The Department of Defence has underspent its allocation from Government by over €220 million since 2012, according to a report from the Parliamentary Budget Office (PBO).
This includes an estimated €15.7 million underspend last year, following a commitment from Government to increase defence spending by 50 per cent by 2028.
Ireland’s military expenditure has been in a general decline since 1991, the PBO said in a newly-published report. It dropped to a low of 0.89 per cent of government spending in 2010 before rebounding slightly to 1.02 per cent in 2023.
Since 2012, €8.78 billion has been spent by the Department of Defence, or 97.5 per cent of the funds allocated to it. During that time, it has returned an average of €20 million a year in unspent funds.
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Most of this related to underspends on wages, the result of increasing numbers of personnel leaving the Defence Forces since 2012.
When a department fails to spend its allocated funding, it is typically surrendered back to the exchequer. In some cases, the Department of Defence has been able to use unspent funds to supplement the army pensions vote and other areas.
The new PBO report focuses on the Naval Service, which has been hit hardest by the retention crisis and is currently at 66 per cent of its establishment strength, or 772 personnel.
This has resulted in a significant drop off in the number of days ships have been able to spend at sea and the number of boardings of suspicious ships in Irish waters.
Last year, there were 500 patrol days carried out, the lowest number in a decade. This year the figure is on track to be around 400. In theory, if it was fully staffed, the Naval Service should be able to undertake 1,600 patrol days a year.
The PBO identified the number and complexity of allowances available to naval personnel as a barrier to recruitment. It also said recent improvements in allowances are not having the desired effect in attracting recruits.
It identified 134 different types and rates of allowances across the Defence Forces, including at least 26 which are specific to the Naval Service.
“Many of these schemes and allowances can be paid concurrently and at different points of the year, in addition some are taxable, pensionable, both or neither.
“This creates an overly complex system of remuneration with associated administrative burdens,” the PBO said.
“Simplifying the remuneration structure for the Naval Service may make employment in the Naval Service more attractive as remuneration can be more easily communicated to prospective recruits.”
It also called for increases in payments for the Naval Service Reserve to make it more attractive for reserve sailors to undertake seagoing patrols.
There are currently 83 members of the Naval Reserve, far below its intended size of 200. The true figure may be much lower, the PBO said, as many members may not have shown up for duty in years.
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