COMMITTEE of PUBLIC ACCOUNTS debate -
Tuesday, 29 Jan 2002

Vol. 4 No. 4

2000 Annual Report of the Comptroller and Auditor General and Appropriation Accounts.

Vote 36 - Defence.

Chairman

Witnesses should be made aware that they do not enjoy absolute privilege. The attention of members and witnesses is drawn to the fact that, as and from 2 August 1998, section 10 of the Committees of the Houses of the Oireachtas (Compellability, Privileges and Immunities of Witnesses) Act, 1997, grants certain rights to persons who are identified in the course of the committee's proceedings. Members are also reminded of the provisions in Standing Order 149 that the committee shall refrain from inquiring into the merits of a policy or policies of the Government or a Minister of the Government or the merits or objectives of such policy.

I welcome Mr. David O'Callaghan and his officials and invite him to introduce them to us.

Mr. O’Callaghan

Thank you, Chairman. Pat Hogan is head of our corporate services, including our finance branch, and Robbie Lyons is the principal in charge of the finance branch in Galway.

Chairman

The Department of Finance officials present are Mr. Eric Hartmann and Mr. Paddy Howard.

Mr. Purcell

The control of stores was an outstanding issue when the committee last considered the Department of Defence Vote about a year ago. Without going back over my report to any great extent, a section of it outlined two main concerns: the need to speed up implementation of the store's computer system to improve stock management and control and the high incidence of surplus and obsolete stock in need of disposal. I am informed that significant progress has been made on both fronts. All the main technical stores are now on the computer system and it is estimated that 86% of consumable stocks are on the new system. It is expected that implementation will be practically completed by the end of the year. Obsolete stocks with a book value of £7 million were disposed of in the past two years and there have been improvements in the procedures for regularly surveying stocks with a view to identifying those surplus to requirements. It is good to record sound progress and I am sure the accounting officer will elaborate on developments if the committee wishes.

There are no paragraphs on either the Department of Defence or Army Pensions Vote for 2000. The committee is aware that paragraph 19 of my annual report dealing with the operation of the Garda air support unit has an impact on the Defence Vote as it bears the operating cost of the Garda aeroplane and helicopters, which are piloted by Air Corps personnel. The committee will deal with this issue during its consideration of the Garda Síochána Vote. As I understand it, the committee has agreed that a senior official from the Department of Defence will be present when the Garda Vote is discussed.

Chairman

I invite the Secretary General of the Department of Defence, Mr. O'Callaghan, to respond to the Comptroller and Auditor General's comments.

Mr. O’Callaghan

I concur with the Comptroller and Auditor General's remarks as significant progress has been made regarding the control of stocks. A great deal of work has been done to dispose of surplus and obsolete stores, for example, we have disposed of clothing worth £2.5 million, engineering equipment worth £500,000 and transport equipment worth £100,000. The total book value of stocks disposed of in 2001 was approximately £4 million, comprising Air Corps stocks worth £2.6 million, Naval Service stocks worth £700,000, communications and information equipment worth £470,000, engineering stores worth £200,000 and £95,000 of transport equipment. The number of items held in stock by the Air Corps has been reduced from 21,000 to 15,000 and the figure for the Naval Service has decreased from 20,500 to 18,000.

I agree with Mr. Purcell's summary of the implementation of the inventory management system as all our main stores are now on the computer system. Ten Defence Forces' stores carry 50% of its consumable stock. The computer system now deals with 70 of the 90 stores that are categorised as class 2 and with 130 smaller class 3 stores. As the Comptroller and Auditor General mentioned, 86% of consumable stores are now on the new system.

Deputy Durkan

Perhaps the Secretary General will give the committee some more information. I have been interested in the disposal of surplus stock for years and I have received a lot of information in reply to parliamentary questions. It is good to have the Secretary General of the Department before the committee, however, to examine the matter in some detail. Apart from old aeroplanes, what is the nature of thesurplus Air Corps equipment that has been disposed of?

Mr. O’Callaghan

The equipment consisted mainly of old aeroplanes and associated spare parts, particularly the Fouga aircraft that were donated as exhibition pieces to institutes of technology in Cork and Carlow. Some £2.6 million worth of spare parts and equipment was allocated and some are used to train apprentices, forexample, by FÁS in Shannon. The Fouga spares had a book value of £1.2 million.

Deputy Durkan

Where did the second one go?

Mr. O’Callaghan

Carlow Institute of Technology.

Deputy Durkan

For training?

Mr. O’Callaghan

For training apprentices.

Deputy Durkan

Will any of them be used by flying clubs?

Mr. O’Callaghan

No. They have all been allocated as museum pieces or to aid the training of apprentices.

Deputy Durkan

Were the spare parts donated with the aircraft?

Mr. O’Callaghan

Yes.

Deputy Durkan

What is the position as regards engineering equipment?

Mr. O’Callaghan

In 2000, engineering equipment worth £500,000 was disposed of and the figure reached £200,000 in 2001. The amounts refer to all kinds of minor pieces of equipment, including paint, scrap material and obsolete items.

Deputy Durkan

Carriages and trestles.

Mr. O’Callaghan

Yes, although vehicles and scrap tyres come under the heading of transport, which accounted for £100,000 in 2000 and £95,000 in 2001.

Deputy Durkan

To what extent has all surplus material been removed?

Mr. O’Callaghan

We have disposed of the vast majority of surplus stored material.

Deputy Durkan

What was the total amount of money received for that?

Mr. O’Callaghan

Some £42,000 in 2000 and £385,000 in 2001.

Deputy Durkan

That was a large increase.

Mr. O’Callaghan

The LE Deirdre was sold for £290,000 and spares associated with it were sold for £27,000 in 2001.

Deputy Durkan

I read that the ship was bought to be used as a yacht.

Mr. O’Callaghan

Yes.

Deputy Durkan

Are there any more vessels to be disposed of?

Mr. O’Callaghan

No, the programme has been suspended for a few years.

Deputy Durkan

The big difference is that the equipment purchased to replace them is modern.

Mr. O’Callaghan

Absolutely, yes.

Deputy Durkan

The new equipment has greater capacity and capability and meets EU fisheries protection standards.

Mr. O’Callaghan

Yes.

Deputy Durkan

What is the total bill to date arising from the Army deafness cases?

Mr. O’Callaghan

The total bill so far is £177 million. We have received a total of 16,067 claims, of which 5,161 were outstanding at the end of December. The average settlement is about £7,600.

Deputy Durkan

How many cases have been settled so far?

Mr. O’Callaghan

Some 10,906 cases have been settled.

Deputy Durkan

Some 5,000 cases remain.

Mr. O’Callaghan

Yes.

Deputy Durkan

The awards seem to have levelled off.

Mr. O’Callaghan

Yes, the average award has reduced from a high of about £34,000 to £7,600.

Deputy Durkan

We hear a great deal of discussion about equipping a modern army. To what extent have funds available to the Department of Defence been expended with maximum impact in relation to creating the necessary equipment for the modern Defence Forces?

Mr. O’Callaghan

A positive aspect of the business of defence in recent years is that we have been able to invest significantly in re-equipping and infrastructure in the Defence Forces. The Naval Service has acquired two new ships in recent years and we now have eight modern ships. There has also been significant investment in equipment for the Army. It has received new telecommunications equipment, and 40 new, modern armoured personnel carriers are on order at £1 million each. We spent £6.5 million on specialist transport cargo vehicles. The radios cost £10.5 million. We also have plans in train to buy light infantry tactical vehicles, anti-armour weapons and night vision, engineering and medical field equipment in the coming years. A pistol replacement programme for the Defence Forces has been announced.

We are in negotiations with a company for medium lift helicopters for the Air Corps and we will shortly go to tender for training aircraft. The situation is positive on all fronts.

Deputy Durkan

Is there any EU support available for air-sea rescue?

Mr. O’Callaghan

No, there is no EU support available for search and rescue. We received some contribution towards fishery protection ships.

Deputy Durkan

That is what I am thinking about.

Mr. O’Callaghan

We received 50% subvention for the LE Róisín. We also received subvention for the CASA aircraft for fishery protection. As far as I am aware, we do not receive subvention for search and rescue.

Deputy Durkan

The emphasis is now on combating drug smuggling. Is any emphasis placed on the provision of special facilities to assist the other authorities involved - the Garda and Customs and Excise? To what extent can the Department call on financial assistance from the EU given the pivotal importance which this issue now occupies in the Union?

Mr. O’Callaghan

I am not aware of any programme through which we can call on assistance to subvent any of our purchases. However, we make our ships and aircraft available for drugs surveillance. For example, the ships would be available for at least 12 operations per year which would be intelligence-driven by the Garda. We must not forget that we now have a Garda air support unit comprising one fixed wing aircraft with sophisticated surveillance equipment and one helicopter. This unit will shortly beaugmented by a second helicopter. These aircraft are available for drugs interdiction and surveillance.

Deputy Durkan

As well as fishery protection.

Mr. O’Callaghan

The Garda's air support unit aircraft are available purely for dealing with crime.

Deputy Durkan

How many CASA aircraft are there?

Mr. O’Callaghan

There are two CASA aircraft.

Deputy Durkan

In terms of patrolling, to which duties are they delegated?

Mr. O’Callaghan

They can be deployed in any area. Obviously this would be done in consultation with the Department of the Marine and Natural Resources.

Deputy Durkan

A number of other European countries are developing air ambulance systems. We have a system by which patients, particularly those with serious head or back injuries, are moved to hospital by Army helicopter. However, to what extent, if any, has thought been given to the provision of an air ambulance service given the traffic problems? I am thinking particularly in terms of road or other accidents where transporting patients by air would be much quicker than by road. Such a service has been dramatically developed in the UK in the past couple of years.

Mr. O’Callaghan

There has been some comment in this regard, but it is a matter for the Department of Health and Children. We supply an air ambulance service for patients with injuries such as those mentioned by the Deputy. We also transport organs in emergencies from time to time. We completed 92 and 107 air ambulance missions using fixed wing aircraft and helicopters in 2000 and 2001, respectively.

Deputy Durkan

An ongoing issue involves the condition of residential quarters owned by the military and the quality of life as a result of those conditions. People still wander across the constituency boundary to ask me when they can be rehoused from existing quarters. This has been a problem for as long as I have been in public life - it has not gone away just yet. In the Department's plans and in terms of its intended expenditure arising from the disposal of various barracks etc., to what extent, if at all, will this be used to improve the quality of some of the residential quarters?

Mr. O’Callaghan

The general policy is to get out of residential quarters, where possible. This has been ongoing for a number of years following negotiations with the relevant people and the Army representative associations. For example, we are in the process of selling the 100 houses in Orchard Park. We have about 140 houses in our portfolio which are in various states of repair or disrepair. I agree with the Deputy that some of them are very poor. We are reinvesting in them. The priority in terms of living accommodation are the new recruits - single soldiers living in barracks and living in atrocious conditions. We are getting around to improving the houses and we are talking to the associations about this. We charge low rent for these quarters at present. There is a combination of improving standards and, perhaps, renegotiating some of the rents.

Deputy Durkan

How many housing units has the Army? How many are occupied and how many are unoccupied?

Mr. O’Callaghan

We have 120 in the Curragh Camp.

Deputy Durkan

There is reference to 106 houses, but are they at 106 different locations?

Mr. O’Callaghan

We have 133 for enlisted personnel and 42 for officers. That is 175 in total.

Deputy Durkan

Are they occupied?

Mr. O’Callaghan

Yes, they are occupied on a temporary basis.

Deputy Durkan

How many in total? Some residential quarters are obviously empty.

Mr. O’Callaghan

There would be some unoccupied quarters, but very few. There are various types - type A, B, C and D - depending on the standard of accommodation. Some are very low standard and some are very basic and are used by men on temporary transfer to a barracks. They would not be family quarters by any manner of means.

Deputy Durkan

Could they be used for residential purposes on an on-off basis? What useful purpose do such unoccupied buildings serve at present?

Mr. O’Callaghan

We have reconsidered the whole policy. A lot of them were not serving any particular or useful purpose so we decided to sell them back to the occupants if they wished to buy them. That has been very successful and went down very well with the residents. We are holding on to the bare minimum, which are normally those within the camp, as in the case of the Curragh. They are within barracks down the country. The bulk of the 175 I mentioned earlier - 127, I think - are in the Curragh. In the eastern command there is a total of only 29 which we require. The southern command has 16 and the western command has only three. They mainly facilitate people going on transfer from one brigade to another on a short-term basis. Very few families, as such, are resident in them and most would not be suitable for family quarters.

Deputy Durkan

The air ambulance system provided by the Department has flown many sor-ties. What about the CASA aircraft? How many operational flights have they undertaken?

Mr. O’Callaghan

In terms of hours——

Deputy Durkan

Over the sea.

Mr. O’Callaghan

We have two. The total number of hours spent on fisheries' protection in 2000 was 1,368 and in 2001 was 1,390.

Deputy Durkan

How many flights were there over land?

Mr. O’Callaghan

In my brief the figures are expressed in percentages. The percentage of time spent by the CASA aircraft on fishery protection duties amounted to 89% in 1999, 88% in 2000 and 84% in 2001. The percentage of time spent on a combination of search-and-rescue, air ambulance and security duties was 9% in 1999, 10% in 2000 and 14% in 2001. The percentage of time spent on occasional back-up for ministerial air transport amounted to 2% in each of the years 1999, 2000 and 2001. I am sorry for listing percentages but the figure of 1,368 flying hours in 2000 represented 88% of its total usage.

Deputy Dennehy

On the subject of buildings and modernisation, I compliment the Secretary General on two projects: the new mess at Haulbowline and the new mess at Collins Barracks in Cork. I compliment particularly the naval mess at Haulbowline from the point of view of design and modern standards. It is one of the best things I have seen produced by any State body. In that context, I have for many years been expressing surprise at the number of senior naval personnel based or deployed at Parkgate Street. I have been trying to encourage a move to Haulbowline for many years and wonder if that has been achieved.

Mr. O’Callaghan

I am glad to report that there are no sailors in Parkgate any more: they are all in Haulbowline.

Deputy Dennehy

That is excellent, Chairman. That is the correct place for them.

We have been through the mill on the question of hearings. Was the primary reason for setting up the commission the speedier hearing of cases, as I hope proves to be the case? It is certainly more acceptable from the point of view of figures.

Mr. O’Callaghan

Yes, we have an early settlement scheme by agreement with the Law Society and it seems to be working.

Deputy Dennehy

Are there any down sides to it? In other words, can it be used as a prototype by the State, for example, by the Department of the Environment and Local Government in public liability cases? Does Mr. O'Callaghan see any possibility of this?

Mr. O’Callaghan

Yes. It has been successful, by and large. The one downside is that it is not exclusive. It is there and available but there are some people who would prefer to have their day in court and we cannot exclude that either, unfortunately. We would prefer everyone to go through the early settlement scheme if possible as it is cheaper for us from a costs point ofview.

Deputy Dennehy

I am glad things seem to be settling down to a more moderate price.

I am not sure if this is Mr. O'Callaghan's bailiwick, but in Crosshaven there is a row of houses referred to as the coastguard houses. They have created difficulty for many years when attempts have been made to sell them.

Mr. O’Callaghan

I will note the issue and return to the Deputy, but as far as I am aware they belong to the Office of Public Works. I will try to confirm that.

Deputy Dennehy

They seem to have taken an unusual amount of time and nothing has been achieved since. To return to the question of the sale of surplus stock, perhaps I need to take a hearing test, but did Mr. O'Callaghan mention that there was £7 million worth of surplusstock?

Mr. O’Callaghan

Between two years, yes.

Deputy Dennehy

That was the actual book value. It was sold at £0.5 million over the two years.

Mr. O’Callaghan

I should add that the biggest thing I mentioned was the £2.5 million in clothing. At least £2 million of that went to the FCA for uniforms. It was not just written off.

Deputy Dennehy

Very good.

Mr. O’Callaghan

Other parts were material we could send back to the GSA or which could be sold via the GSA.

Deputy Dennehy

To return to the issue of stocks and stores, I have, as I mentioned previously, the experience of sharing Haulbowline for 25 years with the Navy and one thing that I noticed, with my engineering background, was the huge amount of space taken up in stores and buildings which were crammed with obsolete material. Has there been much freeing up of premises as a result of rationalisation?

Mr. O’Callaghan

Certainly it has started, but the Deputy is probably aware that conditions in Haulbowline are fairly cramped so they could use all the space they can get.

Deputy Dennehy

I meant generally, around the country.

Mr. O’Callaghan

Generally, it is much more efficient.

Deputy Dennehy

In terms of staff how are things working, with so much to do?

Mr. O’Callaghan

There has not been any reduction in staff. A storeman is needed whether there are 10,000 or 9,000 items.

Deputy Dennehy

In one of the final pages it is stated that the Department paid a fair sum of money two years ago - £40,592 - to the consultants engaged to do the Integrated Action Area Plan for the former Murphy Barracks in Ballincollig. What was the state of play there? This was the December 2000 expenditure, so we have moved on a fair bit.

Mr. O’Callaghan

The IAAP for that property of 138 acres was submitted to the County Council on 27 March 2000. The variation to the county development plan was adopted by the council last year. At the moment we are conducting a tender competition for a selling agent for Ballincollig. That company will be appointed shortly and we will then go to the marketplace to sell it. There have been negotiations with the local GAA and soccer clubs and a conclusion to that was reached last week. The GAA will be allocated an extra three acres and the soccer club will get about six acres.

Deputy Dennehy

The section called social and community activities will probably be made up of the voluntary sector such as scouting and maybe credit unions. The credit unions have written to me looking for space. Are they being facilitated or it is solely the sporting bodies?

Mr. O’Callaghan

The two sporting bodies is all we are briefed on here. They could be included in the area action plan. There is possibly an amenity area within that in which they can be accommodated.

Deputy Dennehy

Would you hazard a guess as to when you might get some cash into your coffers?

Mr. O’Callaghan

Hopefully, we will get them off the books later this year.

Deputy Dennehy

What has been the cost of security up to now?

Mr. O’Callaghan

I can get you that figure. We do not have a separate figure for Ballincollig but since 30 September 1998 we paid about £1.3 million in security for all the barracks that we have vacated.

Deputy Dennehy

Are there three locations?

Mr. O’Callaghan

There are now six, as Clancy Barracks was evacuated before Christmas. Against that of course there are savings. Soldiers getting a security duty allowance would have earned £1.05 million in the same period and we are also saving on utilities and everything else, so it balances out.

Deputy Dennehy

That will still go on for another six or 12 months. I am from the south and Murphy Barracks is of particular interest, but how is the sale of the other barracks progressing?

Mr. O’Callaghan

The 60 acre site at Magee Barracks in Kildare is being used to provide mobile home accommodation for approximately 200 asylum seekers and cannot be sold at this time. Clancy Barracks contains 13.65 acres and was only vacated on 21 December last. It is for sale and we are negotiating with Dublin City Council.

Deputy Dennehy

Is the city council seeking that site?

Mr. O’Callaghan

They are expressing an interest in it. Fitzgerald Camp in Fermoy has been sold to Cork County Council for £767, 000. Of the 22 acres at Devoy Barracks, Naas, 15 acres are in the process of being sold to Naas Urban District Council for £7.3 million. We received a deposit for that and the remaining seven acres is being ceded to the UDC free of charge. Castle-blayney Barracks has been sold to the North-Eastern Health Board for £600,000.

Deputy Dennehy

A lot of progress has been made in the disposal of the barracks.

Mr. O’Callaghan

The property market seemed to take a bit of a dip last year but it will probably pick up again.

Deputy Dennehy

On this committee we have been trying to make an assessment of the value of State owned land and property. How is 20,000 acres valued? Is there a property valuation?

Mr. O’Callaghan

No. We find it very difficult with the little blocks we are selling. The initial valuation for Clancy Barracks was £40 million but when we put it on the market last year we did not get any bids in excess of £20 million.

Deputy Dennehy

It is very much a guestimate.

Mr.O’Callaghan

It is and there does not seem much point in doing it until you want to sell it or do something with it.

Deputy Dennehy

There are reasons for it. You have buildings in 106 locations and somebody may want to know what these State holdings are worth although it might be an academic exercise. On page 324 there is a reference to 40 armoured personnel carriers for which we have been paying over the last two years. What is the state of play with the delivery of the personnel carriers? Are some of these going directly overseas for foreign missions?

Mr. O’Callaghan

Of 40, 27 have been delivered. Five of them are in Eritrea at present.

Deputy Dennehy

In response to a question from Deputy Durkan you outlined the operating cost of the two Garda aircraft - a helicopter and a fixed wing. Are there any difficulties in the fact that you are maintaining them, that they are piloted by the Air Corps and are under the jurisdiction of the Garda?

Mr. O’Callaghan

There is probably some difference of opinion in the way it should be managed. I understand that it is working very well now. There is a vast improvement in the way things are operating and how it is being managed. I gather progress is being made in what is called a service-level agreement between ourselves and the Garda as regards what standards are to be maintained. As soon as we get that in place everyone will know where they stand. I am happy to report that everything seems to be working very well now. As the Comptroller said this will probably get a wider and bigger airing when we are represented at a future committee hearing when this will be discussed in detail.

Deputy Dennehy

It is important, Chairman, because anyone who has ever worked in a business will understand the potential conflicts and the internal dynamics in an organisation, let alone trying to bond two together.

Mr. O’Callaghan

The Deputy has put his finger on it. Obviously when there are matters of safety of personnel, risks cannot be taken. There was a safety issue with the fixed wing aircraft. I gather those issues have been resolved now and it is back in operation and working very well.

Deputy Dennehy

Like all politicians I am wondering what would drive one to give conscience money. I see from your receipts on page 322 that some £1,550 was described as conscience money. I imagine that is rare.

Mr. O’Callaghan

By and large these are amounts of money that come in anonymously to us without any explanations. They literally come in brown envelopes.

Deputy Dennehy

They must have guilty consciences.

We got into a terrible state for a while with the UN. They were not paying us and we seemed to be the one's suffering all the time. Under Appropriations-in-Aid, receipts of £4 million had been estimated for 2000 and £8.6 million was received. Was that conscience money which the UN recognised it owed us? What is the current position?

Mr. O’Callaghan

The main issue was that the United States paid substantial arrears to the UN and consequently we got more than we expected at the beginning of the year.

Deputy Dennehy

Where does it leave us now? What is the current position regarding arrears?

Mr. O’Callaghan

At the end of December 2001 we were due £6.61 million in arrears. That is probably one of the better pictures I have had to report during my years appearing before this committee. It went as high as £16 million seven or eight years ago.

Deputy Dennehy

Are you confident of collecting £6.61 million?

Mr. O’Callaghan

I think so. There are only about four missions abroad for which we are reimbursed and the level of operations has been scaled down considerably. We have the new operation in Eritrea and Ethiopia, we only have a handful of troops in Cyprus and a small number in East Timor. There will be a reducing amount of money falling due on a year to year basis. We see this as an opportunity to dig into the arrears, as we have been trying to do.

Deputy Dennehy

Perhaps we were able to plead the béal bocht for quite a number of years. Has the position changed since our economy has been doing rather well?

Mr. O’Callaghan

There is a standard which applies to all countries in this regard. Reimbursement is at the rate of $1,085.00 per head per month for personnel serving abroad. All countries are entitled to that and it is up to us to ensure we get our entitlement.

Deputy Dennehy

That would also be encouraging for our serving personnel. The situation which prevailed for some years was disheartening with the US and Russia not paying their share.

Mr. O’Callaghan

The problem was mainly with the United States in that regard.

Deputy Dennehy

I am happy enough with those responses. Thank you.

Chairman

I have a few questions, Mr.O'Callaghan. You referred to the disposal of obsolete stocks. Following the tragic loss of four Air Corps personnel in July 1999, the subsequent report focused on the Dauphin helicopter and was critical of the lack of stocks and the consequent "cannibalising" of aircraft for spare parts. Can we be assured that there are adequate stocks in store, if required, for the existing Dauphin aircraft in service?

Mr. O’Callaghan

I can give a categorical assurance on that, Chairman. There is no problem in that regard. Since the tragic event in Tramore on 1 July 1999, we have had a total safety audit of all the operations of the Air Corps. I am not altogether sure that the allegations of lack of spares and cannibalisation of existing aircraft were substantiated.

Chairman

I believe it came from an existing member of staff during the investigation. However, rather than going into that, I welcome the assurance that there are adequate stocks of spare parts. What is the position with regard to the location of air-sea rescue service in the south-east, since July 1999?

Mr. O’Callaghan

We have daytime air-sea rescue by way of an Alouette helicopter.

Chairman

Is that not restricted to a range of about 12 miles?

Mr. O’Callaghan

Yes, it is restricted and it is confined to daylight hours.

Chairman

Do I understand correctly that the Sikorsky has a range of up to 200 miles?

Mr. O’Callaghan

It has a range of 200 miles, yes.

Chairman

It has been suggested that Ireland's area of authority may extend in future to 350 miles. In that event, is there not a problem in relation to our existing limited range of 200 miles? Is that aspect being considered in the current discussions on the purchase of additional helicopters?

Mr. O’Callaghan

No. One hesitates to say that this comes as news but, when we went out to tender for search and rescue helicopters last year, the civil-military team which was appointed to draw up a specification specified 200 miles. The Chairman's reference to 350 miles worries me and I have taken note of it.

Chairman

From my former involvement in defence matters, I am still very interested in this area. I have followed the developments with regard to the proposed purchase of helicopters, including the choice between Eurocopter and Sikorsky. The recommendation of the special inquiry team in favour of Eurocopter was subsequently revised and there are now suggestions that legal action may be taken by the unsuccessful tenderer. What is the current status in that regard?

Mr. O’Callaghan

We went out to tender, advertising in the EU Journal. We had six responses from various companies, including the two which have been mentioned by the Chairman. In December, the Minister decided to go for the best and final offer. That was obtained and was analysed over the Christmas period. On 17 January, the Minister decided to open negotiations with Sikorsky on the basis that it offered the best, strategically, and most economically advantageous tender. This was based on the functional characteristics of the machinery, technical merit, maintenance and after-sales service, tender prices and life cycle costs. Despite media speculation, there was no offer of offsets, as it is generally known, or counter trading by Sikorsky or anyone else to put business in the way of private commercial firms in return for preferential treatment. The decision was not made on that basis. It was a very closely run competition and for the reasons I have stated Sikorsky was judged to be strategically the best and economically the most advantageous. That is why the Minister directed that we open negotiations with Sikorsky and those negotiations have been in progress in the United States yesterday and today. It is true that we have got solicitors' letters from Eurocopter saying we should not sign any contract with any other tenderer until they have examined the documentation that they have requested from us under EU directives and under our own FOI legislation.

Chairman

How long will that process take?

Mr. O’Callaghan

We would have to negotiate with what we regard as the best tenderer to firm up matters, even if there was no distraction by way of legal action. It would take four or five weeks, anyhow, to copperfasten a contract of this size. Under FOI, we have 28 or 30 days to reply to the request. There are sensitive issues involved. We are negotiating and we are under legal threat, as it were. However, under the FOI legislation, there is certain material I do not believe we can release, particularly if it is commercially sensitive, for example. We will have to ask the other people involved in the tender operation whether we can release information about the proposals they made to us. I agree that there is potential for the situation to become messy, but I am happy that the procedures we have employed were apt and that the advice the Minister received was complete, impartial and the best we could provide.

The project team examining this matter had a job to do, namely, to look at the tender documents that were sent to us and judge them under a number of headings. It did actually make a recommendation; it was asked to make a recommendation.

Chairman

What was the team asked to do?

Mr. O’Callaghan

It was to make a recommendation. It was to judge the tenders under various headings.

Chairman

Would the ultimate responsibility for making the recommendation lie with Mr. O'Callaghan?

Mr. O’Callaghan

It would be up to the Minister to make a decision.

Chairman

Assuming that the negotiations with Sikorsky reach a satisfactory conclusion, when is it expected that the three helicopters will be delivered?

Mr. O’Callaghan

As far as I can recall, Sikorsky has offered one of the better delivery dates, namely, the end of next year.

Chairman

I understand that the most recent vessel purchased by the Department of Defence cost approximately £20 million. Is Mr.O'Callaghan concerned about the difficulty in recruiting staff, particularly watchkeepers, for the Navy? I read recently that it is not possible to provide a 24 hour fisheries service on the basis that there are insufficient watchkeepers which obliges vessels to anchor at night. Is that correct?

Mr. O’Callaghan

I do not believe so. All our ships are operational at present. I believe we have sufficient watchkeepers to operate on a 24 hour basis. Our main difficulty at present is recruiting sailors for the Navy. There are 200 vacancies in the service. That is a big problem. We do not appear to have the same difficulty in recruiting people for the Air Corps or the Army. For some reason, a career at sea is not as popular as it was in the past. We are launching a major recruitment programme in the middle of next month and major emphasis will be placed on encouraging people to join the Navy.

Chairman

A number of years ago, cadetships, whether in the Navy or Army, were extremely popular. Is it not correct that the number of applications last year was down on previous years?

Mr. O’Callaghan

Yes, the number of applications has certainly dropped. Five or six years ago several thousands of people used to apply for cadetships, but this is probably less than one thousand now. I can provide recent recruitment figures for the Navy, if the Chairman so wishes. We got 62 new recruits in 2001, 59 in the previous year, 97 in 1999 and 103 in 1998. However, these were probably not even adequate to keep pace with natural wastage.

Chairman

I accept that as a result of hearing impairment claims the Department of Defence has adopted an ultra-cautious attitude in respect of medical examinations. However, I did not realise until recently that a person could be rejected by the Navy if they have flat feet. I am familiar with an individual who was rejected on this basis and he did not realise he had flat feet until he attended for his medical.

Mr. O’Callaghan

That is true. The standards are very high. We are conscious of the health and safety issues involved and are cautious about the possibility of litigation. I have been struck by the fact that the relevant authorities insist on such high standards, but it is hard to argue against them because they are the professionals in this area.

Chairman

Mr. O'Callaghan may remember a story about the use of a particular drug, Xenical, at Collins Barracks to help 20 obese soldiers to lose weight. Was that story serious in nature?

Mr. O’Callaghan

It is difficult to know whether it was serious. It was a fact that there were about 14 soldiers in the Defence Forces who were prescribed the drug by doctors for very good reasons. However, it was not taken purely as a substitute for partaking in the fitness programme. It was taken under prescription by these people to help them with a particular problem. The scale of usage was not enormous by any means.

Chairman

Was it not exclusive to Collins Barracks?

Mr. O’Callaghan

No, it was used throughout the Defence Forces.

Chairman

How many soldiers throughout the country would have participated in the programme?

Mr. O’Callaghan

It cost us £8,400 to obtain a supply of the drug. A total of 38 personnel throughout the Defence Forces were prescribed the drug over a three year period. This particular drug was authorised by the Irish Medicines Board and 14 patients are currently receiving the medication. All patients taking Xenical must observe a strictly low fat diet or they will develop severe and unpleasant intestinal side effects. I am informed that obesity is a recognised risk factor for a variety of conditions such as coronary artery disease and arthritis of major weight-bearing joints. Xenical is used as a medication in association with a primary preventative care service to reduce the potential mortality of persons with such conditions. There are 14 personnel throughout the Defence Forces - they are not restricted to Collins Barracks - on the drug and according to the director of the medical corps, who has responsibility for these matters, it is prescribed in the same way——

Chairman

As for ordinary members of the public?

Mr. O’Callaghan

I do not know. I assumeit is.

Chairman

The company that marketed the drug received complaints from over 4% of those who took part in its clinical trials about hearing disorders and other side effects. I find that ironic, particularly in light of the question of hearing impairment claims. Perhaps Mr. O'Callaghan could verify matters for us in that regard.

Mr. O’Callaghan

Okay.

Deputy Dennehy

Are higher medical standards applied to prospective recruits to the Naval Service than are applied to those recruited to the Air Corps or the Army?

Mr. O’Callaghan

It is——

Deputy Dennehy

A case was taken last year by a person who required gluten-free food on board ship. I do not know what was the result of the case. Friends of mine were involved and I am reluctant to refer to an individual case.

Mr. O’Callaghan

Judgment was reserved in that case.

Deputy Dennehy

I found it absurd that the No. 1 graduate should be prevented from serving as a result of his need for gluten-free food. I will be interested to hear the final outcome in the case.

I accept that people might not want to join the Defence Forces at present and will seek alternative employment. In view of the improved standard of facilities and the pay scales on offer from the Naval Service, it is surprising that there is a shortage of recruits. I appreciate that not everybody wants to go to sea, but the profession is attractive in many other ways and I believe that a good recruitment campaign would work.

Mr. O’Callaghan

We intend to take action in that regard.

Deputy Durkan

The Department of Defence is the co-ordinating body for the national emergency plan. I have pursued this matter over a ten year period and I am aware that another Department was previously responsible in this regard. What provision has the Department of Defence made in terms of expenditure for this new role and responsibility? I looked at the report of the Comptroller and Auditor General and tried to figure out where the iodine tablets are stored because there is no reference to them in the report. If the Department has control over them, and ultimately control over their distribution on a nationwide basis, I would like to know a little more about it.

Mr. O’Callaghan

Following the events of 11 September, the Government decided that an office of emergency planning would be set up in the Department of Defence. We have an oversight and advisory role. The existing lead Departments in respect of specific emergency planning will continue and the existing emergency plans will be the responsibility of individual Departments. Our job is to ensure that the plans are there and that the Departments do their job. Iodine tablets are the responsibility of the Department of Health and Children and distribution of them will be that Department's responsibility also.

Deputy Durkan

Has the Army not seen these tablets?

Mr. O’Callaghan

No.

Deputy Durkan

Do they exist?

Mr. O’Callaghan

I understand the Department of Health and Children put it out to tender last year and that the tablets will be delivered and issued shortly.

Deputy Durkan

How is it proposed to co-ordinate their distribution without some verification of their current location, quantity and quality and so on? This is a matter that will cause some concern. I appreciate that other agencies are responsible for storage at present. However, I would imagine that the logistics of delivering four million tablets, depending on the number that must be taken and the prescribed period, would require a little more information be in the hands of the co-ordinating Department.

Mr. O’Callaghan

There is a Government task force which is chaired by the Minister for Defence. The Minister for Health and Children is a member of that task force. This matter is debated and discussed at its regular meetings. The Department of Health and Children is acquiring huge amounts of iodine tablets - I am not sure whether they are in the country yet - and arranging for distribution to households throughout the country. It is not an easy task but it will be done.

Deputy Durkan

I am a little uneasy about that. Originally there was an assurance that there was a supply and ready availability and that it would be just a matter of going through the motions, that they could be produced almost overnight. I fully accept that a number of bodies are involved in co-ordinating matters, including the Department of Health and Children and the Department of Justice, Equality and Law Reform. I presume the Department of the Environment and Local Government has some involvement as it used to have.

Mr. O’Callaghan

The Departments involved include the Department of Justice, Equality and Law Reform. The Department of Public Enterprise looks after civil aviation security issues which are discussed on a regular basis. The Department of Health and Children sets down protocols in relation to biological threats and related issues. The Department of Public Enterprise is responsible for the nuclear threat and related issues. The Department of the Environment and Local Government discusses chemical threats and related issues. The Department of Justice, Equality and Law Reform is involved in front-line security and in legislation and legal issues. They are the main issues. Other issues discussed are public information, public confidence issues, warning the public, contingency plans, emergency plan activation, international emergency planning and business continuity planning.

Deputy Durkan

It sounds like a major operation.

Mr. O’Callaghan

It is.

Deputy Durkan

How often does the task force meet? What success has there been in tying together all the procedures that are necessary? Given the number of Departments involved, it requires a great deal of unison, for want of a better expression.

Mr. O’Callaghan

Following its setting up, it met on a weekly basis. Shortly thereafter, the frequency of meetings was reduced to once a fortnight. I have attended all the meetings. There is much planning going on in all the Departments down to a very detailed level. We see the job of the task force as being to bring all this planning together, update it where necessary and make it more robust in the light of the events of 11 September. The main objective is to ensure that all State bodies can react quickly and efficiently to any crisis.

Deputy Durkan

Can they now?

Mr. O’Callaghan

No, I would say there is work to be done.

Deputy Durkan

I hate to ask awkward questions, but surely we should be able to put preparations in place here to achieve the highest degree of readiness in the time it took to end the war in Afghanistan which followed the events of 11 September.

Mr. O’Callaghan

I assure the committee there is a high level of planning in all the lead Departments with responsibility. There are areas that need work. No one foresaw the events of 11 September. Up to now emergency planning has been based mainly on the premise that there would be a period of high tension, as happened during the Cuban missile crisis, and that there would be some notification that something was in the offing which would give people an opportunity to plan. We can no longer expect that. We have to be ready for every contingency. There is a high level of planning. The plans are laid down. For example, a protocol was set down very quickly in the context of the anthrax scares. We had 119 of them with which the Garda Síochána had to deal, but, thankfully, all of them were hoaxes.

However, starting from a very low level of knowledge in how to deal with such threats, a protocol was quickly put into place and all the agencies involved worked very well. Very quickly following that, protocols for dealing with all aspects of such a scare and similar protocols were set up for dealing with such matters as smallpox. They are now in existence. They were not in existence heretofore. Emergency planning in relation to the nuclear threat was tested fully on 10 November. There has been outside verification of what went on there and a consultant's report is being considered by the Department of Public Enterprise as to how that operated.

Deputy Durkan

We do not know yet whether it was a success.

Mr. O’Callaghan

Generally, it was a success. However, as with any exercise, protocol or procedure, if it is given outside verification, it will be shown that there is room for improvement. I am sure the same happens when the Comptroller and Auditor General goes into any Department. The Department might think it is doing fine. However, outside verification, outside audit, is important. A Department needs an outsider to stand back and tell it where it can improve. There is a huge level of planning going on. Hundreds of people are involved in this. We are putting it all together, but there are scenarios that have to be worked on and they are in areas where we get no notice of what is going to happen.

Deputy Durkan

I presume that supplies of medication such as the famous tablets are available somewhere in the country now and can be found in the event of an emergency. I am also concerned that a major disaster might coincide with a natural disaster that disrupts telecommunications and rail or road communications. Such things happen and I would be happier if I knew we had considered this possibility. If what we are told about the amount of planning that is taking place is true, we should be thinking about it. I would hate to wake up some morning and find that somebody had forgotten to consider the possibility of gale force winds or a major snowfall or some other natural disaster that would complicate matters. These things have a propensity to happen in that fashion. I hope the planning that is taking place is taking account of all those possibilities.

Mr. O’Callaghan

The planning takes account of all those possibilities in so far as any one can reasonably picture or imagine them. DeputyDurkan mentioned waking up in the morning. One of the scenarios we are looking at is how we alert people to closing their windows and turning off their ventilation systems if something happens in the middle of the night. Everybody would be asleep.

Deputy Durkan

I presume there is an alert system that will be triggered in the event of radiation or whatever the case may be.

Mr. O’Callaghan

That is what we are working on, yes.

Chairman

Thank you. We note the Votes 36 and 37. The next meeting of the committee will be on 5 February to consider the 1999 reports of FÁS. Under any other business, I propose the examination of financial accounts other than appropriation accounts.

The witnesses withdrew.

The Committee adjourned at 3.55 p.m. until 2 p.m. on Tuesday, 5 February 2002.