I would like to express my thanks to the Chairman and other members for inviting me to attend the committee and for affording me the opportunity to provide both detail and context to the findings of the Comptroller and Auditor General. It will also offer me the opportunity to confirm that the shortcomings identified have either been addressed through procedural changes or new practices.
It is important that I set out for the committee the context under which Kildare Vocational Education Committee has operated over the past ten years. County Kildare Vocational Education Committee has experienced rapid growth over that period due to significant demographic changes within the county. In 2002, County Kildare had a population of 163,944 and this has increased to 209,955 in the 2011 census - a population increase of over 28% in ten years.
This dramatic change, in terms of the growth in population in Kildare, resulted in the urgent need to provide for the additional educational needs of local children and to plan to meet their needs immediately. The imperative was to ensure every child in Kildare had access to education when required at the relevant level.
The table in appendix 1 which I have circulated gives some indication of that growth in terms of the scale of the business we manage and how it has impacted on our operations. The key metrics from that table are: a growth of 125% in student numbers; a growth of 32% in our teaching staff; a sanctioned increase of almost 1,500% in the size of our capital budget, which will treble to €30 million over the next two years; a growth of 120% in our annual expenditure; and a decrease of 28% in our head office administrative staff.
To provide for this growth in student numbers, our strategic plans in 2002 clearly identified the urgent need for new schools and facilities to educate the young people of Kildare. Having reviewed all options, County Kildare Vocational Education Committee developed an innovative and exciting campus model to deliver modern educational infrastructure for Naas. This approach was approved by the Minister for Education and Skills of the day and by subsequent Ministers. The campus structure that was ultimately developed in Naas is now the blueprint for the provision of new educational facilities nationally.
This campus at Piper's Hill, Naas, opened its doors in September 2008 and consists of a 1,000 pupil second level college with an enrolment of more than 800 students. In 2008, that college had fewer than 400 students. It opened on the new campus in 2009. A new community national school started in September 2010. A 16-classroom gaelscoil opened in 2008 under the patronage of An Foras Pátrúnachta. A national headquarters and training centre for the IVEA opened in September 2011 and a replacement six-classroom primary school for the Church of Ireland is currently at design stage. At a future date, there will be a permanent school for the community national school.
It should also be noted that during this period the VEC system underwent radical change due to the introduction of the 2001 Vocational Education (Amendment) Act, and there were a raft of changes to employment and procurement law. Under normal circumstances these changes would place a significant additional workload on administrators, but our office had to adjust to a 28% reduction in its staffing allocation.
The VEC governance structure also changed during this period. However, even though Kildare VEC is one of the larger VECs in the country, its staffing structure is that of a category 3 VEC, resulting in the lack of an IT pillar and senior management posts.
Valuable lessons have been learned during this period resulting in an increased commitment to good corporate governance and an increased awareness of risk assessment. At all times during this period the VEC and the Department of Education and Skills were kept informed of our strategic plans, and both sanctioned the key deliverables of that plan.
As CEO, I have a dual role as an education provider and the manager of a substantial organisation. To ensure these roles operate effectively, I report monthly to the VEC and in addition to finance and audit sub-committees, and acquire the relevant sanctions as appropriate.
There are two distinct issues addressed by the Comptroller and Auditor General in his report and I am happy to deal with both. The first relates to the manner in which certain goods and services were procured by Kildare VEC during the period under review. Some of the issues relate to the procurement of ICT materials and support, while others concern the project support advisers engaged for the campus. I accept that there were deficiencies in respect of the procurement of goods and services, but I can confirm that we have taken strong action to address the shortcomings identified in the report's findings, which includes the following.
All purchases at school and centre level require additional documentation to accompany the official order form that will ensure verbal, written or e-tender procurements are associated with the relevant V11. At head office, new standard operating procedures are being developed to cope with the increased capital procurement being undertaken by the VEC, currently estimated at €30 million for the next two years. Also at head office, new tracking systems are being implemented to ensure compliance on a range of functions and to eliminate risk to the VEC. A risk assessment committee has been put in place since 2010.
We would like specifically to update the committee on the findings outlined in figure 1 of Mr. Buckley's report. I apologise to Mr. Buckley's officials in that, at the time of audit, we did not have some of the document required available to us. I had to source it and I have sourced it. At the time, I certified from my examination of the files that procurement rules were followed. However, all of the relevant back-up, which dates back to 2006, was not readily available at that time as the procurement exercised in each case was not conducted directly by Kildare VEC head office, but by schools and centres and by other agencies on behalf of the Department of Education and Skills. We have since sourced in the majority of cases the required back-up, which confirms that procurement rules were followed in respect of these purchases. In a small minority of cases the relevant back-up is not available, but I have no reason to believe that proper procurement rules and processes were not followed in these cases. An ex-post review has confirmed that the prices at which the goods and services were supplied were competitive and value for money, and I can give the committee examples if required.
On the procurement of advisory, project management and design services associated with the development of the campus in Naas, this was a factor of the manner in which the development project proceeded, with extensions at different levels beyond the initial scope. I accept that at each stage of contract extension there should have been a reassessment of the basis on which the services were procured but given the pace and manner in which the project proceeded, this did not happen. I regret this but have put systems in place to ensure that this will not happen again. Having reviewed the sums expended on such services after event, I believe that Kildare VEC and the taxpayer did receive value for money for such expenditure. Of course, I fully accept the point expressed by the Comptroller and Auditor General that the process must not just deliver value, but be demonstrably open and transparent. I can confirm that lessons have been learned across the VEC from this project and new guidance has been rolled out to strengthen the procurement processes involved.
The second aspect addressed in the report of the Comptroller and Auditor General relates to property transactions undertaking by the VEC to support the funding of the new campus. Again, this needs to be understood in the context of the time. I will cite a letter we received in 2004 from the then Department of Education and Science. It asks me to conduct an assessment of all properties in the committee's ownership to establish if any are surplus to known requirements, and to provide an estimate of the value of any surplus assets in the event that they are disposed of on the open market, and in tandem, to identify and prioritise any capital projects to which any funds so released might be allocated, and states that the Minister is anxious to have my report within two months so that the outcome could be dealt with.
As is normal for capital development in education, the funding for major projects is centrally allocated by the Department of Education and Skills. In this case the Exchequer has provided funding for the new campus development of € 29.9 million. It had been intended that the Exchequer contribution in this case would have been largely offset by the proceeds of sale of a property that the VEC had owned in Naas and which Superquinn had agreed to purchase. Regrettably, having paid a deposit to the VEC, which we retain, Superquinn went into receivership and could not complete the contact. This was unforeseeable and unfortunate, but we did retain its deposit and still have control of the asset involved, which is now used as a school in Naas.
The bottom line on the Piper's Hill campus project is the total cost to the Exchequer is €29.9 million while the assets are valued at €56.9 million resulting in a net gain to the State of €27 million. What we were unable to deliver was an additional €20 million saving to the State as a result of events outside our control. Had we succeeded, it would have been the icing on the cake for this project.
The Comptroller and Auditor General's review identified a potential risk to the Exchequer in that an element of the funding for the campus project was reliant on the sale of an asset. I assure the committee that County Kildare Vocational Education Committee carried out due diligence on each element of the project to ensure that all risks were minimised and the Department of Education and Skills was kept appraised at all times.
I should also like to record that in the course of developing the Piper's Hill campus in Naas significant and valuable lessons were learned. These lessons have influenced the VEC and the Department of Education and Skills to develop the campus model for the future. I am pleased to report that Kildare vocational education committee has led the way in the development of the campus model of integrated educational provision. We have recently, together with the Department of Education and Skills, developed the new educational campus in Athy consisting of a second level VEC school and three national schools under different patronages.
We are currently developing a design brief for a new 2,000 pupil second level campus in Maynooth. This will bring together in the one location primary, secondary and tertiary education with the associated infrastructure for community and recreational use. I can confirm that, in respect of both the Athy and Maynooth projects, the lessons of the Piper's Hill project have been learned and applied.
County Kildare Vocational Education Committee is managing devolved projects valued €30 million on behalf of the Department of Education and Skills. It is managing these projects within its current staffing allocations, but with up-skilling and new work systems has the capacity to deliver. This is an example of the public sector delivering in keeping with the objectives of TPS.
I wish to state that County Kildare Vocational Education Committee continues to operate within its financial and staffing allocations as sanctioned by the Department of Education and Skills. I am happy to answer any questions the committee may have and thank it for inviting me here today.
