Civil service managers could face sanctions for failing to properly manage underperforming staff, according to proposals under consideration by the Department of Public Expenditure & Reform.

A review of the civil service performance management system found that unexpectedly high numbers of civil servants were getting good performance ratings, which qualified them for pay increases through increments.

As a result, it is feared the cost of running the civil service is higher than it should be.

In 2005, the then government introduced the PMDS method of managing performance among its 33,000 civil servants.

Under the scheme, civil servants would be rated annually for their performance on a scale of one to five.

Sick leave and absenteeism are also factored in.

Only "outstanding" staff should get a rating of five. Civil servants who "exceeded the required standard" got a four. If they were deemed "fully acceptable", they rated a three.

However, if they were found to "need improvement", they got a two. The lowest rating is “unacceptable”, with a performance score of one.

In order to qualify for an increment or pay increase, staff need a rating of at least two.

The experts who drew up the scheme forecast that statistically around 10% would get the lowest rating and would thus not be entitled to an increment.

However, in 2010, less than half of 1% of civil servants were deemed unacceptable with the lowest rating.

Meanwhile, at the top end of the scale, a remarkable 65% of staff got a rating of four or five.

Also in 2010, 7,000 staff were not assessed at all.

As a result of the potentially incorrect ratings, some civil servants may have been getting increments they did not deserve, increasing costs to the taxpayer.

However, in the future managers who fail to properly manage performance among their subordinates may not be given a rating for themselves above a two.

As a rating of three is required to be eligible to apply for promotion, this could disbar them from career advancement.

The Government is hoping that this restriction will trigger an improvement in performance management.