Business of Committee

The business for this afternoon should be reasonably short. We have minutes, accounts, correspondence, the work programme and any other business. The first business is the minutes of our meeting of 11 November, which have been circulated to members. Does any member wish to raise any matter relating to the minutes? No. Are the minutes agreed? Agreed. As usual, the minutes will be published on the committee's website.

We now move on to accounts and financial statements, which the Comptroller and Auditor General, Mr. Seamus McCarthy, will take us through.

Mr. Seamus McCarthy

Six sets of financial statements have been presented and are now available. The first is from the Donegal Education and Training Board and relate to 2020. That received a clear audit opinion.

The financial statements from the Ombudsman for Children's Office also received a clear audit opinion for 2020.

The 2020 accounts for Ciste Pinsean Thithe an Oireachtais ar fad cóltaí, the pension fund for Members of the Houses of the Oireachtas, received a clear audit opinion.

The 2020 accounts for the Longford and Westmeath Education and Training Board received a clear audit opinion.

The 2020 financial statements for Microfinance Ireland, the provision of additional funding for which was mentioned during the meeting this morning, received a clear audit opinion. However, I draw attention to note 9 in the financial statements. It discloses that there was a provision charge for 2020 of €11.4 million in respect of bad and doubtful loan debts. At the end of 2020, the total of specific and collective provisions for loan bad debts amounted to €13.3 million on outstanding loan advances totalling €30.2 million. What a provision is doing is looking at the quality of the loans and anticipating that losses will be incurred in the future. That is a significant increase in the provision in the year, largely because of additional lending to businesses that were operating in a Covid environment. It is anticipated there will be a higher level of losses incurred as a result of that.

The final set of accounts presented are the annual financial statements for Science Foundation Ireland for 2020. There is a clear audit opinion.

We expect an update on the position relating to Microfinance Ireland when it is audited again. As the Comptroller and Auditor General said, it is not something that is done mid-year.

Mr. Seamus McCarthy

That does not typically happen for a small organisation such as Microfinance Ireland. It will be looking at the provision and the inadequacy of the provision it is making on each reporting date.

Can we agree to note the accounts and statements? Agreed. As usual, the listing of accounts and financial statements will be published as part of our minutes.

We will move on to correspondence. As previously agreed, items that have not been flagged for discussion for the meeting will continue to be dealt with in accordance with the proposed actions that have been circulated and decisions taken by the committee in relation to correspondence are recorded in the minutes of the committee meetings and published on the committee's web page. Five items of correspondence have been flagged in this category.

I will move to consider correspondence from Accounting Officers, Ministers, or both, and relating to follow-up to meetings of the Committee of Public Accounts. No. 872B was received from Mr. Niall Cody, chairman of the Revenue Commissioners, dated 5 November 2021. It provides information requested by the committee arising from the fact that the Revenue did not accept certain recommendations in the committee's most recent report on its engagement with Revenue. The committee asked Revenue to clarify to what extent it can investigate the financial and sectoral implications of a voluntary PAYE system agreed by Revenue and courier firms in March 1997, as well as a copy of the 2019 European Commission inspection report on the control strategy for customs values and repayments. I have flagged this item for discussion, as have Deputies Carthy and Stanley. I suggest we hold it over until next week as I know it is of interest to Deputy Stanley. Is that agreed? Agreed.

No. 873B is correspondence from Ms Marie-Claire Maney, chairperson of the Tax Appeals Commission, dated 8 November 2021. It responds to the committee's request for information relating to tax settlements between the Revenue Commissioners and Perrigo. The chairperson states that due to its statutory obligations around the confidentiality of appellants, rather than any reluctance to respond to oversight, the commission cannot provide such information. The chairperson goes on to detail the relevant statutory provisions, stating that if a settlement is agreed at any stage before the commission makes a determination, the appeal is treated as having been withdrawn and the parties need only notify the commission of the settlement. As such, the commission has no role in the tax settlement agreed between Perrigo and the Revenue Commissioners.

The chairperson also provides an update on the current status of the top ten appeals by quantum. The most recent update was provided for our meeting with the commission on 8 July. It is worth noting that the aggregate quantum of tax under appeal has reduced from €4.5 billion in January 2021 to €1.55 billion on 8 November 2021. We have also requested detailed information from Revenue relating to this settlement, which is due today. It is proposed to note and publish the correspondence. Is that agreed? Agreed. Deputy Carthy and I have flagged it.

No. 874B is correspondence from Ms Cliodhna Guy, interim chief executive officer of the Irish Horseracing Regulatory Board, dated 8 November 2021. It provides further information requested by the committee about the installation of CCTV cameras at racecourses.

The interim CEO states that it has concluded the evaluation of the tenders for the installation of CCTV systems in racecourse stable yards, and that the board continues to work to the previously stated timeframe for installation to be completed at each racecourse prior to the commencement of the 2022 season. The interim CEO also notes that the cost of the system is considerably higher than what had been allocated by Horse Racing Ireland previously and on that basis the matter is currently with the Horse Racing Ireland board for approval. It is proposed to note and publish the item. Is that agreed? Agreed.

Deputy Imelda Munster and I flagged this item, but I do not think she is present. It would be useful to get a breakdown of the cost of the new system to include the installation costs and an update pack when the sanction to the purchase is granted. I presume it will do that, but it would be no harm for us to request it.

No. 875B is correspondence from Mr. Ronnie Downes, assistant secretary at the Department of Public Expenditure and Reform, dated 8 November 2021 in which he provides information on updated arrangements for public bodies presenting their accounts to the Comptroller and Auditor General and, following their audit, the arrangements for laying them before the Houses of the Oireachtas. It arises from a 2018 report of the last Committee of Public Accounts, which highlighted the inconsistency in the obligations of when public bodies must present their financial accounts to the Office of the Comptroller and Auditor General for audit.

The new arrangements, as set out in Circular 24 of 2021, require that, unless otherwise specified in legislation, annual accounts should be presented to the Comptroller and Auditor General for audit no later than three months after the close of the financial year. As the accounts are laid before the Houses and brought to the attention of this committee by the Comptroller and Auditor General, the circular also removes the need for audited bodies to arrange for copies of audited accounts to be submitted to the committee. This requirement was not being complied with in the majority of cases in any event. In most cases, once the Comptroller and Auditor General has certified accounts, the accounts must be laid before the Houses within three months. Members will be aware that this committee has a standing agreement to write to any bodies that are late in laying their audited accounts before the Houses. However, this circular, as was the case with the one it replaces, includes a requirement, at paragraph 9, that the clerk to this committee be notified where there is an unavoidable delay beyond these time limits. In practice, this is not being done. If it were, it would remove the need for us to write to bodies to request explanations for late laying of accounts.

It is proposed to note and publish the item, to thank the Department of Public Expenditure and Reform for providing the updated circular and to request that it remind Departments of the requirement to inform the clerk if statutory accounts are being presented later than the specified time limits and to explain the delay. Is that agreed? Agreed. I hope our consistent following up where accounts were late had a role in putting that onto a more formal footing.

Mr. Seamus McCarthy

It is very welcome that the Department has taken the effort to refresh the instructions to Departments to remove certain anomalies and so on. I certainly welcome it.

Deputy Carthy has flagged this item.

I have nothing to flag. I have a technical question on the weekly sheet we receive outlining the accounts that have been laid. I take it that will continue.

Mr. Seamus McCarthy

Absolutely. I think that is one of the things referred to in the circular. That arrangement is working quite well. We are picking up anomalies. We are going back to Departments and looking for things to be rectified. For example, recently some sets of financial statements were just unreadable because of the way they were copied and so on. We keep pushing on that and we will keep bringing the lists to the committee each week.

I thank the Comptroller and Auditor General.

No. 878B is correspondence from Mr. Joe Hackett, Secretary General of the Department of Foreign Affairs, dated 8 November 2021 in which he provides information requested by the committee on the appointment of special envoys. The Secretary General states that in September the Minister for Foreign Affairs requested that the Department undertake a review of the role and appointment of special envoys, and make specific recommendations on how future appointments will take place through a competitive process. The terms of reference are included. The Secretary General states that the report arising from the review will go before Government at the next available opportunity and that the Minister’s intention is to publish the report following its consideration by Government.

Regarding expenditure in the Department’s accounts relating to special envoys, almost €70,000 was spent on travel and subsistence in 2020. The Secretary General clarifies that no remuneration was paid to special envoys in 2020. However, in recognition of their work as special envoys he states that it was decided to pay each of the six retired special envoys an ex gratia payment of €5,000 per year for each of the two years of their work on the campaign. While the Secretary General states that one of the special envoys waived this ex gratia payment, it was paid to the other five retried staff in January 2021, totalling €50,000, which was €10,000 each. Special envoys who were then serving staff of the Department, the then Minister and the then Deputy did not receive any remuneration for their roles as special envoys.

It is proposed note and publish the item and request a copy of the report once it is published, as well as the basis for the ex gratia payments to special envoys. Is that agreed? Agreed.

Deputy Carthy has flagged this item for discussion.

I seek clarification. Is an ex gratia payment taxable?

I cannot answer that.

Mr. Seamus McCarthy

If it is a form of remuneration, it would be. The term "ex gratia" just refers to the fact that there is no scheme in place under which the payment is made. I think it has no bearing on the taxability of it. I will check it and come back to the Deputy.

The Comptroller and Auditor General might get clarification on that. I do not think it is appropriate to state that no remuneration was paid and then state in the same paragraph that an ex gratia payment amounting to nearly €100 per week was provided. This again highlights the need for a structure in respect of the concept of special envoys and the process involved because it all appears to be incredibly ad hoc, as was prominent for a period.

Next we will deal with correspondence from and relating to private individuals and any other correspondence.

No. 879C is correspondence I submitted to the committee on 9 November 2021 requesting the committee to make inquiries with IDA Ireland arising from HSE correspondence regarding the procurement of ventilators from China. Obviously, that is self-explanatory. I again ask the committee to agree to make those inquiries. Is that agreed? Agreed.

No. 881C is from Mr. Tadhg Daly, chief executive officer of Nursing Homes Ireland, dated 9 November 2021.

It requests an update on the implementation of the recommendations in our report regarding the examination of the Comptroller and Auditor General's Special Report 110 - Nursing Homes Support Scheme (Fair Deal Scheme), which was published in January. One of the recommendations was that the value for money review of the Nursing Homes Support Scheme be published without delay. It was initiated by the Department of Health in March 2018 and was due for publication in March 2019. Over two and a half years later it has still not been published. We looked for an update on this review and on the report concerning the costs and timeline for the national children's hospital from the Department on 18 October and issued a reminder earlier this month but have not yet received a response. It is proposed to provide Nursing Homes Ireland with the updates the committee has received in respect of the implementation of its recommendations and to advise that the Department of Health will appear before the committee on 16 December. Is that agreed? Agreed.

Deputy Munster flagged an item of correspondence. We could hold it over. That is probably the fairest thing to do, so she has an opportunity to address it. If we can move on to the work programme, it is agreed until the end of the year. We previously agreed to revisit the work programme for the new year in late November. It is suggested that we do so next week. Is that agreed? Agreed. Does any member wish to raise anything in respect of the work plan? We will be coming back to it next week anyway. Is there any other business? I take it there is not. We will briefly go into private session before adjourning until Thursday, 25 November, when we will engage with the Department of Tourism, Culture, Arts, Gaeltacht, Sport and Media.

The committee went into private session at 2.52 p.m. and adjourned at 2.53 p.m. until 9.30 a.m. on Thursday, 25 November 2021.