Infrastructure Minister Laurence Skelly MHK has outlined the huge scale of the budgetary challenge facing his Department.
The Department is responsible for achieving cost savings of £5 million in the current financial year, which is half of Government’s overall target for 2014-15.
While praising staff for meeting budget objectives in 2013-14, despite extra costs arising from the severe snow storms and tidal flooding, Minister Skelly has warned of more difficult decisions ahead.
He said that a wide range of measures are currently being considered to ensure that the DoI helps Government to achieve its national priority of balancing the budget by 2016.
Alternative means of service delivery, slimming down the workforce and the introduction of new charges to generate additional income are among the options under review.
Minister Skelly said:
‘The Department of Infrastructure is at the very forefront of efforts to achieve the savings required to rebalance public finances. We are under no illusions about the size of the task ahead. The challenge of securing savings of £5 million, on the back of the significant cost reductions that have already been achieved during David Cretney’s time as Minister, is one that will require a bold and innovative response.’
The Department has saved £3 million in staff costs since 2011-12 through a reduction of more than 100 full-time posts.
Merging divisions has led to a rationalisation of management structures, while work carried out as part of the Scope of Government Review has identified possibilities for new methods of service delivery, including outsourcing certain functions to the private sector.
The Department has also assumed responsibility for shared services in cleaning, caretaking, fleet management and estates services, and is targeting additional savings in these areas.
Minister Skelly said:
‘DoI continually assesses its operations with the aim of achieving a leaner and more customer-focused approach to service delivery. The Department has already made great strides under Mr Cretney in terms of reducing the number of divisions and senior management posts, and the new shared services will provide an opportunity to further streamline processes.’
He added:
‘In common with other areas of Government, a major area of DoI’s expenditure is on staff costs. To meet a savings target of £5 million it is inevitable there will be an impact on jobs. Any reductions will be made principally through retirements and voluntary departures, although compulsory redundancies cannot be ruled out. We appreciate this is an unsettling time and are continuing to work closely with employees and unions.’
The Department of Infrastructure is currently inviting applications from members of staff for voluntary resignation through the Mutually Agreed Resignation Scheme 2014.
In addition to looking at its workforce and services, the Department is also considering the introduction of new charges to help create the additional revenue needed to balance its books.
A number of options are under review, although Minister Skelly has stressed that no firm decisions have yet been taken.
He said:
‘Meeting our budget responsibilities will require a whole package of measures. The Department cannot focus on jobs, services or charges in isolation; it must be a combination of all three. We are working hard to strike the right balance to ensure we continue to deliver a high quality infrastructure that allows the Isle of Man to attract new investment and secure future economic growth.’
