Business of Committee (Resumed)

We had a brief discussion in private session which was substantially connected with our work programme.

The next item on the agenda is the minutes of the meeting of 25 September. Are they agreed to? Agreed.

The next item is correspondence. No. 1610B is correspondence received from the Department of Health on the implementation of the Scally report and was circulated to members yesterday. We will discuss the timing of the issue in the context of our work programme, but for now we can note and publish the correspondence.

Category A comprises briefing documents and opening statements received by the committee. Nos. 1598A and 1608A are correspondence received from Teagasc, including briefing documents and the opening statement for today's meeting. We will note and publish the correspondence.

Category B comprises correspondence received from Accounting Officers and/or Ministers, as well as follow-up material requested at previous meetings. We held over a number of items from last week's meeting and are awaiting further information on some of them. We will continue to hold them over until we receive the information.

The first item held over was No. 1482B, correspondence from Mr. Robert Watt, Secretary General, Department of Public Expenditure and Reform, on the Dublin Institute of Technology. At our meeting last week we agreed to note and publish the correspondence and request the Secretary General’s views on the relevant legislation. That letter has been sent and the correspondence published.

Nos. 1486B and 1566B, dated 12 September 2018, are correspondence received from Mr. Seán Ó Foghlú, providing a copy of the review and report on Kildare-Wicklow ETB. We agreed to note and publish this correspondence. The secretariat is working on isolating matters mentioned in the report that are not subject to investigation by An Garda Síochána.

The next item held over was No. 1490B, correspondence received from Mr. Stephen Blake in the Government accounting unit in the Department of Public Expenditure and Reform, enclosing a minute from the Minister for Finance in response to our periodic report which was published last January. I am proposing that we hold the item over again. At this stage there are two or three reports, each of which merits further discussion. I have had a look at the correspondence and have mixed views on the quality of the response received. We will come back to the matter in public session at a later date.

The next item held over was No. 1502B, correspondence, dated 31 July 2018, received from Mr. Fergal Costello in the Department of Rural and Community Development, providing a copy of the statutory review of the Dormant Accounts Fund. We agreed to note and publish the correspondence, as well as a number of other items related to our periodic reports. The Dormant Accounts Fund will be included as an item in a future work programme. We will come back to this item.

That is good because I have attempted to come to terms with it and failed. I need help. We need to look at this matter more closely to find out what is happening. Approximately 50% of the fund, perhaps more, is unspent, while organisations are struggling for money. Some Departments are much worse than others. I have tried to get to the bottom of the matter and, like other Deputies, have tabled questions in the Dáil about it, but I have failed utterly to grasp it. An effort was made by the committee to have a review carried out. Now that one has been carried out, we must look at it and decide if value for money is being obtained and find out what exactly is happening.

We will come back to it. Representatives of the Dormant Accounts Fund were with us last year and it was one of the most pathetic meetings I had ever attended. Commitments were made to concepts and projects, but there was not a sheet of paper to be had and projects never happened. Money was locked up as part of a concept that had passed its sell-by date. Responsibility for the fund had moved from one Department to another and then another. It ended up being nobody's child in the sense that nobody wanted to take responsibility for it. Meanwhile, because there was no sunset clause, money that had been committed was locked up and could not be used. It was the worst example I had seen in quite a while of poor administration in the use of scarce public resources. We will come back to the matter as part of our work programme.

A lack of preparedness was the main factor in causing the underspend, in addition to low levels of uptake which reached almost 90% in some Departments.

That lack of preparedness meant that proposals were submitted but there were no details behind them. They were not really proposals but concepts or notions. Somebody had a notion about spending €2 million on a concept which was approved and the money set aside. However, nothing ever happened and the money was locked away.

Whatever about notions, there is huge demand for money on the ground-----

Yes, there is. That is the sad part. We will definitely come back to the matter which we will be highlighting in a future periodic report. The correspondence received from Mr. Costello will help us in coming to conclusions.

The next item held over was No. 1510B, correspondence received from Mr. Robert Watt, Secretary General, Department of Public Expenditure and Reform, enclosing a minute from the Minister for Finance in response to our second periodic report. We will hold it over again.

The next item held over was No. 1513B, correspondence received from Mr. Ciarán Breen, director of the State Claims Agency, providing further details as requested by the committee of the status of non-screening cervical cancer misdiagnosis claims. We agreed to note and publish the correspondence and hold it over for further discussion at a later meeting. We will discuss the State Claims Agency and CervicalCheck in the context of our work programme in a few minutes.

Also held over were Nos. 1526B, 1528B and 1530B, correspondence received from Mr. Ray Mitchell, assistant national director of the HSE, providing follow-up information as requested at our meeting on 5 July. A considerable amount of information was enclosed. We noted and published the correspondence last week and will come back to the matter as part of our work programme. Mr. Mitchell has provided very extensive and comprehensive information which will take some time to go through. When we come back to the issues, the correspondence will form part of our work programme. We also held over No. 1538B, correspondence received from Mr. Mitchell, providing follow-up information as requested at our meeting on 14 June. Again, very extensive documentation has been submitted. The correspondence has been noted and published and will be held on file as part of our work programme.

The next item held over was No. 1560B, correspondence received from Dr. Barry O' Connor, president of Cork Institute of Technology, providing a detailed note as requested by the committee on the preparation of terms of reference for the KPMG review of anonymous allegations against Cork Institute of Technology in 2014. We agreed to note and publish the correspondence which we will hold over for now.

Also held over was No. 1561B, correspondence received from Ms Anne Hession of the Higher Education Authority on the HEA's examination of expenditure associated with retirement events for the former president of Cork Institute of Technology, enclosing a note on the ability of technological universities to borrow. At our meeting last week we noted and discussed this correspondence which was read into the record. It will form part of our ongoing work. The memo is the only piece of positive information on the topic I have seen to date.

No. 1599B is correspondence, dated 27 September 2018, received from Ms Michelle Lowe, corporate communications manager, NTMA, providing information as requested by the committee for the preparation of our next periodic report. We will note and publish the correspondence. We are continuing work on our periodic reports. The secretariat has been going through the transcripts and is following up on questions that have not been answered fully by various bodies.

That is part of that process. We will note and publish that in the meantime, but it will come back to us when we are finalising our periodic report.

The next item is No. 1600 B from Ms Margaret Fitzgerald, private secretary to the Secretary General, Department of Finance. The secretariat requested an update relating to the review of staffing, governance and operations in the Tax Appeals Commission, and the Department advise a copy of the review is expected to be issued to the Committee of Public Accounts in the next week or so. It has been completed. It is on the Minister's desk, and we are told we will have it in a week or so. We look forward to receiving that, hopefully very shortly. We will note and publish that.

The next item is C, correspondence from private individuals and any other correspondence. The first one is No. 1491 C from Mr. Mark Griffin, Secretary General, Department of Communications, Climate Action and Environment, dated 19 July 2018, enclosing an information note as requested regarding what appears to be a far from complete remediation of a landfill site in County Wicklow. At our meeting last week, we agreed to note and publish this correspondence and hold it over for further discussion. In the meantime, we have received further correspondence from the original correspondent, and we will return to it as part of our work programme.

Held over from the last meeting also was No. 1572 C dated 15 September 2018 related to the previous item to which I have just referred. At our last meeting, we agreed to send the response from the Department to the correspondent. We have received further correspondence from him and we may return to that as part of our future work programme.

Held over from the last meeting is No. 1578 C from an individual dated 14 September 2018 requesting the committee to make recommendations to the Government regarding accountability for the management of the State's property assets. This matter is related to a forthcoming Comptroller and Auditor General report and refers to an issue raised with the previous committee. We agreed to note and publish that and hold it over for further discussion. Is that the item we discussed in private session?

I do not think we agreed to publish it the last day; I think we agreed to hold it over. This is one of the items we discussed in private session. I call Deputy Kelly to summarise where we are going with this letter.

This is a fairly significant letter in regard to the Office of Public Works, OPW, from a former valuer who worked in the OPW. As I said in private session, I have spoken and met with the individual. I believe the issues he has brought forward in this letter are very serious. We are meeting with the OPW next week and can go through the different issues, particularly those highlighted by the Comptroller and Auditor General. Further to that, at a later date, as a committee, we should meet with this individual. We will take advice on whether that will be a public or, potentially, a private meeting to go through his correspondence and his backup documentation, some of which I have seen, in regard to what he has brought forward. Very serious issues are being brought forward by this individual, who has just retired from the OPW as its most senior valuer.

Deputy Connolly indicated.

I read the letter and I agree that it raises very significant issues. It should be brought to the attention of the Office of Public Works. It should have a chance to look at it so that it is in a position to deal with questions raised. If there is a report or anything else we should have prior to the meeting - a report is referred to here - inquiries should be made about that.

We will forward this letter to the OPW. We discussed it in private session. We might redact a few words because of the parliamentary privilege issue, but, by and large, the substance of the letter will be published during the course of the day by the Committee of Public Accounts, subject to minor redactions. We will send it then to the OPW and ask it to send us whatever report is referred to.

I concur with Deputy Connolly. A report is referred to in here that was compiled by this individual, with another individual, who remains employed in the OPW. That report is with the chairperson of the OPW. As I understand it, there has been no reply to that report so we may want to ask the chair of the OPW, in advance of next week, for this report to be sent to the committee-----

-----and also for the reply he sent to the individuals who wrote it, if one exists.

Okay. We have that. We will ask the secretariat to communicate that to the OPW in advance of next week's meeting. We are conscious there is a Comptroller and Auditor General chapter in his report relating to a particular matter dealing with the OPW and the Department of Health, and we will come to our work programme shortly.

The next item is No. 1595 C from an individual dated 22 September 2018 highlighting matters regarding the appointment of a capital projects manager in Our Lady's Hospice and Care Services, in Harold’s Cross. I propose we note the item, and members are free to address it as part of a future work programme with the Health Service Executive, HSE. It is a section 38 organisation. We will hold over that issue and it can form part of our work programme with the HSE.

The next item is No. 1602 C from an individual dated 25 September 2018 regarding pension arrangements and the President. We will note it, and there will be no debate.

The next item is No. 1607 C, correspondence from Deputy Bobby Aylward dated 1 October 2018 requesting the committee to examine the operation, financial arrangements and oversight of the school transport service. I propose to include the issue of school transport on our work programme. Does Deputy Aylward want to comment at this stage?

I understand a report was done but neither Bus Éireann nor the Department was brought before this committee. Were they brought in here previously?

Mr. McCarthy will fill us in on the background.

Mr. Seamus McCarthy

I did a special report on the provision of school transport. It addresses responsibilities of the Department. Bus Éireann, per se, is not answerable to the committee so I am not sure quite how it would deal with that.

When was that report done?

Mr. Seamus McCarthy

The report was presented on 25 October.

What year?

Mr. Seamus McCarthy

Last year, 2017.

Who requested that report?

Mr. Seamus McCarthy

I decided to do that.

Mr. McCarthy decided to do it.

Mr. Seamus McCarthy

Yes. I think it may have been overlooked in the crush of other issues last year.

The report came to us within the past year but it is one item the Committee of Public Accounts just has not got to yet.

Mr. Seamus McCarthy

That is correct.

Mr. McCarthy has done a report that we have not got to yet.

Mr. Seamus McCarthy

I have a report, yes.

It is clear-cut that has not been-----

I raise this now because we know the problems we are having at this time of the year. Approximately 350 children who are on concessionary tickets are being left on the side of the road. That is my concern. I have a particular concern in my own parish where 11 children have been left behind. That is the reason I raise this matter. It is an issue that raises its head at this time of the year. Is the roll-out of the system in place now fit for purpose? Does it need to be reviewed? We should examine the Comptroller and Auditor General's report to see if we are getting value for money.

As far as I am concerned, if the Comptroller and Auditor General has a report on it since last year, we have to look at it.

Mr. Seamus McCarthy

Given the lapse of time, it may be useful to get the Department to update the key measures in the report, if it can.

When we come to our work programme, we will set a date to deal with that as soon as is practicable.

Will that be sooner rather than later?

We will come to the work programme in a few minutes, but it certainly has to be on our work programme. We will have a discussion on that in a few minutes.

The next item is statements and accounts received since the last meeting. This will take a few minutes because since July, 101 statements and accounts have been submitted to this committee. Normally, we note ten or 20 every week but, due to the summer period, members will have to bear with me. I will move through them as fast as I can, although it does not sound too bad. There are 70 financial statements and the Comptroller and Auditor General's report, which has 40 Votes for each of the State bodies. That is one composite document, but there are approximately 70. If some members have issues, we can hold over a particular one for a later date, but we will try to move on them as fast as we can. We will give it a few minutes and then come back to our work programme before we go into public session. All of these have been received over the summer period.

The first one is 4.1, the Personal Injuries Assessment Board, clear audit opinion. It assesses compensation entitlements in personal injury claims. The next is 4.2, Enterprise Ireland, clear audit opinion. Attention is drawn to expenditure where the procurement procedures did not comply with public procurement guidelines. I suspect it will not be the only public body about which that remark will be made. I am marking that one. Enterprise Ireland's annual turnover for 2017 is €350 million. The next is 4.3, Solas, funding of €603 million. It plans and co-ordinates further education and training. Again, there are issues of non-compliance-----

What is it with Solas?

Its turnover is €603 million.

I know, but what is the issue?

Attention is drawn to instances of non-compliance with public procurement guidelines.

Mr. Seamus McCarthy

I do not have the specific figures here but, in general, the figures are between €0.5 million and €2 million. Some of them would be more than that, but-----

Does it constitute the full amount or are they samples? The HSE only has a sample.

Mr. Seamus McCarthy

Yes. It is difficult to extrapolate in the HSE because of the way its systems are organised.

Or not organised.

Mr. Seamus McCarthy

Increasingly, we are seeing organisations carry out full surveys of their procurement processes and self-declaring the extent of non-compliance. Therefore, in some situations there is a mix and it involves less and less. We are reporting a sample figure.

On procurement, it goes without saying we are meant to be looking at non-compliance, of which there are so many instances. We will come back to the issue. We would probably like to have a summary of the accounts of all of the bodies with procurement issues on a spreadsheet. It is an issue with which we must deal because we cannot hop on it every week and never do anything about it. It is little like getting organisations' financial reporting up to date, on which we have great progress in the past year or two. We must move on a topic such as this, as well as on everything else we must do.

Representatives of Teagasc, the agriculture and food development authority, will appear before us shortly. Again, there is a clear audit opinion, but attention is drawn to expenditure where public procurement procedures were not full complied with.

The next item concerns Bord na gCon, in respect of which there is a clear audit opinion. There is a clear audit opinion in respect of Kingdom Greyhound Racing Company Limited. Obviously, we are dealing with a lot of bodies that are subsidiaries of Bord na gCon. There are clear accounts in respect of Cork Greyhound Racing Company Limited, Clonmel Racing Company Limited and Limerick Greyhound Racing Track Limited. Abergrove Limited, Bord na gCon's food and beverages operation, is a separate company, in respect of which there is a clear audit opinion. There is also a clear audit opinion in respect of Galway Greyhound Stadium Limited and Dublin Greyhound and Sports Association Limited. The latter company ceased trading in February 2017. Agreement was reached for the sale of Harold's Cross Greyhound Stadium for a sum of €23 million which, coincidentally, was sufficient to allow the company to discharge its residual liabilities. I think it was sold to the Department of Education and Skills. People in Dublin will be more familiar with the issue. Will there be a set of accounts for 2018 for that organisation?

Mr. Seamus McCarthy

There will be.

There is a clear audit opinion in respect of Shelbourne Greyhound Stadium Limited, Waterford Greyhound Racing Company Limited and Youghal Greyhound Racing Company Limited.

There is a clear audit opinion in respect of the National Oil Reserves Agency which ensures Ireland meets its obligations to maintain minimum stocks of oil. There is also a clear audit opinion in respect of the Western Development Commission. The Digital Hub Development Agency provides a collaborative space for individuals to create digital media products and services. It is located in Dublin, is it not?

Mr. Seamus McCarthy

Correct.

There is a clear audit opinion in respect of it.

The next item concerns the Pensions Authority, in respect of which there is a clear audit opinion. There is also a clear audit opinion in respect of Teilifís na Gaeilge, the Sustainable Energy Authority of Ireland, the Irish Auditing and Accounting Supervisory Authority, the National Transport Authority and Microfinance Ireland. There is a clear audit opinion in respect of NSCDA (Operations) Designated Activity Company which is involved in developing and operating the National Sports Campus. There is a clear audit opinion in respect of NAMA and a number of its subsidiaries, including the National Asset Management Designated Activity Company, the National Asset Loan Management Designated Activity Company, the National Asset Management Group Services Designated Activity Company, the National Asset Joint Venture Designated Activity Company, the National Asset Residential Property Services Designated Activity Company, the National Asset Property Management Designated Activity Company, the National Asset North Quays Designated Activity Company, the National Asset Management Services Designated Activity Company and National Asset Sarasota Limited. The last named company is a subsidiary in the United States. We recently had a meeting with NAMA at which we covered all of those subsidiaries.

The next item is the Public Trustee Account which administers 148 trusts related to activities of the Department of Agriculture, Food and Marine, including former Land Commission Trust balances. As there is only a figure of €38,000, it really only involve a sheet of paper. There is a clear audit opinion. There are no actual current transactions.

The next item is the finance accounts which involves the annual statement on the transactions of the Central Fund. They were lodged on 18 July. In involves the small matter of €53.6 billion, the full income and receipts of the State. There is a clear audit opinion, but, obviously, it is an issue to which we will return.

The next item is the Local Government Fund 2017. There was a total of €1.9 billion which formed part of the expenditure of local authorities. There is a clear audit opinion. We will deal with that matter as part of our interaction with the relevant Department.

There is a clear audit opinion in respect of the Credit Institutions Resolution Fund which only has a turnover of €8.3 million.

The next item is the State Property (Miscellaneous Deposits) Account for the collection of windfall receipts, for example, from residual property remaining where a company is dissolved or struck off. The figure came to €14.4 million. When we discussed this item previously, I raised the issue of where a company was dissolved but there was a residual asset. Nobody was able to tell me that there was a State account that actually dealt with the matter. Everyone was vague about where the money ended up. I take it that it is somewhere in the Department of Finance.

Mr. Seamus McCarthy

It involves the Department of Public Expenditure and Reform.

Out of curiosity, I will ask the secretariat to circulate a copy of the accounts to the committee. Members can look at them if they want to do so.

Is involves the Department of Public expenditure and Reform.

Mr. Seamus McCarthy

That is my recollection. Last year I gave the committee a note on a number of these unusual accounts. The secretariat will have it and could recirculate it.

Do funds of people who die intestate also go into it?

Mr. Seamus McCarthy

Yes, or it could be sundry moneys. It is explained in the note.

We have started a conversation about people who died intestate and where their money went. This item really concerns companies that are no more and there is nobody left to claim. It is the corporate version.

Is the money used for charitable purposes if it is not claimed?

Mr. Seamus McCarthy

It is money that is collectable or receivable into the Central Fund of the Exchequer. It forms one fund.

We discussed this issue last year. If somebody comes back within a 25-year period and can prove that he or she is the one remaining shareholder, that he or she has been living in Australia and realises the building the company owned has been sold, he or she can claim back the money. It is a little like the Dormant Accounts Fund. It probably happens very little, but in theory, there is that option, which is why the money is held in an account in the event that somebody might show up some day. We learn something new every day.

There is a clear audit opinion in respect of the Ireland-United States Educational Fund which collects funds for the Ireland-United States Commission for Educational Exchange. There is a total of €7,000 in transactions, a small amount.

The next item concerns the Health Products Regulatory Authority, in respect of which there is a clear audit opinion. It involves the cost of superannuation entitlements accounted for as the amounts become payable, rather than in the year of entitlement. This happens in all of the health organisations. The Comptroller and Auditor General highlights the fact that there is no proper accounting for pension payments.

Mr. Seamus McCarthy

I think there is a qualified audit opinion on how the Health Products Regulatory Authority accounts for pension liabilities.

Is there a qualified audit opinion because of that issue?

Mr. Seamus McCarthy

Yes, just on that point.

The next item concerns the Residential Institutions Statutory Fund Board, Caranua, in respect of which there is a clear audit opinion, but attention is drawn to ongoing weaknesses in the board's control over grant payments. I will ask the secretariat to circulate the financial statements to the committee because this issue has come up previously.

Mr. Seamus McCarthy

They are the 2016 financial statements. There is also a delay in that regard.

Has the Comptroller and Auditor General received the 2017 financial statements?

Mr. Seamus McCarthy

We have received them, but I do not believe they have been signed off on yet. The audit is ongoing.

They are a little behind. We will circulate them to members because somebody might want to take a closer look at them.

Caranua should not be behind in presenting its financial statements. It was set up for and with a very specific purpose and function, but it has been mired in difficulty from day one. Is there an avenue by which we can return to this matter? There have been serious issues, including there being no chairman, monitoring and governance, as well as the renting of a building with a limited fund. We know since last week that the total amount of €105 million or whatever was agreed to has still not been paid over.

A total of €3 million or €4 million still has to be paid.

That is not Caranua's fault, but the sum is still outstanding. I have certainly never been happy on the issue of governance, but, more importantly, we know well that people on the ground who are availing of the service have raised serious issues. Is there an avenue by which we can come back to this matter?

There is, because it is audited by the Comptroller and Auditor General and is under the remit of this committee. That is why the account is here.

When will the 17 accounts be ready and appear before us?

Mr. Seamus McCarthy

The audit is ongoing. I do not have a completion date yet.

Perhaps the Comptroller and Auditor General can give us an estimated date next week.

Mr. Seamus McCarthy

I will get back to the committee with a proposed date.

We might schedule a meeting once we have seen the 17 accounts. It is definitely within the remit of this committee, as is everything I am mentioning this morning.

The next item is from Tusla, the Child and Family Agency. It has a clear audit opinion, but attention is drawn to expenditure on goods and services that were not procured by way of a competitive process, and weaknesses in the agency’s oversight and monitoring of grants to outside agencies. We will take up that issue. The HSE had some of those issues, in terms of monitoring grants to outside agencies and seems to have improved its system, so Tusla needs to do the same. We might come back to that Department as part of our work programme, and we can look at Tusla specifically.

The next item concerns the National Disability Authority. It has a clear audit opinion.

The next item concerns the National Cancer Registry Board, which collects and classifies information on all cancer cases which occur in Ireland. It has a qualified audit opinion, but costs of superannuation entitlements are accounted for as they become payable rather than in the year the entitlements are earned. That was not a clear audit opinion because it does not adequately or properly account for its pension costs.

The next item concerns the Health Insurance Authority, which regulates the private health insurance market and administers the risk equalisation fund. The next item, under separate accounts, is the risk equalisation fund itself. The fund involves an audit of €673 million, and the Health Insurance Authority regulates it. The risk equalisation fund, for people wondering what it is, is a fund that concerns the age mix and profile of customers of the three private health insurers in the market. VHI probably has older customers, so there is a transfer of funds, approved by the Health Insurance Authority, from Laya Healthcare and the other insurer, the name of which I cannot recall at the moment, to VHI which equalises the risk across the industry. A large amount of money moves around between the insurers.

Mr. Seamus McCarthy

Some €673 million is moved.

It is a very substantial sum. It seeks to ensure a fair market for everyone in the country rather than allowing companies to cherry-pick customers. The principle is good.

The next item concerns the Food Safety Authority of Ireland. It has a clear audit opinion, although costs of superannuation entitlements are accounted for as they become payable rather than in the year the entitlements are earned. The same issue arises here. The Comptroller and Auditor General might explain why the Food Safety Authority of Ireland got a clear audit opinion even though the same issue arises.

Mr. Seamus McCarthy

That should read "qualified audit opinion".

That is a typo.

Mr. Seamus McCarthy

We are correcting as we go along.

The score is one apiece. The next item concerns the Dublin Institute of Advanced Studies. It has a clear audit opinion.

The next item concerns the Louth-Meath Education and Training Board. Here we go again with this organisation. It has a clear audit opinion, but attention is drawn to non-compliance with national procurement guidelines and delays in finalising the financial statements for 2016 due to changes in senior personnel, restructuring of the organisation and knock-on impact from the delays in 2015. How is this body fixed for 2017?

Mr. Seamus McCarthy

The accounts are not completed yet.

We will speak about it at our next meeting.

Mr. Seamus McCarthy

It is making progress.

The Comptroller and Auditor General might make a comment on the next occasion as to how complete those accounts are and any other outstanding accounts.

The next item concerns another body which always has trouble with getting its accounts in on time. It is the National College of Art and Design. It has a clear audit opinion, but attention is drawn to procurement issues, a number of governance issues - the college was not in full compliance with the code of practice for the governance of State bodies - the board’s decision to discontinue a human resources management project resulting in a waste of public money amounting to €138,000, and the recognition of a deferred pension funding asset of €87 million, which is the standard for universities and third level institutions. We will write to the National College of Art and Design asking it to explain why it discontinued a project it had spent €138,000 on, with no benefit to the organisation or the public for that outlay, and also to deal with the governance issues, including its non-compliance with the code of practice for the governance of State bodies. We will ask for a specific note from the organisation to explain that. Has the Comptroller and Auditor General received its accounts for 2017?

Mr. Seamus McCarthy

I have received those accounts. The audit is ongoing. It has made a lot of progress. I believe 2015-2016 was the year systems began to kick in. I expect that there will be much less comment on control and other matters for 2016-2017.

It is getting there. The next item concerns the Educational Research Centre. It has a clear audit opinion. The deferred pension assets issue is noted again. It is also noted that the board did not carry out a review of the effectiveness of systems of internal control, which will be noted in the set of financial statements.

The next item concerns the Higher Education Authority, which is the statutory funding body for higher education. Its turnover is €1.2 billion. It is on our work programme and we will be dealing with it shortly. It has a clear audit opinion.

The next item concerns the 2017 accounts of Ollscoil na hÉireann, Gaillimh. It has a clear audit opinion but attention is drawn to the deferred pension asset - the same issue affecting all universities - payments where the procurement procedures employed did not comply with public procurement guidelines, and omission from a disclosure about severance of a payment of €91,000 to a staff member in respect of a period of non-attendance treated incorrectly as sabbatical leave. We will write and ask for a note about that.

I would like the Comptroller and Auditor General to clarify that. Was that omission concerning the treatment of the payment done inadvertently? Will the Comptroller and Auditor General put that in context?

Mr. Seamus McCarthy

We discussed that matter with the college. We felt the figure should have been included but it took a different view.

On what basis did it take that view? It seems to be a very practical matter. Someone has decided that a person is getting a severance payment or not.

Mr. Seamus McCarthy

The view of the college was that this was not part of a severance payment. Our view was that it should have been comprehended in the severance payment.

Did the college agree with the Comptroller and Auditor General then?

Mr. Seamus McCarthy

No, it did not. That is why I have drawn attention to it.

That is why it has been highlighted.

The college stuck to its guns and the Comptroller and Auditor General is highlighting the fact that he has a different opinion.

Mr. Seamus McCarthy

An amount has been disclosed, and we drew the college's attention to our view that it should have disclosed a larger figure. When it chose not to disclose that larger figure, I chose to draw attention to it.

That begs the question as to whether there are similar situations elsewhere where this is happening.

Mr. Seamus McCarthy

A report is with the Department at the moment which refers to another similar situation. I would prefer not to mention it.

Mr. Seamus McCarthy

The committee will have details of the other case shortly and will understand why, in that circumstance, I felt it was appropriate to draw attention to this case as well.

Are we talking about the same college?

Mr. Seamus McCarthy

The other case relates to a different institution within the education sector.

Where is that report?

Mr. Seamus McCarthy

It is with the Department, and I would expect to see it at some point this month.

Will we write to the college about this matter?

Yes, we will write asking it to restate its views so that we can consider it formally here. It also did not comply with procurement guidelines, so we will ask it to put the reasons for that on record.

The next item concerns the Longford-Westmeath Education and Training Board. There was material non-compliance with national procurement rules, but it has a clear audit opinion.

The next item concerns the Cavan-Monaghan Education and Training Board. It has a clear audit opinion, but the statement of internal financial controls disclosed concerns regarding the internal audit resources available to the board.

The Cork Education and Training Board has a clear audit opinion, but again there was material non-compliance with national procurement guidelines, and internal financial controls issues were highlighted by the Comptroller and Auditor General.

The Tipperary Education and Training Board has a clear audit opinion, but there was material non-compliance with national procurement rules and concerns regarding the adequacy of the internal audit resources.

We have received accounts from four education and training boards. They are getting their accounts in on time, but they are having problems.

Mr. Seamus McCarthy

A number of the education and training boards have raised concerns around the adequacy of internal audit arrangements. That refers to an unusual arrangement in place in those institutions where there is an agency located in Cavan-Monaghan which provides internal audit services and which became understaffed. That has been addressed, but each institution has a concern that insufficient internal audit was carried out in 2017.

The statements are from last year.

Mr. Seamus McCarthy

The audits were carried out during the period covered by last year's financial statement.

We might cover this issue globally rather than individually, because the same point arises. It seems that there was a centralised system.

Mr. Seamus McCarthy

It is centralised.

It is based in Cavan-Monaghan and if one had a problem, then they all had a problem.

Mr. Seamus McCarthy

Yes, exactly.

Okay, the next item is-----

On the non-procurement issue. Usually we deal with non-procurement but here our attention is being drawn to a material level of non-compliance by the Cork Education and Training Board.

Mr. Seamus McCarthy

They are all material.

They are all material. Tipperary is material as well.

Mr. Seamus McCarthy

If the identified non-compliant expenditure is less than €500,000, we do not draw attention to it. Once it goes over that level, we regard it as material; that is our materiality threshold.

So it is over €500,000 and being tendered for inappropriately.

They did not comply with the guidelines.

Mr. Seamus McCarthy

They were non-compliant.

Is there a figure in their accounts?

Mr. Seamus McCarthy

They generally disclose that, yes.

It is in their accounts, all of which are in the Oireachtas Library-----

Mr. Seamus McCarthy

Yes, the details are available. They are also on the Oireachtas website.

Members can check the figures for the ETBs in which they are interested. They are published and are available through the Oireachtas too. The next item is the 2017 accounts of the National Paediatric Hospital Development Board, which have been given a qualified audit opinion. The financial statements give a true and fair picture except that the cost of superannuation entitlements is accounted for as they become payable rather than in the year they are earned. The same issue arises with all of the health bodies.

The Mayo, Sligo, Leitrim ETB 2016 accounts are given a clear audit opinion but attention is drawn to delays in the production of the financial statements. This is the 2016 account-----

Mr. Seamus McCarthy

Yes, it is. As we discussed previously, that ETB had a very particular problem. There was considerable difficulty getting 2015 accounts together but significant progress has been made since then and 2017 is under way.

Again, control weaknesses were identified. The finance committee met just once during the year and there was no review by the board of the effectiveness of the system of internal financial control.

The 2016 account for Dundalk Institute of Technology received a qualified audit opinion. The financial statements give a true and fair view except that the group income for 2015-2016 has been materially overstated. Contrary to accounting standards, the institute has recognised €812,000 that should be treated as a prior period adjustment as current income but the end of August 2016 financial position is not affected. Attention is also drawn to non-recognition of pension costs and liabilities and a material level of non-compliance with public procurement rules. The issue with the €812,000 relates to whether it should have been accounted for in one year or another. It is in there now-----

Mr. Seamus McCarthy

It is in there now and the statement of financial position at the end of 2016 is correct. It is really a question of where one recognises the income.

We will come back to all of those separately.

The Commission for Aviation Regulation's 2017 accounts received a clear audit opinion.

Donegal Education and Training Board received a clear audit opinion for 2017. However, attention is drawn to a payment of €853,000 made to the Revenue Commissioners in 2017 in respect of the misclassification of a number of employees for PRSI purposes between 1997 and 2011. We will have to write to Donegal ETB on this matter, to which the Comptroller and Auditor General has drawn attention. Did that €853,000 include interest and penalties? Does the Comptroller and Auditor General have a breakdown on that?

Mr. Seamus McCarthy

I do not have the breakdown here but-----

We will write to Donegal ETB and ask for a full breakdown. Was the €853,000 a settlement?

Mr. Seamus McCarthy

Yes, it was a settlement. Effectively, some employees had the wrong PRSI classification and employer's PRSI was underpaid as a result.

Was it self disclosure or was it published? I do not remember seeing it.

Mr. Seamus McCarthy

I do not recall it being published.

We will ask for a full explanation of how that arose, how the figure of €853,000 was settled with the Revenue Commissioners and the lessons learned.

An Bord Pleanála received a clear audit opinion on its 2017 accounts.

Finally, the 2017 appropriation accounts, published with the report on the accounts of the public services last Friday, covering 42 different Votes, all got clear audit opinions. However, there are some interesting chapters with commentary on at least half of them, to which we will return. That will keep us busy for the year. That is a total of 101 financial statements that have been noted, recorded and published, with comments on some.

The next item is our work programme. Today, we are dealing with Teagasc. Next week we are dealing with the OPW and as part of that work programme, we are sending the letter we received from Mr. Alan Morgan, with some redactions, to the OPW for comment. That letter will be noted and published and we will discuss the issue with the OPW next week. On 18 October we will meet representatives from the Department of Public Expenditure and Reform to discuss the accounts for 2017. We never got to do the 2016 accounts so we will have to include them too but our focus will be on the most recent set of figures.

In terms of other issues, the Scally-----

Are we meeting the Higher Education Authority, HEA, on 18 October too?

Yes, we will try to have the HEA in on the afternoon of 18 October. That is arising from the press statement by the HEA's chief executive, Dr. Graham Love, that he is stepping down. We agreed in private session that we would invite Dr. Love to attend to assist the committee in its work in the education area. We also agreed to invite Mr. Michael Horgan, the chairman of the HEA and the Secretary General of the Department of Education and Skills to that meeting. The Secretary General has come before us previously with the chief executive but given the fact that the HEA is in transition in the context of its chief executive, we felt that it was important to invite the chairman of the board to attend as well. It was agreed to proceed on that basis and to contact those concerned as soon as possible to give them sufficient notice in respect of that meeting.

In private session, we also agreed to have a private meeting with a person who has made a protected disclosure regarding the Irish Prison Service.

Are we absolutely certain that Dr. Love will still be in situ on 18 October?

No, we have to check that out.

If he is not going to be in situ on that date, we will have to bring the meeting forward.

I will ask the secretariat to confirm that by tomorrow.

I suspect he will not be around on that date so we will probably have to bring our meeting forward to next week.

We will ask the secretariat to check into that and to email all members once confirmation has been received.

I thank the Chairman.

We may be meeting them next week.

Let us see how the secretariat gets on. It will keep all members informed by email.

As already stated, we are going to arrange a private meeting as soon as possible with a person who made a protected disclosure. We also had a discussion in private session earlier on Dr. Gabriel Scally's report. The Joint Committee on Health is meeting Dr. Scally and the HSE on 10 October. The clerk to this committee will liaise with the clerk to the Joint Committee on Health regarding any matters that arise which may be of significance to us, such as, for example, contracts, contract management, procurement and so forth. We also agreed that we will deal specifically with the State Claims Agency regarding how claims are being dealt with, whether through mediation or in court. We will get an update on that as soon as possible. We will also get updates after the Joint Committee on Health meets next week. Essentially, the health committee is doing work on this and there is a role for us too. We will try to ensure that there is no unnecessary duplication.

What date has been agreed for dealing with the OPW representative who wrote to us?

We will set a date for that after the meeting next week. We will see how we get on. In terms of general ideas for the work programme, we have agreed meetings for 11 October and 18 October. On 25 October, we will be dealing with matters relating to housing. We will be meeting representatives from the Department of Housing, Planning and Local Government solely in connection with housing.

As part of that issue we are going to bring in representatives of the Irish Council for Social Housing, the umbrella group for approved housing bodies, AHBs. Most of the funding is now being channelled through approved housing bodies. It is very clear from the Comptroller and Auditor General's report that there is no statutory regulation of housing bodies. I think he said the Department cannot confirm how many houses have been built by approved housing bodies. There is a lacuna of information.

The topic is listed as "matters related to housing", which is a fairly broad church. Is the Secretary General of the Department coming in on that day?

We said previously at the committee that we could do a whole day on the housing assistance payment, HAP, in terms of value for money, the amount of money now being spent on housing assistance payments and the amount spent on acquisitions. I think nearly €1 billion has been spent by local authorities on house acquisitions in the past seven years. Are we going to structure the day in order to deal with the various issues? Otherwise, we could go all over the place.

I expect it will be an extensive meeting. We need to have the Department, the Secretary General and key people in the housing section in. We also need to have someone from the housing and sustainable communities section of the Housing Agency.

Did you say, Chairman, that the housing bodies are coming in as well?

No. Am I correct in saying the Irish Council for Social Housing is the umbrella body for approved housing bodies?

Mr. Seamus McCarthy

Yes, as I understand it. The body is not within my remit.

Does Mr. McCarthy audit them?

Mr. Seamus McCarthy

No.

So it is responsible for the private housing organisations. We all know who the approved housing bodies are. Essentially, most Government funding is being channelled through them for house construction and long-term leasing, as opposed to the local authorities. We will have a major gap if they or their representatives are not in the room.

The Department of Employment Affairs and Social Protection still pays up to €250 million for rent supplement, not to mind the substantial amounts of money being paid in HAP. The issues are all connected. Perhaps we will not get everything covered in one meeting. I would hate to have a discussion here without the approved housing bodies. If they are the main agents to deliver houses then they must be present. Perhaps we could leave rent supplement and HAP for another meeting. I would prefer to start by having everyone present and they can come back if need be.

Given that the Secretary General is coming in we should structure the day and reach an agreement among ourselves on our approach. There is a body of work with regard to how money is being spent by the Department.

We will put all of those organisations on notice to be ready on 25 October and by next week's meeting on 11 October the secretariat can give us a proposed structure for how to handle the meeting. It could be a case of having a different time for different sections or an agenda and timetable for the meeting. First, we will give them notice and we can come back to how we structure the meeting the next day.

In that context, I have asked parliamentary questions about State-owned land, council-owned land and a breakdown of same, but it is like running around the field trying to get an answer. Such information should be provided to us ahead of the meeting.

In terms of capital construction, we hear a lot of talk about where the possibilities exist for the tens of thousands of homes that could be built. Could we ask the Department to provide us with tabular information on a county-by-county basis on land in local authority and State ownership, a breakdown of the status of the land in terms of zoning, and if it is part of the land aggregation scheme? We will need to get the information in good time. I ask that we would make the request now in order that we can have the information well in advance of the meeting.

The land aggregation agency is the Housing and Sustainable Communities Agency.

Mr. Seamus McCarthy

It has the land that came from the land aggregation process.

It has schedules of every piece of land it took over from local authorities.

We need to put it all together. It is difficult to get information.

If we do not get the answers on the day the witnesses will have to come back a second time. It is as simple as that.

I support Deputy Cassells. I take a particular interest in housing. Whatever about the approved housing bodies coming in, the Department and the Housing Agency must come in as they are subject to the Comptroller and Auditor General. We definitely want them in here.

And those responsible for the HAP.

HAP comes into it anyway. HAP is under the remit of the Department. This year the amount will be €300 million. The amount doubled this year. It has gone from €150 million to €300 million.

I read the chapter on the approved housing bodies. It is clear that there is no statutory regulation of them. There are many schemes concerning them with names such as the capital advance leasing facility, CALF, and others that make it difficult to follow. There are also various types of tenancies. My understanding is that one got a local authority house or one could seek a house from an approved housing body. The only distinction in the past is that one could buy out the local authority house but one could never buy out the other one. Now it seems there are many other distinctions, not least of which is the oversight in relation to AHBs and the absence of security of tenure. With millions being expended, there are serious issues to be examined.

It should be simple for the city council and the county council in Galway to be able to tell the Department what land they have in their direct ownership, the zoning of it and the plans they have for it. They should be able to tell us in plain, simple English, and what other public lands are available. In Galway we have Ceannt Station, where there are 14 acres. The site has huge potential yet it is being developed by a private person on behalf of CIÉ, with no regard to an overall plan. The docks are waiting to be taken in charge. I understand all the other small ports have been taken in charge. One might ask what relevance that has. The port has a significant landbank with major potential for housing. We have the existing land that is under the direct control of the city council and then we have public land under CIÉ or the docks authority.

Or the IDA.

Yes, I did not even mention that. We need clarity in advance of the meeting so we have the information.

Deputy Connolly cited the example of Galway. Could we request the Department to get all 31 local authorities to submit the capital projects they currently have with the Department requiring funding and also what is currently in the pipeline in terms of construction on the ground so that we can get an appraisal of where they are and where they want to be. We hear consistently about the projects and the funding the Department has provided to all 31 local authorities and the work that is in progress at the moment. We should be able to get that information by tomorrow.

A big element of that equation is the request from the approved housing bodies to the Department for their developments.

That is fine. That is separate. If we have the Secretary General here we want to get a sense of where the local authorities are at as well. You might decide to break the meeting into two distinct sections, Chairman. We require all of the information ahead of the meeting so that we do not let witnesses go without having dealt with the issue in a substantial manner.

The only reason I mention the approved housing bodies is that in my experience nearly every housing project that is under way is through an approved housing body. From my observations, more requests are going to the Department for funding from approved housing bodies than from local authorities. AHBs are the elephant in the room.

I agree with you, Chair, but I do not think it is their role to be here. I think what is important is to see what the Department is doing in terms of oversight given the volume of work undertaken by the AHBs and the type of schemes the Department has set up. That is the most important thing. Otherwise, we could spend half the day talking to AHBs about their vision and mission rather than oversight and the amount of expenditure. We should get confirmation that the Housing and Sustainable Communities Agency will be represented at the meeting.

Yes, I think they are departmental officials.

Mr. Seamus McCarthy

No, they are two separate agencies. The Housing Agency is a separate State body.

Our hands will be full trying to tease out all the issues if we have the Department in and the Housing Agency.

We will want to deal with HAP.

It is inevitable that we will deal with HAP.

There has been a change from rent supplement to HAP. When one goes down, the other goes up. They are fundamentally the same thing.

People transfer from the rental accommodation scheme, RAS, to the HAP scheme. Everybody who was in RAS will now be in HAP.

Rent supplement is being phased out, except for emergency cases. HAP is the only game in town, but there is also the rental accommodation scheme. They are just three of the schemes that support the private market.

This would be important given the number of voluntary housing organisations in receipt of State money. I am open to correction on that. No one knows where they are or what they are doing. It would be a mistake not to investigate those in detail.

I know we will not go through them individually. I believe I saw somewhere yesterday that 6,000 staff are employed in the-----

They all have chief executives who are well paid.

Only a fraction of that number work in the housing sections of all the local authorities combined.

Hundreds are reported on by the Comptroller and Auditor General.

Some of them are kind of dormant.

There are 547 bodies. I agree with the Chairman, but it is not for that day. That day is for us to hear from the Department and that agency. We are looking at governance and money. They should come in on a separate day.

I have no intention of getting into the plans and concepts of the individual approved housing bodies. I am interested in the funding the Department is giving approved housing bodies to do the job.

The Department will tell us.

For next week we will ask the secretariat to prepare a programme. The big issue in respect of housing - no one has mentioned it yet even though we mention it every day in this House - is the issue of homelessness. Do we keep that funding for homelessness? There is €109 million support for homelessness in 2019. We cannot do everything on the one day if we want to deal with the construction and all that sort of stuff. I will list that as an issue in case someone asks why we did not talk about homelessness. I will ask the secretariat to draft a structured way of dealing with the housing issue. It will not all happen on that day. We will have to decide which topics we are dealing with. I think we will start with house starts and house building.

As everyone knows, the Comptroller and Auditor General issued his report last Friday. He has chapters on approximately half the Departments and organisations like the Revenue Commissioners. I make these as suggestions. We have ongoing things in our work programme. The issues relating to the Revenue Commissioners need to be examined fairly soon. There is a chapter on tobacco smuggling, high-wealth individuals' tax liabilities, corporation tax losses, which we dealt with, and PRSI contributions for the self-employed. There is quite a bit there for the Revenue Commissioners and we can start with them fairly early on in our work programme.

Mr. Seamus McCarthy

The PRSI is more a matter for the Department of Employment Affairs and Social Protection.

There is something else for the Department of Public Expenditure and Reform relating to pension contributions to the Exchequer. Is that the Department of Public Expenditure and Reform?

Mr. Seamus McCarthy

That is Department of Public Expenditure and Reform.

That needs to be addressed with the Department of Public Expenditure and Reform when its officials come in. That is on the list.

The management of high-wealth individuals' tax liabilities-----

That is the one I mentioned, and it concerns the Revenue Commissioners. People would benefit from a public discussion.

I think the public would benefit from a full, open and transparent discussion on that.

We will try to schedule for officials from the Revenue Commissioners to come in as promptly as possible. If anyone has any other comments-----

We spoke about private patient activity in acute public hospitals. There is no monitoring of that. There are no mechanisms in place to give clear information.

Those are two issues so far. We have to deal with everything in the Comptroller and Auditor General's report as the year goes by. I am just trying to identify a few for early on. The Comptroller and Auditor General has a chapter on the oversight of approved housing bodies, but that is for the Department.

The next issue we want to deal with somewhere along the line is this hepatitis C treatment fund that has now cost €1.5 billion. I know it is an historical issue, but we are on the verge of starting another one of these issues with CervicalCheck. Someone will be here in five or ten years. I want to interrogate the Department. We want to know at the end of that process what lessons were learned to prevent some of these major scale issues arising again. We have not seen evidence that they worked. I want to address that issue because it is such a big issue. The State Claims Agency's handling of the CervicalCheck issues is on our work programme.

For the next meeting members should indicate if they want any particular issue from the Comptroller and Auditor General's report to be discussed early. We have mentioned three or four. I will ask the secretariat to try to work on those three or four.

The decisions that we have made will determine what the clerk has to do regarding meetings because we have three or four meetings we need to tie down in the next few weeks, including Dr. Love, the Office of Public Works, OPW, and the Prison Service whistleblower. Once we know more next week, we might to be able to slot in what we will do with the others.

This only deals with the next couple of weeks. For next week we will ask for a draft work schedule to take us into November or early December.

Until the next Government.

We will have a draft until Christmas. Will many of us be here next summer? We have had a useful discussion. We are a little behind schedule, but I will-----

I seek clarification on one thing. Did we deal with the question that came in on thalidomide and write back to the individual?

We are dealing with that with the State Claims Agency

No. It was an individual who wrote into us. It may have come through Deputy Cullinane. The Irish Thalidomide Association provided a letter dated 30 July. I thought we held that over.

We will come back to it next week. We have written to the State Claims Agency on that.

I knew the State Claims Agency came in because it was a Statute of Limitations issue.

The letter raised a number of questions regarding-----

We have written to the State Claims Agency, which will come back to us. We will suspend to allow the witnesses to take their seats.

Sitting suspended at 11.06 a.m. and resumed at 11.12 a.m.