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Outsourcing is killing Ireland.!!
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02-12-2011 3:00pm#1I read recently that the “number of people employed in the public sector has gone below 300,000 for the first time in five years”. This same article, on www.RTE.ie, then said that the “Programme for Government” is committed to further reducing numbers in the public service by up to “25,000” by the end of 2015. I am here to tell the people that this is pure, unadulterated FRAUD.
The fact is that for every public sector “employee” that the Government manages to get rid of, there is still someone there doing the job, obviously, as work doesn’t just get done itself. So who is this mysterious entity that’s working for the Government, but isn’t actually working “for” the Government? Surely if the Government are committed to saving money, for the benefit of the country and the people, they wouldn’t lose an employee and then hire someone else to do the job but not actually “employ” them. Would they? If the agenda is to “Reduce the total number of public sector employees by between 18,000 and 21,000 by 2014, compared to the total number at the end of 2010 & Reduce this number by a further 4,000 by 2015”, as stated on Page 28 of the “Programme for Government”, then I suppose they would. I mistakenly thought the reason Public Sector employee numbers are being reduced was to save money, but this doesn’t seem to be the case. In fact, the Government, and this includes all Public Sector bodies, when they lose an employee, whether it’s through retirement, emigration etc., see this as a win, well it’s reducing the numbers isn’t it? But, hold on, who’s actually going to do the job? So the dilemma is, we can’t hire someone, but the work needs to be done by someone. The answer is of course, Outsourcing!
After I read the article on RTE, I had to read the “Programme for Government”, mainly to see if I could make any sense of how the Government are getting away with wasting millions, lying about it and contradicting their own policies. On Page 2 they say “The Government will get our economy moving, restore confidence, fix our banking system and support the protection and creation of jobs”, and on Page 5 & 6 they say “We will re-commit to structural reforms required to accelerate growth… job creation” & “Job creation is central to any recovery strategy”. Surely that’s the same as a morbidly obese person, sitting on a couch with a Big Mac in one hand and a copy of “Healthy Living” in the other?! How can you be committed to job creation and at the same time be committed to cutting staff levels? Obviously, the assumption is that there are too many public sector workers and that by reducing those numbers & therefore the salaries that go with them, the Government is saving a fortune. But who, and this is the BIG question, is looking at what the Government is spending on Outsourcing? On Page 28 it says “We will instigate a Government-wide review to identify and eliminate non-priority programmes and outsource, where appropriate, non-critical functions”. Well I can tell you this, the functions that the Government are Outsourcing are far from non-critical.
Let’s, however, give them a break. I mean, they’re told to cut staff levels so they do. They still need someone to do the job so they Outsource, let’s call it a loophole, all in the name of getting the job done. That’s all well and good, but before you rush out to shake your local TD’s hand, let’s looks at one specific example. A person working for an Outsourcing company, in this case is being paid less then €50,000 a year by that company. So how much do you think the Government is paying the company, to have that person do the job? Well hold on to your hats, because the Government is paying this Outsourcing company over €150,000 a year, more than 3 times what the person actually doing the job is earning.!! Now I’m no expert on how much it costs to have an employee on the books (pension, PRSI etc.), but are the Government seriously trying to tell us that they are saving money by spending over €150,000 on a €50,000 a year position?!! I think not.
Now I want you to bear in mind that this is just one outsourced resource, in one Public Sector agency. Sadly though, we could literally be talking about any Government Department, including all of the agencies under their umbrella, because this practice is rampant throughout every aspect of the Government. This is one example, in one particular department, and it represents a misappropriation of close to €100,000. If we look at the further 25,000 reductions intended to happen before 2015, and even halve that and assume that the Government will only replace one of every two with an outsourced resource, with the figures from the example above that would total €1.25billion. Why? Because they are committed to job creation, as long as they don’t have to hire anyone.
You may wonder why I’m writing this. Well, the fact is I am against corruption, against wasting money and against the “rich get richer” attitude that has soured this country over the last few decades. What particular Government started it is irrelevant, the fact is there is rottenness in the core of our Government which has no sign of disappearing. Getting elected on the sole fact that the previous Government were so bad, doesn’t give you the right to spout false promises and carry on in the same vane. On Page 3 of the Programme for Government they say “Our country deserves a fresh start from the failed politics of the years past. It also deserves a new hope that a new Government guided by the needs of the many rather than the greed of the few can make a real, positive difference in their lives”, a lovely statement, but as any hard working, honest person knows, actions speak louder than words. Surprisingly, I’m not even talking about greed. I’m talking about pure stupidity and deception. To think that by showing one column of how many staff you’ve cut and getting a pat on the back, while covering the other column showing how much you’re spending on Outsourcing & “Advice” from other companies, is absolute deviant behaviour.
If the new Government lives up to some of its promises, such as the Comprehensive Spending Review, then there may be hope. This review, so we’re told, “will assess effectiveness in achieving….. value for money”. So I’m hopeful that some clever civil servant somewhere will stumble across the fact that they are wasting millions by not hiring their own staff and the cost of outsourcing is obscene. Although, if that hasn’t happened yet, it’s unfortunately not likely to happen at all. My simple plea to the Government?
Hire, don’t Outsource - Believe in your Workforce.Tagged:0
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HonestWorker wrote: »I read recently that the “number of people employed in the public sector has gone below 300,000 for the first time in five years”. This same article, on www.RTE.ie, then said that the “Programme for Government” is committed to further reducing numbers in the public service by up to “25,000” by the end of 2015. I am here to tell the people that this is pure, unadulterated FRAUD.
The fact is that for every public sector “employee” that the Government manages to get rid of, there is still someone there doing the job, obviously, as work doesn’t just get done itself. So who is this mysterious entity that’s working for the Government, but isn’t actually working “for” the Government? Surely if the Government are committed to saving money, for the benefit of the country and the people, they wouldn’t lose an employee and then hire someone else to do the job but not actually “employ” them. Would they? If the agenda is to “Reduce the total number of public sector employees by between 18,000 and 21,000 by 2014, compared to the total number at the end of 2010 & Reduce this number by a further 4,000 by 2015”, as stated on Page 28 of the “Programme for Government”, then I suppose they would. I mistakenly thought the reason Public Sector employee numbers are being reduced was to save money, but this doesn’t seem to be the case. In fact, the Government, and this includes all Public Sector bodies, when they lose an employee, whether it’s through retirement, emigration etc., see this as a win, well it’s reducing the numbers isn’t it? But, hold on, who’s actually going to do the job? So the dilemma is, we can’t hire someone, but the work needs to be done by someone. The answer is of course, Outsourcing!
After I read the article on RTE, I had to read the “Programme for Government”, mainly to see if I could make any sense of how the Government are getting away with wasting millions, lying about it and contradicting their own policies. On Page 2 they say “The Government will get our economy moving, restore confidence, fix our banking system and support the protection and creation of jobs”, and on Page 5 & 6 they say “We will re-commit to structural reforms required to accelerate growth… job creation” & “Job creation is central to any recovery strategy”. Surely that’s the same as a morbidly obese person, sitting on a couch with a Big Mac in one hand and a copy of “Healthy Living” in the other?! How can you be committed to job creation and at the same time be committed to cutting staff levels? Obviously, the assumption is that there are too many public sector workers and that by reducing those numbers & therefore the salaries that go with them, the Government is saving a fortune. But who, and this is the BIG question, is looking at what the Government is spending on Outsourcing? On Page 28 it says “We will instigate a Government-wide review to identify and eliminate non-priority programmes and outsource, where appropriate, non-critical functions”. Well I can tell you this, the functions that the Government are Outsourcing are far from non-critical.
Let’s, however, give them a break. I mean, they’re told to cut staff levels so they do. They still need someone to do the job so they Outsource, let’s call it a loophole, all in the name of getting the job done. That’s all well and good, but before you rush out to shake your local TD’s hand, let’s looks at one specific example. A person working for an Outsourcing company, in this case is being paid less then €50,000 a year by that company. So how much do you think the Government is paying the company, to have that person do the job? Well hold on to your hats, because the Government is paying this Outsourcing company over €150,000 a year, more than 3 times what the person actually doing the job is earning.!! Now I’m no expert on how much it costs to have an employee on the books (pension, PRSI etc.), but are the Government seriously trying to tell us that they are saving money by spending over €150,000 on a €50,000 a year position?!! I think not.
Now I want you to bear in mind that this is just one outsourced resource, in one Public Sector agency. Sadly though, we could literally be talking about any Government Department, including all of the agencies under their umbrella, because this practice is rampant throughout every aspect of the Government. This is one example, in one particular department, and it represents a misappropriation of close to €100,000. If we look at the further 25,000 reductions intended to happen before 2015, and even halve that and assume that the Government will only replace one of every two with an outsourced resource, with the figures from the example above that would total €1.25billion. Why? Because they are committed to job creation, as long as they don’t have to hire anyone.
You may wonder why I’m writing this. Well, the fact is I am against corruption, against wasting money and against the “rich get richer” attitude that has soured this country over the last few decades. What particular Government started it is irrelevant, the fact is there is rottenness in the core of our Government which has no sign of disappearing. Getting elected on the sole fact that the previous Government were so bad, doesn’t give you the right to spout false promises and carry on in the same vane. On Page 3 of the Programme for Government they say “Our country deserves a fresh start from the failed politics of the years past. It also deserves a new hope that a new Government guided by the needs of the many rather than the greed of the few can make a real, positive difference in their lives”, a lovely statement, but as any hard working, honest person knows, actions speak louder than words. Surprisingly, I’m not even talking about greed. I’m talking about pure stupidity and deception. To think that by showing one column of how many staff you’ve cut and getting a pat on the back, while covering the other column showing how much you’re spending on Outsourcing & “Advice” from other companies, is absolute deviant behaviour.
If the new Government lives up to some of its promises, such as the Comprehensive Spending Review, then there may be hope. This review, so we’re told, “will assess effectiveness in achieving….. value for money”. So I’m hopeful that some clever civil servant somewhere will stumble across the fact that they are wasting millions by not hiring their own staff and the cost of outsourcing is obscene. Although, if that hasn’t happened yet, it’s unfortunately not likely to happen at all. My simple plea to the Government?
Hire, don’t Outsource - Believe in your Workforce.
Would you please have the courtesy to use a normal font size ?0 -
HonestWorker wrote: »***
In theory -your right
In practise your very very wrong
A worker gets hired into the public sector they provide 1/8th the output of a private sector employee
So for that 150K we pay a private firm it would cost us 400K to get that job done "in house"
That 50K needs managers
That 50K needs HR
That 50K gets holidays up to 35 a year
That 50K gets benefits including a pension that costs the enployer >20% of the actual salary on offer
That 50K is likely in a union
That 50K is inflexible
That 50K is virtually impossible to replace,upskill or retrain
That 50K takes between twice and four times the sick leave per year.
When you add all that up 100K for somebody else to manage your employees is cheap very cheap.
Now that said we can easily negotiate that 150K for a 50K employee down -market rates are 100% mark up so we should only be paying 100K for that employee.0 -
Where do I start?
The OP is so incredibly wrong. All over the public service, people are leaving and not being replaced, either by somebody else or by outsourcing.
In other parts of the public sector those who leave are being replaced by others who are surplus to requirements elsewhere. For example, our local primary school took in two teachers last September who were surplus elsewhere to replace two teachers who retired. At the same time 2 SNAs were let go and not replaced.
It seems that the OP has a gripe about something particular (which s/he doesn't give details about) and is using boards to blog about it.0 -
OP edited to make text readable.0
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Bandana boy wrote: »In theory -your right
In practise your very very wrong
A worker gets hired into the public sector they provide 1/8th the output of a private sector employee
So for that 150K we pay a private firm it would cost us 400K to get that job done "in house"
I'm sorry, but it's not that black and white. I worked for a large multinational in a call centre for 8 years - of which, a lot of our lower level work was outsourced to India. The difference in the two centres was unmistakeably huge. We ended up spending a lot unnecessary time resolving problems caused by outsourced agents and protocols.
While it may be true that the private sector is more efficient, it doesn't mean they have the same interests. The private sector's goal is to make a profit, the public sector's goal is to represent the public.
So there are two issues - firstly, the issue of outsourcing - which is just a cost-saving exercise, rather than a productivity exercise. The second is who's interests are served by the public sector, and who's interests are served by the private sector.0 -
Well where i work not one person has come in to replace those that have retired. Not a single person not even for a day. The work has been spread out among existing staff.0
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outsourcing has been happening in the private sector for years..0
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Nothingbetter2d wrote: »outsourcing has been happening in the private sector for years..
At a detriment to the consumer.0 -
At a detriment to the consumer.
Simply not true.. there are many cases where one could argue it is to the detriment of the consumer, but there are as many if not more cases that demonstrate it's value.
If I run a small business consisting of 5 people, how is outsourcing my accountancy, payroll, cleaning, gardening/landscaping, electrical, shop fitting, marketing etc etc etc a detriment to the customer? Expanding my staff to 20 permanant but unnecessary staff to cover those functions and passing the cost on to the customer would be detrimental..
Outsourcing is a model that allows you to pay for services when they are required, and more importantly not have to carry a sustained cost when you don't need those services.0 -
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I agree to a certain extent that Outsourcing is necessary for certain situations, small businesses etc., but this is the Government basically hiding the enormous cost of what they are outsourcing so they can show how many staff they are cutting and get kudos for it. They are not saving money by doing this, I can promise you that as I've seen the figures. Yet at the same time, they say they're tackling unemployment, ridiculous.0
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Has the overtime increased exactly in proportion to the number of staff that have left?Well where i work not one person has come in to replace those that have retired. Not a single person not even for a day. The work has been spread out among existing staff.
i.e. for every 1 person gone, is there now 35 hours of overtime a week being spread over existing staff?0 -
Simply not true.. there are many cases where one could argue it is to the detriment of the consumer, but there are as many if not more cases that demonstrate it's value.
So we are in agreement - it can be detrimental to the consumer. As already stated, I worked in an environment for 8 years where I saw how detrimental it was on a daily basis.0 -
So we are in agreement - it can be detrimental to the consumer. As already stated, I worked in an environment for 8 years where I saw how detrimental it was on a daily basis.
But your initial post didnt' say "can", which was why I responded.. it was a blanket statement that outsourcing was detrimental in its entirety. I disagree with that completely.
As per my example there are literally hundred of thousands of outsourced roles in any economy which provide a positive cost effective result for the customer. There are of course potentially equally as many outsourced roles which provide a poor customer experience. Outsouring is not the problem, it is the manner of what and how it is outsourced that is the core of any issues.0 -
Please the main priority of the public sector now is to serve its own needs, ' serving the public' is merely the ostensible' reason for their existence.I'm sorry, but it's not that black and white. I worked for a large multinational in a call centre for 8 years - of which, a lot of our lower level work was outsourced to India. The difference in the two centres was unmistakeably huge. We ended up spending a lot unnecessary time resolving problems caused by outsourced agents and protocols.
While it may be true that the private sector is more efficient, it doesn't mean they have the same interests. The private sector's goal is to make a profit, the public sector's goal is to represent the public.
So there are two issues - firstly, the issue of outsourcing - which is just a cost-saving exercise, rather than a productivity exercise. The second is who's interests are served by the public sector, and who's interests are served by the private sector.
The private sector exists to finance the public sector.0 -
Please the main priority of the public sector now is to serve its own needs, ' serving the public' is merely the ostensible' reason for their existence.
The private sector exists to finance the public sector.
Really?
In that case, who provided your education, your electrisity, your TV content etc etc?
Some benovelent alien rase perhaps?
Generous Martians?
Or maybe even Zig and Zag0 -
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HonestWorker wrote: »A person working for an Outsourcing company, in this case is being paid less then €50,000 a year by that company. So how much do you think the Government is paying the company, to have that person do the job? Well hold on to your hats, because the Government is paying this Outsourcing company over €150,000 a year, more than 3 times what the person actually doing the job is earning.!!
Any link to this assertion? It seems amazing to me that a recruitment company would make €100k profit/commission, per employee, per year.
Also, when you say outsourcing, are you talking about Grafton Recruitment (or whoever) supplying contract workers within Ireland, or are you talking about outsourcing to an overseas setup?0 -
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Really?
In that case, who provided your education, your electrisity, your TV content etc etc?
Some benovelent alien rase perhaps?
Generous Martians?
Or maybe even Zig and Zag
My education was provided for by my parents as taxpayers and later by myself. any teachers involved were paid for thier services. I have never seen much evidence that there was any degree of quality control involved by the Dept of Education as regards ensuring quality if service provided.
AS for ESB, suffice to sat we have one of the most expensive electricity services in Europe mainly due to having an overpaid ESB staff.0 -
I'm sorry, but it's not that black and white. I worked for a large multinational in a call centre for 8 years - of which, a lot of our lower level work was outsourced to India. The difference in the two centres was unmistakeably huge. We ended up spending a lot unnecessary time resolving problems caused by outsourced agents and protocols.
While it may be true that the private sector is more efficient, it doesn't mean they have the same interests. The private sector's goal is to make a profit, the public sector's goal is to represent the public.
So there are two issues - firstly, the issue of outsourcing - which is just a cost-saving exercise, rather than a productivity exercise. The second is who's interests are served by the public sector, and who's interests are served by the private sector.
First off my figures were not for the work to leave Ireland but just to transfer from public to private
With regards to your case
I believe the issue here was not outsourcing per say but the decision where to outsource to.
I too have seen and struggled with low cost countries providing a less complete service.
But that is not an argument not to outsource but rather on execution
Eg
Dell in Limerick at its height outsourced much of there supply chain and operations to smaller firms in the limerick area to great results.
That is purely within the private sector
When we look public to private the savings are even greater and with none of the risk of going to India.
There can be no real argument these days about Public Sector efficiencies vs Private sector.
Is the Ideal solution make the public sector more efficient or hand it over too the Private sector ?
I would agree keeping private sector hands off these activities but get the same level of efficiency as the private sector would be preferred.
We have to look at the skill levels of those empowered to this task combined with the union representation of the employees and general willingness to change in the public sector.
Outsourcing becomes not the preferred option but the only feasible option.
The OP suggest that there are no savings ,claims first hand experience ,if this is the case i would put it down to execution of the idea not the idea itself.Also though these things often have a longer horizon than those on the front line can see.
The firm I work for here in Ireland recently negotiated taking over a piece of the operations for a large multinational.
The contract was to come in at the same cost as there current operations for the first year but a guaranteed 8% savings per year for the balance of the five year contract.
We will make our money on how much cheaper than that we can do it.0 -
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:rolleyes:Pete_Cavan wrote: »Really bad examples there, I would rather get those two off anybody but government controlled companies.[/QUOTE
:rolleyes:I tend to agree with you yhere. I could have used roads, water air trafic control policing ect, but it was late at night, and I was tired!!:cool:0 -
I don't think the unions would accept a massive level of outsourcing TBH.
Even if it was going on, I don't see how outsourcing public sector jobs is killing Ireland.0
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