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Wednesday, 2 Dec 2020

Business of Committee

I welcome everybody to the meeting. We are joined by the Comptroller and Auditor General, Mr. Seamus McCarthy, as a permanent witness to the Committee. Apologies have been received from Deputy Neasa Hourigan.

Before we move on to the other items of business I want to make a statement. I want to address the issue surrounding the tweet that I published over the weekend marking the 100th anniversary of the Kilmichael ambush in County Cork. I am very conscious, as the Chairman of the Committee of Public Accounts, that the controversy has placed all the members in a difficult and totally unnecessary situation, particularly when this committee has such important work to carry out. What I was attempting to do was to highlight that following the disastrous decision to partition the country almost 100 years ago, in the wake of events such as Kilmichael we still had conflict that went on for a long time during which a lot of suffering took place. I deleted the tweet and apologised for posting it.

As we work to advance reconciliation on our island, we need to be able to talk about the past in a way that is honest to all of us and our beliefs but that does not deepen division or cause hurt. As an Irish republican and someone who is in a position of political leadership, I have to be more aware of my responsibility to ensure that I do not do anything that is disrespectful to others. Since the mid-1980s, when A Scenario for Peace was published, right through the Hume-Adams dialogue, and, finally, to the achievement of the Good Friday Agreement, I have actively supported initiatives to bring about peace on the island. On Sunday, I apologised for any offence that I caused due to the insensitive nature of the tweet and I want to repeat that apology to the members today. I also want to apologise to all my colleagues for the position in which I put them. My tweet fell below not just the standard we expect of each other but the standard I expect of myself as a Member of the Dáil, and for that I am genuinely sorry.

I thank the Chairman for making that statement. I welcome the decision by the Ceann Comhairle to respond to the letter from Arlene Foster. It was a very strong statement to the effect that nothing we do in here should in any way contribute to undermining the democratic process. I believe the tweet was offensive at a time when, more than ever, we all need to work together with the UK leaving the European Union. We all have a harder task in respect of working together with the Six Counties, which will be outside the EU, and we must make sure that nothing is done to undermine that process whereby the entire issue is now changed.

This committee is one of the most important committees in this House. We are here to hold Departments and State authorities to account. Likewise, it is here to hold every one of us to account, including Deputy Stanley, as Chairman. It is disappointing that this tweet was sent out. The Chairman's party leader said his was a one-off tweet but a number of tweets have been sent over the past number of months which were subsequently withdrawn. There is a lot of speculation that some of these tweets are being deliberately and carefully drafted. That is not the way to deal with issues and create division, and I certainly believe the tweet has created division.

It is extremely important now that the Chairman makes a full statement on this matter in the Dáil to re-establish his credibility as Chairman and the credibility of this committee. Many people died over the 30 years of conflict. The day the Chairman mentioned, the Narrow Water attack, was the same day two people aged 14 and 15 died in another tragedy at a different location. It is extremely important that we do not bring back the divisions that existed at that time or add to them in any way.

Does anybody else want to comment?

I acknowledge that the Chairman took down the tweet, apologised and has made a statement here. As Chairman of the Committee of Public Accounts and a Member of the Dáil, the tweet got much more attention beyond Twitter in the broadcast and the mainstream media. That is not terribly surprising but it does have an external impact also beyond this jurisdiction. I sat on the decade of centenaries committee which dealt with the pre-1916 period and there were members of the Chairman's party on it who played a very constructive role. The one thing we all understood was how difficult any kind of marking of the War of Independence and the Civil War would be and the need to be very respectful in any of that. I would want an assurance that this is a one-off mistake. I would like to hear that from the Chairman. The Committee of Public Accounts does not have a role in respect of this issue. Any role in respect of it is within his party in terms of how media and social media are handled.

I am a member of the Joint Committee on the Implementation of the Good Friday Agreement. Last week, John Finucane, MP, came in to seek our support for his family's quest for an inquiry into the horrific murder of his father.

In the course of that meeting and of the debate on the Seanad motion which preceded it, the Houses of the Oireachtas recognised and recounted the terrible details of the violence visited upon the Finucane family. The Chairman of the joint committee, Deputy O'Dowd, offered his full support and noted that Mr. Finucane's family was not the only one to suffer and that all the victims of violence need to be respected. The party of our Chairman has stated repeatedly that there is not a hierarchy of victims. We have to acknowledge that his tweet was about a very violent incident within recent memory, involving the death of very young men and in a very strategic and deliberate way. We heard at another committee last week about the human impact of violence. There is a human impact to this violence also that is very significant and has been well recounted. The Chairman's tweet hurts the survivors who are alive today and whose family members — teenage boys and young men, some of them fathers — are still missing this Christmas.

What I want to know is what was behind the sentiment the Chairman expressed and what it says about what we are trying to do in terms of reconciliation for the future and about mutual respect. The tweet seems to have no regard for the personal impact on the people who are left behind, in the way his party quite rightly called for in recognition of the Finucane family last week. It is what is behind that sentiment that concerns me. I am also interested in what prompted the Chairman to remove it and what was his thought process in that regard? It is hard to see because a person must have that sentiment within himself or herself in the first place in order to express it. Did somebody call the Chairman and tell him to delete it? Did he receive an instruction?

I do not think that anything Sinn Féin does is by accident. It is a highly strategic operation that has been well controlled, well managed and well planned in all its steps, before 1998 and since. This is the first time Sinn Féin has held such a senior position in this Parliament. Deputy Stanley is Chair of this committee, which, historically, is the most important of all the parliamentary committees and which is always chaired by an established parliamentarian of significance and of significant experience. It is because of the significance of his office, that the reaction we have seen has been forthcoming. My view is that he needs to go further than making an apology to this committee. What he has said represents an attempt to alleviate the discord within the committee, but the real offence is to the Irish people and to their representatives in Dáil Éireann. I think the Chairman should go to the Dáil and apologise or make a personal statement there. His party needs to make a statement of a similar nature that genuinely separates this repeating of violence and the glory of violence every couple of weeks. The sequence is that it happens every couple of weeks and then there is an apology and we move on. Meanwhile, it becomes more normalised just as we move towards a period of commemorations.

As parliamentarians, we must ensure that we take steps to protect the moderate nature of our politics. Every party here has done things in stepping towards the centre in defence of the State that might have been politically uncomfortable for it. I do not want to lose that centre ground to a polarised sort of politics like we have on other parts of this island. I urge the Chairman and his party to take those steps towards moderation and to talk about separation from violence and to reject that. I think he can play a hugely significant role in that regard. His office is of such significance that it is hard to let the matter pass without noting it in this way. I really urge him to give the matter further reflection before we get on with our business.

I thank the Cathaoirleach for making that statement. I know it is never easy for a public representative, especially somebody who holds the Chair of an important committee such as this, to sit in front of his or her colleagues and tell them that he or she made a mistake and to outline that he or she is genuinely sorry for that mistake. I believe the Chairman. I think anybody who knows him, regardless of their political affiliations, will believe him. Anybody who knows him will know that the tweet was a clumsy attempt at something. I think he has accepted that and that it was not the place to have, as other members of the committee have alluded to, an important debate in which we all need to participate.

Anybody who knows Brian Stanley will acknowledge that, first and foremost, he is a good man. He is a fair man. He is certainly a very fair and effective Chair of this committee. In the short number of months since the committee has been in existence, anybody looking on, recognising the challenges that it has faced trying to deal with two-hour sessions and what are in some instances very elaborate and detailed issues and sets of accounts, knows that the Chairman has conducted himself in a very fair and effective manner that has allowed this committee to deliver, insofar as it can, under those restrictive measures.

These are going to be a very important number of years, not only in the context of the ongoing decade of centenaries, but also as we move to the full implementation of the Good Friday Agreement. That means we all need to be part of mature reflection, but also mature discussion and debate and a recognition that there is not a shared narrative in terms of the causes of conflict in the first instance but also the outworking of those conflicts. The only thing we all agree on is that in whatever roles we have, we must all do everything within our power to ensure that never again does this island experience the conflicts that have been a hallmark of Irish history. We are moving to a point in terms of the Good Friday generation where some Members of this House have no recollection of the conflict itself. This means that those of us who have some recollection and those who have a very clear recollection of the conflict have a very important responsibility to ensure that there is no glory in conflict. Unfortunately, many people suffered. As has already been mentioned, lots of people tragically lost their lives. The role that we all now need to play is to ensure that the suffering and loss of life in those circumstances never happens again.

As for this committee, we have important work to do. I, for one, accept the Chairman's apology. I believe that it is heartfelt. I hope that in our own individual ways we can play a role to ensure that we can all give commitments that we will be incredibly careful in terms of our public utterances on these issues in the first instance, but that we can play constructive roles in the ongoing job of building peace in our country.

I thank Deputy Carthy very much.

I accept the Chairman's apology and his statement. I have known Brian outside of my short time in the Dáil as president of the Irish Road Haulage Association and I have always found him to be a pure gentleman. Unfortunately, given social media as it is today, things happen in this regard. I do not condone the content. I spoke to the Chairman personally about that. I do, however, accept his apology. I did not agree with the motion that was brought by Sinn Féin in respect of the previous Taoiseach, who is now Tánaiste. As a result, I do not agree with anybody calling for his head. I think we have far too much important work to get on with. I do not think anybody has taken the level of offence that is being purported. I think we are all aware of our history and we should just get down to work and get on with what we have to do.

I thank the Chairman for his statement. I accept his apology to the committee and I thank him for it. There is no doubt, however, that the tweet was hurtful and that it was a glorification of what happened at Narrow Water. The Chairman's words from when we started our work ring true, namely, that we need to leave party politics at the door. We are here on behalf of the Oireachtas to scrutinise public bodies and other bodies. That said, I accept his apology. I do not think this is the place to scrutinise the tweet. That is for the Dáil Chamber and it is for the Chairman and his party to reflect on whether they want to deal with the matter in that forum.

I would not classify the tweet as clumsy. I do not say the Chairman did so. I hope that when he says he apologises for the tweet, it will not happen again. That is an important element because, as he rightly points out, this is a very prestigious committee within the Houses and there is an extra onus on him, as Chair. I know he accepts that and I know he understands it now.

I hope, however, that we will not have this situation in respect of the Chairman again because it puts the committee into disrepute and it is something we do not want to see again. I thank the Chairman for his statement.

I accept the Chairman is making an apology to the committee. Apart from distracting from the work of this committee, my view is that the apology should be made to those impacted by the tweet, rather than to us. I was not going to comment on the issue but in the Chairman's explanation and in Deputy Carthy's contribution, whether it was a clumsy tweet or a strategic approach, as another member mentioned, a definite attempt was made to try to conflate actions which the army of the Republic of Ireland took in 1920 and the actions that an organisation of the same name took at Narrow Water. That is not new. It is a political difference the Chairman's party has with many others in the Dáil. It is also an attempt to suggest that for someone to be in favour of a united Ireland, it is enough to be anti-British. We know we need to do far more than that to create a shared island.

While I and many other members of the committee were quite reasonable when we were getting media requests yesterday, the irony is not lost on me that if any of us had been in the Chairman's position, we would probably be the subject of a pile-on. I do not draw my political tactics from that style of politics when I am in the wrong and I do not believe I should do it when other people are in the wrong. I object to the Twitter pile-on today in respect of the Ceann Comhairle. It was an attempt to open up a second line of defence and it was deplorable, especially when so many members of this committee have been so reasonable on this issue. Deputy Devlin put it well when he said that this is a political difference between the Chairman's party and others here. The Chairman has as much of a mandate as any other Deputy in this House. The matter is one between Sinn Féin and the Irish people, not the Committee of Public Accounts.

I thank the Chairman for his apology, which I accept. Like Deputy Verona Murphy, I do not condone the content of the tweet, which was insensitive and inappropriate. It caused hurt to victims and descendants of victims and people who have a particular perspective. I respect and fully understand that. The Committee of Public Accounts is not the place for what some people are seeking, however. The Joint Committee on the Implementation of the Good Friday Agreement should by all means invite the Chairman before it to explore this matter. If the Ceann Comhairle wants to pursue this issue, that is what the Committee on Procedure is for; it is not our role.

Like Deputy Verona Murphy, I believe that, as a nation, we have become a colosseum where we are far too anxious to set up a guillotine every time there is a misdemeanour. I have previously stated outside this room that an appropriate body, such as the Standards in Public Office Commission, SIPO, should develop a book of quantum of sorts, with a list of appropriate sanctions for appropriate levels of misdemeanour, from lesser offences right up to more serious ones. The outcome of the approach we are taking now is the same every time there is an indiscretion or a misdemeanour, however serious or minor. It is to seek someone's head. We saw that recently with the Tánaiste's leak. Some approached that issue in an appropriate way, but others in a different way.

I am not for one second condoning the content of the tweet. It was insensitive. It is a matter, however, for the committee on the Good Friday Agreement, and certainly not for us. A great deal of dirty laundry will need to be washed out publicly in the years ahead, as the healing and reconciliation process continues. That of course includes the Finucane family and a public inquiry in that regard, where we have done our end of the bargain with the Smithwick tribunal, as agreed at Weston Park. That has not been matched by the British, who have, unfortunately, brought their judicial system into disrepute by their actions.

I am old enough to remember the Troubles being a nightly blight on the news, in respect of the loss of life on both sides. We all regret that. Given the years we are in, I wonder, when we look back, why we manage to romanticise and glorify atrocities of 100 years ago and then look at others in a different light. I abhor all violence. I mourn the victims of all violence, no matter on what side or in what era.

I would prefer if this committee stuck to its business. We have a huge body of work to get through. I accept the Chairman's apology. If the Joint Committee on the Implementation of the Good Friday Agreement wishes to pursue a particular line, it can do that. If the Dáil wants to pursue a particular line, the Business Committee and the Committee on Procedure are there for that purpose. We do not have the competence, and I certainly do not have the will, to pursue this matter any further here.

I thank the Chairman for his statement. There is not a shred of doubt in my mind that every word spoken was genuine and sincere. That reflects the type of person the Chairman is. The Chairman, like me, is a lifelong and proud Republican. He is a person who walks the walk. People talk about bringing peace to the island and the Good Friday Agreement. The Chairman was actively involved in promoting and working for that peace and seeing it come to fruition. We have had a permanent peace now for more than two decades. I know the Chairman's words are genuine because he has walked the walk.

Regarding the chairmanship of this committee, I think the two matters are totally separate. In the short time he has been in this role, the Chairman has been exemplary. He has been impartial and fair on all occasions. Again, that reflects the type of individual he is. That is the end of the matter for me. The Chairman has genuinely apologised and, as others have said, this committee has much work to do and we need to get on with that.

I welcome the Chairman's statement. The Committee of Public Accounts is one of the most important and effective of the parliamentary committees. The Chairman's actions have impacted on the work of the committee, especially given his privileged position as the Chair. The public see accountability as a moral construct which is only achieved when public officials serve with the commitment to do the right thing. As Deputy Carroll MacNeill has said, an important step will be for the Chairman to clarify his position in Dáil Éireann.

Time and again, we have seen Sinn Féin members not taking responsibility for their actions. We had Deputy John Brady a fortnight ago and the Chairman last weekend. This is not a singular or once-off event. The Chairman's party leader also needs to make a statement on this matter. It is seen by the Irish public as a strategic ploy to inflate tensions. We all have a responsibility in the decade of commemorations to commemorate the past in a respectful manner. That is an important step. Political representatives, irrespective of their political and ideological differences, must lead responsibly. It is apparent that we need a statement on this matter and we must also continue the important work of this committee in an appropriate manner.

I acknowledge the thoughtful comments of members. There is obviously a range of views among members who are coming to this matter in a thoughtful way. I clarify that my actions are my own. I take full responsibility for them. I was wrong. I have apologised, and I am saying that sincerely. Nobody else needs to take any responsibility. I am solely responsible for my actions and I have to take responsibility for them.

I am conscious of what the members have said on this matter. My commitment in the time ahead, through my words and actions, is to have the confidence of members, as Chairman, as we deal with the important work ahead.

A number of members mentioned the decade of commemorations. We are in that decade now and there are a few difficult years to go through because there are difficult issues. The lesson for me and all of us is that during that period we need to be very careful and continue to build reconciliation on the island of Ireland. That is my commitment.

The committee went into private session at 5 p.m. and resumed in public session at 5.30 p.m.

Members are reminded of the provisions within Standing Order 218 that the committee shall refrain from inquiring into the merits of a policy or policies of the Government or a Minister of the Government or the merits of the objectives of such policies. Members are also reminded of the long-standing parliamentary practice to the effect that they should not comment on, criticise or make charges against a person outside the Houses or an official either by name or in such a way as to make him or her identifiable.

There were 13 sets of financial statements and accounts laid before the Dáil between 16 November and 27 November. The Comptroller and Auditor General issued a clear audit opinion in all cases. In the accounts for the Residential Institutions Statutory Fund Board — that is, Caranua — the Comptroller and Auditor General has drawn attention to two matters. The first is the inadequate control over grant repayment. Second, there is the review of the effectiveness of internal controls. We will meet Caranua, as agreed at our last meeting, on 17 December. I propose we request Caranua to provide further information as part of the briefing it will provide for that meeting. Are members happy to agree to that? Agreed.

Mr. Seamus McCarthy

The Chairman might note that the accounts he is referring to are for the 2018 financial statements. For some reason, there was a delay in presenting those to the Oireachtas. I understand that the 2019 accounts have been laid and will be noted on the next occasion there is a list. They are available in time for the meeting.

Are the issues about the control over grant repayments and the review of the effectiveness of internal controls repeated in the 2019 accounts?

Mr. Seamus McCarthy

They are. Certainly, I think it is just the control over grant repayments. It is the same issue that has been noted on a number of occasions in their processing of payments.

I ask the Comptroller and Auditor General about the delay in the 2018 accounts. Is there a particular reason for that?

Mr. Seamus McCarthy

I do not know. I have sought to find out what the problem was. Members can see the accounts were certified on 6 December 2019. I looked at the appropriation account of the Department of Education and at that stage, the end of March, it noted it had received the accounts but the laying of the accounts was pending. For some reason, that did not happen between March and November. There were three other sets of accounts pending at that stage so I have asked to check that each of those sets has since been laid.

That is something we can take up with them when they are here.

Mr. Seamus McCarthy

I think it would be a matter for the Department. They had done what was required of them, which was to submit them to the Department.

The delay was on the Department's end.

Mr. Seamus McCarthy

That is my understanding. I think the committee's practice, where there has been a significant delay, is to write to the Department concerned and get an explanation.

I suggest we do that. It might help when Caranua is here for us to have been aware of that.

Can we agree to note the accounts and statements? Agreed.

The next item on the agenda is correspondence.

On the Sea Fisheries Protection Authority, I draw the Comptroller and Auditor General's attention to the results of the EU audit. That is the very top item. Was any financial penalty accrued in relation to that?

Mr. Seamus McCarthy

The risk is that there may be penalties involved in that but the process was not complete. There had been additional information furnished to the commission at the time we were completing the audit. It might be timely to ask for an update on that. The certification of the account was in May so there may have been developments since then.

I ask that we do that.

That is prior to my joining this committee so is it possible to get information on that?

Mr. Seamus McCarthy

The statement on internal financial control in the financial statements gives a lengthy description of the process of the audit, the findings and the subsequent submission of additional information.

It might be helpful to pick up that statement on Thursday if that is possible, rather than us all going rooting.

Mr. Seamus McCarthy

It is in the Oireachtas Library, but I am sure the clerk can make a copy of it available.

On the day Caranua comes in, we can if we wish agree to invite a representative from the Department of Education, as the work of Caranua moves into that Department. Are members minded to do that? We will request that it be done.

The first category of correspondence under which members have flagged items is category B, correspondence from the Accounting Officer and Ministers and their follow-up to previous Public Accounts Committee meetings. The first one is No. 202B, from Mr. Seán Ó Foghlú, Secretary General of the Department of Education, dated 13 November 2020, providing further information requested by the committee arising from the meeting of 21 October. A number of Deputies have requested to address this today. I think Deputy Catherine Murphy was one of them.

Yes. There were a number of things that stood out. I will refer to one. The prefabs in the longest standing rental agreement have stood since 2000. There is a building going up now but one would have to ask about value for money in terms of the length of time that took and it is important that we note that. There may well be others that are not as long but that could be nearly as long.

It would be quite useful to get a few more examples, perhaps five, six or even ten examples of the length of time. There is the cost of renting and the issue of substandard accommodation as well. I ask that this be done.

With regard to the payroll system, Mr. Ó Foghlú states on page 3 that there are approximately 9,000 casual employees and that there is a new standard of governance and approval process for the sourcing of goods and services. An interim payroll upgrade is under way and it is due to be completed in the latter part of 2021. He said the implementation of a new payroll system could take up to three or four years, which is a surprisingly long lead-in time for something like this. It is stated there is a very complex system with four different streams on the payroll, with primary, post-primary, non-teaching staff and retired people but there are 9,000 casual employees. I received information in reply to a parliamentary question that under the home tuition scheme, home tutors have always been engaged by parents or guardians of a child who receives home tuition. Tutors do not have a contractual relationship with the Department. Are they among the 9,000? What is the proportion of these 9,000 casual employees? I acknowledge that some of them are probably substitute teachers. A little more examination needs to happen so we can get an understanding of it.

The average compensation payment does not always compute in the one year. It is not entirely satisfactory that we are unable to see it all and it may well be that we have to look back historically. Where there are compensation payments, we have to learn whether there are things that can be avoided in the future. It is very important that we see the cost of something and the value of doing some work. That is the reason I am particularly picking up on this.

There is an important paragraph on page 6 on the school transport system and the fact that some moneys were paid back to the Exchequer. It is an important paragraph with regard to some issues we have previously looked at. It would be quite useful to ask about the final sentence on page 7 and whether it is intended to pursue a Garda investigation. Perhaps we can ask for an update in a few months just to keep an eye on it.

The first issue I want to raise arising from the correspondence also relates to temporary accommodation prefabs. I am always wary when temporary solutions are in place for a long period because we end up creating vested interests and people who have an interest in a bad practice continuing for longer. The three largest suppliers of rental accommodation in 2019 were three companies that provide Portakabins and prefabs. Can we ask the Department to clarify the number of students being educated in such structures?

The school Deputy Murphy spoke about has made use of temporary accommodation for 20 years. We know from the work of previous Committees of Public Accounts that this is not a cheap option. Over time, the funds expended on temporary accommodation in a single school would buy a small house in Dalkey, just to give Deputy Devlin's constituency a mention. We are speaking about substantial money. It would be useful if the committee could ask the Department to list, in tabular format, all the schools using temporary structures, the duration for which they have been used and the cost associated with them to date. That is important.

I fully endorse Deputy Murphy's point on legal claims. It requires much more scrutiny. It is not just the Department of Education but it is a good place to start. As she said, it is very opaque to find out exactly how much in any given year was spent on settling legal claims. It is very hard to find information, particularly where claims were settled or if there was a non-disclosure element to the deal. The State could have been forfeiting substantial sums due to negligence, for example. We hear anecdotes about public servants making complaints about another public servant and the Department settles. The public servant at the heart of it could be promoted in an external competition and nobody realises that person is the reason the State is out substantial funds. Is the Comptroller and Auditor General in a position to give us an analysis of the legal costs associated with the Department over a period of time as opposed to just one year? As the correspondence correctly states, a claim might be made in 2020 but it might not be settled until 2023. Usually, when a Department comes before us in a given year, its representative states a claim that was settled last year relates to something from five years ago and that the problems have been addressed. If we had an overarching analysis, it would be useful for the committee.

Mr. Seamus McCarthy

I will respond on that specific point. All of the appropriation accounts have this note and the structure of the note is set out in the template, which is directed by the Department of Public Expenditure and Reform. It is not a great note from an information point of view. It is opaque and there are many difficulties with it. There should be better information available and it should be available on a Department-by-Department basis. The State Claims Agency handles all of these on behalf of Departments. There should be better information available from it as to the amount of compensation paid out on a claim and the associated legal costs, whenever they were paid. That might be the first place to go to look for what information is already available from the State Claims Agency on these.

I want to get the advice of the Comptroller and Auditor General on the points made on postage costs. It is very clear from the breakdown given that the overall figure of €13.8 million for post and telecommunications is largely, as we suspected, with regard to the postage of payslips, which amounts to more than €10 million. In the course of the Secretary General's contribution, he mentioned there may be the possibility of using an existing or planned upgrade to allow a system to be implemented. My question as a new member of the committee is how we track this. It was a formal issue raised with the Secretary General. He has written to us to outline the figures but has not given us a commitment or responded in any way as to how he would address the costs, which I call "wasteful". While we might give him the time between now and when he next comes before us, I would hate for him to give us the same answer then.

Mr. Seamus McCarthy

When the committee is presenting its report on the examination of the appropriation account, it can make a recommendation. It would seem reasonable that the committee requests that he comes back before it, let us say within six months of having appeared, to explain or provide an update.

What the Comptroller and Auditor General has said on the note is very useful. Perhaps we should recommend that there be an improvement so it is more transparent.

I presume that we would write to the Department of Public Expenditure and Reform to request it to ask all of the Departments to apply a different format so that people can follow this a lot more easily.

In terms of the Department of Education, a good few years ago I remember asking parliamentary questions and being absolutely gobsmacked by the reply regarding the amount of money that was spent by the Department to fight parents who sought appropriate education for their children. Some of those cases were initiated but never concluded but then the children ended up being facilitated. The expenditure would have provided a large amount of very good quality education instead of paying legal fees. To ensure there is appropriate expenditure of public moneys we must take a good look at this matter because there can be things that are bad practice. This committee must try to interrogate such matters.

I do not want to rehash anything but prefabricated buildings have been a big bone of contention for me over the years. It would be useful if we could get more detailed information on the percentage of them that have been rented for more than five, ten and 15 years, respectively. We accept that prefabs must be used as a short-term measure but I think their use needs to be phased out. Apparently, the school population will decrease according to the trend in demographics. We will look for further information on the other items raised and on how the wage is administered through the post. We can make the recommendation in terms of the report.

Mr. Seamus McCarthy

On the circular in relation to the 2020 appropriation accounts, we will be issuing it, I would say, within the next week so we may have just missed the window for getting a change done for the 2020 accounts. Certainly, I would be willing for my office to talk to the Department of Public Expenditure and Reform about what we can do for 2021 to provide better information in relation to that note.

We will do that and I ask the clerk to do that. I propose that we note and publish the information on the committee website. Is that agreed? Agreed.

The next item of correspondence is No. 204, from Mr. Robert Watt, Secretary General, Department of Public Expenditure and Reform, dated 16 November 2020, providing further information requested by the committee arising from our meeting on 22 October 2020. When we discuss our work programme later in the meeting I will propose a further meeting with the Department with a view to examining public private partnerships in more detail. Several of the Members wish to discuss this item of correspondence. I ask them to please bear in mind when they contribute that we have an opportunity to bring representatives of the Department back in again to discuss public private partnerships.

Can we find out from the Department how often the One Person, One Salary aspect has featured since it was introduced and the cost?

On a code of practice or governance, can we get an indication of where exceptions exist when it comes to the appointment of a board member, how many have been sanctioned by the Minister since 2016, by whom and the term length?

I wish to make a few points about public private partnerships. We know that the schools bundle 5 is not on time due to the liquidation of the Carillion group and have been consistently told that this is not a cost on the State by virtue of the way that the matter was handled. In Maynooth, there is a schools bundle 5 project to build two 1,000-pupil schools right beside each other. These schools were due to be occupied last September but they still have not been completed so there is a cost in the interim. It may not be the cost of building the schools but there are costs for additional accommodation. There are costs that are not counted as costs by virtue of the fact that the project has not been completed. Therefore, it is not quite accurate to say that the entire cost is borne. There are financial consequences when projects are not completed on time.

Mr. Seamus McCarthy

On the One Person, One Salary, my recollection is that we were looking at that in the course of audits of the various public sector bodies. When the policy was initially introduced we were finding some cases where there were, let us say, board membership fees being paid to people who were in public sector employment but we would have brought those to attention, I think probably around 2011, 2012 and 2013, and most of them would be washed out of the system at this stage. It does not appear to be a problem any longer and would not have been for the past four or five years. Now the Department of Public Expenditure and Reform may have codified some of that but they also may not have the information readily available.

We will note that and seek the extra information. I propose that we note and publish the correspondence. Is that agreed? Agreed.

The next item of correspondence is No. 213, from Mr. Derek Moran, Secretary General, Department of Finance, dated 24 November 2020, providing further information requested by the committee arising from the meeting on 5 November 2020. I open the debate to the floor if Members with to comment.

The Irish Bank Resolution Corporation, IBRC, liquidation is an old chestnut. Deputy MacSharry pursued an issue regarding the Committee of Selection and the absence of one. I note the increase from €304 million to €313 million. This is the biggest liquidation in the history of the State and the key issue for some of us is how such inadequate oversight has been overlooked. We need further information on the liquidation and the length of time that it will take, which was unclear when the delegation was here. I want to know the timeline and whether there are risk assessments on delays and further costs. I ask that we request the Department to provide all of that information.

The correspondence is quite lengthy and contains a lot of information.

Yes, I am not going to go through everything.

The Deputy is all right; she may take her time.

Page 12 relates to dividends from State companies. I am not quite clear in my own mind about the differentiation between State agencies and companies. Does the Comptroller and Auditor General audit both? I can see in the documentation that some companies paid a dividend in 2019. Possibly, that situation will be changed considerably in 2020 because of under-performance caused by Covid-19.

Some State agencies or enterprises are technically supposed to be commercially run but there is no obligation on them to pay a dividend to the State and for some of them that would not be appropriate.

I picked out in particular the Irish Greyhound Board. For example, Abargrove seems to be a company within a company. It is the catering section in Limerick Stadium and it is a separate company from the stadium itself. Is that audited separately?

Mr. Seamus McCarthy

Yes, it is audited by my office and, in fact, the financial statements for Abargrove are available for 2019. There are two other subsidiaries. One is Shelbourne Park and while I cannot remember the name of the other, it is the other eight stadia. Together with Bord na gCon, they form a group, so the group audit pulls it all together, if one likes. There may be the appearance that things are losing money, but they are actually being cross-subsidised by other parts of the organisation.

I think there was an amalgamation.

Mr. Seamus McCarthy

There was, yes. All of the tracks were individual subsidiaries and they would all have been established and operated as companies but, obviously, operating in a co-ordinated way as part of a group.

For example, if we had the Irish Greyhound Board or whatever it is now called-----

Mr. Seamus McCarthy

It has actually just changed its name again and is now Rásaíocht Con Éireann.

If we had them in, we would not necessarily be dealing with some of those subsidiaries and they would have to come in separately. Is that the case?

Mr. Seamus McCarthy

No, the logical thing to do would be to take all of the accounts together, to take the group account and all the subsidiaries. With those subsidiaries, there are common directors and the directors of the subsidiary companies would usually be directors of the parent as well.

There is no difference in terms of how the Office of the Comptroller and Auditor General deals with a State agency and a State company.

Mr. Seamus McCarthy

The Deputy started by referencing the companies that deliver dividends to the Exchequer and those do not come within my remit. They would be what are called commercial State bodies and I do not generally audit commercial State bodies. What I would be auditing is generally what are called the State agencies or non-commercial State bodies. Some of them are legally organised as companies but, effectively, they are heavily dependent on Exchequer funding, and that is why they fall to my remit.

I thank Mr. McCarthy.

It is worth noting that while the commercial semi-States fall outside our remit, it is useful to have that list of dividends paid to the State. The public purse, the taxpayer and the public service benefit from this. For example, the ESB has paid more than €258 million in one year and Bord na Móna, despite having gone through a very difficult time, is paying €10 million. While this has reduced in recent years, hopefully, that will go back up again. It shows we have a number of very successful semi-State companies that have served the State, the taxpayer and the industrial development of the country very well. It is proposed to publish that correspondence on the committee website. Is that agreed? Agreed.

Next is No. 215B, from Ms Rachel Downes, CEO of Caranua, dated 24 November 2020, providing further information requested by the committee regarding the arrangements for winding down Caranua. We considered this at our meeting on 25 November and agreed to postpone our engagement with Caranua until 17 December. We have also written to the Taoiseach, the Minister for Education and the Secretary General of the Department of Education to raise our concerns around the wind-down. A number of us are concerned about the wind-down and the fact there are still outstanding applications for compensation under that fund.

We understand Caranua’s representatives are coming in on 17 December. It would be appropriate if, in advance of that, we wrote to Caranua and advised them that some members of the committee are particularly interested in the provision of supports for survivors following its wind-up. It would be useful if they were in a position to provide a detailed briefing note on their engagements to date with the Government agencies and the Department in regard to funding for future services and the arrangements that will be in place. Obviously, it is a matter of concern. They might indicate what agreements have been in place. We know that, in previous correspondence, Caranua contradicted correspondence that had been sent to the committee with regard to the level of supports that were available and, in another instance, they said they were not aware of a specific case. It would be good practice if, in advance of their attendance, they were asked by the committee to familiarise themselves with the few outstanding issues, and I understand it is only a few outstanding issues, with regard to the processing of concerns about the services that are in place. We are clearly going to be asking questions and it would be useful if we let them know that.

This is similar to the question I raised the previous time we were discussing this issue. I note in the correspondence a reference to the passage of the residential institutions statutory fund (distribution) Bill. I am not sure at what stage that is at or when to expect it in the House. However, I note they say it will not impact on the operational process of Caranua. Ultimately, our question to the Comptroller and Auditor General at the previous meeting was about the remaining funds for distribution and what happens there. It is going to form a part of our discussion with them when they are before us. If they can, through the clerk, furnish as much information as possible in advance of that, it would assist in our process of questioning.

From memory, the figure of approximately €330,000 was mentioned as remaining in the fund. There are applications and appeals amounting to €1.38 million in the accounts. Is that correct?

Mr. Seamus McCarthy

I do not know offhand.

The fund started off at €110 million. We can write to them if that is the specific issue we want to address, and also in regard to our concerns on dealing satisfactorily with any valid applications for funding and supports that are required. It is important that survivors be looked after. Is it agreed to publish that? Agreed.

Next is category C, correspondence from and related to private individuals and any other correspondence. First is No. 211C, dated 21 November 2020, from an individual raising further questions about the Strategic Banking Corporation of Ireland, SBCI. At our meeting on 30 September, we agreed to request the correspondent’s consent to forward a number of items to SBCI to respond to the matters raised. I propose to request the correspondent’s consent to send this additional information to SBCI so that it can also be addressed. We need to point out to SBCI that we have not received a reply to our previous correspondence, which would have gone out very shortly after that meeting on 30 September. We will seek an immediate reply. Deputy MacSharry had an interest in this issue.

Outside the committee, I asked a number of parliamentary questions and although replies have come back, I have not had a chance to look at them yet. I have an issue with the corporation. This was established for SMEs. In this instance, it certainly highlights a failing in the rules because I do not think it captures the spirit of where we were coming from with the SBCI, in that a company that has a substantial foreign holding is given €20 million to pay off a loan from a foreign bank.

In pursuing this matter previously, I raised it before this committee and I know that the Comptroller and Auditor General has also looked into the matter. I know that in responses to parliamentary questions, the view taken, and these are my words paraphrasing it, was that an Irish company had its lunch eaten by another company, but the SBCI operated within the rules. It may well have operated within the rules, but it did not capture the spirit of the intentions under which it was established. A sum of €20 million to a company that was operating abroad, which I am sure is a very reputable company, and good luck to it, certainly was not where we were coming from. It is something that we should look into, if only to identify the fact that the terms of reference or the regulations and guidelines that underpin the establishment of the SBCI were flawed to the extent that the money did not go to where we intended it to go, which was to the SMEs.

Half of it is publicly funded. My memory of it is that 50% of it is publicly funded and 50% is funded by the private sector. The Deputy is correct to state that the funding was intended for SMEs, and Irish SMEs, but this correspondence appears to indicate that a substantial part of it did not end up there.

I agree with the proposal.

I spoke to the correspondent recently.

The references in this correspondence are very significant. Essentially, it states that a huge amount of money that we were told was going to be directed to SMEs, which form a very important part of our economy, was actually used to bolster the balance sheet, repay a loan, pay dividends to shareholders and provide significant liquidity to a foreign-based parent company. According to the correspondence, only 7% of what was loaned to BIFSL, essentially by the Irish taxpayer, was deployed into the Irish SME market. That is very substantial and I agree with the proposal that has been made. However, I think it would also be prudent for the committee to ask the Department of Finance for its response in respect of all of this. At the end of the day we are dealing with Irish taxpayers' money, so it would be appropriate to ask the Department of Finance to comment on this matter. I would also like to put on the record that SBCI, which is potentially a very important body, has not responded to this committee on the issue as yet, and that is not acceptable practice. I agree that we should write to the corporation again.

The committee did write to the corporation again at the end of last week.

I, too, have had a lot of communication with the correspondent over some time, have asked parliamentary questions and so on. The whole idea with this fund was that where commercial banks were not an option for some SMEs, this would ensure that we had a strong indigenous base in that small to medium sector, which is incredibly important and one of the bigger employers, if it is looked at collectively. This is an extremely important fund and it is not exclusively made up of public money, but there is a large portion of it that is made up of public money. The correspondent has certainly convinced me of his own bona fides in terms of the research that he has done, and this is exactly the kind of thing that is very useful when it is brought to our attention. In addition, is there a particular Department to which the SBCI responds? If so, we should write to that Department also. I would also like to hear from the Comptroller and Auditor General on the interaction that his office has with the SBCI on this matter, and specifically whether the interaction is through the Department or is direct with the corporation.

I ask the Comptroller and Auditor General to come in here.

Mr. Seamus McCarthy

I audit the accounts of SBCI, and therefore it can be called to appear before the committee. It is under the aegis of the Department of Finance. One of the significant developments in the past year is that the corporation has carried out a strategic review of its operations and it has published the results of that review, which are available. This year, 2020, is the first year going forward from that review, so the corporation is making some changes in its mode of operation and there has been some paying down of the borrowing, which I believe was borrowing from Germany, so some of that has been repaid. It is involved not just in the first line of activity, which is lending to SMEs that were having difficulty in accessing the market, but also in providing funding in the context of Brexit. That is being funded by the Department of Agriculture, Food and the Marine, and the Department of Enterprise, Trade and Employment. There has been quite a shift in the organisation and it is perhaps timely for the committee to invite it to attend a meeting. We have certainly dealt with this correspondent previously and we have followed up on matters that he has brought to our attention in the course of each audit.

I ask that this matter be added to our work programme. It may be useful to talk to the correspondent in advance of the appearance of the corporation before the committee, whenever that meeting is scheduled.

It would be useful to include the matter in the work programme, because it is clearly an issue about which a number of members are concerned. We can include it on the list when we are moving the next item on the agenda, which is the work programme.

That concludes the correspondence, and we now move on to the work programme for the months ahead. Some of our upcoming engagements are displayed on the screens. Tomorrow we will be launching our report on NAMA's 2019 financial statement and also Report No. 109 of the Comptroller and Auditor General, which concerns Project Nantes.

On 9 and 10 December, we will have further engagement over two days with the Department of Justice and the Prison Service. This doubles the time that we have to examine the accounts, and we have already agreed going forward that we will try and use that approach rather than trying to cram all the work into the one day. We then have one public engagement left before the end of the year, which takes place on 17 December, when Caranua, which has been discussed today, will appear before the committee.

There are a number of engagements provisionally scheduled for January 2021, which the members can see listed before them. We will ask that the Strategic Banking Corporation of Ireland is included in that. On 14 January, it is proposed that we examine the Office of Government Procurement 2019 appropriation account, and on 20 and 21 January, it is proposed that we examine the HSE's 2019 financial statement, with a focus on the awarding of Government grants to agencies, which are referred to as section 38 and 39 agencies, which Deputy Burke, who is now absent, has raised a number of times, and about which a number of members are concerned. We will also look at agency costs and value for money. On the second day, we will focus on the integrated financial management and procurement system and capital expenditure. On Thursday, 28 January, it is proposed that we examine the 2019 financial statements of the National Paediatric Hospital Development Board.

There are also a number of other engagements suggested for February 2021. On 3 and 4 February, it is proposed that we examine the 2019 appropriation account for the Department of Communications, Climate Action and the Environment, and focus on chapter 9 of the Comptroller and Auditor General's report on the remediation of landfill sites and the expenditure related to the national broadband plan. On 11 February, it is proposed that we examine the National Shared Services Office, in particular, chapter 5 of the Comptroller and Auditor General's report on the implementation of financial management of shared services.

Are members happy with the work programme as it stands? Yes. There are have also been a few additions to the programme. I think RTÉ has been added to the list of organisations engaging with the committee as part of the draft work programme. If it has not been added to the list, I propose that we add it to the programme.

For the benefit of Deputy Carthy, who was temporarily absent, we are discussing the draft work programme, and he will find a list of proposed engagements on the screen in front of him. One of the Departments we are considering engaging with is the Department of Tourism, Culture, Arts, Gaeltacht, Sports and the Media, and I have suggested that we add RTÉ to the list of engagements for the new year.

It would be useful if we could invite the Competition and Consumer Protection Commission to come before us. It is an organisation that has a lot of money to spend on PR. I am just not sure whether it is spending the rest of its money on delivering, so it might be useful to do that. An important body that could be useful also, and there is not necessarily an urgency about it, is Bord Bia. In a post-Brexit world, Bord Bia could be very important. In addition, can the Comptroller and Auditor General explain the export credit guarantee account for me?

Mr. Seamus McCarthy

It is a very old scheme. It was running from 1971 until the middle of the 1990s. Effectively, it was guaranteeing credit. There were claims paid out under the guarantee and then there was a process of reclaiming those. I believe it was supporting beef exports in the mid-1990s.

That is why it rang a bell. Is it still in existence?

Mr. Seamus McCarthy

We are auditing the account each year but it is a nil account. We have suggested to the Department that it bring in legislation to get rid of the account because effectively there are some balances that are not recovered and it is very unlikely that they will be recovered, and the Department accepts that. I believe about €22 million has not been recovered and it is very unlikely at this stage to be recovered so there is no point in maintaining the account but it is still there and therefore we have to audit it every year.

At some point during the first half of next year, I would like to see the greyhound racing board, or whatever it is called now, come before us.

Mr. Seamus McCarthy

Rásaíocht Con Éireann.

In light of where we will be in January, we might invite the Dublin Port authority to come in given that-----

If it is agreed, we could do that. The Deputy has a list in front of her which we can agree on, with the additional-----

Mr. Seamus McCarthy

It is not subject to my audit and therefore it is not within the remit of this committee.

It is a private company.

Mr. Seamus McCarthy

It is a public company but it is regarded as a commercial State body; therefore, I do not audit it.

So it cannot be invited to come before the committee.

Mr. Seamus McCarthy

This is one of the types of situations where the committee could apply for an extension of its remit.

We can seek to have it brought in. It is important that we put it on the list. We can then work out through the secretariat how to bring it before the committee in the new year. Is the Deputy happy with that?

I agree with the Deputy that with Brexit, there will be an urgency around that.

I am proposing that a number of organisations be invited to come in and I will email them to the clerk directly but I ask the Comptroller and Auditor General for his information on a number of organisations on the list of organisations he provided to the committee. Could he give a brief explainer on the local loans fund and the heritage fund, because depending on his answer it might be of interest to us to put them on the work programme. Others are the sundry moneys deposit account and the State property miscellaneous deposits account. I was unsure about the basis of NSCDA Operations Limited. A final one is the hepatitis C accounts. I can see that a number of those are still in operation. Are they still operational accounts?

Mr. Seamus McCarthy

Yes. All of them are operational accounts, some bigger and some smaller than others. I think I did a note a couple of years ago for the previous committee on some of these accounts. It was brief explainers of what they are. Of the ones the Deputy has mentioned, the sundry moneys is probably the biggest one. That is just a holding account. When moneys are collected it is likely that they will go to the Exchequer but once they go into the Exchequer they cannot be taken out unless there is power in law to take them out. There is a question mark over whether some moneys are properly receivable into the Exchequer so they are held in sundry moneys.

Who manages that?

Mr. Seamus McCarthy

The Department of Finance manages that.

The local loans fund is an account that is not used very much. It was for the provision of loans to local authorities and for the recovery of those. The heritage fund is under whatever it is called now — the Department responsible for heritage. Again, that is a small fund. I would have to refresh my memory on the scale of operation of it but it is a grant giver.

NSCDA is a subsidiary of Sport Ireland. It operates some of the facilities in Abbotstown. Aspects of it are run on a commercial or quasi-commercial basis. If the committee wanted to examine those, it could bring in Sport Ireland and NSCDA and they could be examined together.

On the hepatitis C accounts, I did a chapter a couple of years ago in respect of that. I can get the Deputy a copy of it. It explains the structure. They are very complicated accounts in the way they operate. What I tried to do with the chapter was to give an overview of it but there are persons affected by the hepatitis C scandal who are still in receipt of funds in certain ways. Obviously, it is not operating on anything like the scale it did a number of years back. One of the things that was significant when I was doing the chapter was a scheme to actually cure hepatitis C and there does seem to have been a lot of success with that.

Finally, the State property miscellaneous deposits account.

Mr. Seamus McCarthy

Again, that is one of the things that is explained in the briefing-----

Mr. Seamus McCarthy

-----which I will copy to the Deputy.

That would be very helpful.

Mr. Seamus McCarthy

One of the key things with that was about proceeds from the liquidation of companies where there were excess proceeds. It very rarely happens but sometimes it does and that becomes State property. That is an account to receive that, pending any reclaim of it. Moneys are held there for a period but if, say, somebody is entitled to the proceeds of an estate or something, he or she can reclaim it from that account and after a period, if a tranche of money has not been reclaimed, it is then forfeited to the Exchequer.

I do not want to rush members but the Deputy is running out of time.

I thank Mr. McCarthy for that. Any explanation on some of these funds would be helpful. For our own purposes it would be interesting to link them to the Departments or organisations they are part of because when they are before us we can ask questions on that.

I will correspond with the clerk on this but the other items are the National Council for Special Education and the National Disability Authority. I do not know if they have been before the committee in the recent past but the clerk might liaise on that.

I am not sure whether the residential institutions redress special account falls under the Department of Finance or-----

Mr. Seamus McCarthy

The Department of Education.

That is fine. The others are the Medical Council, the Secret Service, the Personal Injuries Assessment Board, the Pensions Authority, the Trade and Business Development Body and Waterways Ireland. I will email those to the clerk.

Mr. Seamus McCarthy

On that, the liaison officer is working on producing a briefing note that will list the Departments, Votes, funds and bodies under the aegis but if the Deputy looks at the back of an Appropriation Account, he will see a listing of bodies under the aegis of each Department for which they are responsible for submitting accounts.

I thank Mr. McCarthy.

Have we ever had the Secret Service come before the committee?

Mr. Seamus McCarthy

No. It is a relatively small amount of money. There is a limitation of scope in respect of it. We do not-----


May I get the agreement of members on the proposed additions that are on the screen? They will see the seven bullet points under the heading, Proposed for Addition. Can I have agreement on that? Agreed.

We will add on the other matters that were mentioned and we will endeavour to try to work that.

That concludes the business with the work programme. Are there any other issues members want to raise in the remaining minute or two? Members are all happy enough. Tomorrow we will launch the report on the engagement with the National Asset Management Agency, NAMA, at 11.30 a.m. As that is not a formal meeting of the committee, this meeting is adjourned until 4.30 p.m. on Wednesday, 9 December, when we will engage with the Department of Justice.

The committee adjourned at 6.30 p.m. until 4.30 p.m. on Wednesday, 9 December 2020.