It’s official: Ireland is in recession. Two consecutive quarters of negative growth and, in all probability, more downbeat quarters to come. There’s no point blaming the media for engaging in a conspiracy to “talk down” the economy any more. Nor is there any consolation to be gained from laying the blame on external factors.

The collapse of the economy is inextricably linked to the government’s willingness to let the construction sector bear the heaviest load in driving the Celtic tiger.

Even when it became clear that people could no longer afford to pay the house prices that builders needed to charge to cover the cost of the land they had bid up during the building frenzy, the government turned up the heat another notch, throwing a few more incentives into the market in an attempt to keep it boiling. Now the building boom has bust, taking with it thousands of jobs and billions in tax revenues.

There’s no mystery about where all that tax money went either. Some of the riches that flowed into the exchequer were used to invest in critical infrastructure. There should have been more, of course, particularly in the areas of telecommunications and public transport.

But far too much of the money went to public sector workers. The first benchmarking pay award in 2002 remains a scandal. Predicated on the unproven claim that pay in the public sector had fallen behind levels in the private sector, the government gave wholesale pay increases to every grade and position in the service.

To this day it refuses to publish the full details of the comparisons that were used to determine the various increases. In truth, there is probably nothing to reveal. The pay awards were designed to secure electoral support for Fianna Fail and curry favour with public-sector trade unions. Benchmarking was not a one-off cost. Rather, it raised the base for all public-sector pay for ever — and public service pensions too.

The change in the national mood music is as good a time as any to begin a real debate about public-service reform. Indeed, the need to reform the service and to reduce its ¤19 billion pay bill cannot be delayed any longer. It is in everybody’s interest that the public service is run in a professional manner with pay awards, promotions, bonuses and training all following best private-sector practice.

That message is still not understood in government. Ministers seem to be avoiding the unpleasant task of reform for fear of what they will find. Once they uncover the inefficiencies, poor productivity, unmerited promotions and, worse, job duplication in the public service, the government will have no choice but to take action.

Against that background, Mr Lenihan deserves one cheer for dipping his toe in the cesspool that is public service politics by suggesting that civil and public servants should be offered a redundancy package. Two cheers could be a long time coming. Nothing, of course, can be done until the task force that was appointed to deliberate on a report into the public service commissioned by the government last year and carried out by the Paris-based OECD makes its findings known.

We won’t hold our breath. The OECD report published in April was, at best, mildly critical of the public sector. The later revelation that the report was approved by senior civil servants in Dublin at various stages during its preparation has completely undermined its independent authority.

In an era when businesses are closing or shedding jobs in an effort to stay afloat, it is unacceptable that almost one-fifth of the workforce should be protected from economic realities with guaranteed jobs, guaranteed incomes and guaranteed pensions. Mr Lenihan knows what needs to be done. Now he needs to do it.

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