiseach Brian Cowen will then outline them to the Dáil. This will be followed by a press conference.
The Department of Finance's focus has moved already to preparation of the estimates for December's budget, where far more stringent action will have to be taken if Ireland is to avoid breaking European Union borrowing rules.
So far, the measures speculated upon - including centralised IT spending, curbs on travel and subsistence, and recruitment freezes - are unlikely on their own to produce savings of the kind desired by Minister for Finance Brian Lenihan so late in a financial year.
A big share of the required cutbacks is likely to come from end-of-year savings that have become common in recent years, and will be achieved again this year, Government quarters are confident.
In addition, a number of National Development Plan projects - although not roads or other major construction projects - are likely to be quietly delayed.
The Government has already slowed the pace of some projects by insisting that contractors offer fixed prices, though this can delay completion by 18 months.
Under the NDP, the Government has committed itself to spending €184 billion between last year and 2013, but €100 billion will be on capital projects.
Tax revenues are expected to be €3 billion behind this target this year, while €500 million more will be needed to pay for the additional unemployed. The Government's programme of action will be debated by the Dáil on Wednesday and Thursday before full sittings of the Oireachtas end for the summer, except for committee meetings.
Last year, Government spending increased by 13 per cent, while this year it is still expected to rise by nearly 9 per cent. Next year, the rise would have had to come down to match economic growth, plus inflation, regardless of current economic woes.
"Savings in 2009 are much more important. It isn't so much about this year, but you have to start paring back now to have any real chance of doing so next year," said one informed quarter.
Minister for Social and Family Affairs Mary Hanafin said "harsh decisions" would be taken by the Cabinet, "but everyone wants us to do that. I think the public wants us to do that and we're going to do it."
The Minister said on RTÉ's The Week in Politics: "We will then immediately set about preparing the estimates for next year which are going to be difficult. There's no doubt about that - they are going to be difficult because of the demands that are going to be on the live register; recognising things like fuel poverty, the price of fuel and the way that's going to impact on older people."
The Government is constrained in its desire to curb the number of State agencies, partly because it has put so many of them onto a statutory footing in recent years.
Last year, the now Minister for Finance, Mr Lenihan was scathing about the number of agencies created over the last decade, decrying it as "government by quango".
The search for spending cuts has been guided by efficiency audits ordered last year by Brian Cowen during his last Budget as Minister for Finance.
