The Government has set September 15th as a deadline for departments to submit details of proposed cutbacks to meet the target of saving €440 million this year and a further €1 billion in 2009.
A letter from the Department of Finance to secretaries-general of all departments, which has been seen by The Irish Times, sets out the procedures to be followed in implementing the Government decision of July 8th to cut back public expenditure.
With the final instalment of the Towards 2016 pay agreement being paid out at the start of next month, departments other than Health and Education are instructed to submit plans to reduce their payroll costs by 3 per cent.
The letter stipulates that, unless certain conditions are fulfilled, "no further capital commitments for projects over €10 million should be entered into by your department in 2008".
Government sources said this was not a threat to the National Development Plan.
A list of "illustrative" ancillary measures to save costs is provided in the letter, including the use of monochrome printing instead of colour; publication of annual reports on the internet instead of as hard copy; and the use of e-mail as the "standard method of replying to correspondence".
Civil servants are also told to book airline flights at the "cheapest price available" and "maximise use of public transport options for official travel" which means they should "rationalise use of taxi services insofar as possible".
On the 3 per cent reduction in the public sector pay bill, senior civil servants are being asked to "please put in place immediately the steps necessary to give effect to this decision in your department and in all relevant bodies under your department's aegis".
Measures to be considered would include, "curtailing or suspending staff recruitment with immediate effect, whether for replacement or additional staff, contract or permanent".
The letter points out that Minister for Finance Brian Lenihan will be reporting back to Government by the end of September with proposals for rationalisation of non-commercial agencies operating under State auspices, "that would deliver a minimum saving of €20 million in 2009".
In the light of information provided to the Department of Finance under a consultative efficiency review commissioned in the last budget, the letter states that "a comprehensive programme of agency rationalisation has now been prepared for implementation".
Departments have been provided with a list of suggestions for rationalising these agencies or bodies.
The Department of Justice, for example, has been advised to consider merging various equality and human rights bodies operating under its auspices. "There is no scope for deferring this rationalisation programme," the letter warns.
In addition, the Department of Finance has set out specific amounts to be saved in different categories by each department this year and next.
The Department of Justice has been asked to save €50.41 million in payroll costs next year, which it is hoped will come largely from a 50 per cent reduction in Garda overtime. Monthly progress reports are to be provided by each department.
Commenting on the proposed measures, Opposition finance spokesman Richard Bruton said: "When he came into office as Taoiseach, Brian Cowen said public sector reform was a priority but, as minister for finance with responsibility for the public service, he didn't come up with a single proposal in this regard.
"These proposed measures are the crudest form of slide-rule savings and they aren't adequate to the crisis we are facing."
He continued: "As for the rationalisation of agencies, there has to be a business case made out for each of them rather than the 'let's-make-a-list-lads' approach that went into decentralisation.
"The efficiency measures are all well and good but you are talking about the small change, how to save petty cash.
"The Government should start by abolishing the extra three minister of state posts established last year," Mr Bruton said.
