COMMITTEE OF PUBLIC ACCOUNTS debate -
Thursday, 12 Nov 2009

Vote 37 — Army Pensions.

Mr. Michael Howard (Secretary General of the Department of Defence) called and examined.

Chairman

I draw attention to the fact that while members of the committee enjoy absolute privilege the same privilege does not apply to witnesses appearing before the committee. The committee cannot guarantee any level of privilege to witnesses appearing before it. I remind members of the longstanding parliamentary practice to the effect that members should not comment on, criticise or make charges against a person outside the House, or an official by name or in such a way as to make him or her identifiable. Members are also reminded of the provisions within Standing Order 158 that the committee shall also refrain from inquiring into the merits of a policy or policies of the Government or a Minister, or the merits of the objectives of such policies.

I welcome Mr. Michael Howard, Secretary General of the Department of Defence and ask him to introduce his officials.

Mr. Michael Howard

I am joined this morning by Mr. Pat Hogan, head of corporate services, Mr. Maurice Quinn, assistant secretary, Mr. Ciarán Murphy, assistant secretary, and Mr. Robbie Lyons, deputy finance officer.

Mr. Dermot Quigley

I am a principal officer in the sectoral policy division of the Department of Finance. My colleague on the right, Mr. Billy Noone, works in the procurement area. On my left is Ms Brenda Farrell who works in the pensions area and Mr. David Denny works on the administrative budget side.

Chairman

I ask the Comptroller and Auditor General to introduce 2008 Annual Report of the Comptroller and Auditor General, chapter 28 and 2008 Appropriation Accounts — Vote 37: Defence and Vote 37: Army Pensions. The full text of the chapter can be found in the report of the Comptroller and Auditor General or on the website of the Comptroller and Auditor General at www.audgen.gov.ie.

Mr. John Buckley

The net cost of running the Defence Forces in 2008 was €865 million. Around 69% of this net expenditure went on pay of Defence Force personnel and civilian employees. Army pensions cost approximately €200 million in 2008. Apart from domestic duties, the Defence Forces contributed to certain international missions and activities, including the European Union Force in Chad and a special Kosovo force. These two operations cost approximately €61 million in 2008.

The Department subvents the activities of the Irish Red Cross to the extent of €951,000, the Civil Defence Board, €6.2 million, and Coiste an Asgard, €803,000. Members will be aware that the Asgard sank in September 2008 and insurance compensation of €3.8 million was received in 2009.

There was one chapter in the annual report for 2008. It outlines the cost of the Irish involvement in the EUFOR mission in Chad and some issues around the procurement of helicopter support. A sum of €60 million is estimated as the extra cost of the EUFOR mission up to June 2009. Irish troops since March 2009 form part of a further UN-directed operation, MINURCAT.

The chapter outlines certain breaches of procurement procedures in the acquisition of helicopters for the EUFOR mission. Essentially, a contract to the value of €3 million was entered into by Defence Force personnel to acquire two helicopters, pilots and associated services. This was done without submission of a business case for the transaction to the Accounting Officer; without reference to the internal approval procedures including approval by a joint military civilian procurement group; without competitive procurement procedures in that there was inappropriate use of an existing framework agreement that was designed to cover chartered flights of Defence Forces personnel; and in breach of contracting limits that applied to this type of procurement.

In the event, the air worthiness certification of the helicopters was found, following deployment, to cover the carriage of cargo only and their use for the transport of troops had to be curtailed until properly certified replacement helicopters were provided.

The Accounting Officer will be in a position to detail any lessons learned, the adjustments made by him in the area of procurement as well as the operational implications for the EUFOR mission.

Chairman

I ask Mr. Howard to make his opening statement.

Mr. Michael Howard

I thank the Chairman. Total gross expenditure on defence in 2008 amounted to €1,083 million, comprising €880 million under the Defence Vote and €203 million under the Army Pensions Vote. The pay, allowances and pension costs of the Defence Forces and the pay of civilians employed with the Defence Forces account for the bulk of expenditure. At the end of 2008 the strength of the Permanent Defence Force was 10,400. There were 820 civilian employees attached to units of the Defence Forces and 385 civil servants in the Department of Defence. In addition there were about 7,500 personnel in the Reserve Defence Force.

The re-equipment programme for the Defence Forces continued in 2008. In December 2008, a contract for the supply of light tactical armoured vehicles, LTAVs, was awarded to BAE Systems, based in South Africa. An initial 27 vehicles will be acquired: 17 for overseas missions and ten for training at home. The intention is that LTAVs will complement the Mowag armoured personnel carriers, APCs, in the conduct of conventional and peace support operations and will fill a gap that exists between soft-skinned vehicles and the Mowag APCs.

The contract for the LTAVs will run over a period of three years and has a value of €19.6 million. An initial down-payment of €8 million was made in 2008 and the balance will be paid this year and in 2010. Sixteen of the vehicles will be delivered in the first quarter of next year and 11 later in 2010. The contract provides the option for the acquisition of further vehicles in the future, should the requirement arise.

Very significant investment has been made in replacing the aircraft in the Air Corps over the past number of years, with new trainer aircraft, a new helicopter squadron and a significant mid-life upgrade to the CASA maritime patrol aircraft. Expenditure in 2008 was €18.6 million under this heading.

A number of the ships in the Naval Service are coming to the end of their useful life and a tender competition for a ship replacement programme commenced in 2007. The competition sought tenders for the purchase of two offshore patrol vessels, OPVs, and one extended patrol vessel, EPV, with an option for up to two additional vessels. It is a multi-stage process. During 2008, stage 1 of the tender process was completed and tenders were received in response to stage 2. Following tender evaluation, a preferred bidder has been selected and detailed and extensive contract negotiations are now close to conclusion. The decision to proceed with the final award of contract to purchase the OPVs will be subject to Government approval and agreement on funding. Subject to such approval, it is expected that the new vessels will be delivered for acceptance by the Naval Service on a phased basis from 2012. In relation to the larger EPV, stage 1 of the competition has been completed. Stage 2 will not be initiated until the contract for the OPVs has been concluded.

The programme of improving the living and working conditions of military personnel continued during 2008. Expenditure on capital building works was €26 million while a further €11.2 million was spent on maintenance works.

Through the Defence Forces, Ireland continues to make a significant contribution to peacekeeping. At the end of 2008 there were 760 Defence Forces personnel serving in 16 different overseas missions and postings throughout the world. The largest overseas deployment at that time was the contingent of 425 personnel with the EU-led operation in Chad and the Central African Republic. When the mandate of the EUFOR mission expired on 15 March 2009, it was replaced by the UN mission, MINURCAT. The UN assumed operational control of the United Nations force of 2,085 personnel, including 1,877 troops re-hatted from eight EUFOR contributors. The Irish contingent which had been deployed in Chad with EUFOR transferred to the authority of MINURCAT on 15 March 2009.

At present, the other main Defence Forces deployments on UN authorised missions are to the NATO-led operation in Kosovo with 233 personnel, and to the EU-led operation in Bosnia and Herzegovina, with 44 personnel.

As the Comptroller and Auditor General mentioned, his office completed an audit of the Chad mission this year and I accept the findings of the audit which are broadly in line with those of the investigation carried out by the internal audit unit in the Department at my request and finalised in February. However, it is important to take into account the overall context in which the contracting of the helicopters occurred. The deployment of the Defence Forces contingent to Chad was the most challenging logistical project ever undertaken by the Defence Forces. The unprecedented extent and nature of the deployment meant that the project was a very important learning exercise for the Defence Forces. Overall, the very difficult task of deploying and sustaining the Irish battalion has been accomplished in a very professional manner.

Given the remoteness of the Irish battalion's base in Goz Beida, the complete absence of road infrastructure, the isolation anticipated during the rainy season and the considerable distance from the nearest hospital, the absolute necessity for comprehensive helicopter support was recognised from the outset. The authority to procure air support for the Defence Forces, including helicopters, was delegated to the Chief of Staff. A contract was signed at the end of May with a UK company, Air Partner, for the charter of two Mi-8T helicopters for use in Chad. The contract included the provision of airframes, crew and maintenance at a cost of €2,100 per flight hour for a minimum of 120 hours per month, plus additional war risk insurance. The two civilian registered helicopters arrived in theatre in Chad on 28 June 2008. The contract duration was originally ten months but was subsequently extended by a further six.

In September 2008 a question arose on the certification of the helicopters for the transport of passengers. On further investigation, it was discovered that they were classified in the air operator certificate as cargo-carrying only. It was a regulatory and licensing issue relating to civilian registered helicopters and did not reflect in any way on the safety, technical or operational capacity of the helicopters. Pending resolution of the matter, the helicopters were for a period temporarily restricted, largely to transport operations only. The certification matter was resolved when the company replaced the helicopters with two others which were certified at no additional cost to the Department. The new helicopters became operational in January.

In purely operational terms, the contracted helicopters performed well in service and provided vital support for the Defence Forces. The requirement for the helicopters was very real. Even when their use was temporarily restricted in 2008 while the certification issue was being resolved, they continued to fill an important role by providing logistical support. They remained available as emergency cover in casualty evacuation. Therefore, they continued to provide essential capability throughout the period.

I confirm to the committee that the findings and recommendations made in the internal audit report have been fully accepted and acted upon. The procedures for delegating authority to military personnel generally have been reviewed and strengthened. This was done by a thorough review and amendment of the delegation instruments by which I delegate budgetary control and responsibility to the Chief of Staff. The terms of reference of the civil-military high level planning and procurement group have been revised to ensure all procurement decisions are monitored at the point of decision to go to tender and contract award. The military authorities have provided additional training for military personnel on procurement procedures and further courses have been and will continue to be scheduled on a regular basis. The next course is scheduled to take place in December.

I inform the committee that preparations for the decentralisation of the Department's Dublin-based staff to Newbridge are at a very advanced stage. The numbers of posts to be relocated to Newbridge are approximately 200 civil servants and 55 military personnel. In excess of 90% of the Civil Service staff are now in place in anticipation of the move. The new building to house the Department in Newbridge is scheduled to be completed in December and personnel will be relocated early in 2010.

Deputy Niall Collins

I advert to the matter of helicopter support, referred to by Mr. Howard. He stated the helicopters had been temporarily restricted in 2008. What contingency arrangement was made while their use was restricted? For how long was their use restricted? If there was a window during which we operated under a restricted regime, the obvious question is what if something had taken place and we needed to have the capability to transport personnel? Were the two helicopters provided under the contract ordinarily certified for civilian use? Could an ordinary member of the public lease such an aircraft? Was it licensed for ordinary civilian passenger transport operations? Is there a difference in the certification arrangements for military personnel as opposed to civilians?

Mr. Michael Howard

I will do the best I can to address the question without making it any more complicated than is necessary. However, it is a somewhat technical and complicated issue. I refer to the "what if" scenario. I emphasise that the difficulty which arose had to do with the air operator certificate. There was never any question about the air worthiness or the safety of the aircraft to fly. The question was whether the operator was licensed to carry passengers in the aircraft. The aircraft, the Mi-8T helicopter, is commonly used in Africa. Tens of thousands were built for the Red Air Force. It is a very strong, robust workhorse with a good reputation. It was originally designed to carry 22 troops. It has a particular seating configuration and construction which is common to military helicopters generally. The seating construction is very different from that which would be normally found in a passenger carrying aircraft.

When the Defence Forces were getting ready to go to Chad, we accepted that there would be a need for helicopter support. We were told in good faith that other air forces would supply this but at the last minute it fell through. It is very important to understand this in view of what happened. We had to proceed and lease from a civilian company helicopters that could be used by the military in Africa. The committee should understand that in trying to lease aircraft for operation in one of the poorest countries of the world and one of the remotest parts of that poor country one must take what one can get. I am very keen to preserve the reputation of the company from which we leased the aircraft and I believe it acted in good faith.

The helicopters were mechanically sound and designed to carry troops. They had an air worthiness certificate. The air operator certificate certified their use for aerial and cargo carrying purposes. There is a question of interpretation as to what could be included in terms of aerial work. For example, a helicopter used to cargo sling lumber in Canada is considered to be engaging in aerial work. If one had to place one attendant member of a felling crew on the aircraft, it would probably be considered to be aerial work. As the Government, we take the most conservative possible interpretation. When we made the first approach to the company, it would have asked us if we understood we would be operating in Africa and that acquiring perfect certification would present a difficulty. That must be understood. There was never a question mark against the mechanical reliability or certification of the crew to fly or any such issue. However, the difficulty was drawn to our attention by the Dutch who had encountered a similar problem in other parts of the world with leased helicopters. When we realised there was a problem, we informed the company that it had to solve it. Between September 2008 and January this year we restricted the use of the helicopters to cargo carrying, casualty evacuation and the evacuation of troops from a place of danger.

I refer to the second "what if" scenario. Throughout this period the battalion commander of the operation in Chad always knew he had the authority to use the helicopters to ferry troops if there was an emergency or from some position of danger. Therefore, there was never a gap in the essential cover provided.

The business case made has been legitimately put. It should be clearly understood that this was a major procurement. I must be very fair to my colleagues in the Defence Forces. They completely put up their hands and stated that in the chaos obviously everything was not done right. That a business case was not made in writing does not mean there was no business case or that I did not accept it. Normally, as the Comptroller and Auditor General stated, there are procedures to be followed. Obviously, it should have been done in writing. However, the fact that there was a business case requirement was never in doubt. A major part of it was the need to be able to keep our troops resupplied in the rainy season or if road transport service became unavailable. The helicopters were always capable of fulfilling that mission.

The other major aspect was that in the event of casualty evacuations, we could use helicopters to extract injured or ill troops from a place of danger. They were always available to fulfil that end of the mission. From that point of view, the essential components were met all the time. The company accepted our position at no extra cost and understood that as a Government contractor or customer, we had to take a strict or exemplary view of air safety. It acquired two other helicopters which had full air operator certification. As far as I know, these helicopters were not, in any substantive way, mechanically different from the others. It was simply a regulatory issue.

Deputy Niall Collins

Was there ever a question that members of the Defence Forces on the ground in Chad believed they had been compromised because there was restricted use for a period?

Mr. Michael Howard

No.

Deputy Niall Collins

How were the duties undertaken by the transport provider performed until September? The transfer of personnel around the region——

Mr. Michael Howard

The first point is that the most essential elements for the Defence Forces were resupply by air, casualty evacuations and, if needed, emergency evacuation, for which they had cover the entire time. The rainy season was coming to an end as this problem arose. The normal patrolling profile was to use ground vehicles. In other words, the normal patrolling profile continued and to sustain the ground patrols the most important thing was that the helicopters were available to resupply them and, in the event of an emergency, to extract personnel. There was never a gap in the essential element of that service.

We would not have been able to lift infantry-based patrols purely by helicopter. While they are one important component of what the helicopters were capable of doing, I would go so far as to say they were not entirely the critical success factor. It was always the sustainment of troops in the field and casualty or emergency evacuation which was important.

Deputy Niall Collins

Is Mr. Howard saying he feels the mission was not compromised?

Mr. Michael Howard

Essentially, the mission was not compromised. That is my view and one which is shared by the Defence Forces.

Deputy Niall Collins

Earlier in the process——

Deputy Jim O’Keeffe

Was it compromised?

Mr. Michael Howard

It was not.

Deputy Niall Collins

We were provided with a time line for the tendering process which mentions that the Air Corps was not consulted as part of the tendering process and, therefore, had no input. Can Mr. Howard elaborate on that? As lay people we consider it to have expertise in advising on air travel and logistics.

Mr. Michael Howard

With the perfect vision of hindsight, if the people concerned had seen what would happen they would have consulted the Air Corps. I am repeating myself, but it is very important that we do not read the events backwards. At the time we were assured, in good faith — which I emphasise — that helicopters would be provided somewhere else and then it very suddenly became apparent that they would not be. People who had not previously negotiated this kind of contract did it in a rush and, unfortunately, shortcomings resulted.

Chairman

This committee hears, week in and week out, that procurement practices are being ignored and that things had to be done in a hurry. It does not excuse anybody from not doing a job properly.

Mr. Michael Howard

I fully accept the findings of the Comptroller and Auditor General's audit report and our response to this is not to come before the committee and say, "Sorry, it was done in a rush". Our first response was to completely revamp the process of delegating to the Defence Forces. When I became aware of the difficulty I revoked the delegation. There was no question of the Department, me as the Accounting Officer or, to be fair, the general staff of the Defence Forces responding to this matter by saying, "It was done in a rush. That was okay". The opposite is the case. We have completely reformed the higher level planning and procurement group, that is, the joint military and civil body which sits over this.

I mentioned an important point in my opening statement to which I again draw the committee's attention, that is, now sanction must be sought for contracts before they go to tender rather than before the contract is awarded. In other words, approval must be sought at an earlier stage. The delegation instruments have been tightened up and reviewed to make it explicitly clear to the people to whom authority is delegated what their responsibilities are. Perhaps most importantly of all, one of the things exposed here is that Defence Forces' personnel needed more training in procurement procedures, something which we have also undertaken to do with the full support and co-operation of the Defence Forces. The response to this is that the situation which obtains today is substantially different. I emphasise that we took this issue on board to learn lessons from it. Our procurement procedures have been tightened up and there is a very strong culture of support for this in the Defence Forces.

Chairman

Deputy Collins asked a very straight and very strange question. Why were the people who were flying the aircraft not consulted? The members of the Air Corps are the specialists——

Mr. Michael Howard

That is correct.

Chairman

——but they were not consulted, which was the question Deputy Collins asked. Did Mr. Howard ask the military why people who would be responsible for flying the aircraft concerned were not consulted?

Mr. Michael Howard

It would be normal——

Chairman

To use a pun, was a turf war going on?

Mr. Michael Howard

There was no question of that at all. When we procure leased aircraft and air taxis the normal procedure is to consult the Air Corps. When I first became aware of a possible difficulty with this matter, I consulted the Air Corps. There was an oversight, which everybody accepts, and our response is that we have tightened up the procedures and everyone involved is now much more aware of the procedures and of the importance of adhering to proper procedures. We have put measures in place which should ensure that when people have authority delegated to them they should put to it in black and white, that people are provided with training and that the high-level planning and procurement group which oversees procurement will now be aware of major contracts at an earlier stage.

Deputy Niall Collins

I hear what Mr. Howard is saying and the question I asked is one which I ask of most delegations who appear before this committee. A documented set of procedures should have been followed. Were any sanctions taken against the people who did not comply with the procedures? Did the delegation say, "Alright lads, we did not follow procedure"? We understand the context in which this operated, namely, that the delegation expected it would have air support from other sources. The procedures were not followed and the delegation has told us procedures are now in place, but are the people who did not follow them still at the wheel?

Mr. Michael Howard

To be fair to the people concerned, I am always mindful of the reminder the Chairman gives at the start of the meeting about being careful of peoples' reputations. The short answer is that it is a matter for the chief of staff and I am entirely certain that all those involved are fully aware and accept the shortcomings which took place. However, I also have to be fair to them. Looking at the overall context of this, nothing was ever undertaken by the Defence Forces in the logistics field which remotely compares with the entire set up of the operation in Chad. Overall, it was a success and the people involved in this are also the architects of that success. We have to be proportionate.

When we became aware that there was a problem, the response of people was to be positive, constructive, learn from it and make sure that we do not have the same problem again. There has been no question of people taking a cavalier or shoulder-shrugging attitude to the issue. Everybody involved in it has taken it extremely seriously.

Chairman

Nobody suggests that there was a cavalier attitude. If I want to buy a car, I go to the showrooms, take a test drive and do many other things. However, this case concerns two helicopters. The people directly involved were not involved in the procedures. Did anybody go to see them or take a test flight? If that was done, who did it and why were those responsible for flying them not involved?

Mr. Michael Howard

I wish to make it clear that they were not being flown by the Air Corps. This is what we call a "wet lease". They came equipped with pilots and ground crew.

Chairman

I know but did anybody check their suitability before the contracts were signed?

Mr. Michael Howard

No. When one leases an aircraft in normal circumstances one does not inspect the aircraft, rather, one inspects the paperwork. It is accepted that the procedures used in this case were incorrect. I do not want to give the impression there is any push back in regard to this, but we know it was not done as it should have been and have responded to that by putting procedures in place to make sure it will be done properly in future. I made the point that, to be fair to the Defence Forces personnel involved, they accept they got this part of the procedure wrong but got much more of it right. If one looks at all the work which went into deploying the Defence Forces to Goz Beida, overall it was a success. The actions of the people involved should be more fairly judged in that overall context.

Chairman

We can only deal with the report we received from the Comptroller and Auditor General, which is what we are dealing with today and is the context of the question Deputy Collins asked.

Mr. Michael Howard

I accept that.

Deputy Niall Collins

I have a number of questions on Vote 63 — Defence. Under appropriations in aid there are receipts from banks for cash escort services. What is the current provision on those? Does the Department recoup the entire cost or cost plus a margin?

Mr. Michael Howard

We recoup the full cost. At the end of each year we go through a process with the banks which are charged the full cost for all the support given to the Garda for cash escorts.

Deputy Niall Collins

Is it correct to say that there is no up-to-date schedule of valuations on all the Department's land? What is the Department's policy on that?

Mr. Michael Howard

We would not get a formal valuation, unless we acquired or disposed of a piece of land. Every so often we review the portfolio and put a value on it. There are resource constraints on us and on the commissioner for valuation. It would not be logistically practical to do a full market valuation every year. If we are not engaging in transactions for the land there is no pressing business requirement on us to do so. A valuation done by departmental staff, based on their knowledge of prices, could vary a great deal from one piece of land to another if one went to sell the land. In the current market it would be extremely difficult to value our land holdings.

Deputy Niall Collins

That is a fair point. What is the Department's land bank holding and what is surplus to requirements?

Mr. Michael Howard

We do not have a vast surplus of land. The ball park figure approaches 20,000 acres but the bulk of that is made up of a few large firing ranges, such as Kilworth and the Glen of Imaal, the aerodrome at Baldonnel and the Curragh camp. We are working our way through many small holdings to see if we can dispose of any. We have a programme of identification and disposal.

A review of training land is under way which we expect to complete at the end of the year and we may make further recommendations based on that. As part of the modernisation of the Defence Forces there is a much greater emphasis on collective training and modern re-equipment which means that we have more crew-served weapons and we need space in which to train and to fire. We are probably getting down to the optimum holdings. There is some further scope for disposals and we intend to make some further disposals but there is no tremendous land bank left. We have been disposing of property for some time and it is a finite resource.

Deputy Niall Collins

The Department has decommissioned or downsized some of the barracks. Does it have a disposal policy?

Mr. Michael Howard

We have a policy of disposing of property if it is surplus to requirements. There are two policy aspects to this which I must be cautious about addressing. First, whether it is economically advisable to dispose of property in the current market and that question is not peculiar to the Department of Defence. Second, any question of barrack closures is a matter for the Government. Having closed four and having previously closed six, a great deal of progress has been made on that front.

Deputy Niall Collins

There is a note here for extra receipts payable to the Exchequer, "conscience money". I think the figure is €3 million. What is that for?

Mr. Michael Howard

It is €3,000.

Deputy Niall Collins

In that case we can scrub the question. People's consciences are not so big.

Mr. Michael Howard

It comes in anonymously so we have no idea what transgression gave rise to it.

In respect of the disposal of the barracks we have in the first instance offered them to other State agencies and organisations and are in active discussions with several of these. Those disposals could take place regardless of market conditions generally in the economy.

Chairman

The last day the Department was before this committee Mr. Howard said that there was a review of the Border allowance scheme. Border duty allowances amounted to €5.6 million. Has the recent increase in dissident Republican activity had an impact on Border duty activity?

Mr. Michael Howard

There has been no great impact on activity levels. The Garda Síochána are always the first responders and the Defence Forces respond to requests as they receive them. The representative associations had a different view from ours of the Border duty allowance. We have felt for some time that it should be withdrawn. We have acted to withdraw the allowance but the association took a claim to the adjudicator, as it is entitled to do. The adjudicator has ruled that those who already have the allowance should be allowed to retain it on a personal to holder basis up to the date of its being discontinued in February 2009. Those who held it until the date of the adjudication should continue to hold it. In industrial relations terms it is not unknown where a benefit has been stopped, it is then stopped for new entrants.

Chairman

How many are on active Border duty now or is that confidential?

Mr. Michael Howard

The ball park figure is 1,100.

Deputy Jim O’Keeffe

To return to the helicopter issue, Mr. Howard mentioned that from the outset the"absolute necessity" for comprehensive helicopter support was recognised. There was a framework agreement in place with the company that supplied the helicopters, Air Partner. Is it a broker?

Mr. Michael Howard

Yes.

Deputy Jim O’Keeffe

Has the Department been dealing with it for some years?

Mr. Michael Howard

This is a delegated subhead which the Defence Forces would have administered at that time. They used Air Partners to acquire aircraft when we needed to lease it, for example, for re-supply flights or rotation flights for troops overseas.

Deputy Jim O’Keeffe

The Department and the Defence Forces have been dealing with that company for several years.

Mr. Michael Howard

Yes, and the company is regarded as reputable in that business. It is the normal way to lease aircraft. One goes to a broker who checks the market and comes back with the best prices.

Deputy Jim O’Keeffe

Was Mr. Howard aware that there were discussions with Air Partners either at or before the deployment of the troops in early 2008? The company was either asked to provide aircraft or it offered to provide helicopters.

Mr. Michael Howard

My recollection is that there was some sounding of the market in March but we were then told that it would not be necessary and no more was done about it. I refer to the build-up phase. There was a tremendous amount of difficulty. Once the European Union decided to launch EUFOR in principle it convened a force generation conference at which it was expected that member states of the Union would pledge the resources they would provide. Helicopter support was one of the identified resources. That process took an unprecedented five force generation conferences. At various stages people would initially and formally make offers and formalise them afterwards. The operations HQ, acting on the basis of informal assurances, told us that we would not need to provide our own helicopters so the matter did not become serious until May when it was obvious that what was promised would not be delivered.

Deputy Jim O’Keeffe

Up to that period was there any helicopter cover?

Mr. Michael Howard

They were deployed but the overwhelming fear we had was that when the rainy season came, all surface transport activities would cease. In Chad which is two and a half times the size of France there are about 300 kilometres of paved road in total. To move, it is necessary to move by air.

Deputy Jim O’Keeffe

Did we leave our troops without such cover for the first six months from the time of deployment in early 2008?

Mr. Michael Howard

No. They were deployed in March 2008 and at all times there was a French military presence in Chad. The French air force had a presence. To an extent the French air assets were available to EU forces. There was never a time when there was no cover.

Deputy Jim O’Keeffe

Was that emergency cover?

Mr. Michael Howard

Yes.

Deputy Jim O’Keeffe

I recollect publicity at the time. Lieutenant General Nash raised the issue before deployment about the absolute necessity for helicopter cover. I am concerned for the safety and security of our troops. We are looking at the way the contract was ultimately issued and the questions that surround it but I am looking at it from a different angle, the safety of our troops. Why was there not more urgency earlier in the year to make arrangements for the provision of helicopters?

Mr. Michael Howard

I may sound like I am repeating myself but at the time we were being comprehensively reassured that it would not be necessary. That was being done in good faith. Other countries were giving assurances they would deploy helicopters. I went to a meeting in the European Union at which one delegate remarked around the table that 1,270 military helicopters could be supplied but that they could not get one for Chad. There was a lack of air cover support for the mission.

We must bear in mind that operational headquarters were being commanded by a very capable and successful Irish officer. We were told as late as 26 May——

Deputy Jim O’Keeffe

He was demanding helicopters.

Mr. Michael Howard

Yes, but he was not just demanding them; he had been promised them and then was let down. That is crucial to understanding what happened. If I had been asked on 20 May, I would have been certain that other air forces would supply helicopters for Chad, with good reason, because the person who was reassuring me had good reason. Unfortunately, it did not come through.

Deputy Jim O’Keeffe

Why, at the end of May, did the Department write for a specific case to be made by the Defence Forces for the lease of helicopters when everyone knew from before deployment that they were an essential part of the mission?

Mr. Michael Howard

I may not have expressed myself well earlier but that was a point I was trying to make. Procedurally, there should be a written case. It was simply to formulate the case, not because the case needed to be proved. It needed to be recorded.

Deputy Jim O’Keeffe

It was known there was a case.

Mr. Michael Howard

No, the fact that I knew is not the same as having the case submitted in writing. It was purely for the record that it would be formulated correctly.

Deputy Jim O’Keeffe

With respect, was this not just another delaying operation?

Mr. Michael Howard

There was no question of delaying because the principle was accepted. The only question was that if we had to procure our own, our desire was to procure them in a correct manner. To do this there had to be a business case made for the transaction purely in order that it would be procedurally correct. The point I was trying to make was that the principle was never in doubt, nor could it be. The fact that I know the principle is not the same as knowing, for the benefit of the auditor when he or she audits a record, that the case was made. It was purely that there had to be a record of the case that was not available anywhere in writing.

Deputy Jim O’Keeffe

My concern is understandable. It relates perhaps not to internal procedures but to the fact that we had 400 or more of our troops out in the middle of the desert with the rainy season approaching and virtually no helicopter provision. Should that not have been an emergency case for the Department and headquarters?

Mr. Michael Howard

There is no question of this being used as a delaying tactic because there was never any desire to delay it. When something is to be procured, there must be a business case and a clear specification of what is to be procured. The first stage must be that there is a proper record of what one is going to procure. There was no question of this being used to delay procurement; it was our desire that the procurement would take place correctly.

Deputy Jim O’Keeffe

I shall move on. When the Dutch advised us on 24 August about the possible technical problem with the certification, were we then in a situation where our troops, because of restrictions placed on them, were without helicopter cover, other than emergency cover, for the rest of the year?

Mr. Michael Howard

No. It is important to distinguish between the roles fulfilled by helicopters. The leased helicopters were not the only air assets available to the mission. For most of the time there was also a French medivac helicopter based in Goz Beida. The one role of helicopter usage that was restricted was that they could not be used to ferry troops for routine patrolling but in every situation where the sustaining of troops or their safety required helicopter cover, the helicopters continued to be available.

Deputy Jim O’Keeffe

How often were they used for such emergencies?

Mr. Michael Howard

In the event there were no emergencies.

Deputy Jim O’Keeffe

Therefore, they were not used at all other than for transport?

Mr. Michael Howard

They were available. Thankfully, there were no emergencies. A major aspect of the presence of the helicopters is the management of risk and ensuring we have cover available should something happen. That is our duty of care to our troops overseas.

Deputy Jim O’Keeffe

There was a change and two similar helicopter types that had certification were put in place. These contracts were then renewed.

Mr. Michael Howard

Yes.

Deputy Jim O’Keeffe

Was the contract then renewed or were tenders sought?

Mr. Michael Howard

Let me be clear about this. In the handover from the EU force to the United Nations a number of difficulties arose. There was a less than optimal performance by the United Nations in setting up during the handover. At the time, being fully aware of all the difficulties that had arisen in the placing of the contract, we were not in a position to have full faith in the United Nations in providing helicopter cover. It was necessary, therefore — I am accountable for this because nothing is more important to us than the safety and security of our troops — to say we would have to continue with those helicopters in place until we were confident the United Nations could fill the gap. At the same time, our ambassador in New York put strong pressure at the highest level of the United Nations that the issue be resolved. Being fair to the United Nations at New York level, Under-Secretary General Malcora took a personal interest and intervened to secure a resolution. We considered that, on the precautionary basis, we had to maintain our own helicopter cover until we were absolutely certain the United Nations had stepped up to the mark. There was a delay in it so doing.

Deputy Jim O’Keeffe

We have helicopters. Was there ever any question of using them in such a difficult situation?

Mr. Michael Howard

The short answer is no. The helicopters we have would not be comparable to the MIATs we are leasing there. They would be too small and too light. We do not have an expeditionary Air Corps. A huge logistic support is required to maintain helicopters in the desert and it would be outside our current capabilities to fulfil that requirement.

In this context it is important to understand that we make a very good contribution to peacekeeping but small military organisations cannot be just scaled down versions of big ones. One relies on the big countries for the expeditionary air assets. They have the scale and the depth for it whereas we do not.

Perhaps I can go back to the question of why we extended the contract. An emergency arose involving a soldier who had an injury which was not very serious but it took several hours for the UN to respond. We were a bit unnerved by that and we felt we could not withdraw the helicopters, however we felt about the procedure by which they had been procured, they were doing the job very well. We could not withdraw our own until we were sure the UN had put in enough to provide the level of cover we expect.

Deputy Jim O’Keeffe

I ask Mr. Howard not to misinterpret me. While I am very anxious that procedures be properly followed, the safety and security of our troops has to be the over-riding concern.

Mr. Michael Howard

It is ours too. We are very proud of the normally good standard of compliance and procurement. To be fair to the Defence Forces we have been delegating a wide range of procurements to them for many years and overall there is a very good standard of procurement. There is nothing more important than the safety of the lives of our troops overseas. That would be our priority at all times.

Deputy Jim O’Keeffe

One last point on that issue, was there anything else that could have been done other than dealing with Air Partner? The estimate for travel and freight services associated with the mission in Chad for 2008 was underspent by almost €7 million. You had sufficient provision for the costs associated with equipment and so on for the troops.

Mr. Michael Howard

The original expectation was that everything would have to be flown to Chad. In the event the Defence Forces were able to use their own ingenuity and some of the material was able to be shipped by surface but there was a very heavy reliance on transport aircraft because of the lack of a road and rail infrastructure. When the costs were estimated, people did the best they could but when they learned more about the options available in Cameroon they were able to find some local hauliers who were able to haul material for us and they were able to make some limited use of the local railway, although we still had to use a good deal of air freight.

Deputy Jim O’Keeffe

Even though there is a legitimate criticism of the procurement process they actually achieved a saving of €7 million on the mission in Chad——

Mr. Michael Howard

Absolutely.

Deputy Jim O’Keeffe

——and the availability of equipment there.

Mr. Michael Howard

The point I was trying to make earlier is that overall there was a huge effort put into this and it was, I believe, successful.

Deputy Jim O’Keeffe

May I go back briefly to the Border duty allowance which the Chairman touched on. Can Mr. Howard give an update on it?

Mr. Michael Howard

The essential position is that the association has taken us to an adjudicator and it has won. The departmental position was that the conditions which gave rise to the allowance no longer obtained and that, therefore, we should withdraw it. The associations took a claim to the adjudicator that people should be able to retain it and the adjudicator has ruled that people who have the allowance should be able to retain it on a personal basis and that we can only restrict new entrants from receiving the allowance.

Deputy Jim O’Keeffe

Does Mr. Howard accept that?

Mr. Michael Howard

Yes, is the short answer. We insist that the association use the system of adjudication. I hate to say this, but even when it rules against the Department, I have to accept that it is an impartial adjudication. I may not like it but it is a fact that the association won its case.

Deputy Jim O’Keeffe

On the issue of the cash escort services, the accounts show receipts from the banks of €7.5 million for 2008. Is this done on a full cost-recovery basis or is there a case for a review of that figure?

Mr. Michael Howard

We charge the banks the entire cost of providing the escort service. This was an initiative taken by the Minister for Defence, Deputy O'Dea. He insisted that there should be no question of resource to marginal costs or anything else; they pay the full cost and that is what we charge them every year.

Deputy Jim O’Keeffe

I thank Mr. Howard.

Chairman

In regard to Air Partner, there was an extension to the original contract.

Mr. Michael Howard

Yes.

Chairman

Did that go to tender again or was it a roll-on contract?

Mr. Michael Howard

No. Let me be straight. It was presented to us in the hand-over. There was a particular incident when there was a delay of seven hours in responding to an emergency of a soldier with a broken arm. It was put to me and I just had to accept that if it was something far more serious than that we would have a situation that we could not sustain. We extended it. I did not particularly like doing it because we had our reservations with the contract, but there was no way of getting another helicopter in there.

Chairman

That is okay. Let us go back to the start. You signed a contract with Air Partner and found subsequently that Air Partner was unsuitable.

Mr. Michael Howard

The certification was unsuitable.

Chairman

One could not use it for a period.

Mr. Michael Howard

Yes.

Chairman

What was the length of time between the original contract and the roll-over?

Mr. Michael Howard

We would have originally signed it in May 2008. March 2009 was the hand-over date to the UN when the UN should have taken over. We finally released the helicopters at the end of last month. In other words, the extension would have been from March of this year until October, six months.

Chairman

In the meantime did you look for an alternative supplier?

Mr. Michael Howard

One would have to understand that we were extending them on a month to month basis with the intention of releasing them as soon as we could when we were satisfied with the UN performance. We did not realise in March that the month to month extension could take us to October. At each stage, if one was to go back to the market, nobody would ship the helicopters there unless it was for a minimum period.

Chairman

That is reasonable.

Deputy Thomas P. Broughan

I welcome Mr. Howard and the officials from the Departments of Defence and Finance. I missed a part of the debate due to the Order of Business and the legislation on NAMA. If I ask a question on any issue that was raised perhaps the Chair would remind me.

As a follow-up on the point about equipment in Chad, we appear to have had a number of such issues during the years of our UN involvement. Would it be fair to say there is a general problem that the equipment we give to our troops and Naval Service and Air Corps tends to be antique? We have a situation where it is almost like a Dad's army given that we have 30 year old vessels, allegedly with holes in the hulls of a number of them. There was a problem with choppers. We got the small LTAVs recently but we always seem to be chasing the ballgame. Surely that is unfair.

We have heard a similar debate on a much bigger scale in a totally different context in respect of the armed forces of the United Kingdom in its war theatre. Is there a danger in not providing up-to-date equipment for our Army and Navy, given that everybody agrees the Naval Service and Air Corps have performed outstandingly well in recent times in preventing cigarette and drug smuggling? We know their performance across a range of activities in supporting all kinds of civil power with the armies. For example, I notice that on the ships it will be 2012 or 2014 before a replacement programme is commenced yet we are required by the EU to spend a large sum of money. Has it not been the case from almost our first big involvement, which may have been the Congo or Cyprus, that we always seem to have a problem with equipment?

Mr. Michael Howard

The Chairman would have to silence me at about 2 o'clock if I got rolling on that one. I can comprehensively reassure the Deputy that any impression or fears he may have are without foundation.

To take the Army first, we have been through the most comprehensive re-equipment programme in the past ten years. Ten years ago, the Defence Forces could not have mounted the missions in Liberia or Chad. Leaving aside the wider supports we must get from other bigger organisations, the equipment we provide our own troops, and it starts with boots, socks, the personal equipment they wear, uniforms and the living accommodation they are provided with, is, within reason, the best one can get. It is better than is normally used by many of the other countries. We co-locate with the troops from other countries and they are often envious of the uniforms, personal equipment and other items our troops bring.

The acid test of how well equipped and trained our Defence Forces are is the fact that we are now a partner of choice. When we go peacekeeping, we have had a component of Sweden's army embedded within ours. It would not do that if it did not believe we were playing in the first division.

Deputy Thomas P. Broughan

Is it not a fact that of the 27 European Union countries, we spend the least per capita on defence?

Mr. Michael Howard

Absolutely. We have a small defence organisation and it is lightly equipped but we equip it specifically for the peace support operations we undertake and for that role the equipment we have is, within reason, the best one can get. I am talking about the personal equipment soldiers wear, the small arms they carry, their radios, their communication equipment, their field kitchens, field hospitals and their living accommodation. The equipment is to the highest standard and is at least as good and often better than that of other European countries. That is the standard we wish to maintain. I emphasise that this is not just a question of what I am saying to the members. Currently, Finland has a smaller component of its Defence Forces as an element of our battalion. It would not do that if we were not equipped and, to use a military phrase, inter-operable. Everything that has to do with the comfort and safety of soldiers in terms of personal weapons, especially body armour and protective equipment, we do our level best to provide them with the best.

The Defence Forces of ten or 15 years ago would be very different. I often say to others, and there is always a tremendous interest in the Defence Forces, that it is a major success story in public sector modernisation. What we did was downsize the organisation and used the money saved to re-equip. If we consider the MOWAG armoured personnel carriers used in Chad, other countries may have bigger and heavier armoured fighting vehicles but for that environment the MOWAGs are excellent. They are very good in service and would be seen as very good quality armoured personnel carriers.

To turn to the Air Corps, we have reduced the size of the fleet but we get more work out of newer aircraft because they are more reliable. A great deal of money has been spent on the helicopters, training aircraft and maritime patrol aircraft and they are modern and capable. As I mentioned in the account for the year in question, we would have spent €18 million. Much of that would have been contract payments for new helicopters and it would have been on the upgrade of our two CASA maritime patrol aircraft.

There is no question that a particular issue arises in regard to the Naval Service. Ships are built with a 30 year life-span and three of our ships —LE Emer, LE Aoife and LE Aisling — are at or about the 30 years. It is unfortunate this has arisen when the country is facing a genuine fiscal crisis. Everybody has talked about that. We have initiated the replacement process with the intention of modernising the fleet but that decision is now in the hands of Government in the Estimates context.

Deputy Thomas P. Broughan

An bord snip nua made certain comments, and while this is going down the policy road, from what Mr. Howard said we have a pared down, tightly knit organisation. I am reflecting the views of some of our military personnel who contacted people on this committee. They have grave concerns that we must not suck the marrow from the bone. Mr. Howard has more or less accepted that in the past we sent people abroad with the wrong equipment. In the most famous example we sent soldiers to an equatorial climate wearing heavy serge uniforms——

Chairman

Woollen.

Deputy Thomas P. Broughan

Yes. They were wearing woollen uniforms from northern Europe.

Mr. Michael Howard

That was 40 years ago.

Deputy Thomas P. Broughan

Whatever. We have got this wrong in the past, and Deputy Jim O'Keeffe and the Chairman expressed eloquently that even recently there is concern that our personnel could in any way be endangered by the lack of adequate equipment.

Mr. Michael Howard

There is no question of that. The way the defence organisation runs is that we will not deploy troops overseas unless they are properly equipped.

To deal with the Deputy's point about the uniforms, that was a very long time ago. Nothing like that has happened in the recent past. I can say from personal experience, both in Liberia and in Chad, that the Irish light infantry battalion is better equipped than any of the components and would be seen as such.

The other point I would make is that while we have a pared down organisation, we have a lean, effective organisation. We are also entering the current fiscal cycle having acquired much good quality equipment. We are entering this in a strong phase and we understand, as does every public organisation, that in the years immediately ahead we must play our part in making sure we contribute to the national economic recovery. However, we are entering this with a well-equipped Army and I assure the Deputy that the view we would take of any overseas mission is, if it is not right, it is wrong. If the troops do not have the equipment and the training, they will not be going.

Chairman

We are all in contact with current members of the armed forces and veterans. The veterans have great pride in the service they have given to the United Nations and to our country abroad. The current members of the force have a similar pride and I would hate the message to go from this committee that there is a type of "Dad's Army" element to it. I would not agree with that because we would be insulting the people who have given a service.

Deputy Thomas P. Broughan

Can I clarify——

Chairman

The fears the Deputy has expressed have been addressed.

Deputy Thomas P. Broughan

The bottom line is that we expect the Department responsible for these personnel who are so important to us to ensure that their safety is paramount, regardless of the fiscal position. That is the point I was trying to make.

I want to make one or two other points on the accounts. In respect of decentralisation, the move will be to the historic centre in Kildare, Newbridge and so on. Does that mean that the personnel in the current headquarters in Parkgate Street and everybody else will be based in Newbridge, given that it is very close to Dublin? How is that proceeding?

Mr. Michael Howard

The decentralisation plan for the Department of Defence is to decentralise to Newbridge and the Curragh. The building in Newbridge is almost complete. I am told the building in the Curragh is ready to go to tender but that is subject to finance and the Estimates for next year. When that is completed, Parkgate will be evacuated.

Deputy Thomas P. Broughan

What is the timeframe for that?

Mr. Michael Howard

I expect the Department's headquarters to move early next year.

Deputy Thomas P. Broughan

In the grant in aid section, an issue that has a local connection for me is Coiste an Asgard. What is the position regarding the Asgard training vessel or a possible replacement? When Mr. Howard last came before the committee, we had received insurance and so on but there appeared to be a reluctance to continue the facility for training young people at sea. What is happening on the Asgard?

Mr. Michael Howard

We are awaiting a decision as part of the Estimates process. The insurance money has been paid out but obviously a policy decision must be taken as to the way it will be expended.

Deputy Thomas P. Broughan

There is sufficient money for a straightforward replacement.

Mr. Michael Howard

We have not gone to the market so I cannot be 100% sure of that. There is a substantial amount of money but I emphasise we are now awaiting a decision as to how we should proceed. The Minister has put a submission to the Minister for Finance and he is waiting for an answer.

Deputy Thomas P. Broughan

Mr. Howard mentioned veterans of whom we are rightly proud in terms of their service to the country. An issue we come across, and I note we are gradually disposing of married quarters, is that of former Defence Forces personnel occasionally facing a problem of lack of housing or even of homelessness. Has the Department and the Army, in particular, any policy initiatives to assist a person who has fallen on hard times with regard to housing? Other countries' armed forces, famously those of the United States, appear to have a plethora of enhancements and encouragements in terms of further education, housing and other developments to help people who have served the nation to adjust to civilian life and ensure they have a happy life after their service. Have any initiatives been taken here in that regard?

Mr. Michael Howard

The overall policy is to dispose of married quarters, preferably to the occupants wherever possible. Our view is that it is always very difficult when a person's home is tied to their job, especially in the case of a career in the Defence Forces where many people will only serve for a brief period when they are young and move on to other things. It has always given rise to difficulties. On the more general issue, the Department of the Environment, Heritage and Local Government has grant-aided the Organisation of National Ex-Servicemen, ONE, which has done excellent work in the provision of hostels. We also make a contribution to it every year of approximately €40,000 on a voluntary basis. Generally, however, the needs of ex-service personnel are taken care of in the same context as those of citizens. That is the way things have been done in Ireland. I do not know the precise details, but ONE has been supported by the Department of the Environment, Heritage and Local Government in the important work it does in helping ex-service personnel.

Deputy Thomas P. Broughan

That is something the Secretary General might examine with the Department of the Environment, Heritage and Local Government. With regard to fuel for vehicles and so forth, do we hedge in any way? Do we try to take advantage in that regard? With other Departments and State organisations there is a certain amount of hedging to try to achieve the best possible value. Does the Department have a straightforward contract and pay market price? I have the Naval Service in mind, in particular. Is there a policy on fuel cost management?

Mr. Michael Howard

We do not enter hedging contracts. We try to keep an eye on the fluctuating price of oil and buy at the most opportune time. The Defence Forces have a couple of reasonably large holding facilities, for example, in the Naval Service, but we do not enter formal high hedging contracts.

Deputy Thomas P. Broughan

Might it be considered in the future with regard to cost control?

Mr. Michael Howard

Possibly. The issue with hedging is that it has gone well and badly for different organisations.

Deputy Jim O’Keeffe

Ask Michael O'Leary.

Mr. Michael Howard

The problem is that if one hedges at the wrong price, one can be trapped.

Deputy Thomas P. Broughan

I note item No. 13 in Vote 36, the final cost of our involvement with EUFOR and KFOR, in Bosnia and so forth. It might appear to citizens examining the accounts that there is always a considerable net cost to the State for that involvement. Obviously, there are gains from having our armed forces involved in peacekeeping in terms of training, motivation and so forth. However, there is a significant net financial cost to the State.

Mr. Michael Howard

There is a substantial cost to which I should draw the committee's attention because it is a trend that will continue. In a force such as EUFOR everyone pays their own bills. There is a trend in international peacekeeping whereby the United Nations which is under a great deal of pressure is asking organisations such as the European Union or NATO to field peacekeeping forces for it and when they do, they must pay all their own bills. Even when the United Nations organises a traditional blue hat operation, the contribution it will make to costs, especially to the costs of a western European army, will never cover more than a portion. Against this, the benefit to the Defence Forces is enormous in terms of training, professionalism and the opportunity to forge relationships with others such as the Finns and the Swedes to ensure we stay at the cutting edge of best practice.

Second, we should never lose sight of the phenomenal difference it makes to the lives of the people in the countries where these peace support operations deploy. Liberia and Chad are cases in point. Obviously in my job I have the opportunity to visit troops in these places. We spoke about the capacity of the Defence Forces. One feels a sense of pride in them when one sees them deploy overseas and how professional, well trained and equipped and totally in charge they are in an enormously challenging environment. It is one the things that makes one very proud to be associated with the defence organisation.

Deputy Thomas P. Broughan

On cost management, there is a net cost of €39 million for the operation in Chad and €22 million in respect of KFOR in Kosovo. Is it up to the Department of Defence to provide an estimate of cost? Let us say the Defence Forces were being sent to a country in south central Africa. Would the Department of Defence be able to give the Department of Finance an estimate of the additional net cost to the State?

Mr. Michael Howard

Yes, we are able to do so. For the first stage of the triple lock, Government approval, we would be expected to provide an estimate of the cost. Sometimes it might be possible, as in the case of the operation in Chad, to find ways of saving money, but the decision would always be taken on the basis of an estimate of the cost. It is quite expensive, particularly when the force must set up and bring every single item with it. In Africa the local economy cannot supply the forces with anything; therefore, they must bring everything with them. Sometimes, as in Chad, it is necessary to fly items there, which one would not normally dream of moving by air, simply because there are no roads. It is expensive. We do the best we can to ensure decisions are taken with people's eyes open regarding cost.

Deputy Thomas P. Broughan

Is the hearing claims saga over?

Mr. Michael Howard

Yes.

Deputy Thomas P. Broughan

Are there no more claims being brought forward?

Mr. Michael Howard

The hearing saga is finished and behind us.

Deputy Thomas P. Broughan

It was the State Claims Agency which dealt with it.

Mr. Michael Howard

Yes, in later years. It was dealt with by the Department in earlier years.

Chairman

I was watching the Armistice Day celebrations last night and saw footage of cavalry in combat. We have an equitation school. What is its role in the armed forces?

Mr. Michael Howard

The role of the Army Equitation School is to promote the Irish horse. From that point of view, it trains riders, enters competitions and generally publicises the Irish horse. The role relates to the bloodstock industry. It is a long-standing role and the school has fulfilled it with great distinction.

Chairman

Is it more appropriate to the bloodstock industry?

Mr. Michael Howard

It was referred to in the report from Mr. McCarthy and the Special Group on Public Service Numbers and Expenditure Programmes. What its future should be is part of the debate on the issues raised in the report.

Chairman

It costs more than €1 million a year.

Mr. Michael Howard

Yes.

Chairman

How has the incentivised scheme of early retirement impacted on the Department?

Mr. Michael Howard

A total of 14 members of staff on the civil side have availed of the incentivised scheme of early retirement, while eight have availed of the career break scheme. It would not have applied to the Defence Forces because they had very different pension arrangements.

Chairman

My last question is on the use of saloon cars or passenger vehicles by Army personnel. I often see Army vehicles at airports and railway stations picking up personnel. How wide is the usage of chauffeur-driven cars for senior Army staff? Is there an estimated cost?

Mr. Michael Howard

I do not have any data or figures in that regard. Military vehicles are made available for official travel. Senior officers use military vehicles for such travel.

Chairman

These are not military vehicles but normal cars such as BMWs and so forth.

Mr. Michael Howard

I do not think we have any BMWs.

Chairman

Not BMWs but saloon cars.

Mr. Michael Howard

As far as I know, the backbone of the saloon fleet is the Ford Mondeo. Again, I do not have that statistical information with me. Senior military officers use military saloon vehicles for official travel. The military is a nationwide organisation and there is an awful lot of travel involved. Obviously we have to keep all our costs under review and we do, but there is quite a requirement for travel on the part of senior military officers. For example, the remit of the general officer commanding the southern brigade in Cork may extend from Wexford to Limerick, so there is a tremendous amount of travel. The job itself requires senior officers to spend a lot of time visiting troops. They have a big role in visibly supporting the various training activities that go on. There is a tremendous amount of official travel involved. From our point of view, it is simply the provision of official vehicles for official travel.

Chairman

I am a member of many organisations and if I drive to events I drive myself, but there is a custom in the army of chauffeur-driven cars driving senior officers around and picking them up at airports and railway stations. There must be a major cost involved in it.

Mr. Michael Howard

I am not sure how major the cost is. Many of the individuals concerned are involved in a lot of official travel and that is the purpose for which the service is supplied. If it was not supplied, some other arrangement would have to be put in place. If people use their own vehicles they will have to be paid for that through some form of mileage allowance. If people use taxis that will also have to be paid for. There is absolutely no cost-free way of providing travel facilities. We are always mindful that if people are working long hours we do not want a situation where people are driving on official business to and from day-long events. There is a health and safety dimension and a question of how long it is safe for a person to keep working and then drive. That is something that has to be managed too.

Deputy Jim O’Keeffe

Do those considerations apply to TDs?

Deputy Thomas P. Broughan

Not unless one is a party leader.

Chairman

I am surprised to see that no analysis has been done on the cost of this system or its cost effectiveness.

Mr. Michael Howard

If the Chairman so wishes, we can look at it and see what we come up with.

Chairman

Perhaps Mr. Howard can give us a note on that.

Mr. Michael Howard

We will give the Chairman an information note.

Chairman

Thank you. Are there any other questions? If not, I thank everybody for their participation. We received clear answers to the questions posed. I want to thank Deputies Collins, Jim O'Keeffe, Broughan and other members of the committee for putting those questions. I will now call on Mr. Buckley to make his final comments on what we have heard.

Mr. John Buckley

The paramount requirement in any situation is operational effectiveness and the safety of troops is very important. A co-existing requirement is conformance with rules on procurement. The use of a business case in procurement is important because it allows for proper specification of requirements. It also allows for the consideration of alternatives as to how procurement might proceed, as well as the actual procedural compliance while doing it. The point of our chapter in this year's report was to emphasise those co-existing requirements, so it is neither one nor the other. We recognise that there will always be urgent situations. Later this year, the committee will be dealing with a chapter on procurement which outlines situations where there have been departures from competition in the procurement of about €82 million worth of goods in 2008. From the point of view of principle, the committee will, therefore, be able to reconsider this issue in some detail later. In the meantime, however, the purpose of this chapter was to give an insight into one particular incident.

Chairman

I thank Mr. Buckley. I will now ask the committee to note Vote 36 — Defence and Vote 37 — Army Pensions and to dispose of chapter 28 — mission to Chad. Is that agreed? Agreed.

The witnesses withdrew.

Chairman

We will meet again next Thursday, 19 November 2009 to look at special report No. 67 — the supervision and substitution scheme, fulfilment of employment contracts and the Commission to Inquire into Child Abuse.

The committee adjourned at 1.05 p.m. until 10 a.m. on Thursday, 19 November 2009.