LAYING OFF staff is a tough thing to do at any time. It is especially difficult in the current climate where the impact on the people concerned is going to be far more dramatic, and probably more widely felt.

In good times, when unemployment is low and money is being made, many companies quickly gain weight; make appointments that are not totally necessary or employ from a gene pool that is not of the usual calibre. In bad times, that extra weight is jettisoned very quickly, with very little regard for the individual concerned.

This unfortunately is the way of all organisations, private, state or semi-state.

Not many of us will lose any sleep over job losses at the country’s banks. AIB has announced job losses in the short term of around 2,000. The other banks will follow suit in announcing job cuts over the next few months.

But are the right people being cajoled into accepting the packages on offer to disappear from the world of banking? I very much doubt it.

The walls of power in banking have a very effective way of protecting their own. More often than not it will be the people that present the public face of the banks that will be moved along. Those people, who work behind the tills, facilitate the small loan books and operate our accounts.

The real decision-makers will remain, either reincarnated within the current organisation or finding a role in another bank or financial organisation.

The financial grim reaper very rarely operates at the top of the organisation.

As the cutbacks within any organisation are targeted in terms of financial savings, the effect is clear. When the aim is taken at the lower end of the organisation, the job losses are higher in number.

Take AIB as one particular case. The tally of ridiculous banking deals handed out to developers is endless. But what will happen to the people who made these foolish decisions? The likelihood is that they will remain in their offices along plush corridors of their banks.

In one case I know of, a loan of €300m was handed out on the basis of a letter of undertaking from a solicitor. In another, €800m was given to a convicted fraudster named Achilleas Kallakis, only for it to transpire later that this wasn’t his real name and that he had a prior conviction.

I lost £862m during my time at Barings, a considerable sum – but unfortunately dwarfed by some of the numbers that we have experienced more recently. I, quite rightly, was forced to serve time for my actions. But what became of the numerous treasury, risk management and compliance professionals who were employed to oversee and control my actions?

It’ll come as no surprise that they still continue to work in the finance industry.

To take another example in the semi-state sector, An Post announced last week that there would be up to 2,000 redundancies over the next four years. As with the banks, these will be aimed at the lower end of the salary scales. An Post pays its chief executive a sum in the region of €500,000 per year and has turned a €49m profit in 2007, through diminishing returns led to a loss of €24m in 2010.

An Post’s ceo is not guilty of any pf the wrongdoing that has blighted the banking sector, and it may well be that he deserves this sum – but I firmly believe that to be fair to the ordinary taxpayer who is footing the burden of the recent excesses, the focus should start at the top of every organisation and work its way through. Not the other way round.

As organisations go, there are more even obvious targets in my opinion. The Central Bank of Ireland reportedly employs 1,301 full-time staff: 699 of them working a 32.5 hour week, and some of those working shorter hours earning in the region of €69,000 a year. What does a Central Bank actually do? Very little, in my opinion – and often very poorly, as recent history shows.

The responsibilities of a Central Bank are principally distribution of currency and implementation of monetary policy. Regulating the banking industry and setting official interest rates have also been key roles in the past as well as being a lender to smaller banks.

Ireland no longer has its own currency and since accepting the euro as its currency, the majority of these functions have passed to the European Central Bank. The current staffing level, which has been climbing, seems excessive.

In Ireland, the Central Bank was clearly asleep on the job, as lending ballooned to completely irrational levels. In The United States the Federal Reserve operates independent of the US federal government. There is an opportunity to move away from the legacy of an ill functioning central bank and make considerable savings at the same time, but a fresh approach and tough decisions need to be made.

Lets look for cutbacks in the right places and avoid the easy targets.