Minister for Public Expenditure and Reform Brendan Howlin has forecast that the public sector pay and pensions bill will fall by 19% between 2009 and 2015.

Mr Howlin was addressing the Public Service Executive Union conference in Kilkenny.

He said that during the period in question, the public service pay bill would fall from €17.5bn to €13.7bn.

The minister said that even allowing for increased pension costs, there would still be a fall of €3.3bn a year, a 19% reduction that he described as very significant by any measure.

Mr Howlin assured public servants that the Government wants to stand by the Croke Park Agreement and the commitments made under it.

However, he reiterated that that would only be possible if there were full and continued cooperation with implementation of the change and reform agendas.

The agreement had many detractors he said, but he was confident that when the Implementation Body reports later this year, it would find that targets for savings and reform were being met.

The Minister acknowledged that future changes would be challenging and warned that while unions were entitled to press the Government on changes, they had committed under the Croke Park Agreement to deliver efficiencies.

Mr Howlin also said it was in everyone's interests to make a success of the agreement, which was under scrutiny not just from the media and the public, but by international stakeholders.

"There are certain unpalatable realities that everyone must be conscious of, including inheriting a catastrophic deficit due to unprecedented basic policy failures," he said.

Public servants who currently receive allowances on top of basic pay were warned by the Minister that they may lose them.

The warning followed a review of up to 800 allowances.

Allowances currently cost the Government €1.5bn over and above basic pay and it wants to cut that bill by 5% this year.

New recruits or staff promoted since 1 February have not been eligible for allowances pending the review, but those who already had an entitlement retained it.

Mr Howlin said every single allowance is being investigated and Government departments and agencies are being asked to submit a business case for each.