The relevant correspondence and documentation have been circulated, together with the report on this Department. We have dealt with paragraph 26 of the Comptroller and Auditor General's report and today we will deal with paragraph 27. I welcome Mr. Farrelly from the Department of the Environment and Local Government. Perhaps you could introduce your accompanying officials.
1997 Annual Report of Comptroller and Auditor General and Appropriation Accounts.
Vote 25 - Environment and Local Government (Resumed).
Mr. J. Meade (Director of Audit of the Office of the Comptroller and Auditor General) and Mr. J. Farrelly, (Secretary General, Department of the Environment and Local Government) called and examined.
With me are Mr. Tom Corcoran, principal officer, housing division; Mr. Ian Keating, the finance officer in the Department; Mr. Niall Callan, assistant secretary, roads division; and Mr. Brendan Ahern, from the water services section.
I also welcome Mr. Howard and Mr. O'Neill from the Department of Finance and Mr. Michael Tobin of the NRA. Perhaps you could introduce your officials, Mr. Tobin.
Mr. Tobin
With me are Mr. P. J. O'Connor, head of project engineering and management; Mr. Michael Egan, head of corporate affairs; Mr. Cyril Sullivan, head of internal support and control, and Mr. John Maher, our accountant.
The Comptroller and Auditor General has sent his apologies and his deputy, Mr. Meade, is here in his place. Paragraph 27 of the Report of the Comptroller and Auditor General, dealing with nugatory expenditure, reads:
Major water supply and sewerage schemes are carried out by local authorities following approval by the Department of Environment and Local Government (the Department). The cost of these works are generally met by the Vote and while the local authority enters into the contractual arrangement, the Department has to approve the contract documents.
The West Wicklow water supply scheme was examined as part of a review of expenditure on these schemes. Departmental papers indicated that:
· In December 1988, the Department of Defence (Defence) gave approval to Wicklow County Council (the Council) to use lands in the Glen of Imaal for site investigation at Knickeen Ford. Also that month, the Council informed the Department that an Order had been made accepting a tender in the sum of £69,584 for the site investigation contract and explained that the contract had to be completed by the end of January 1989 in accordance with an agreement reached with Defence concerning access to the Firing Range which is situated in the Glen of Imaal.
· The Department requested the contract documents for site investigations in February 1989. However, although the documents as submitted in July of that year were deemed to be in order, the Department insisted in November 1989 that the Council re-advertise for the contract. The lowest tenderer at £77,736 was the same firm which had been earlier accepted, but as this firm specified a completion time of 10 weeks to carry out the works and as Defence was prepared to only allow 4 weeks access to the site, the contract was awarded in August 1990 to another firm who submitted the second lowest tender of £82,920.
· The final account for the work, which was carried out in late 1990, amounted to £168,684. The increase was due almost entirely to extra costs on rotary core drilling. The Consulting Engineer on the project stated that "the results of the initial boreholes drilled on site revealed that the underlying rock was more badly weathered and highly variable than expected". The contractor was instructed to drill further boreholes over the site and, due to the time constraints imposed by Defence, the core drilling rig was used for drilling through alternative methods because of its much higher output than the cable tool rigs.
· Consultants fees and expenses amounted to £83,520 and inhouse technical fees incurred by the Council in the preparation of the preliminary report for the scheme came to £57,402 bringing total fees to £140,922.
· The project was eventually put into abeyance in 1996 after Defence in 1992 had refused to allow the Council to build on its land, as the site chosen by the Council for the construction of a dam would severely restrict military use of the Glen of Imaal as a training area and furthermore the area could not be declared free from unexploded ordnance and would therefore present a safety risk.
· Total expenditure on the scheme funded by the Department amounted to £323,007. This comprised:
|
£ |
|
|
Site Investigation Contract |
168,684 |
|
Advertising |
1,419 |
|
Technical Fees - Council |
57,402 |
|
Consultant Engineers Fees and Expenses |
83,520 |
|
Materials |
6,018 |
|
Plant and Machinery |
2,975 |
|
Stationery, Ordnance Survey Maps etc. |
2,777 |
|
Miscellaneous Expenses |
212 |
|
Total |
323,007 |
Public financial procedures require the noting in the annual Appropriation Accounts of losses in the nature of payments for which no value has been obtained by the Department concerned. As it appeared to me that this case could be regarded as falling into that category I asked the Accounting Officer why the 1996 Appropriation Account for the Department was not noted to this effect.
The Accounting Officer informed me that:
· In the normal course, the outcome of site investigations will enable aspects of a project to be designed and constructed in the most economic manner possible. It is inevitable, however, that there will be some instances where site investigations reveal that it would be uneconomic, or simply impractical, to proceed with a particular project. In these circumstances, he could not accept that site investigation costs must be classified as nugatory expenditure where the results of the investigation give rise to a project, or one aspect of it, being abandoned.
· He accepted that the case of the West Wicklow Water Supply Scheme is complicated by fundamental issues relating to the intrinsic suitability or otherwise of the Knickeen Ford site. In this context, the view of Defence and the military authorities go to the heart of the matter. At no stage prior to October 1992 was the Department or (to the best of its knowledge) the Council aware of the strong objections of Defence or the Army to development of the Knickeen Ford site as a supply source.
· The Knickeen Ford site was, and continues to be, the supply source which offers the best potential in terms of economic and civil engineering criteria. Bearing in mind that Defence agreed to the site investigations in 1988 and in 1990, it is considered that neither the local authority nor the Department had any reason to entertain reservations about expenditure incurred on the site investigation works.
· Departmental checks had not uncovered any instances in other schemes or programmes where nugatory payments occurred.
The Accounting Officer also informed me that Wicklow County Council is exploring options in relation to an alternative source for the scheme, but to date no economic or other suitable alternative has been identified.
I also sought the views of the Accounting Officer of the Department of Defence who informed me that:
· In 1984 the Council approached Defence with a proposal to abstract water from a number of points in the Glen of Imaal. Permission was granted to carry out the necessary surveys but since intake points were on land where artillery firing was taking place, Defence suggested that the Council might instead take additional water from their existing water scheme at Coolmoney Camp which is currently supplying approximately 35 local households.
· The Council informed Defence in 1987 that a new scheme was being considered which would involve the construction of a new dam. Following a survey by the Consulting Engineers, permission was given to the Council to construct and maintain a flow gauging station on the Knickeen River which is on Defence lands. Further permission for site investigations was granted in 1988 subject to the condition, inter alia, that it was being granted “without prejudice to any further facilities which may be required in connection with the next phase of the water supply scheme in question” and this was accepted by the Council.
· When in 1992 the Council sought permission for further site investigation to establish the likely consequences for the area should a dam be installed, Defence outlined its fundamental objections to the building of an impoundment dam in the area chosen.
· At meetings held since 1984 with Defence personnel the Council representatives have been made aware of the dangers from unexploded ordnance in the ground and safety restrictions on military and civilian personnel entering the area were emphasised at all times. In this regard it should be noted that 3 children were killed in the Glen of Imaal in an accident involving an unexploded ordnance in April, 1979. Following the accident, a committee which was appointed to investigate the circumstances of the accident and which subsequently produced the Crean Report, included a representative of Wicklow County Council. Safety measures recommended in this Report continue to be implemented by Defence.
Perhaps Mr. Meade could introduce this paragraph.
Mr. Meade
This paragraph draws attention to expenditure of £323,000 on a water supply project which had to be abandoned. The cost of works on water schemes is borne on the Vote. In short, Wicklow County Council wanted to build a dam on the river running through Army lands at the Glen of Imaal and, to that end, obtained permission from the Department of Defence to carry out tests and drilling. When the council sought to carry out further site investigations the Department refused permission on the grounds that the scheme would interfere with the use of the area for weapons firing and tactical exercises, and that the site was unsafe due to the danger of unexploded ordnance. As I understand it, othersources of supply are being examined by the council.
It appeared to me that the expenditure in question could have been avoided if it had been made clear at the outset that there was little or no chance of a dam being built on the site. Realistically, even a cursory knowledge of the intrinsic problems associated with the use of the site should have sent danger signals to all concerned. Better co-ordination between the State agencies involved would, I think, have nipped this project in the bud and saved the State a lot of money.
Secretary General, do you wish to make an initial comment on how this happened?
The circumstances surrounding efforts to locate a source of water for the west Wicklow water supply scheme are set out in paragraph 27 of the Report of the Comptroller and Auditor General, which has been described to the committee. A fundamental principle of public capital investment is that it should be properly thought out and planned, and this goes to the core of what we are talking about today. Different elements are involved in this process but in the case of water supply schemes the location of a suitable source of water is central to a properly planned scheme and considerable investigations must proceed. It is almost inevitable that some money will be expended on investigating sources which turn out to be inadequate or less suited than alternative sources, and in these situations this would be considered legitimate expenditure.
However, I accept that, in this case, difficulties arising on the site investigations at Knickeen Ford, County Wicklow, go beyond this. I hope the committee can accept that none of the parties involved would wish to be responsible for giving rise to unnecessary payments of the type described by the Comptroller and Auditor General's representative. Quite clearly, a breakdown in communications took place, having regard to the fact that public moneys were expended on site investigations at a place where there were fundamental objections to the building of an impoundment dam, the feasibility of which the site investigations were carried out to determine.
For my part, I can only repeat what I conveyed to the Comptroller and Auditor General, which is that at no stage prior to late 1992 was the Department or, to the best of my knowledge, Wicklow County Council, aware of the fundamental objections to the Knickeen Ford site. There had been considerable discussions between Wicklow County Council, the Department of Defence and the various Army authorities, including the supply of maps detailing the location of the impoundment dam. Notwithstanding that, the investigations were allowed to continue until ultimately, in late 1992, the Department of Defence more or less pulled the plug and said it would not allow this to be carried to its conclusion. I have had discussions with the Secretary General of the Department of Defence in the meantime on the basis of ensuring that this type of case should not arise again.
Mr. Meade said the Department of Defence gave permission for this investigation into the use of the site for water and it seems that Department should answer for this, to a large extent. Mr. Farrelly said there was a breakdown in communications and we would be concerned that that would not recur. Could he explain exactly what that breakdown was and what procedures were put in place to ensure it will not recur?
The breakdown in communications was that preliminary investigations were allowed to commence and continue into a site where what was proposed could not, in the final analysis, take place. There were considerable discussions and contacts between Wicklow County Council and the Department of Defence, particularly Army representatives, over a number of years on this and various works were carried out in good faith on the basis that, if one was investigating the feasibility or suitability of a site for the provision of an impoundment dam, there had to be a clear expectation that it was possible it could be carried to finality. It was only in late 1992 that the Department of Defence ultimately said no. At one stage a condition was attached to a letter from the Department of Defence which said that, before proceeding to a further stage, it would be necessary to clear it with the Department, but that would be a normal condition.
Is that the initial letter of permission to investigate the site? Is it the definitive approval from the Department of Defence?
No, it is not definitive approval. It was for carrying out preliminary works.
Does Mr. Farrelly have that correspondence with him?
I have the terms in the letter. It approved these investigations being carried out "without prejudice to any further facilities which may be required in connection with the next phase of the water supply scheme in question".
What date is on that letter?
I will have to check that for the Deputy and come back to him.
Who had responsibility for spending the money which was spent? Would that person have had knowledge of that letter?
The letter is dated December 1988.
If, effectively, no further work could be done, what permission was given by the Department of Defence?
The Department of Defence agreed to Wicklow County Council carrying out preliminary studies and investigations.
Was there any definition of what those would be?
There was not but, of course, the county council would have discussed it in detail with, and provided maps to, the Army authorities.
Would it be reasonable to assume that, if the investigation was positive, the council would seek to put a dam in there?
Yes, I would have felt so. It was clear the investigations were being carried out specifically to provide an impoundment dam in accordance with site location as specified in maps supplied.
When did the Army say "Stop, we are not allowing you go any further"?
In October or November 1992.
In what format or how did it do that?
The council went back to it with further proposals and at that stage the Department of Defence said "No, we will not permit this".
What was different in substance between the requirement to investigate the site and the talks held in 1988 and those held in 1992 that would have caused the Department of Defence to change its mind on this?
At that stage the council was looking for site investigations over a greater area, but that would not be the critical factor. It was stated the critical factor was that, because of military safety and other considerations, there were no circumstances in which it would be permitted.
Does Mr. Farrelly feel those military and safety circumstances pertained in 1988 as well as in 1992?
Yes, absolutely.
Does that mean, effectively, a change in the Department of Defence's attitude on whether to allow the investigation to continue caused the waste of resources?
It looked as though the Department of Defence was prepared to accept investigations and studies being carried out for the purpose of providing the facility but was not prepared to allow the provision of the facility.
Does Mr. Farrelly accept that some responsibility for the expenditure incurred, which in hindsight was wasted, rests with the his Department and its officials?
We feel unhappy about the situation which has arisen. Clearly, the main investigations and discussions would have taken place between Wicklow County Council and the Department of Defence or the Army authorities. It is unfortunate that we were not in a position to say earlier that clearly the facility could never be provided on this site. I accept that. At the same time, as I stated, it was late 1992 before we became aware of this fundamental objection. As far as I am aware, prior to that date, Wicklow County Council was in a similar situation. It proceeded in good faith on the basis that it was allowed to carry out the investigations and survey. Inherent in that was the fact that these were being carried out to provide an impoundment dam and there was little point in doing that if provision of the impoundment dam would not be permitted in the end.
Were consultations ongoing between the Department of Defence and Wicklow County Council? Did indications arise at any time that the Department of Defence would not allow this?
To a large extent the discussions would have been with the military authorities. There would have been discussions, including on-site discussions.
Was it the case that the executive or administration of the Department was in favour of it but the armed forces were not and the military won out in the end?
No. As I have stated, the discussions took place between Wicklow County Council and the military on a number of occasions and if the military were absolutely against it that should have come across in these discussions.
Are there contemporaneous notes of any discussion held at that time?
I have no notes of discussions held between Wicklow County Council and military authorities or the Department of Defence. We would not have that. It would be a local authority matter. The Department would not be involved in that. It is operational.
What lessons were learnt from the exercise?
The lesson I would take from it is that if, at a very early stage, there is a likelihood that something cannot take place, one should call it very straight and direct from day one.
I am very disappointed with information the Department gave us as a result of a request last January - we received the information on 22 April - on local authorities which overspent on their Estimates provision and which did not budget for year end deficits. We received a list of 46 councils like a litany, and it was as though Dublin and Cork would just pay for them. There is no money or figure and there is no perspective in which the figures which should have been there could be examined. When the Committee of Public Accounts asks for information it does not expect to get only a list of 46 county or urban district councils. If a board of directors of a company requested information from an executive officer concerning deficits and over-spending and a list was provided which showed only the names of the councils, it would not be considered sufficient.
If it is less than what is required by the committee I can only apologise. This is a letter dated 22 April 1998. I assure the Deputy that if he wants further information I would be happy to have it provided to the committee.
Does Mr. Farrelly understand why I am disappointed with it? Is there an understanding within the executive that this is the Committee of Public Accounts and it deals with money and spending? It wants information consisting of hard figures, not a list of 46 county and urban district councils and another 16 councils. Could I get an undertaking that that type of response will not come to the Committee of Public Accounts in future?
I accept what the Deputy is saying. Our interpretation was that what was being queried was the principle of county councils spending money without the necessary permission and that was the issue involved rather than the amounts. I would be happy to supply the detailed information to the committee. It was done in total innocence. The belief was that what was being questioned was the principle of any authority, regardless of how small the amount, going ahead and spending money without the prior approval of the council.
What use is that statement? Was anyone thinking when they replied to our request?
It indicates the scale involved and the number of authorities involved. I dealt with this issue in great detail at a previous hearing. I spoke in terms of the differences between the Civil Service system and the local authority system. With the Civil Service system there is the power of virement where you get the sanction of the Department of Finance, which is a simple enough operation, and you can switch money between one subhead and another. For example, if we under-spend on roads, we can use the remaining money on housing. In the case of local authorities, however, there is a statutory requirement that you must have the prior approval of the council. This is an archaic requirement which, in the context of the major review we are carrying out of the local government system and local government finances, will be changed because it is clearly unworkable.
I went on to say that we accept, in breach of a statutory requirement, it is important to get the permission of the council. There are various circumstances and in cases of exceptional circumstances adjustments may have to be made because council meetings take place only every month. My Department has constantly drawn the attention of local authorities to this requirement. Our local government audit system consistently draws their attention to it also. It is our intention to change this statutory requirement because it is unworkable.
In what way?
We have not worked out the total detail, but a statutory requirement where people have to wait for a council meeting before being able to make adjustments does not work due to the type of pressures and last minute issues that arise. You have to spend money in those instances and you cannot afford to wait for a month before getting formal sanction.
There is no problem because the council sanction is normally retrospective. I am a member of South Dublin County Council and the council regularly approaches us in the event of a flood or bad weather where there might be a fall of snow and tractors would be required. These exceptional circumstances would result in an expense which would be in excess of the amount budgeted. The council would approach us later seeking permission to spend money.
With regard to this deficit, on the list provided I would have expected to find the amount of the deficit in each case, the amount that was budgeted in that year to eliminate that deficit and a total amount of the budget for each of those counties. That is the type of information this committee requires in order to examine the situation properly. We need to see that our money is being used effectively and efficiently. Does Mr. Farrelly accept that we are looking for good, solid information, not lists? Very competent executives working within the Department should, when we ask for something, think about what we are looking for and what would help us to improve the way we do business.
The Deputy has extended his question. I thought he was looking for an indication of the extent to which a county council had exceeded its expenditure without getting the sanction of the council, even though it got it retrospectively. Is the Deputy asking for more information? If he is I would like to be clear about it so that I can facilitate him.
He referred to the end of year deficits. That information can be found in the published accounts of the local authority. We will take on board what he has said and see what package can be put together for him.
I do not wish Mr. Farrelly to go over this issue. It is for the future.
I take on board what the Deputy has said.
The last time we requested this information we stated that we wanted a league table from the Department of the indebtedness of the various authorities. We wanted a clear running order of the authorities that were more deeper in debt than others, and that means providing financial figures not just a list. Perhaps I am mistaken but I thought we requested league tables. Our initial request was for a league table on the efficiency with which local authorities spend their money. I do not want you to provide a methodology for calculating the efficiency of local authorities in terms of how they spend money. We would like a league table on their indebtedness. We want to know how the £900 million debt is divided between local authorities. We also want a league table detailing what authorities were most and least in debt. If we got that information we could compare local authorities. That is what Deputy Ardagh and many Members of the committee want. We cannot make comparisons by using generalised lists.
Retrospective sanctioning should be banned. The reality is that if the council refuses its approval and it is faced with a fait accompli then councils are being bypassed. Far from us liberalising that arrangement I would expect we would enforce it and bring in rules and regulations that would ensure executives do not spend money that has not been approved by the council. Otherwise the councils are only rubber stamps.
In acts of God, such as a flood, money has to be spent.
This is a case of systematic bypassing of elected representatives by the executive who are then faced with a fait accompli. There is provision in the national finances for emergency expenditure. The type of emergency should be specified before the executive can take the initiative.
Retrospective sanctioning should be stopped forthwith. That power is given to unelected executives. It is a power they should not have and it is one that can be severely abused. We could be left with egg on our faces. Who knows if it is being abused?
I thought I dealt with this issue in a reasonable manner on a previous occasion. I will try to clarify the issue of expenditure by local authorities in excess of what is approved by the council in its proper context. As I said earlier, the local authority system does not equate in any way with the Civil Service system which we generally deal with. Approval for over-expenditure in local authorities can only be given by a council meeting and, typically, council meetings take place once a month. Civil Service over-expenditure, where it involves breaching the overall limits of an Estimate, is sanctioned in advance by a Supplementary Estimate. However, in recognition of the fact that, with the best will in the world, over-expenditure will occur from time to time on individual programmes - that is critically important - financial procedures applicable to Departments allow such over-expenditure to be accommodated without the approval of the Dáil through the virement principle which is done through the Department of Finance. There is no corresponding latitude for local authorities.
On the one hand, I equate the departmental system and the Dáil with the local authority system and the council. In other words, some type of virement system in local authorities is needed comparable to that which is in operation in the Civil Service. Unlike in the Civil Service, expenditure in local authorities cannot be equated with payments. Expenditure has been incurred in the case of local authorities when an invoice is received. Once a local authority receives an invoice which is validly payable, that raises expenditure. In the case of the Civil Service, it raises expenditure only when the amount is paid. In the case of local authorities, when a valid claim appears on the desk, that is payment at that stage. Therefore, one can understand the difficulties this creates.
The local authority expenditure concept is more elastic. It is less amenable to operating a controlled system designed in the 1950s for the simple receipt and payments systems which operate in the Civil Service.
This is the old Ireland. This is the old style of a "wink and nod" which is no longer tolerable. This is the sort of thing which is causing scandals in all the institutions of the State. We cannot have the law being ignored by county council officials. We will hear later today about contrived and falsified invoices by county councils. We must have an assurance that the law is being observed by county councils, that people cannot go to councils for retrospective sanction. This is effectively presenting elected councils with a fait accompli. How can something which is done be undone? There must be some effective remedy. In the case of virement in the public service, at least the Minister is subsequently answerable to the Dáil or the Accounting Officer is subsequently answerable to this committee. There is no such accountability in the case of county managers. We need assurance that something will be done to prohibit this practice.
I hear what the Chairman is saying. We are working towards a solution. First, we want to improve the accounting system so that better management information and forecasting of expenditure is in place and, second, to change the legislation in a manner which will be easier to operate. Some flexibility should be given to the executive at council level comparable to the Civil Service but which retains what the Chairman rightly demands, that is, the correct oversight of expenditure by elected members. This will arise in the context of the local government Bill and the various other changes proposed.
This committee is very worried that Exchequer money provided to local authorities is not already accounted for to this committee. It is the only Exchequer money not accounted for to this committee because a lacuna exists in our accounting and audit arrangements. Local authorities are not subject to the scrutiny of the Comptroller and Auditor General; therefore, they are not subject to the scrutiny of this committee. What is referred to as "the licking up principle" exists whereby local councillors, who are supposed to overview the audit arrangements in their council, do not do so effectively because in many cases they want to ingratiate themselves with the county manager in the hope that they will receive favours in other respects. This is very unsatisfactory and the committee has been exorcising this for some time. Our eyes were opened following the publication of the National Roads Authority report when it was found that two local authorities had claimed money for works verified as done but which had not been done. We must ensure that there is effective control over the executive of local authorities. To continue a process where they can spend money without legal sanction and claim it retrospectively is not acceptable. This is in breach of financial procedures and must stop. I want an assurance that this will be stopped, and speedily.
The Department has consistently reminded local authorities, both generally and in specific cases, of the requirement on them to receive prior approval of the council for over-expenditure. Various policy issues arise in relation to powers given to local government, local authorities and elected councils, the extent to which they must be brought within a central system of control or the extent to which the subsidiarity principle is to be applied. There is a difficult debate taking place about, on the one hand, the over-control of the Custom House over the operations of local authorities and, on the other, the call to devolve powers.
This is a false argument. You will devolve powers more confidently if you know that the law under which devolution takes place is being observed. Here we have a case where the law is not being observed. I am appalled that Mr. Farrelly tries to justify this. These are past standards which are no longer acceptable. The law as set down must be observed by all institutions, including local authorities. We need an assurance that some effective arrangements will be put in place, without further delay, to ensure retrospective sanction stops, except in stated emergencies.
I can give you an assurance that I will write to city and county managers. I will emphasise this requirement, as we have done in the past, and draw their attention to the fact that this should only arise in the most exceptional circumstances. I will also take the opportunity to discuss the topic with them.
We need more than that. We need to set out the law in this matter, and ensure that the law is being observed, and will be observed, that councils will not be asked for retrospective sanction, and, in fact, will be forbidden from giving retrospective sanction, except in stated emergencies which should be specified.
I will write to city and county managers and discuss the issue with them. I am sure some major policy issues will arise in the context of the local government Bill later in the year.
Is this practice prevalent? Are there large amounts of money involved?
No, the amounts of money are not large; they tend to be technical breaches.
What is the percentage figure?
I do not have the figures to hand, but in terms of overall expenditure of local authorities, the figure is not large.
Is it the Department's intention to provide a reasonably readable guide to value for money in terms of local authority spending or to arrive at some type of league table that would be helpful to the public and public representatives so that we can evaluate efficiency and make comparisons between local authorities of comparable size?
It is the intention of the Department to come up with performance indicators for different areas. In an ideal world one should be able to put a price on work done, for example, the cost of lifting a bin. This would allow for comparative indicators where one could look at one authority vis-à-vis another. Everything might not be equal, but at least one could examine the reasons for this.
That is correct. For instance, some authorities charge for wheely bins while others do not. Many members of the public are bewildered by this. People living in certain areas may have to pay for a wheely bin while their neighbours two miles down the road may be supplied with a wheely bin free of charge. There needs to be some sort of transparency and an ability to compare how different authorities fund different initiatives under their control.
That comes down to the legitimate choices of local authorities and whether a centralised initiative will be taken to oblige everyone to use wheely bins. This is at the core of what local government is about.
That is correct.
However, I accept the Deputy's point in respect of performance indicators. We believe such indicators should be provided because they will be a valuable tool in identifying best practice, disseminating information to people and enabling comparisons to be made between authorities. The other factor is that we have been taking initiatives on new financial management systems within local authorities. I referred earlier to the difficulties in respect of different systems for receipts and payments operated by the Civil Service and local authorities.
Above all, we are interested in developing certain indicators which should be meaningful. Planning permission would be a good example because it is not enough to focus solely on the percentage determined within two months. This could disguise the quality of decisions to grant, reject or otherwise. There is also a necessity to refine the indicator by reference to the rate of appeals. We are working on this matter but it will take time. However, we absolutely accept that there is a need for performance indicators at local authority level.
With regard to planning permission and in view of the housing crisis, is Mr. Farrelly in a position to inform us whether planning permission has been applied for in respect of large urban housing schemes? Will he indicate the speed at which such houses can be constructed? People are concerned because we are being informed that property prices are falling and simultaneously we are being told that it takes a great deal of time to bring houses on stream because of the time lag at local authority level.
I must stop the Deputy because he is straying into another area. Before proceeding to deal with performance indicators, I wish to discuss retrospective sanctions by councils which is an issue of concern to me. I would like the Secretary General to communicate in writing with the committee in the coming weeks regarding the current legal position and practice in this area, the frequency with which retrospective sanction is used and the steps that have been taken to stop or regulate it.
We will do that.
With regard to performance indicators, if the councils state that they are going to spend £2 million on communities and parks is there some way, when the estimates are being devised, that councillors can discover the number of trees to be planted, the acreage of grass to be mown and the number of people involved? For example, would it be stated anywhere that the £2 million will be used in the next year to plant 20,000 trees and mow 16,000 acres of grass? Estimates are brought forward at this time of year in all county council areas in respect of eight specific programmes, without any measure of whether the money will be used effectively or an indication of the results expected to be obtained from its use.
With regard to the new programme and procedures being put in place between 1997 and 2002 - when the new accounting system will be operational - could a system be established within that from which we might obtain information? If such a system was established and a council planted 22,000 trees instead of 20,000, we would then be in a position to offer our congratulations because the results of its efforts would be there for all to see.
In the new financial system we are putting in place, major emphasis will be placed on transparency, accountability and performance indicators. That is the route we must take. The information provided by councils at present falls far short of what is necessary. I accept the Deputy's remarks in respect of the need to change the system. The process of change is already in place in the entire local government system, starting with the financial system and working its way through. Indeed, a major point will be reached later in the year when an extremely important local government Bill will be published and debated in the House.
I accept the need for performance indicators. At the same time, however, a great deal can be done at council level by individual councils demanding, as is their right, the type of information to which the Deputy referred.
I did not realise that.
Councils have a statutory right under local government law to demand and obtain such information. However, that is not sufficient. In general, we do not have any difficulty with what the Deputy is saying and we are in agreement about the need for change at all levels in the local government system. In addition, I believe the Minister would strongly endorse that fact.
We will now deal with the housing question raised by Deputy Lenihan. As it stands, the housing situation is very unsatisfactory. Is the Secretary General concerned that a negative equity situation might arise where, because of the escalation in house prices and the atmosphere of unreality, people may have their fingers burnt? Has tangible progress been made in attracting a source of supply to meet the demand for housing?
If we look at the massive increase in housing output between 42,000 and 43,000 houses, a record number, were completed last year, which represents a 20 per cent increase on the previous level of completions. As highlighted in the various discussions on the Bacon report, there is a problem in terms of supply. Major efforts are being made to deal with that problem, as indicated by the output figure for last year, but that is not sufficient. I must inform Members that figures I obtained last evening show that during the first ten weeks of the year, ESB connections were up by 20 per cent. I refer here to houses connected for the first time to the electricity supply system, which is a good indicator.
Twenty per cent up on what?
On the figure for the corresponding period last year.
Is Mr. Farrelly saying that the indications are that there will be a further 20 per cent increase in housing output this year?
I would not care to project that figure forward. However, I will state that it is a positive development and it is the best indicator one can obtain because connection to an electricity supply system means that a house has been occupied for the first time within that period. People's perceptions are very important. There has been a great deal of scaremongering by individuals we would prefer to see minding their own business. It is easy to forecast that there will be an X or X plus Y percentage increase in housing and such statements scare, alarm and concern ordinary people. I prefer to put the emphasis on the positive aspects of our work and the many new initiatives that are being introduced. In addition, we are obliged to deal with the supply side of the market and we are attempting to do so.
What action has been taken in respect of improving the rate of supply? The development plan process in local authorities is trundling on at its normal pace rather than being fast forwarded.
The Secretary General mentioned scaremongering. Is he implying that auctioneers and others are trying to heat up the market and suggest that there may be larger potential hikes in house prices? I want him to clarify his comments on scaremongering.
From time to time we tend to get suggestions of increases beyond the level they turn out to be on the basis of what best statistics reveal further down the line. Those suggestions are not helpful in the present situation.
Do you think they——
I am not saying anybody is doing that deliberately. It is hard to get a balanced presentation and view on this.
Let us move on to what is being done to increase the supply of houses. Am I right in saying that the development plan process in Dublin Corporation and in the county councils is trundling on at the normal pace without any attempt being made to fast forward the rezoning of the needed lands?
I will deal with what we doing and then return the planning issue. Under the serviced land initiative £40 million in Exchequer funding is committed to bring forward services for the release of 100,000 sites. That has been published. A total of £5 million of Exchequer funded grants has been specifically allocated for road works. That was made available to 14 local authorities for works on non-national roads to facilitate 9,000 houses. Additional staff and board members were appointed to An Bord Pleanála to deal with the huge increase in the number of appeals and volume of work.
On housing density, draft planning guidelines on residential density have been published for consultation. In the meantime, local authorities were asked to have regard to those draft guidelines. We accept a problem exists in this area. We regard the issue as being so important that, notwithstanding the consultation process, we asked local authorities to have regard to these guidelines. On the social housing front , we provided a 45 per cent increase in Exchequer expenditure on housing over a two year period.
The development plans in the Dublin area will need to be looked at again in light of strategic planning guidelines published for the Dublin region. However, the indicators in the case of the Dublin planning authorities are positive. We have got many draft plans of extra land being zoned and provided. Discussions have taken place between ourselves and various local authorities. In certain areas, such as the Dublin northern fringe where public sector schemes are not available, we encouraged local authorities to investigate the area and put forward private sector proposals to deal with the issue during the two or three year period until full public sector services become available.
Many major initiatives have been taken. I would like the message to go out that the issue is being dealt with on a scale we have not seen before and that the scale of price increases in the past will not continue in light of the actions we are taking.
The scale of increases will not continue?
It will not continue on that scale. Twenty years ago the problem was inflation of the order of 16 per cent. That impacted on buyers regardless of the level of their repayments. We would like the market and the people to accept that significant substantial actions are being taken by everybody concerned, the local authorities and central Government, and that these will produce results. The problem cannot be solved overnight. To a large extent it is a Dublin problem. It brings up strategic planning issues, strategic planning guidelines and other related issues.
The committee has been told by a consultant it hired that one of the major inhibitors to continued economic growth is the housing problem. It will have major economic consequences if it is not sorted out.
My perception is that work on local authority development plans, particularly those for the greater Dublin area, is proceeding at the same pace as previous reviews of development plans, as if we did not have a major problem in housing. Am I correct in assuming there is a view that the final rezoning of the necessary lands is some way down the road and there is no great urgency about the need to draw up and complete plans?
I would be disappointed if that was the case. We have had discussions with Dublin managers and Dublin authorities. There is a concern and realisation of the difficulties. The approach to the Dublin area is very different from the way Dublin was approached in the past. While it is not an answer to today's problem, a major planning Bill, which will consolidate all planning legislation, is being prepared and I hope it will be ready later this year. We will examine the way development plans are dealt with. This will enable decisions to be made quicker and the process to be finalised at an earlier stage.
A consolidated planning Bill that will be introduced later in the year is welcome.
It will include major changes.
Will it curtail time limits for decisions and appeals and deal with the nature of appeals?
An attempt will be made to refine the process in a manner which will result in decisions being made more quickly.
Are there a number of vexatious complaints holding up decisions? Will that Bill propose to deal with flimsy objections?
I must be careful as I do not want to encroach on the independent powers and responsibilities of An Bord Pleanála. There is a legislative provision which enables it to throw out any appeal regarded as vexatious. As to how that operates vis-à-vis the courts, one has to be careful. A legislative provision deals with vexatious appeals. If an appeal is regarded as vexatious, it can be turfed out by An Bord Pleanála, but that only happens in a limited number of cases.
We have a right to third party appeals on a scale that is not the case in many other jurisdictions. This comes down to policy issues and what people want. I would not like to anticipate the debate on this legislation in the Oireachtas. I look forward to it with interest.
Has it been commented that the timescale for decisions on housing, roads or infrastructural projects takes much longer here than in most other European Union countries?
The comparisons can be anecdotal in many cases. That we have a written Constitution in which people's rights to property are enshrined puts us in a slightly different position to many other countries.
Mr. Farrelly said one of the major factors holding up economic growth is the provision of affordable housing. He seems to have his finger on the pulse and to know exactly what is happening. Could he give an indication of the length of time he considers it will take to meet the demand for the supply of affordable housing?
To bring it into equilibrium.
It is difficult to say because it is contingent on resources. It is also contingent on economic development and other factors.
Work on the assumption that all the resources are there. Leave out all the reasons and give us an answer. You can add in the other things on the side rather than giving us the side issues.
Bacon looked at this and considered it also. His view, with which I would not disagree, is that it will certainly take a few years to realise that, before everything works out.
This is important for young people who are considering whether they will stay in the country or travel abroad. It is easy to travel now. People have degrees and jobs are available throughout the world. We want to try to give them a reason to stay here so that within two and a half years they could reasonably expect to be able to afford a house. Is there any way you can put a time on it to give hope to some of the young people who are seeking housing and wish to stay in this country?
It will take a few years before one can deal with the problem totally. In the meantime, the situation is being dealt with and the extreme increases which we have seen in the past are abating and are being controlled. We have issued strategic planning guidelines, for example, although Deputies may not yet have had a chance of considering them.
Allied to this is the question of where housing is located. To a large extent it is a Dublin problem. I am not saying there are not problems outside the capital, but the biggest problem is in the Dublin area. To accommodate demand one must look within the greater Dublin region, which the strategic planning guidelines for the Dublin area do. It is tied in with getting appropriate housing on the outskirts of the centralised area and providing a public transport system to facilitate and support the provision of housing in these areas. I am optimistic, based on the state of the economy, the type of growth rates we are achieving, the scale of funds available, which are unprecedented in the history of the State, and the use of that money to meet these various problems.
The problem is not housing alone. It includes public transport, land use and planning. For the first time we are looking at it in a concerted manner while trying to pull all these elements together. We have strategic planning guidelines for the Dublin area, density proposals and Government decisions arising from the Bacon report, but it will take time. The various elements are beginning to lock in now and I would be optimistic if we continue to drive these elements forward. In particular, I accept what the Chairman said - that housing is one of the major problems we currently have. I accept that absolutely.
To go back to my earlier question, is there evidence to suggest that we are a society of cribbers and objectors compared to other European Union countries, or does it take longer to get planning permission for housing projects here? Last week we read in the newspapers about a reported further four year delay in the last leg of the Dublin to Portlaoise motorway because of snails. Is this serious?
This relates to the Kildare by-pass. What we are talking about are the difficulties vis-à-vis the Pollardstown fen and underground aquifers. The newspaper heading referred to snails, but I am not sure if a snail is specifically involved there or not. The difficulty for us is that this was carried through under very specific and clearcut statutory procedures, but having done that it still ends up in the courts.
As regards whether we are cribbers, I would not go on record as saying that. We have a planning system with extensive rights of appeal. In the final analysis, it is for the political system to decide whether it can, or should, be curtailed.
Let us call a spade a spade. Everybody must have rights to object where their interests are concerned or where there are serious environmental issues. However, is this being exploited to a ridiculous degree? What is your opinion?
To some extent we have been major beneficiaries of the EU system, particularly in the infrastructural area . Without the support of the EU we would not have achieved what we have today. On the other hand, the continuing bevy of objections to proposals will certainly slow things down. People have the right to object to the EU. In turn, the EU, if it is funding something, will legitimately pursue those complaints. That is a slow down pattern.
Are there any comparative figures on how other countries perform in this respect? Are there more complaints or more delays from Ireland compared to other EU countries? I have read that there are but I would like to have the matter clarified.
In relative terms, there are far more complaints to the EU on environmental issues from the public here than from other countries.
So that perception is correct and it is inhibiting all sorts of housing and road developments.
Roads rather than housing.
Sometimes there must be roads. It would help the housing problem if there was better road and rail access. To return to the development plans, is it not true that they are trundling on at the same pace? There is no fast forwarding or renewal of the development plans.
We have had discussions at departmental level with the Dublin authorities. There is a commitment there and they are being dealt with on a bigger scale than previously. There are statutory requirements as regards preparing the plan, putting it on display and dealing with objections. Those statutory requirements must be dealt with.
At local authority level in the Dublin area, there is a greater commitment. There is a realisation of the need to fast-track decisions and to make land available as speedily as possible for new housing, as well as providing the necessary back-up services. There is a new feeling out there.
I have not sensed it. My experience in my constituency is that the reaction of local authorities is not nearly as urgent as the circumstances demand.
We will take your views into consideration, Chairman. We will continue to have ongoing discussions with local authorities. There are so many issues in the area and so much is being done that we are passionately committed to driving all these issues forward.
South Dublin County Council seems to be moving fast, particularly in relation to putting in-field housing in place. My experience would differ slightly from that of the Chairman in that regard.
I find one issue rather strange. In the older more traditional housing areas, is any consideration being given to older local authority style housing with long gardens? Are there any proposals, national recommendations or guidelines whereby local authorities - particularly in the Chairm an's constituency and Deputy Ardagh's constituency - could grant planning permission as a matter of policy to people who have large gardens that they do not use any more? Such gardens could be converted to sites for mews or smaller scale one or two-bedroom dwellings. This would be feasible, for example, with access via laneways at the end of gardens.
This practice is common in particular parts of my constituency, including Walkinstown, Greenhills and the older parts of Drimnagh. Is there any way these, by modern standards, excessively long gardens could be divided into sites with permission being granted for smaller scale housing for younger first time buyers? In practical terms, that would help in bringing new houses on stream and adding to the variety of housing in a particular area.
Eventually it is a planning issue. That is not to cop out of answering the question. It has to be decided as a planning issue. I am conscious - I cannot speak for the Deputy's area - that increasingly in the case of semi-detached houses on corner sites, houses are being built there.
That is right. That is definitely happening.
Local authorities are accommodating this. It cannot be done on a directive from the centre because if one attempts to put up——
Mr. Farrelly, you said this was a land use problem. This problem exists in urban areas; younger people do not need big gardens, nor do older people.
Walkinstown is a good example. If there was an incentive to convert those gardens people would do so; there is the social nightmare of the lanes onto which many of these gardens back. Those back lanes are causing huge problems because of anti-social activities. If there were houses built there these lanes would be better kept and they would be real access ways.
We have a very positive attitude on the question of infield housing. We support that to the last, as it ties in neatly with our new density proposals. Those are very important but we cannot interfere with individual sites.
You can issue guidelines.
The cities and towns of Ireland are filthy and getting worse rather than better despite the litter legislation. What are we going to do about the dirt in Dublin - not just on the main streets but in the canals, rivers and laneways?
We share your concerns. Progress is being made but it is not sufficient. We continue to push local authorities and other bodies very hard on the issue. The enforcement of the litter laws started very slowly and the primary management and enforcement response to the litter problem came from the local authorities themselves and we are pushing them very hard on it. The 1997 Act empowers local authorities to do different things but the number of litter wardens has increased by 125 per cent from 85 to 191 in the past year.
Is that nationally?
Yes. They would only be employed by certain authorities but we are beginning to see the application of on the spot fines. Interesting cases tend to appear in the newspapers. There has to be pain before we have gain but prosecutions have more than trebled in the same period. We do not have statistics for the second half of 1998 but on the basis of the figures I quoted, I expect that period to produce a far more positive picture.
A national litter pollution monitoring system to monitor local authority performance on litter management planning will become operational shortly. That is a major initiative. We will put in place a system to monitor the performances, which are uneven and are pretty awful in some cases.
I have lost all confidence in local authorities on the litter issue. We have been complaining about litter for years and the Litter Act was introduced under pressure from Deputies but it has made no impact. Dublin city is filthier than ever. What disturbs me is that when one walks into shopping centres like The Square in Tallaght, Quarryvale or Jervis Street they are spotless inside. The managers of private shopping centres, which have the same crowds as are walking the streets, keep their properties clean while the local authorities are not addressing the problem properly. I am not a privatiser by nature but I would love to see private companies taking over sections of the city to see if they could do something about litter. If they can, let us privatise the whole area. The local authorities are not delivering on the requirements of the law and it is an embarrassment. Tourists remark on it and it is a constant topic of conversation among natives.
Apart from the local authorities I should also have said that we want to involve communities and outside bodies to a greater extent. We have a national spring clean running in association with An Taisce and the Tidy Towns competition addresses the litter problem also.
Dublin Corporation was mentioned. It is spending £11 million this year on this problem as against £10 million last year and has doubled its number of litter wardens to 20. That is a small number for an area the size of Dublin but it is not bad for starters. There are five mobile units, which are to be increased to 11 in the next month or so, and the corporation has indicated that it will maintain or increase law enforcement in this area.
I accept what the Chairman says. The position is still unsatisfactory and the more that is said the better. We have to speak up to get action. A great deal is being done and changes are being made but more has to be done. I would like more outside bodies to be involved as everyone has a part to play, and not just local authorities.
Have any studies been done on how shopping centres are kept clean while the streets outside them cannot be kept clean? Have the techniques and standards set by these centres been discussed?
I am not aware of any such studies. Under the Litter Act a private body must keep the street outside its premises clean and action can be taken against it if that is not done.
This is bizarre. All over the country the areas around newsagents and fast food outlets can be litter disaster zones. These establishments are often in core areas - parts of the city that are meant to look well in order to develop commerce. It seems strange that local authorities do not come down hard on those types of outlets, which spit out papers and cartons. It is not the fault of these businesses in many ways but of their customers. However, they should be made responsible for their areas. It does not work in my area and I am sure it is the same for other Deputies. This law is not enforced.
If one walks along the Dodder Valley or the canals, what should be a pleasant experience is offputting because there is litter everywhere.
I accept what is being said. The Litter Act, 1997, clearly prohibits the creation of litter in carrying on a business, trade or activity or in loading, transporting or handling. The difficulty is one of enforcement. More litter wardens have been appointed and this should lead to a more thorough enforcement of the law.
The question is also one of management. Litter can be controlled in shopping centres but local authorities appear to be incapable of controlling it on the streets. The bin collection service in Dublin city is excellent. It has been operated for many years by the Dublin Corporation cleansing department and it is reliable and consistent. However, the same department seems incapable of keeping the city clean.
Prizes should be offered to people who report incidents of littering. The public must be involved.
In the United Kingdom partnerships exist between private sector bodies such as chambers of commerce and local authorities. To some extent, responsibility for the maintenance of a pleasant environment lies with the businesses in an area. It is in their interest to make an area attractive for shoppers. There are thriving chambers of commerce in Dublin city and in the new local authority areas. Local authorities should initiate a programme of co-operation with chambers of commerce and tenants of industrial estates by which the private sector would take some responsibility for the cleaning of an area. Local authority employees who operate the green machine, for example, will be more effective if they are responsible to the people who are directly affected by the service. This approach has worked effectively in a number of places in the United Kingdom and could be tried here.
In yesterday's newspaper I read that a number of new green machines are in operation. These machines are cumbersome and cannot be used when cars are parked at a footpath. In France, I have seen workers using vacuum cleaners strapped to their backs. These machines can be used to clean under parked cars. I have suggested the use of these machines to the Dublin city manager but no action has been taken. Throughout the city, streets cannot be cleaned if cars are parked at roadsides. There is not a flexible reaction to a multi-faceted problem.
I accept what Members say. The problem will not be solved by local authorities acting alone. I agree with Deputy Ardagh that groups in the private sector must be involved but the solution must be promoted by a local authority. It may be more useful to consult interested groups rather than prosecute offenders. A programme was initiated in Waterford by the local authority and Irish Business Against Litter which was similar to that suggested by Deputy Ardagh. We would support such an initiative and would like to see it extended to other areas.
For years we have had a parking problem in Dublin. Privatised clamping is solving a problem which could not be solved under public control. That is a headline for the solution of the litter problem.
I could not agree more.
Can one make an argument for offering rewards for reporting individuals or businesses who create litter? The fault does not lie completely with local authorities. The public must be mobilised to solve this problem.
The feeling that the public are filthy and cause litter appears to underlie the attitude of local authority officials and there is an element of truth in that. However, the same members of the public go to private shopping centres where litter appears to be controlled quite successfully. This indicates that public management is not responding adequately to the problem.
Shopping centres are limited areas.
Were you ever in The Square or Quarryvale?
I was. Compared to County Dublin they are small areas.
Those centres are the equivalent of a number of streets. If some of the streets in the city centre were as clean as they are we would be doing very well. The committee members have expressed themselves very strongly on this issue.
The committee notes Paragraph 28 of the Comptroller and Auditor General on Motor Vehicle Duties.