COMMITTEE OF PUBLIC ACCOUNTS debate -
Thursday, 15 Jul 2010

Vote 22 — Courts Service.

Mr. Brendan Ryan (Chief Executive Officer, Courts Service) called and examined.

Chairman

Before we commence I advise witnesses that they are protected by absolute privilege in respect of the evidence they give to the committee. If they are directed by the committee to cease giving evidence on a particular matter and they continue to do so, they are entitled thereafter only to qualified privilege in respect of their evidence. They are directed that only evidence connected with the subject matter of these proceedings is to be given and they are asked to respect the parliamentary practice to the effect that, where possible, they should not criticise or make any charges against a Member of either House, a person outside the House or an official by name or in such a way as to make him or her identifiable. Members are reminded of the provisions within Standing Order 158 that the committee should also refrain from inquiring into the merits of a policy or policies of the Government or a Minister of the Government or the merits of the objectives of such policies.

I welcome Mr. Brendan Ryan, chief executive of the Courts Service, and ask him to introduce his officials.

Mr. Brendan Ryan

On my extreme right is Mr. John Mahon, principal officer in charge of estates and buildings, who was the project manager for the Criminal Courts of Justice. Next to him is Mr. John Coyle, assistant secretary with responsibility for District and Circuit Court operations. On my right is Mr. Seán Quigley, assistant secretary with responsibility for resource management, who is also the accountant for the Courts of Justice.

Chairman

We also have officials from the Department of Justice and Law Reform.

Mr. Brendan Ryan

Ms Oonagh McPhillips is from the courts policy division. My other two colleagues are from the National Development Finance Agency: Mr. Martyn Byrne and Mr. Jim Golden.

Chairman

We also have representatives from the Department of Finance.

Mr. David Denny

I am from the staffing side in the Department of Finance. My colleagues are Mr. Dermot Nolan and Mr. Dermot Quigley from the sectoral policy division.

Chairman

You are all very welcome. I apologise for the change in today's arrangements. That was outside our control. I ask Mr. Buckley to introduce Vote 22 and Chapter 17. The full text of Chapter 17 can be found in the annual 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

I will deal first with the Criminal Courts of Justice building. Arrangements between public and private sector partners for the delivery of public infrastructure or public services have become more common in recent times. Chapter 4 of my annual report for 2008 reviewed the overall public private partnership programme and listed the individual projects comprised in that programme. Commitments under PPP arrangements were estimated at €4.27 billion at 31 December 2008. The Department of Finance has recently estimated that, overall, the annual cost of PPP charges will be €780 million on average over the next 30 years.

In recent years, because of the materiality of the sums involved, my office has reviewed one of these projects each year. In 2008 the project reviewed was the Criminal Courts of Justice building, out of which project a total of 14% of all commitments at 31 December 2008 arose. I will deal with three key elements of the process: establishing the case for the facility, confirming that PPP procurement represented value, and closing the deal with the preferred tenderer.

The development of a business case for the facility arose from a set of accommodation challenges faced by the Courts Service. A number of options were considered and it was determined that the additional cost of constructing a new complex was €24 million greater than the cost of refurbishing existing facilities and that the benefits outweighed the costs involved. The identified benefits included better facilities for court users, increased capacity, savings as a result of the release of buildings no longer required, and reduced prisoner transportation costs. In reality, while the cost of public procurement of an equivalent project was assessed for benchmarking purposes, procurement by way of conventional means was not an option owing to budget constraints.

The new criminal courts complex was procured through an arrangement under which the design, building, financing, maintenance and operation of the facility were to be delivered by the private sector partner. The Courts Service did not develop estimates of the likely impact on the number of criminal cases processed or waiting times as a result of the construction of a new facility. Where a project of this size is being proposed it would be preferable if expected efficiency gains were quantified. This would facilitate subsequent assessment of the extent to which a project had achieved value for the outlay.

The business case envisaged the disposal or reassignment of a number of buildings which would no longer be required. Savings of €22 million were projected, largely arising from property disposal and reduced operating costs. While in the current climate the timing of disposals will be an important factor in determining the outturn, it is important that the realisation of these savings is continuously tracked.

Public private partnerships normally provide for the construction and operation of a facility by a private sector partner in return for a unitary payment. This project was different in that in addition to a determined unitary payment, there was provision for the acquisition of certain services from the PPP company to be paid for on a usage basis. The agreed unitary payment amounted to €20 million and covered the development and operation of the building for 25 years. At the time of the examination, final agreement had not been reached on the charge structure for the services to be drawn down on a demand basis. Since it has the option of reverting to direct provision or re-tendering, the Courts Service will need to actively manage these costs, estimated at about €2 million per annum, through periodic market testing and maintain tight control over related demand.

One particular risk of using a process that is based on selecting a single preferred bidder is cost drift in the course of negotiation of the final specification and the final price. Maintaining competitive tension during the negotiation phase, while critical to ensuring value for money, is a challenge in these circumstances. In this case, costs increased by almost 7% in the course of deal making with the preferred tenderer. Half of the increase could be put down to environmental or time factors and the balance to firming up on specification.

Turning to the Vote, the gross cost of the service was €138 million in 2008. Against this, fees of €39 million have been offset, bringing the net cost to €99 million. Fines totalling €22 million were collected by the service and were also remitted to the Exchequer.

Chairman

I thank Mr. Buckley. I invite Mr. Ryan to make his opening statement.

Mr. Brendan Ryan

I thank the Chairman for the invitation to appear before the committee in my capacity as Accounting Officer for the Courts Service, Vote 22, and I look forward to discussing any aspect of the Vote with him and the members of the committee.

I am pleased to report that a clean audit report has been provided by the Comptroller and Auditor General on the 2008 Appropriation Account. Overall the Vote was managed successfully and, with the assistance of a technical Supplementary Estimate, expenditure was within budget. The Supplementary Estimate enabled surplus receipts under appropriations-in-aid to be used to fund excess on non-pay current expenditure and, as such, did not involve any additional Exchequer funding. A surrender balance of €8 million was recorded on the Vote.

The Courts Service is responsible for the management and administration of the courts. As the committee is aware, the administration of justice is a matter for the Judiciary and is outside the scope of the functions of the Courts Service in accordance with the constitutional independence of the Judiciary and the provisions of the Courts Service Act. Members will appreciate, therefore, that in my discussions with them today I am precluded from commenting on any matter relating to the exercise by a judge of his or her judicial functions. I am also, of course, precluded from commenting on matters of Government policy.

Since establishment, the Courts Service has worked to ensure that the courts operate effectively and efficiently, the use of available resources is optimised and the best possible service is provided to court users. Since the Vote was last considered by the committee in 2004, very good progress has been made in implementing a comprehensive and broad ranging reform and modernisation programme to address the deficiencies which existed in the management, administration and resourcing of the courts.

Through the capital building programme we have prioritised the refurbishment of court buildings and an investment of over €240 million has been spent on over 50 major projects which have been successfully completed. We are particularly proud of our most recent major building project, the new Criminal Courts of Justice complex on Parkgate Street. The complex is a state-of-the-art criminal justice facility designed to accommodate criminal business of all jurisdictions in one serviced location and overcome the security, service delivery and logistical problems of running criminal trials in a number of sites dispersed throughout the Four Courts and adjoining buildings. The project was delivered by way of public private partnership and construction took 34 months, with the building being delivered on budget and three months ahead of schedule on 17 November 2009. As members know, the CCJ project was the subject of a review by the Comptroller and Auditor General — chapter 17 of the 2008 annual report. His report endorsed the approach taken, which was fully compliant with Department of Finance guidelines.

The implementation of our ICT strategies has resulted in the development and deployment of an IT infrastructure and systems, including e-Government systems, which are designed to support the operation of the courts and enhance the service to court users. Recent ICT initiatives include the centralising and automation of processing of payments made by court offices, the electronic payment of family law maintenance, the rollout of small claims on-line, the development of CJHP, which is exchange of data with the Garda Síochána, and the phased deployment of digital audio recording in courtrooms nationwide.

The successful centralisation and computerisation of accounting systems has enabled us to make significant progress in the area of fines collection. Over the past ten years, the effectiveness of the fines collection system has been the subject of review by the Comptroller and Auditor General and this committee, and I am pleased to report that, as a result of a number of initiatives, including the introduction of on-line payment options, the compliance rate is now at 70% from an estimated 50% a number of years ago. In monetary terms, the benefits to the Exchequer are significant, and it is estimated that the increased yield to the Exchequer is in the region of €8 million annually. Indeed, the initiatives provided for in the Fines Act 2010 are designed to bring about further improvements in the collection rate of fines.

Significant progress has been made in the area of financial management, resulting in the centralised management of court funds and of all financial transactions in the District Court, which amount to over 700,000 transactions annually. We have also taken a proactive approach to the management of court fees, ensuring that regular reviews are carried out and that the level of fees are appropriate while ensuring that they are not a barrier to a person's constitutional right of access to the courts. We have driven a substantial programme of legislative and procedural reform to enable improved operation of the courts, efficiency in deployment of court resources and a reduction in the cost of litigation.

A review of District Court districts and areas has led to the reorganisation of the District Court districts to bring about a more equitable distribution of caseload and the amalgamation of court areas. A review of Circuit Court circuits has been initiated and a committee has been established in conjunction with the President of the Circuit Court to examine Circuit Court circuits.

The Courts Service, like other Departments and agencies, has seen significant reductions in funding since 2008. The service acknowledges the difficult economic environment facing the country at this time and I want to assure the committee we are staying within the reduced funding parameters. In this regard, the Courts Service has in place robust financial control measures across the organisation to ensure that expenditure is kept to an absolute minimum, is incurred only where it is absolutely necessary and unavoidable, and that value for money is achieved. Our priority has always been and will continue to be the provision of front-line core court services to support the Judiciary and court sittings. Every effort will continue to be made to protect these front-line services and core court operations but this will only be achieved through the implementation of further reforms in the structure of the organisation and the delivery of services.

Our current strategic plan 2008-11 recognised the need to carry out a comprehensive review of our structures and methods of service delivery to bring about improved services and value for money. The onset of the economic recession in 2008, together with the consequent impact on the public finances, accelerated and increased the urgency with which this had to be addressed. This review, Transforming Administration and Structures in the Courts, or TASC, was carried out in 2009. It examined a number of areas including the role of county registrars, the restructuring of court offices, the rationalisation of court venues, the allocation of staffing resources and the development of a workforce strategy. There is no doubt that significant economies and efficiencies can be delivered through the use of shared services, improved processes and the rationalisation of court office and venue networks.

The recommendations coming from the review are very closely aligned with the provisions of the public service agreement which was recently approved by the Irish Congress of Trade Unions. The agreement provides a very positive and constructive environment in which to engage with the staff unions and associations in regard to implementing a transformation programme and we look forward to working with them and with the Judiciary, county registrars and other stakeholders to bring about transformation of court administration and structures.

The Courts Service will work to ensure that we continue to improve services to court users, make the courts as accessible as possible and achieve real value for money in the provision of these services.

Chairman

Thank you. May we publish your statement?

Mr. Brendan Ryan

Yes.

Deputy Brendan Kenneally

I welcome Mr. Ryan and his colleagues. I had the pleasure of visiting the Criminal Courts of Justice complex with members of the justice committee prior to its opening and I assume it is running efficiently, as intended. Having seen the complex I am of the view that it was money well spent. I read that it would have cost an additional €24 million to refurbish the existing buildings to provide the facilities needed and therefore the provision of the new complex was money well spent.

Savings should have arisen from the sale of surplus properties. I saw a figure of €22 million somewhere. Could Mr. Ryan tell the committee if any of those properties have been disposed of yet and if that is the figure the Department expects to realise?

Mr. Brendan Ryan

It is the figure we expect to realise and exceed. We had intended selling the children's court in Smithfield once the Criminal Courts of Justice building was completed. We had a price of approximately €10 million assigned to that in the mid-2000s when we got it valued. We have to sell that as yet. The property market has declined, as the Deputy is aware, and the building remains within our control and is still being used as a children's court. To move the children's court at this stage would require investment in further courts around the Four Courts campus.

Regarding savings we have made, we have ceased leaseholds on various buildings, including Conyngham Road, the Distillery Building and King's Inns. Last year the Distillery Building and King's Inns alone cost us €615,000 to rent, mainly for High Court actions. The Conyngham Road and Riverbank buildings were costing us an extra €200,000. The leases on those have ceased. Over the lifetime of the Criminal Courts of Justice, the leases on the Distillery and King's Inns buildings will save the Exchequer in the region of €15 million.

We continue to pay in excess of €300,000 a year for the leasehold in Bow Street. The lease is up in 2012-2013. If we cease to lease at this stage, a penalty will be imposed and therefore we have decided to maintain that lease.

There are significant savings for the other agencies involved in the administration of justice — the Garda Síochána and the Irish Prison Service. With regard to the Garda, taking Green Street alone, it had a permanent Garda presence in Green Street 24 hours a day, 365 days a year. We estimate that in the course of the lifetime of the CCJ building there will be savings of between €7 million and €8 million to the Garda alone from withdrawing that security presence in Green Street. Savings have been achieved and there will be——

Deputy Brendan Kenneally

Why would there be such a reduced security presence in the new complex compared with that in Green Street previously?

Mr. Brendan Ryan

Security is outsourced in the CCJ building. It is part of the PPP arrangement.

Deputy Brendan Kenneally

Yes.

Mr. Brendan Ryan

There are significant savings, therefore. There will be further savings when Bow Street is handed back and when we eventually sell the Children's Court in Smithfield.

Deputy Brendan Kenneally

Extra services such as jury minding, utilities, catering and so on have been outsourced. I understand that costs approximately €2 million per annum. Is that something that will go out to tender in future years or is it a service carried out by the PPP company and which will be carried out for the next 25 years?

Mr. Brendan Ryan

The services in the Criminal Courts of Justice could be divided into two sections. There are the core services, which are security, cleaning, catering and waste management. They are the core part of the PPP arrangement and they are benchmarked against prices in the market after the initial two years, and five years thereafter. The other services such as jury minding and some catering facilities will be benchmarked annually. We pay a variable rate to the PPP company and it will be benchmarked annually. If we believe we can achieve greater value by taking over the provision of those services, we can take those services back from the PPP company, run our own procurement and provide the services directly.

Deputy Brendan Kenneally

If the Courts Service believes the operator is overcharging, could it get someone else in to do it?

Mr. Brendan Ryan

Yes.

Deputy Brendan Kenneally

The Department is making savings in maintenance costs because of this new building. Can Mr. Ryan quantify those?

Mr. Brendan Ryan

With regard to the buildings we have already given up, we are saving in the region of €300,000 to €315,000 per annum in the maintenance costs of those premises on which we have already given up the lease. Obviously, that will increase as we give up Bow Street and other buildings. It is a significant saving over a 25-year period.

Deputy Brendan Kenneally

Regarding the throughput of cases, is it possible to give the committee figures for the number that were processed in, say, the first six months of this year compared with the same period last year?

Mr. Brendan Ryan

We anticipate that in the first 12 months the court venue is open, approximately 40,000 cases will be disposed of——

Deputy Brendan Kenneally

In the CCJ.

Mr. Brendan Ryan

——in the CCJ. It is difficult at this stage to give any indication as to whether they will increase——

Deputy Brendan Kenneally

In a full year, Mr. Ryan anticipates that 40,000 cases will be disposed of.

Mr. Brendan Ryan

A total of 40,000 cases will be disposed——

Deputy Brendan Kenneally

Compared with what number?

Mr. Brendan Ryan

Much depends on——

Deputy Brendan Kenneally

No. Compared with what number before the CCJ building was in place?

Mr. Brendan Ryan

We anticipate it will be approximately 40,000. It was 35,000 to 40,000 in the previous year. The throughput of cases depends, among other things, on the allocation of judicial resources and that is a matter for the presidents of the courts. The more resources they assign to dealing with criminal business, the greater the number of cases we will get through.

Deputy Brendan Kenneally

The Courts Service has six extra courtrooms.

Mr. Brendan Ryan

We have. When the building was being built, we provided for an expansion element. At the time we were developing this project, between 15 and 16 courts in Dublin were used every day for criminal business and therefore we built in provision for an extra six courts. Since the courts opened in January, up to 21 courts could be used on some days. Business has already increased there, but the allocation of judicial resources is a matter for the presidents of the courts. We have the capacity now to ratchet up dealing with criminal business in Dublin. As the Deputy is aware, most of the Central Criminal Court is based in Dublin. It does its business in Dublin and that is where most of the significant criminal cases are dealt with. We are in a position now to deal with many more criminal cases if the resources allow.

Deputy Brendan Kenneally

Does that mean there has been no reduction in the waiting times for the hearing of criminal cases, as such?

Mr. Brendan Ryan

Not as such.

Chairman

With regard to Deputy Kenneally's question on the appointment of additional judges, has the Courts Service a place to put them if they are appointed?

Mr. Brendan Ryan

Yes, we do now. Prior to the CCJ building opening, the allocation of courtrooms and ancillary facilities in Dublin was causing us great angst. That is the reason we spread our wings. We operated from King's Inns, the Distillery Building and various other buildings. We were renting or leasing any building that was near the Four Courts. As the Chairman will be aware, there was a 29% increase in judicial numbers between 2002 and 2008. That significant increase occurred at short notice to the courts' management. We could not respond as quickly as we would have liked and there were many leases, therefore, that we would have preferred not to have taken out but were a short-term necessity. To answer the Chairman's question, if additional resources were made available, we would be able to deal with that.

Deputy Brendan Kenneally

Mr. Ryan spoke about the improvement in Garda resources because of this new complex. Has there been any improvement in prisoner transportation costs as a result of the opening of this new complex?

Mr. Brendan Ryan

Unfortunately, I cannot give the Deputy any definitive information on that. I would comment that when we were in five or six different locations around the Four Courts, Irish Prison Service, IPS, vans were servicing all those locations, with the vans parked on the streets outside because they had to wait in case those in custody had to be returned to jail. I envisage significant savings for the IPS. The Deputy will appreciate that in the basement of the new Criminal Courts of Justice there is a custody area which can accommodate up to 100 people. There has been major rationalisation in that regard. The 2009 Courts and Court Officers Act allowed the Irish Prison Service to take into custody those arrested by the Garda to be brought to court. The IPS now looks after that function as well. The Bridewell Garda station will have been released of many of its duties during the day, although perhaps not during the evenings. While I cannot give the Deputy a definite figure, I surmise it is significant.

Deputy Brendan Kenneally

When I visited the complex I noticed that a magnificent area was laid out for our learned friends from the Bar Council.

Mr. Brendan Ryan

Yes.

Deputy Brendan Kenneally

How much per square metre is the Bar Council paying for that facility? Does it equate to the commercial reality of rates in the market?

Mr. Brendan Ryan

We have a licence agreement with the Bar Council which was signed as construction commenced on the building. It was based on the going rates at the time. It is an upwards-only review. The Bar Council pays us €450,000 per annum based on the space it got, which is a significant fee income for the Courts Service over the course of the 25 years. There are, of course, break clauses for the Bar Council after a number of years. We are getting the commercial rate from the Bar Council for that space.

Deputy Brendan Kenneally

After Babcock and Brown was selected as the preferred bidder, significant increases in costs were allowed because of underestimates in certain requirements. Why were those increases allowed?

Mr. Brendan Ryan

First and foremost, when the initial bid came in, we contemplated building in the region of 17,000 or 18,000 sq. m. We entered into an agreement with the Bar Council which resulted in an increase in some of the space. When the Deputy was in the building, he would have seen there is an area within the building that we call the great window to the park — that is what it was locally known as — which is the expansion area. Because the groundwork required additional funding, we also changed some of the plans. The Deputy will appreciate that when the preferred bidder was accepted, the design was about 32% complete, and during the negotiation of the final stage of the agreement before the contract was signed, we had to finalise exactly the full detailed requirements, and there were increases in that respect. We took on extra security, which added to the cost of the provision of the building.

Deputy Brendan Kenneally

Moving from the CCJ building to the appropriation accounts, in 2008 the Courts Service had a staff of 1,059. How many staff has it now?

Mr. Brendan Ryan

Our authorised number in 2008 was 1,080.5. Under the employment control framework, our number is to be down to 1,002 by the end of this year. We have approximately 1,030 people at the moment. By the end of 2012, our number of staff is to be down to 960. The decrease is to be 121 staff, approximately 11% of our total staff number.

Deputy Brendan Kenneally

Is that because of the rationalisation of services?

Mr. Brendan Ryan

No, that is based on the employment control framework that the Department and the Government brought in to decrease numbers in the public service.

Deputy Brendan Kenneally

I assume the number would decrease because some of the work in the CCJ is outsourced. That would lead to a natural reduction in the number.

Mr. Brendan Ryan

There are efficiencies to be gained in the CCJ, but the Deputy should bear in mind that in the Four Courts and in the other buildings, most of the cleaning and security staff were outsourced already. The agreement with the unions in regard to the CCJ was that there would be no outsourcing of core functions. We did not get savings efficiencies in that way. Where the efficiencies will be made, we gather, is from centralising all our criminal court business in Dublin. I would like to point out one other aspect. In the period 2005 to 2009, the case count for the Courts Service went up from 580,000 to 830,000. There has been a 40% increase in the case count of the Courts Service in the past four to five years.

Deputy Brendan Kenneally

There are 830,000 cases.

Mr. Brendan Ryan

Yes. That was in 2008. In 2009, there was a slight decrease in the number, which fell to approximately 820,000, but in 2008 it was 830,000 cases. Therefore, there has been a significant increase in the number of cases. Much of that has to do with the extra judges, and Garda numbers have also increased significantly over the years. Therefore, there is a great deal of crime detection, but the Deputy can appreciate that the 40% increase in the number of cases has put huge pressure on court resources. It is only by creating these efficiencies that we have managed to maintain the waiting lists as they are.

It should also be borne in mind that the average cost of a case in the period 2004 to 2008 dropped from about €138 per case to €117 per case. As the Deputy can appreciate, the courts are becoming increasingly efficient. I appreciate that is a crude measure. It is the division of the number of cases into our current funding.

Deputy Brendan Kenneally

Okay. The cost of extra remuneration in 2008 was €2,155,395. Can Mr. Ryan explain why that arose?

Mr. Brendan Ryan

If the Deputy will bear with me——

Deputy Brendan Kenneally

Yes.

Mr. Brendan Ryan

The details include higher, special or additional duties, overtime, extra attendance and miscellaneous matters. As the Deputy can appreciate, the significant increase in the case count would have driven the demand for extra remuneration. Those figures have decreased since then.

Deputy Brendan Kenneally

They have come down.

Mr. Brendan Ryan

They have, yes.

Deputy Brendan Kenneally

I note that in 2008 the Courts Service incurred €147,000 in the payment of five retired civil servants to carry out duties. Is that practice continuing? There are enough people unemployed without bringing back civil servants who are already in receipt of a pension.

Mr. Brendan Ryan

They were involved mainly in carrying out an internal audit. Those staff would normally be retired chief clerks in the District Court or Circuit Court who would go around the country and audit accounts of the various District Court offices. They have expertise and knowledge which they would have garnered over many years. Therefore, they are an ideal group of people to do that work. Likewise, that figure has also come down in recent years. A few of those staff were also involved in the training of court registrars, which is a very technical job. It is not as if one can bring in an outside agency to train staff in court procedures. We use retired staff to train newer staff, especially staff who have been transferred from other Departments, in the technical expertise required to act as a registrar.

Deputy Brendan Kenneally

Why does the Courts Service not carry out that training with its current staff, such that a member of the current staff would carry out that training?

Mr. Brendan Ryan

The Deputy will appreciate that the number of cases has greatly increased and judicial numbers have gone up by 29%. During the period 2005 to 2008 when the figures I am talking about increased, the staff number in the Courts Service remained the same. I refer to the number of staff available to provide front-line services. We do not have the resources to provide for this. We do not have a big training unit. Our training unit comprises two or three people, so we do not have the necessary expertise. Also the training unit does not comprise staff who have worked generally in court operations, so they would not have the necessary expertise. The difficulty in releasing a court registrar to do registrar training is that it would result in a court not being available and a judge not being available to do his or her duties. I would also mention that during the vacations periods, registrars train their more junior colleagues in best practice.

Deputy Brendan Kenneally

I have an issue with retired civil servants coming back to do work. They are already being remunerated through their pensions. There are enough people unemployed. I would have thought that if the Courts Service has to bring in someone to do a job, there would be enough expertise in the marketplace, especially in the area of auditing which Mr. Ryan mentioned. Many people are available who would be able to do that type of work.

Mr. Brendan Ryan

We hope that will not be required as much in the future. In recent years we have developed our own in-house training manuals which are available on the intranet for the staff. It is a step-by-step approach to dealing with issues that arise in courts. We hope that as a result of these training manuals and the chief clerks and head of offices in the various operational offices going through the training manuals with their staff, this expenditure will be reduced.

Deputy Brendan Kenneally

There is another note about €119,812 of payments in respect of exceptional performance awards. Who got them? Who adjudicated on them?

Mr. Brendan Ryan

A committee was set up. When I became the chief executive officer in 2009, we decided there would be no more exceptional performance awards with the agreement of the partnership committee of the Courts Service. A figure was allowed within the salary budget over the years for Departments and agencies to set aside 0.2% of salary for exceptional performance. There were criteria and a review committee made recommendations for the payment but there are no exceptional performance awards anymore.

Deputy Brendan Kenneally

They are gone.

Mr. Brendan Ryan

Yes, and I do not envisage them coming back.

Deputy Brendan Kenneally

That is fair enough. Mr. Ryan mentioned in his opening remarks that he was precluded from commenting on matters relating to the exercise by a judge of his or her judicial functions. I accept we cannot get into that. Do the salaries of judges come under the Courts Service Vote?

Mr. Brendan Ryan

No.

Deputy Brendan Kenneally

However, the service pays their travel and subsistence expenses. I am told judges get extraordinary allowances. Can Mr. Ryan explain the garage allowance and the sitting room allowance?

Mr. Brendan Ryan

I can. The Courts Service is not involved in the terms and conditions of judges. The Departments of Finance and Justice and Law Reform negotiated the allowances to which the Deputy referred with the judges and their representatives over the years. The Courts Service pays them based on receipts and vouching but we are not involved in the setting of allowances.

Deputy Brendan Kenneally

What are the allowances worth?

Mr. Brendan Ryan

I do not have the details in front of me. I think the garage allowances is around €7 a night and the sitting room allowance is around €36. The sitting room allowance is vouched.

Deputy Brendan Kenneally

What is it?

Mr. Brendan Ryan

It is where the judge has to engage a separate sitting room to undertake work, for example, a hotel bedroom. This goes back a long time to the days when judges travelled around the country and got a hotel bedroom when they needed to work late in the evening or to have their dinner separately, which they still try to do as much as possible.

Deputy Brendan Kenneally

It is just an add-on for them.

Mr. Brendan Ryan

It is vouched so they have to provide receipts for it.

Deputy Brendan Kenneally

But they would book the room to stay in anyway.

Mr. Brendan Ryan

Yes.

Deputy Brendan Kenneally

Is the €36 added to the cost of the hotel room?

Mr. Brendan Ryan

It has to be separately vouched. A separate receipt has to be provided. We do not determine the rates. We just implement the figures approved by the Departments of Justice and Law Reform and Finance.

Deputy Brendan Kenneally

If a judge makes a claim for travelling, overnights or whatever, who checks that?

Mr. Brendan Ryan

The validation office in the Courts Service.

Deputy Brendan Kenneally

It checks the amount of mileage and——

Mr. Brendan Ryan

Yes.

Deputy Brendan Kenneally

——receipts have to be put in for all of that.

Mr. Brendan Ryan

No, it is standard for judges, like public servants, to get an overnight rate. It is a 24-hour rate which covers their bed, breakfast, lunch and evening meal. They therefore get the overnight rate but the sitting room allowance is paid on a vouched basis separate to that.

Deputy Brendan Kenneally

What about the garage allowance?

Mr. Brendan Ryan

The garage allowance is not vouched.

Deputy Brendan Kenneally

These are the only two allowances I have been able to uncover so far. How many others——

Mr. Brendan Ryan

In relation to travel and subsistence, they are the only allowances.

Deputy Brendan Kenneally

Do they get other allowances outside of travel and subsistence?

Mr. Brendan Ryan

The members of the Judiciary get an annual allowance. I do not have the figures with me but they are agreed centrally. It is to maintain, I believe, libraries at home and things like that but I do not have the figures. It is paid from the Courts Service but it is set centrally.

Deputy Brendan Kenneally

How much would that cost in a year?

Mr. Brendan Ryan

I do not have the figures in front of me but I can get back to the Deputy if he wishes.

Deputy Brendan Kenneally

That would be part of these accounts.

Mr. Brendan Ryan

They are part of the accounts but I do not have that detail with me. I can back get to the Deputy on it. I can outline the various allowances.

Chairman

Mr. Ryan should know which subhead it comes under.

Mr. Seán Quigley

It is within miscellaneous provisions, A3.

Chairman

This strikes me as akin to the moat allowance in the House of Commons.

Deputy Brendan Kenneally

This area seems loose. Perhaps it is not the fault of the Courts Service, given, as Mr. Ryan said, these allowances have been set elsewhere and the service has to pay them. Perhaps Mr. Ryan will get the committee the figures on those allowances.

Mr. Brendan Ryan

I will, of course.

Chairman

Before the Deputy moves on, I would like to ask the Department of Finance officials for their view on this. Mr. Ryan said the Courts Service only implements what has been agreed. What has been sanctioned by the Department? Do the officials have a list of all the allowances?

Mr. David Denny

I am sure one of my colleagues who deals with remuneration for the Judiciary would have that information and I can certainly get that list to the committee. As the committee will be aware, the Judiciary are paid from the Central Fund rather than from voted moneys. It is just——

Deputy Brendan Kenneally

We are not discussing their salaries.

Mr. David Denny

——travel and subsistence and various out of pocket expenses. As Mr. Ryan has indicated, these have been negotiated centrally. It is not directly in my area but I can get the information for the committee from my colleagues who deal with remuneration for the Judiciary and forward that to the committee straight away.

Chairman

I refer to the question of tipstaffs. Is this the only jurisdiction that has the post of tipstaff?

Mr. Brendan Ryan

No, it would be fairly common in common law jurisdictions.

Chairman

What do they do, given they cost €2.5 million?

Mr. Brendan Ryan

There are a couple of issues around tipstaff. First and foremost, the appointment of ushers and criers, who are tipstaffs, form part of the terms and conditions of a judge and is a matter for the Departments of Justice and Law Reform and Finance. The Courts Service has no role in their appointment. The Department of Finance has expressed an interest in acquiring a fuller understanding of the role of ushers and we will meet the Department soon on this area. An bord snip nua recommended the abolition of tipstaffs.

Chairman

It is Victorian; it is out of date. It goes back to the 19th century and surely at a time people are experiencing cutbacks all over the place, this is a luxury judges could do without.

Mr. Brendan Ryan

It is a matter of their terms and conditions. It is not something I can comment on. All I can say is an bord snip nua indicated the Judiciary should have support services and they should be made available by the Courts Service. With an 11% reduction in our staff over the next couple of years, we are not in a position to meet that need. Leaving aside tipstaffs for the Judiciary, only 39 staff in the Courts Service directly support the Judiciary. The Chief Justice, the three presidents and each Supreme Court judge have a private secretary. Five High Court judges share a secretary. The Circuit Court and District Court judges have no secretaries. There are two librarians in the Courts Service. There are six judicial researchers — the number has been significantly reduced — and there are ten self-employed judicial fellows. The tipstaffs are the only direct support service the judges have. There is a statutory basis for the appointment of tipstaffs. The Department of Finance has written to us looking for further details on exactly what their functions are so it can get a greater understanding, and we will meet officials of the Department. Tipstaffs perform an essential service in that they are the only link the judge has with the legal profession, the Courts Service and the outside world. For example, when a judge comes in to the Four Courts in the morning, he goes to his chamber. He will get the legal diary and find out what court he is sitting in. He stays in isolation in his chamber until such time as he is ready to go, so that judicial independence is respected. He is then brought to the court by the usher. The usher is available to him during the day. At lunchtime, he stays within the chamber so the usher has to assist him there. Tipstaffs are the only resource judges have. The Courts Service has no potential to provide any additional support for judges. They have limited resources at present. Like all jobs, in both the private and public sectors, this one can be looked at. I merely say it is outside my remit to do anything about their positions. The judges look upon them as part of their terms and conditions. There are very few support services available directly to judges, if you take the ushers and criers from them.

Deputy Brendan Kenneally

There are 182 tipstaffs.

Mr. Brendan Ryan

No. There are 82 or 84 tipstaffs.

Deputy Brendan Kenneally

Are they allocated to specific judges?

Mr. Brendan Ryan

They are allocated to specific judges in the Supreme Court, High Court and Circuit Court.

Deputy Brendan Kenneally

When a judge goes on circuit, does his tipstaff go on circuit with him?

Mr. Brendan Ryan

Yes.

Chairman

Deputy Kenneally referred to 182 tipstaffs. An bord snip nua also said 182.

Mr. Brendan Ryan

The number is 83. There is no hundred before it. There are 147 judges in the country. The 64 or 65 District Court judges do not have tipstaffs. There are either 83 or 87.

Chairman

The cost is €2.5 million anyway.

Mr. Brendan Ryan

Yes.

Deputy Brendan Kenneally

With regard to interpretation costs, a pilot scheme is running somewhere in the north of the country to reduce interpretation costs by bringing cases to one location——

Mr. Brendan Ryan

On a monthly basis.

Deputy Brendan Kenneally

In a regional setting.

Mr. Brendan Ryan

In a district setting, within a judge's district.

Deputy Brendan Kenneally

It is within the judge's district. All the cases are brought to one place.

Mr. Brendan Ryan

All the cases that require interpretation are scheduled to one sitting a month.

Deputy Brendan Kenneally

How is that working?

Mr. Brendan Ryan

It is working very well. The 8% supplier levy together with the substantial reduction in the demand for interpretation so far this year has reduced costs. In 2008 we spent €3.5 million on interpretation. Last year it was around €3 million and in the first four or five months of this year we have seen a further 35% reduction in the cost of providing interpretation services. The cost is being driven down all the time. This is partly owing to the 8% levy. The scheme is no longer a pilot. It was piloted in 2008 but Judge MacBride, in the northern region, took it on as well. Several judges around the country are taking it on as their practice. We anticipate huge savings.

Deputy Brendan Kenneally

What about the other District Court judges? Is it a matter for them?

Mr. Brendan Ryan

It is a matter for them. The disposal of business is a matter for the judges. They now see the benefit. This pilot was completed only recently so it is early days. We anticipate significant savings. We have already reduced costs by 34% or 37% this year compared with the same time last year. We envisage significant savings.

Deputy Pádraic McCormack

I thank Mr. Ryan for his presentation. Although we are severely outnumbered today, we will try to do the best we can. Deputy Kenneally has dealt with several matters. On Vote 22 — Courts Service — what is the progress on video recording and audio-visual evidence?

Mr. Brendan Ryan

There is digital audio recording and video recording. We have implemented digital audio recording in all criminal court rooms throughout the country, in the civil court rooms in the Four Courts and in the criminal courts of justice. That was phase 1 and phase 2 of our roll-out of digital audio recording. Phase 3 of the roll-out of digital audio recording is mainly to District Courts and the few Circuit Courts where we have a presence, that is, where the Courts Service owns the building and has an IT network in place. Phase 3 has just commenced roll-out and 80 courtrooms are involved. We anticipate that within the next 12 months all those court rooms will have digital audio recording. The final group of court rooms, which are about 60, are mainly in stand-alone District Court venues that might sit only once a month. As they are not on the Courts Service network — the back-up of the digital audio recording does not go into a central repository — we are working on a pilot for the roll-out of digital audio recording to those courtrooms.

Deputy Pádraic McCormack

Do any savings result from this?

Mr. Brendan Ryan

As we no longer require stenography services from the commencement of this year, we envisage a saving in the region of €320,000 in this year alone. We also have video-conferencing in 24 locations throughout the country. We have video witness facilities for young children aged 17 and under who need to give evidence in cases. We have that in eight locations throughout the country. We also have other video equipment.

Deputy Pádraic McCormack

We often get representations about reducing the waiting times in Circuit Courts and District Courts. Have waiting times been reduced? Some criminal or civil cases can take up to three years to be called. There is a great discrepancy between one area and another. In some areas there is practically no waiting and in others there is up to two years. In Galway, there is practically no waiting time for criminal appeals while in Carlow, for example, there is 18 months' waiting time. What factors are involved?

Mr. Brendan Ryan

First and foremost, the assignment of judicial business is a matter for the Judiciary. A report from the Council of Europe in 2006 said Ireland has the lowest rate of judicial numbers per head of population in the 45 countries investigated.

Deputy Pádraic McCormack

Why is there a difference between one area and another?

Mr. Brendan Ryan

There is a limited number of judges to deal with a significantly increased caseload. We have had a 40% increase in caseload in the past four years. The assignment to judges of particular lists is a matter for the Judiciary. The President of the High Court decides on the basis of the resources he has available. There has been no significant increase in waiting times over recent years. I am surprised at the Deputy's figure of two years' waiting time because most criminal business is dealt with——

Deputy Pádraic McCormack

Is there such a thing as more efficiencies? Are some judges more efficient than others in dealing with their lists while backlogs build up in other court areas?

Mr. Brendan Ryan

I cannot comment on that.

Deputy Pádraic McCormack

I would not expect Mr. Ryan to do so. I am only making the remark. As John B. Keane said, "It is only what I see on my travels."

Mr. Brendan Ryan

Criminal trials, in particular, are taking longer. A few years ago, criminal trials on indictment were taking one or two days. Most criminal trials on indictment now take a minimum of three or four days. There are various reasons for that.

Deputy McCormack mentioned waiting times in Galway. They would be mainly criminal trials in the Circuit Court. We have 26 Circuit Court offices. In 12 of those offices criminal matters are dealt with within six months, in seven they are dealt with within 12 months, in five they are dealt with within 18 months and in two offices the delay is more than 18 months. These are the statistics for criminal business.

Deputy Pádraic McCormack

Mr. Ryan mentioned that interpretation costs were €3.5 million in 2008, €3 million in 2009 and that they have now been reduced by 35%. How did this come about? Is it owing to the fact that many foreign nationals have left the country or because a reduced number of people speak Irish? What caused the reduction in this area?

Mr. Brendan Ryan

The savings come about owing to three factors: the 8% supplier levy, the fact we have better processes in place, and as the Deputy rightly said, the significantly reduced numbers appearing before the courts who require interpretation services.

Deputy Pádraic McCormack

Are they people who speak Irish or foreign languages?

Mr. Brendan Ryan

They are non-Irish speaking people. The main groups requiring interpreters are Polish, Romanian and Lithuanian. These account for 60% of interpretation.

Deputy Pádraic McCormack

Is the 35% reduction this year due to the fact there are fewer of these people coming before the courts now?

Mr. Brendan Ryan

Yes.

Deputy Pádraic McCormack

I have another question on the payment of court fines. What percentage of fines are never paid or collected and what steps are taken to collect outstanding fines?

Mr. Brendan Ryan

Over the past ten years, the collection system and the effectiveness of court fines have been the subject of review by the Comptroller and Auditor General and the Committee of Public Accounts. The fines collection process for court imposed fines involves three agencies: the Courts Service, the Garda and the Prison Service. We have proactively addressed our role in the process and the compliance rate for court imposed fines was adopted as one of our key performance indicators. In 2009, some 15,000 fines were imposed by the courts. Approximately 20% of the fines are reversed or cancelled on appeal, thereby reducing the number of fines collectable. We have made significant progress in improving the effectiveness of the fines collection process over a number of years. This has been achieved through the implementation of——

Deputy Pádraic McCormack

What percentage of fines is collected currently?

Mr. Brendan Ryan

The percentage has increased in recent years from 50% to 70%.

Deputy Pádraic McCormack

Are 70% collected or not collected?

Mr. Brendan Ryan

We collect 70%.

Deputy Pádraic McCormack

Therefore, some 30% are not collected currently.

Mr. Brendan Ryan

Yes, but the Deputy may recall the Fines Act was passed late last year. We envisage that when it is implemented——

Deputy Pádraic McCormack

What percentage of the 30% of unpaid fines are fines owed by non-nationals?

Mr. Brendan Ryan

I do not have that detail. The international best practice rate of collection is in the region of from 80% to 85%. We envisage, once the Fines Act is fully implemented, that we will reach those figures. As a result of moving from a 50% collection rate to a 70% collection rate, the fines collected provide an extra benefit of €8 million annually to the Exchequer.

Deputy Pádraic McCormack

What steps are taken to collect the unpaid fines?

Mr. Brendan Ryan

That is not a matter for the Courts Service. Unpaid fines are a matter for the Garda Síochána.

Chairman

Did Mr. Ryan give members a figure for the uncollected fines?

Mr. Brendan Ryan

I did not, but it amounts to 30% of approximately €44 million or €45 million. It would be approximately €10 million.

Deputy Pádraic McCormack

That is a lot of money.

Mr. Brendan Ryan

Yes, but we hope to achieve a collection rate of 85% or 90% over the next few years. That is one of our——

Chairman

It is €12 million or €13 million that is uncollected. If it is 30% of €44 million, it is €13.2 million in uncollected fines.

Mr. Brendan Ryan

Yes.

Deputy Pádraic McCormack

I know Mr. Ryan dealt with this issue already but I did not understand it clearly. How many properties has the Courts Service sold or tried to sell to raise the €22 million since the new criminal courts complex was brought into use? Has any property been sold? Are the properties on Smithfield, Bow Street and Riverbank on long-term leases?

Mr. Brendan Ryan

No, they are all gone now. Only one building was due to be sold, the children's court in Smithfield, but it could not be sold in advance of us moving into the CCJ because until it was ready we had no place to move the people in the children's court. The other buildings were just leased and all except one of the leases are now finished.

Deputy Pádraic McCormack

Were they sold?

Mr. Brendan Ryan

No, the lease time was up. We had phrased the leases in such a way that they would run out by the time the CCJ was built.

Deputy Pádraic McCormack

All right. Therefore, the Courts Service did not recover any of the €22 million that was projected to be recovered.

Mr. Brendan Ryan

That was the projected savings.

Deputy Pádraic McCormack

Have those savings been realised?

Mr. Brendan Ryan

Yes, very much so.

Deputy Pádraic McCormack

What building does the Courts Service still retain?

Mr. Brendan Ryan

The children's court in Smithfield, which deals only with children's cases.

Deputy Pádraic McCormack

Is that building on lease?

Mr. Brendan Ryan

No, we own it. It is a fine building and was valued in 2004 or 2005 at €10 million.

Deputy Pádraic McCormack

Mr. Ryan does not need to impress me. I am not a customer.

Mr. Brendan Ryan

One would have to be under 18 to be a customer in that building.

Deputy Pádraic McCormack

Is it for sale all the time?

Mr. Brendan Ryan

No, it is not for sale. We never put it on the market owing to the current depressed prices. There are a huge number of premises available around Smithfield. The area was developing well as a hub that could compare well with Temple Bar during the boom years, but unfortunately the decline has impacted badly on the area and there are a significant number of buildings for sale or lease there. Now would not be the appropriate time to put the children's court building on the market.

Chairman

With regard to an bord snip nua, Mr. McCarthy said we had 129 District Court venues and 56 Circuit Court venues, many of which were in close proximity to each other. He suggested that substantial savings could be made by rationalising the number of buildings. What steps have been taken to do this?

Mr. Brendan Ryan

We have taken significant steps in that regard and had taken steps even before the an bord snip nua recommendations were made. When we were established in 1999, there were 260 venues outside Dublin used for court business. This number has now been reduced to approximately 125. We have done a review of the remaining court venues and anticipate significant further closures and amalgamations of venues over the next few years. There must be savings in this area. Unfortunately, when we close a venue, this causes inconvenience to people. Many of the premises are used only one day a month and are in a bad state of repair and there are also significant health and safety issues. We know we must retain some of the venues in provincial areas, non-county town venues, but we know from experience that the cost of renovating these buildings and providing the appropriate facilities will cost approximately €2 million per building. The days are well gone when we had that type of money. We must also consider the value for money aspect and that a building of that nature may only be used one day a week or 12 times a year. We must take into consideration not only the investment but also the maintenance and heating of the buildings. That is a significant investment. We must reduce the number of venues significantly.

There are also other inefficiencies in the system. Some of the venues do not sit for a full court day and may finish early, yet we send out staff and judges also attend. If we amalgamate some of these venues in central locations, we can increase the case count lists and create greater efficiency. We can also justify the significant expenditure we make on these fine buildings by moving cases to them from the closed venues. Currently, we have an excellent portfolio but we are not finished and still have long way to go. The current portfolio maximises the use of the buildings.

Deputy Pádraic McCormack

What was the total final cost of the new courts complex?

Mr. Brendan Ryan

The construction and fit-out costs, including VAT, came to €149 million. It was €132 million excluding VAT.

Deputy Pádraic McCormack

Was that the total cost?

Mr. Brendan Ryan

That is the cost of building the building.

Deputy Pádraic McCormack

And fitting it out.

Mr. Brendan Ryan

Yes, including fitting it out.

Deputy Pádraic McCormack

I thought the figure quoted earlier in the report was that the refurbishment would cost €229 million.

Mr. Brendan Ryan

Which refurbishment?

Deputy Pádraic McCormack

Refurbishment of the existing building, the existing internal accommodation.

Mr. Brendan Ryan

Many of those buildings in the environs of the Four Courts are listed buildings and many were buildings not in the ownership of the Courts Service. We estimated if we had to stay in that environment it would have cost us that amount of money to bring the buildings up to the standard we now have in the CCJ, Criminal Court of Justice building.

Deputy Pádraic McCormack

Surely the figure Mr. Ryan has given for the new complex——

Mr. Brendan Ryan

That is the construction cost, yes.

Deputy Pádraic McCormack

The construction costs and the fitting-out costs.

Mr. Brendan Ryan

It is not the full contract cost. Obviously there is a huge operational element to that.

Deputy Pádraic McCormack

That is what I want to find out, the bottom line cost.

Mr. Brendan Ryan

The NPV value of that project, based on today's values, is €297 million, over 25 years.

Deputy Pádraic McCormack

On the PPP, did Mr. Ryan mention a cost of €780 million to pay that back over 30 years?

Mr. Brendan Ryan

No, €780 million? I did not, no.

Deputy Pádraic McCormack

Mr. Ryan mentioned €780 million for something in answer to Deputy Kenneally, I think.

Mr. Brendan Ryan

I do not think so, Deputy, sorry.

Deputy Pat Rabbitte

How much is the annual repayment?

Mr. Brendan Ryan

€21.7 million, unitary charge, €21.4 million unitary charge for 25 years.

Chairman

That takes it up to €700 million.

Mr. Brendan Ryan

No, that takes it up to about €600 million, yes.

Chairman

Some €700 million if my sums are right.

Mr. Brendan Ryan

The Deputy must have gone to the North Mon.

Chairman

I did; like Mr. Ryan himself. I refer to the McCarthy report which made a number of recommendations which I will paraphrase. The report spoke about providing court sittings on Mondays, keeping the courts open for a full year, streamlining the selection of juries, using court real estate more efficiently, in other words, using courtrooms to hear more than one case per day, if this were possible. What progress has been made?

Mr. Brendan Ryan

Progress has been made in most of those areas. I will go through what the Chairman has outlined. McCarthy mentioned court fees and an bord snip nua indicated that the Courts Service should in principle try to get as close as possible to applying in a uniform way charges that reflect the actual economic cost, especially in commercial cases. There is a fees order presented to the Minister at the moment, which will increase the cost of the fee in commercial areas substantially and once this order is signed it will mean full cost recovery for commercial cases for the Courts Service.

We dealt with the question of the rationalisation of court venues. On the use of court buildings, we are maximising the use of court buildings. As I indicated earlier, we have closed many outlying venues and we are maximising the use of refurbished buildings. That is an ongoing process.

With regard to the streamlining of jury service, the Civil Law (Miscellaneous Provisions) Act 2008, amended the Juries Act 1976 and the court now has an option not to sequester jurors once they have commenced their deliberations in the case before them. The committee may recall that up to then, juries would have been sent off to a hotel overnight with a Garda escort and this is no longer the case. Most judges now decide to allow the jury members go home and recommence the following morning. This has resulted in savings. The Law Reform Commission has made a consultative report on juries.

Chairman

The McCarthy report spoke about providing the defence with a fairly extensive list of potential jurors rather than having the whole process of objecting to jurors within the courtroom situation. Has this been considered?

Mr. Brendan Ryan

No, the consultative paper from the Law Reform Commission is dealing with such issues and we await its full report. The question of jurors has not been dealt with. The defence is given the list of jurors in advance of the jurors being empanelled.

Chairman

To return to Deputy McCormack's figure — I make it €750 million — what amount of this is for construction and what element would be the cost of ongoing maintenance?

Mr. Brendan Ryan

The 52% of the unitary charge deals with the fixed construction costs. The other 40%, approximately 48%, deals with the core services provided over the 25-year period which includes fabric maintenance, cleaning, waste management, security, various such aspects.

Chairman

A total of 52% of €750 million would be about €390 million for capital.

Mr. Brendan Ryan

I do not have the figures in front of me.

Chairman

I assume 52% of €750 million would be €390 million.

Mr. Brendan Ryan

Yes, about €350 million, €390 million. This is over a 25-year period. The NDFA, National Development Finance Agency, will confirm that the 52% annuity percentage of the unitary charge that goes to pay back the banks the construction costs was the best rate that had been achieved to that date on the markets. We have been informed that such a rate for the repayment of that sum will never be achieved in the foreseeable future. I think the rate was around 5% and the NDFA indicated at the time that it was the best rate it had seen up to that stage for projects of that nature.

Chairman

Was a comparative cost analysis undertaken on an up-front payment for the capital?

Mr. Brendan Ryan

An analysis of the cost of providing the services now being provided in the Criminal Court of Justice was undertaken in an outline business case.

Chairman

Was a comparative cost analysis undertaken between up-front payment for the construction of the building as against the 25-year cost of €390 million?

Mr. John Mahon

The public sector benchmark which is the public sector reference cost for delivering the project includes capital costs, operational costs and risk costs. The capital cost element would have been the estimate for delivering the project by the traditional means. My recollection from the preferred bid is that the construction cost provided for in the PSB, public sector benchmark, was very similar to the bid element relating to construction or to the capital costs. In terms of the competition, the cost was marginally below. The overall bid was obviously below the public sector benchmark and so that, in principle, demonstrated there was value for the Exchequer. My recollection is that — we can confirm this for the committee — the capital element of the bid was also below the capital element of the public service benchmark.

Chairman

I am a little confused and that may be my fault. Was an analysis undertaken between specifications for a particular building? Was an estimate received of the cost if done in the traditional way, such as putting it out to tender and paying up-front, as against the €390 million involved in the PPP?

Mr. John Mahon

Yes. The public sector benchmark was the place where we developed that public sector estimate of the capital cost of delivering the project. When the bids are received in a PPP project, the bids are compared against that public sector benchmark. There is a capital element, an operational element and a risk element. My recollection is that the winning bid in capital cost terms was in or about the same or slightly less than the capital element in the PSB. However, the PSB has a capital estimate for delivery of the project.

Chairman

Do you have that estimate?

Mr. John Mahon

Yes, we have that estimate. I do not know that I have the exact figure with me. We can certainly get it for the committee. We can provide it.

Deputy Pat Rabbitte

Deputy Kenneally and I had an opportunity to see the new building before it was commissioned. We agree that it is the outstanding statement building of the boom. There is no doubt that it is a tremendous addition to our infrastructure. I ask the representatives of the National Development Finance Agency about the point raised by the Chairman. Mr. Ryan said that the cost of construction, excluding VAT, was €132 million. The total figure will be borne by the Exchequer over 25 years. It seems very large. The state of the national finances means that PPPs are used in the cases of certain major infrastructure projects. Have we learned any lessons about the respective merits of deciding to build by the traditional method and by the PPP method? I refer to more routine projects, such as schools and hospitals. What is the National Development Finance Agency's thinking on the respective merits of both approaches?

Mr. Jim Golden

The primary purpose of PPPs is to deal with complex projects in which there is substantial scope for innovation in the private sector. We are currently conducting a post-project review for this project. We maintain ongoing contact with our colleagues in terms of finance, ultimately to determine the percentages of the envelope that will be accounted for by the PPP and traditional approaches. I remind the committee of the differences between the PPP approach and the traditional approach, which have been mentioned. The traditional approach focuses on the capital cost of the works. It does not focus on the Exchequer financing costs, such as the cost of borrowing Government bonds, which are associated with funding it in the traditional way when one is running at a deficit rather than at a surplus. Our experience is that the PPP approach is a good way for a Department to set out its output specifications; to say it wants certain things to be produced; to put a fiscal discipline around it, in terms of following the Department of Finance's capital appraisal guidelines; to arrive at the budget; and to go through the Department's four value for money tests. The four tests are making an outline business case, doing the public sector benchmark, seeing whether the PPP has an opportunity to deliver value for money in relation to a shadow bid model, and doing the procurement and seeing what comes back from the market. The market always supplies comprehensive business and financial models for all bids. That allows one to go through each item, for the next 25 years, line by line. One can assess the private sector prices at all stages, from the point at which the preferred bidder is appointed all the way to the financial close of the project. At all stages, one has an opportunity to control the negotiating process one employs. One can see any movements in risks and costs, and so on. Such information is available of at the end when one gives one's opinion to the Accounting Officer — the Courts Service, in this case — on whether one believes value for money has been delivered. The audit trail is highly disciplined and based on evidence. While I admit it is sometimes tortuous, at the end it allows one to see clearly what has been done. It gives those who are planning an opportunity to have an idea of what the whole end cost will be.

Deputy Pat Rabbitte

Mr. Golden's commentary will bear close reading. I am not sure I absorbed it all. It is important, obviously. I would like to apply what he has said to Thornton Hall, for example. The Thornton Hall deal collapsed, officially because the State considered it unaffordable in the new economic circumstances. An attempt is now being made to recruit a builder in the traditional way for the construction of the first block of the prison. The difference between the relevant amounts is enormous. The figure that was being used at the time when the State withdrew from the initial deal was an unimaginable number of hundreds of millions. The figure now being cited for the construction of the first block, which will accommodate up to 300 prisoners, is approximately €29 million. I am not saying I am comparing like with like, as the design is not exactly comparable and the management, and so on, is clearly different. In light of the new economic circumstances and the increased competitiveness in the building industry, I wonder whether it would be more advantageous to the State to resort to traditional building procurement.

Mr. Jim Golden

I will give some background information. The National Development Finance Agency is obviously a project taker, a policy taker and a fund taker. That has always been the case. The size of the multi-annual capital investment envelope, which determines the mix between the traditional and PPP approaches, has always been a matter for the line Minister and the Government of the day. Off the top of my head — I will have to check the multi-annual capital investment envelope — to date the target has been that approximately 10% of it should be PPP, as opposed to the traditional envelope. As far as I know, it was never planned that it would be anything greater than that. It was intended that the PPP approach would primarily be used as a path-finder, to see what the potential capital solutions might be. It is a matter for the sanctioning authority and the sponsoring agency to decide how much money is allocated and which method is used. We are there to provide advice to them and to give them support if they want to do it on a PPP basis. We can answer any other financial questions they might wish to ask about capital areas. Ultimately, it is their choice. As far as we are concerned, the PPP approach has always been a minor element of the overall delivery of the capital programme. It exists primarily to deal with issues that did not arise in the past. In response to the Deputy's question about the Thornton Hall project, it is ultimately a matter for the sanctioning authority and the sponsoring agency to allocate their multi-annual capital investment envelopes as they fit.

Deputy Pat Rabbitte

Perhaps I can put the same question to the Department of Finance. Is it the opinion of the Department that the time has come to review the efficacy of the PPP mechanism, as compared to the traditional build approach?

Mr. Dermot Nolan

The PPP mechanism is designed as a means of delivering value for money. It was always intended as an alternative to traditional means of procurement. It almost acts as a control on procurement. As Mr. Golden said, it has pioneered the scoping out of things like risk. The Secretary General of the Department of Finance and the chief executive of the National Development Finance Agency have spoken about having some sort of a look at how PPP is working out, compared to traditional approaches. Public private partnerships have set the trend, in many ways. We now have fixed-price contracts in the area of traditional procurement. Under fixed-price contracts, all risks are transferred to the bidder, in effect. That territory was opened up by the PPP approach. It actually acts as a control, in parallel to the traditional system of procurement. It can offer value for money in particular circumstances.

Deputy Seán Fleming

I apologise for being late. I want to ask a couple of questions. I recently read an article in which it was mentioned that the new court building has won an award as the most energy efficient building to have been constructed in Europe. The article suggested that the building works like a flask — essentially, it was built within an outside shell, which is supposed to keep it cool on hot days and warm on cold days.

Mr. Brendan Ryan

Yes.

Deputy Seán Fleming

How is that working or has it been in place long enough for it to be judged?

Mr. Brendan Ryan

We have not been there long enough to judge it yet but when we moved there in January the winter months were very cold and June was very warm. I have worked a long time in the Courts Service. Traditionally, in the Four Courts there were huge problems with the heating in that in the summer the building was too warm and during the winter it was always too cold. We did not get a single complaint from the members of the Judiciary, staff or any of the users of the Criminal Courts of Justice, CCJ, about the conditions in the CCJ since it opened in January. We got a significant response from all users, be they Judiciary, staff, practitioners, jurors. They have all had a very welcoming and positive experience there. I do not know if anyone read Róisín Ingle's piece in The Irish Times magazine two weeks ago. Her mobile telephone was stolen and halfway through her article she refers to her experience the previous week as a juror. It is a lovely article. Her experience was very positive. One would not have had that experience six or 12 months ago. It was an embarrassment as such for those of us who work in the courts to bring jurors into the Four Courts because the facilities were antiquated and appalling. Jurors can now focus on the matter in hand when they are empanelled on a jury. I am sorry for the long response. The building works very well because there are two skins on it, an outside layer and an inside layer, and it keeps the building very functional. It is a very efficient building. The rating it received was very good based on a system that went from excellent to poor.

Deputy Seán Fleming

From what Mr. Ryan has said, is he making a case for moving the civil cases out of the Four Courts as well? From what I can gather he would not take much convincing.

Mr. Brendan Ryan

In recent years when the CCJ approached completion we set up a committee in the Four Courts chaired by a High Court judge to examine the Four Courts once the criminal business moved out. That report has been presented to the Minister for Justice and Law Reform. It called for a significant investment in the Four Courts complex and the centralising of the remaining civil courts and family courts around Dublin in the one complex.

Deputy Seán Fleming

I wish to ask a few simple questions about the building which we all know from passing it. Who picked the site or how was that site chosen? Mr. Ryan should focus on site selection rather than the building itself. I put it to him that the facilities for the public are woeful in terms of access to the building. There are double yellow lines for a half mile in every direction on every street. Nobody can park there or legally drop someone off, although there might be a tiny drop-off space. Jurors, the public, victims, families of victims, defendants and families of defendants all have to go there on foot. There may be a train station at the other side of the river but that does not get one from the train station to the building.

In addition, some witnesses have to run the gauntlet of the media. That is another day's work. Protection was given to a witness in one particular case. Once one steps outside the door of the building one's immediate environment is not suitable for access. I accept there are bus services but most people cannot get the bus that goes to the junction in question. How was the site selected and who selected it? How was it envisaged that people would get in and out easily? On a wet day if one does not have an umbrella one will get soaked to the skin getting in and out of the place.

Mr. Brendan Ryan

On site selection, we considered purchasing sites in the vicinity of the Four Courts because that is part of the legal quarter. We wanted to keep the criminal business as close to the Four Courts as possible. We could not get a site of the proportions required, approximately 2.5 acres. The site we chose was in State ownership so there was no cost to the State. Some Members may recall it was the Garda pound. If one's car was lifted in town that is where it ended up. The site was available and a small bit of extra space was required to make the site more suitable. The Department of Defence, which has an adjoining site, gave us a small parcel of land as well. From our point of view it was an ideal site. It did not cost the State any additional money. It was in sufficiently close proximity to the courts not to cause disruption to the services.

On public transport, it is close to Heuston Station and the Luas line goes to Heuston Station. I appreciate there is a bit of a walk, which I have done myself. There is no parking around the Four Courts. I accept buses pass the Four Courts but one would have to travel a fair distance around it to find any decent parking facilities.

Deputy Seán Fleming

Are there not parking meters in the area?

Mr. Brendan Ryan

Yes, there are meters for ten or 20 cars on the quays. That is all. The spaces are always full by early morning. There are no parking facilities around the Four Courts either.

I accept Deputy Fleming does not wish me to go into what we provided but that justifies the reason for moving to the new site. Public transport is quite good. If one gets any bus in Dublin it will bring one to O'Connell Street and once one is there one can get the Luas which leaves one within a three or four minute walk of the steps of the building. I accept parking facilities are poor. The difficulty the OPW is facing is that people are parking in the Phoenix Park which is contrary to the OPW's best practice. I am open to correction but as far as I am aware we have not had any complaint from witnesses, jurors or anyone of that nature on the lack of parking facilities. The CCJ is close to the M50 and the Red Cow.

Deputy Seán Fleming

Close?

Mr. Brendan Ryan

When one parks at the Red Cow one can get the Red Luas line straight into Heuston Station. If one is coming up from the country one has that facility as well.

Deputy Seán Fleming

Then one must walk over from Heuston Station or from the Luas. Does Mr. Ryan understand——

Mr. Brendan Ryan

I can understand.

Deputy Seán Fleming

There is quite a scrum. One gets that with big court buildings. There can regularly be quite a scrum at the front door.

Mr. Brendan Ryan

One gets that scrum in the Four Courts as well because both court houses are in city centre locations. Once inside the facility Deputy Fleming will appreciate that the design is world class. Architects are coming from all over the world to visit the building, as are court officials. It is an iconic building that is state of the art.

Deputy Seán Fleming

Someone who is innocent has quite a distance to go to get away from the cameras and everyone else. There is a certain lack of dignity involved for people who are going through a traumatic event having to walk across the Liffey bridge.

Mr. Brendan Ryan

The Deputy may recall it was worse in the Four Courts because those in custody were marched in and out of the building through the gates handcuffed to prison officers. Those people were only in custody having been accused of a crime but the court had not decided their fate. The people were publicly filmed. In the new building we have facilities for separate and secure entrance for vulnerable witnesses, which we never had in the Four Courts. If the DPP or the Garda decide that a particular witness should not be brought in through the front entrance, arrangements are put in place to bring him or her in through a side entrance away from the public glare.

Deputy Seán Fleming

That is new development. Does any other courthouse around the country have that facility for vulnerable or sensitive witnesses?

Mr. Brendan Ryan

Not the way it is designed in the CCJ, which is a world-leading design.

Deputy Seán Fleming

Does Mr. Ryan have a view on who should have access to that entrance or is it a call for the Garda to make?

Mr. Brendan Ryan

No.

Deputy Seán Fleming

Who makes those decisions?

Mr. Brendan Ryan

It is a matter for the Garda and the DPP. We facilitate any request they make.

Deputy Seán Fleming

In truth, I do not have a complaint about the finances. It is a fabulous building. I hope it is there in 100 years' time.

Mr. Brendan Ryan

I thank the Deputy.

Chairman

The Four Courts has a lovely entrance from the quays. Why is it closed?

Mr. Brendan Ryan

I have good news for the Chairman, it will be open from October.

Deputy Brendan Kenneally

I wish to ask one question on the capital building programme. Mr. Ryan would be disappointed if I did not ask him. He knows what I am going to ask. Is there progress on the court house in Waterford?

Mr. Brendan Ryan

Deputy Kenneally will be pleased to hear there is excellent progress. I met representatives from the Bar in Waterford last Friday morning and we had an excellent meeting. The project depends on funding, as the Deputy knows. The Deputy may assist us in any way he can in that a fire station needs to be moved. The plans will be finalised later this year. We will seek planning permission next year and we hope that, if all goes to plan and if funding permits it, we can aim for a date of late 2011 or, at the latest, early 2012. It will be a magnificent project. It is a fine venue and there is great potential. The plans that have been drawn up will enhance the whole area.

Deputy Brendan Kenneally

I am glad to hear that.

Mr. John Buckley

Obviously we are all in a process of continuous improvement. One reason we consider one of these projects per year is to see what lessons might be learned. At the tail end of the report, there are some remarks aimed at the wider system. I will point out one or two but, before doing so, I will address some of the questions that were asked. In individual cases, if the public sector benchmark is done objectively and properly, it should be a test of whether value is being achieved. This is because it compares the public sector cost with the private sector cost.

The question of affordability is a more or less separate issue and needs to be considered on two levels. One level is the project level, where having an appropriate budget is an issue. However, if there has been major recourse to public private partnerships over time, one is constraining future resources. There would have to be a limit at some point on how much of one's future budget one could commit in advance to this process. I see this as having to be considered on two levels.

One of the points we made was that efficiency gains need to be estimated as part of the business case, where appropriate. These are all very variable projects but as we carry out new ones we learn new things. In the case of the project in question, we suggest that every asset created can only be judged in terms of its usefulness in terms of the contribution to efficient service delivery. The extent to which a project has an input into more efficient service delivery should be the test.

Having looked at this project, we would tentatively suggest that it might be useful to state the benchmark in terms of a range rather than as a single point or figure. It is very sensitive to movement. For instance, we point out in the report that if one considers the 1% assumption in the area of service inflation, one will realise a single figure, constructed on the basis of assumptions about uncertain events, cannot be regarded as more than a central tendency in a range of legitimate values. There are many other uncertain factors that are combined in the benchmark.

Looking at the project in question, it is certainly worth reflecting on how we might improve the process of comparison. In next year's report on this year, we will be looking at a project in respect of which there may be other lessons to be learned, the convention centre project. We will, I hope, return to this subject, focusing on one project each year. Perhaps it will give us a chance to reflect on how these things are actually put together.

Chairman

I thank the witnesses for attending and the members for sticking around for two sessions today. Is it agreed to note Vote 22 and dispose of chapter 17? Agreed.

The witnesses withdrew.

The committee adjourned at 3.45 p.m. until 10 a.m. on Thursday, 22 July 2010.