The Government is planning to introduce sanctions for senior civil servants who fail to manage sub-standard staff after conceding that the system for measuring employees’ performance is not working.

A performance-management system for the estimated 33,000 civil servants has been in place for several years, aimed at linking staff members’ performance to pay increments and eligibility for promotion.

However, an internal Government review of the system acknowledges there are “serious deficiencies” and that “in general it is not seen as an effective tool in management of performance”.

The system involves a sliding five-point scale. Five points is “outstanding”, four points “exceeds the required standard”, three points is “fully acceptable”, two points “needs improvement”, while one point is “unacceptable”.

The expert group that drew up the scale anticipated that – based on other organisations – up to 10 per cent of staff would score a single point, while up to 20 per cent would score two points.

However, an internal review of the system found a majority of civil servants – 65 per cent – were awarded between four and five points by their managers during 2010.

In contrast, just 1 per cent of staff were assessed at between one and two points.

In its review of the system, the Department of Public Expenditure and Reform conceded that underperformance in the Civil Service was not being dealt with.

As a result, pay levels or promotions may not have been reflecting actual performance.

An internal briefing note states: “There is evidence that management buy-in to the process needs to be strengthened . . . the process itself is perceived as being a form-filling exercise, too cumbersome and lacking in fairness and consistency.”

Overall, the number of civil servants who have completed the assessment process annually has been poor but is improving.

In 2009, just 56 per cent completed it, rising to 69 per cent in 2010.

Among the arms of the Civil Service where the fewest employees have been assessed are the Department of Social Protection, the Houses of the Oireachtas, the Prison Service and the Department of Foreign Affairs.

Since 2005, the awarding of pay increments to civil servants has been conditional on completing annual assessment and receiving a minimum rating of at least two points, or “needs improvement”.

An employee’s sick leave and attendance records are also taken into account.

The Comptroller and Auditor General has previously raised concern that deficiencies in the assessment system – along with the numbers not being assessed – give rise to the risk that significant numbers of underperforming staff have received pay increases.

Briefing documents obtained under the Freedom of Information Act state that senior Government officials are working on plans to reform the system on a phased basis.

Among the measures being proposed are sanctions for managers who fail to take a more active role in managing underperformance; a more streamlined, less bureaucratic system; a greater focus on fairness and consistency of approach.

In addition, detailed guidelines have been provided to managers on how to deal with underperformance in recent months.

“Our strategy to change the system and work with management across the civil service to strengthen management culture is aimed at making performance management more effective,” a Government briefing note states.

Latest figures indicate there are up to 33,000 staff employed in the Civil Service at a total cost of well over €1 billion.

In his report into the performance of the Civil Service in 2011, the Comptroller and Auditor General concluded that effective management of the Civil Service was critical if the State was to maximise the value of its workforce.