COMMITTEE OF PUBLIC ACCOUNTS debate -
Thursday, 24 Feb 2022

Business of Committee

Chairman

The public business before us is as follows: the minutes; accounts and financial statements; correspondence; the work programme; and any other business.

The first item of business is the minutes of our meeting of 17 February, which have been circulated to members. Does any member wish to raise matters in respect of the minutes? No. Are the minutes agreed? Agreed. As usual, they will be published on the committee's webpage.

Five sets of financial statements and accounts were laid before the Houses between 14 and 18 February. I will ask the Comptroller and Auditor General to address these before opening them to the floor.

Mr. Seamus McCarthy

The first set of statements is from the City of Dublin Education and Training Board, CDETB, for 2020. The turnover was €574 million. It is the largest of the ETBs but members will be aware that it includes all student support grant payments. I issued a clear audit opinion but I drew attention to non-compliance with procurement rules. I believe the figure was approximately €2.9 million, excluding VAT.

The second set is from Letterkenny Institute of Technology for 2019 and 2020. There is a clear audit opinion.

The third set is from the Travellers' Protection Fund and the travel agents and tour operators bond accounts for 2020. That has a clear audit opinion.

The fourth set is from the Western Development Commission for 2020. It has a clear audit opinion.

The fifth set is from the Commission for Railway Regulation for 2020. It has a clear audit opinion.

Chairman

Regarding the Health Research Board, HRB, an issue that arises regularly where health bodies are concerned has to do with accounts giving a true and fair view except for the account for the cost of retirement benefits, which are only shown as they become payable, and there is a standard for that. Are we notifying those bodies to change their approach? This is the second year the figure has increased.

Mr. Seamus McCarthy

I am not sure what the Chairman is quoting from. It does not affect any of this. Are we looking at a different list? It does not arise in this context but it is an issue. The Minister for Health can determine the format of accounts for health bodies. Where this matter arises, I am drawing attention to it because it is an exception to what is called the true and fair view. It is for the Department and the Minister to make-----

Chairman

What Mr. McCarthy is saying is that the costs, as they accrue, should be-----

Mr. Seamus McCarthy

That is what would be required if the financial statements are to give a true and fair view. It is an exception to that and I am obliged to draw attention to it because it is not a true and fair opinion in respect of that one aspect.

Deputy Cormac Devlin

I wish to ask about the CDETB. The Comptroller and Auditor General mentioned a figure of a little over €2 million as regards non-compliance with the procurement rules. What kind of non-compliance issues did he discover?

Mr. Seamus McCarthy

The statement on internal financial control sets out the categories of expenditure in significant detail. The text then explains that most of it is because of purchases in many individual centres being procured separately.

Deputy Cormac Devlin

I see.

Mr. Seamus McCarthy

For example, the €340,000 in respect of acquiring the delivery of school meals from suppliers should probably have been put out to tender, particularly in Dublin because it is a relatively small, self-contained ETB. It is different if we are talking about a large county, where it would not be reasonable to expect one supplier to supply at two ends of the county. There is another element as well, which is where contracts were in place but they expired and a replacement competition had not been run, so they just rolled over the contract, which makes it non-compliant.

Deputy Cormac Devlin

Which can happen.

Mr. Seamus McCarthy

It happens. Obviously, it is quite a big ETB and I think the figure is €2.9 million excluding VAT.

Deputy Cormac Devlin

That makes sense for the individual centres as well. I thank Mr. McCarthy for that.

Chairman

Do we agree to note the statement?

Deputy Cormac Devlin

Noted.

Chairman

As usual, the list of the accounts and the financial statements will be published as part of our minutes.

Moving to correspondence, as previously agreed, items that were not flagged for discussion for this 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’s meetings and published on the committee’s webpage. The first category of correspondence under which members have flagged items for discussion is B, correspondence from Accounting Officers and-or Ministers and follow-up to Committee of Public Accounts meetings.

The first item is No. 1076 from Mr. David Gunning, chief officer, National Paediatric Hospital Development Board, NPHDB, dated 16 February 2022, providing information requested by the committee regarding the number of claims received by the employer representative. We requested this information to assist us in finalising our report on the National Paediatric Hospital Development Board's 2019 financial statements. It is proposed to note and publish this. Is that agreed? Agreed. It has been flagged by Deputies Catherine Murphy and Matt Carthy. I call Deputy Catherine Murphy.

Deputy Catherine Murphy

There is one particular aspect that I raised at last week's meeting. It is in regard to McCann Fitzgerald, a firm of solicitors. I presume that it would have been a requirement to go to tender for its services. There are different steps outlined here, as we can see in the table - everything from the employer representative to the project board, conciliation, adjudication and the High Court. Would it be involved in all of the five steps there? Is there a contract around that? If so, it might be useful to see it or to at least inquire about whether there was an open procurement process in regard to their services. It was involved in designing the contract in the first instance. I just want to satisfy myself on this.

Chairman

Do other members wish to come in? If not, the only other thing that I see is the claims information up to the end of January of this year. The total value of substantiated claims and adjustments issued for determination is €554 million, which is a huge sum, but the employer’s representatives determined the claims and adjustments issued by the contractor and they have been put at a value of €19.9 million, less €5.5 million because there is an adjustment with the other figure. It would seem the ones that have been settled are the easier ones and the concern is that the 159 cases that are left are the sticky ones. It is proposed to note and publish the item. Is everybody happy with that?

Deputy Catherine Murphy

I would like to have that extra information.

Chairman

The clerk is clear on that.

The next item is No. 1079 from the Government accounting unit, Department of Public Expenditure and Reform, dated 16 February 2022, enclosing the minute of the Minister in relation to the Committee of Public Accounts reports regarding our examination of the 2019 appropriation accounts of the Department of Social Protection and the Department of Housing, Planning and Local Government. These are important items of correspondence in that they are the responses to this committee’s recommendations. I will open the floor and if members would like more time to review them, they can be added to the correspondence list for next week’s meeting as well.

Deputy Catherine Murphy

I ask that we do that.

Chairman

The wise thing, given people are seeing these for the first time, is that they be circulated for next week's meeting and we would come back to it then. Deputy Carthy, who is not present, has flagged it. We will put it on next week's agenda.

The next item is No. 1082 from Ms Oonagh McPhillips, Secretary General, Department of Justice, dated 16 February 2022 providing information requested by the committee regarding the impact of industrial action on the operations of the Garda Síochána Ombudsman Commission, GSOC. The Secretary General advises that:

... agreement was reached between the parties on a mechanism to move the matter under dispute forward over the next two months. As part of this agreement, the Association of Garda Chief Superintendents and the Association of Garda Superintendents undertook to suspend their industrial action.

That is good news. This means they will return to carrying out activities that they had characterised as being outside their core duties, including certain GSOC investigations. It is proposed to note and publish this item. Is that agreed? Agreed. It is flagged for discussion by Deputy Matt Carthy, who is not present. It would appear that may have been delaying investigations by GSOC so it is good news it is happening. We will note and publish that.

I had overlooked one item, No. 1077, from Ms Kerstin Mey, president, University of Limerick, dated 16 February 2022, providing information requested by the committee in relation to a KPMG report regarding the purchase of a Limerick city centre site – the Dunnes site - and the terms of reference for this review. It is proposed to note and publish this item. Is that agreed? This had been flagged by Deputy Catherine Murphy.

Deputy Catherine Murphy

The expectation was that it would be available the following week and it is a week since that. At what point do we go for an update? We have to keep chasing these.

Chairman

It states that the report has been received by the individuals and that they passed the correspondence to their legal adviser, who has been advised not to circulate the report until the contents of the letter are reviewed and responded to. They are currently in the process of seeking a view from KPMG and expect this in the next week or so, at which point the legal advice will be updated. In regard to the terms of reference, the HR director issued a draft terms of reference to the independent chair of the audit and risk committee for review. The final terms of reference were prepared based on feedback and were then reviewed by the legal advisers and were further issued to KPMG as a basis for the review. That is the current situation. Is Deputy Murphy suggesting we should correspond with them again in a week or two?

Deputy Catherine Murphy

I think we have to keep an eye on it and not allow it to slip.

Chairman

We have scheduled a session with UL and the Deputy will see that on the work programme. A number of us are concerned, among many issues, about that particular issue regarding the city centre site.

Deputy Catherine Murphy

We do not want to end up having the people here and not having that or having it a day before, which has happened in the past.

Chairman

What I would advise is that perhaps after the week after next, when we are back, that if we do not have an update by then, we should seek one. Is that okay?

Deputy Catherine Murphy

Yes.

Mr. Seamus McCarthy

Chairman, I understand that its financial statements, which we discussed previously, will be laid in the near future. It will be before that meeting, as I understand it.

Chairman

Okay.

We have dealt with the justice correspondence. The next correspondence is No. 1085B from Mr. Robert Watt, Secretary General, Department of Health, dated 17 February 2022. It relates to reports in the media of alleged recordings of internal meetings of officials in the Department of Health. The Secretary General states that they were made and released without the knowledge of those involved which has led to partial statements "that were taken out of context and also contained some factual inaccuracies". The Secretary General goes on to correct some of those inaccuracies and to clarify the Department’s position on some of the matters raised. It is proposed to note and publish this item. Deputy Catherine Murphy and I have flagged this correspondence.

Deputy Catherine Murphy

Under the mental health budget, and I am reading this from the letter, he said the actual sum initially sought by the HSE was €35 million. Can we ask for some documentary evidence of that?

On the prior adjustment, I do not know why this is addressed in this. There is an acceptance that there is prior adjustment to the 2020 accounts. He is saying it is in the range of €10 million to €100 million. That seems to be quite a wide range. It is strange to have addressed that at all.

The recruitment targets is an issue we will have to return to. It may well be that we will deal with some of that with regard to, for example, mental health in the next couple of weeks. Is the Department being set targets that it cannot meet? Is the money being provided for targets it cannot meet? If it cannot meet them, why not? It may well be that there are a variety of reasons for that. Not spending money is as big an issue where a service is required as spending money badly, so it is very much within our remit. It is certainly something we need to take a serious look at.

Chairman

With regard to the mental health budget, there is obviously a huge need in that area but, in respect of capacity, a need to use it and to deliver the services where there appears to be a gap in that. The article stated the additional money sought was reported to be €10 million. The Secretary General underlines in the letter, and seems very clear about it, that the actual sum initially sought by the HSE was €35 million and I believe the final figure was €37 million. The question is whether we have, or if there is, a copy of correspondence from the HSE where the initial sum was €35 million. Perhaps we could look for that from the Department of Health.

As regards the prior adjustment, one of the things when I saw this first in what was being published regarding the €10 million and €100 million is that it raises concerns not that we do not know the figure but that even at that point the Department or the HSE was not in a position to determine whether it was €11 million or €99 million. It seems to be an awful long way apart.

Regarding the recruitment, we need to raise questions with the Department about recruitment and the issue of the budget providing for an extra 10,000. It is the will of the Oireachtas, and the Oireachtas provided the budget. However, we have this situation. Is there a blockage or are there barriers? Is the barrier here simply that the people with the skills are not available? If they are not, the HSE and the Department of Health need to inform the Oireachtas. Members of the Oireachtas need to know if the pipeline of trained staff is not coming through the third level institutions and so forth. We can provide whatever money we wish but if we are unable to fill those positions with the necessary qualifications that is a problem. The Oireachtas and obviously the Government have to take this on board and the measures to address this have to be put in place.

From what we have seen in the last fortnight in some of these revelations, if this is actually the case it would appear to confirm some of the issues many of us have been raising over a period of time now and that we must have more longer-term workforce planning in this country or we will be unable to reform the health service or provide the service. We can supply whatever budget we wish but we will not be able to provide satisfactory services. We should request the Department of Health to explain the challenge further. Mr. Robert Watt mentions discussions between the Department and the HSE, and officials agreed that due to the current challenging recruitment environment 5,500 whole-time equivalents is a more achievable target for 2022. It is worth noting that these recruitment targets are additional whole-time equivalents and do not include the replacement of existing staff who retire and leave during the year. I noted that. However, we need an explanation of the current challenging environment and we should seek that from the Department of Health. Is it that we do not have the trained personnel coming through the institutions? Is it that people who are trained are emigrating very quickly? What percentage of them are emigrating and not taking up posts? Also, is there a problem with the posts being offered by the HSE? Are they short-term contracts and is that the reason people choose to emigrate rather than to stay and work in these positions? We will try to get clarity on that.

I call Deputy Devlin.

Deputy Cormac Devlin

I agree with the comments of the previous speakers. We must get more information anyway from it. The article was very serious and concerning, particularly the commentary that was used and quoted in the article of 13 February. In that vein, I welcome the clarity of this letter, particularly about the actual sum initially sought by the HSE, which was €35 million. While the agreed budget was €37 million, there was an additional €10 million allocated.

In terms of the clarity in respect of recruitment, we know on this committee from across the country the challenge of recruitment that is faced by industry anyway, let alone in the public sector. It is helpful that this correspondence has set the record straight, but the tone and some of the commentary of that article are concerning to say the least.

Therefore the letter itself should be published and we should seek further information, as has been requested already. Then we can take it up with the Department and the HSE the next time they are before the committee.

Chairman

We will note and publish the correspondence.

There are no other items of correspondence for consideration today. However, one matter which I would like to raise is a request we made to the Department of Public Expenditure and Reform to include the remuneration of Accounting Officers in the appropriation accounts, beginning with the 2021 accounts. We made this request in the interests of transparency and accountability and because State bodies are required to disclose similar information. I understand that the information was requested by 11 February. The secretariat followed up on 14 February to ask when the committee could expect a response but has not received a reply. With the agreement of the committee, I ask the clerk to bring this matter to the Secretary General’s attention and request that we have a response before next meeting on 10 March. Is that agreed? Agreed. We had discussed this and agreed that it should be itemised in the accounts.

The next item is the work programme. Next week, on 3 March we will have the final meeting in our series of housing-related meetings with Home Building Finance Ireland. Please let the clerk know if there are any areas of particular interest arising from Home Building Finance Ireland's financial statements in order that a briefing can be requested in advance of the meeting and the witnesses can be prepared to engage on the areas of interest to the committee.

On 10 March, we will engage with the HSE regarding expenditure on mental health services, with a particular focus on child and adolescent mental health services, CAMHS, expenditure. Last week we agreed to request a detailed breakdown of that expenditure, as well as associated governance and oversight arrangements. We also agreed to include expenditure in relation to the Owenacurra centre in Cork on the agenda for that meeting and briefing has been requested in that regard as well. On the engagement with the HSE on 10 March, we had agreed that representatives of HSE estates would be present.

The week after that, 17 March, is a non-sitting week. We had agreed to schedule a meeting with the University of Limerick on 24 March but while the president was available, the chancellor was not. We had also sought information in relation to the Department of Health and the HSE’s availability on that date but as neither are available, we need to agree how to proceed on 24 March.

The Sustainable Energy Authority of Ireland, SEAI, had been mentioned in the work programme in the context of the national retrofit schemes and SEAI grants. Other bodies on the work programme include the Central Bank and Revenue Commissioners in relation to the outstanding chapter on assessment and collection of insurance compensation fund levies. Horse Racing Ireland, HRI, and the Irish Horseracing Regulatory Body, IHRB, were also raised. We have reviewed the last meeting with HRI with a view to drafting a report but there is little of significance that the committee has not already progressed through correspondence. A further meeting with both bodies might provide additional material. There is also the Department of Education and its outstanding special report on education and training boards, ETBs. We need to confirm which we wish to go with on 24 March. Are members happy that we would arrange a meeting with the SEAI? It is accountable.

Deputy Cormac Devlin

I want to raise an area I had mentioned before, namely, the Dublin Dental Hospital. It is a long time since it was before the committee. I forget how long. Maybe the clerk or Mr. McCarthy can say.

Mr. Seamus McCarthy

I do not remember a meeting.

Deputy Cormac Devlin

That is what thought. I thought we had discussed that previously. Given the length of time, I suggest that 24 March be offered to them.

Deputy Catherine Murphy

Is there a reason apart from it not having been before us? What would be the big reason?

Chairman

Are there particular issues of concern in respect of the Dublin Dental Hospital?

Deputy Cormac Devlin

No, I had flagged it when we were going through the list of organisations last September or October. It was given the fact that it had not been here before. I take Deputy Catherine Murphy's point but we might look to see if it is a possibility if there space. The Chairman suggested Horse Racing Ireland. I have no problem with either but if there is a space, we should consider it.

Chairman

On the Dublin Dental Hospital, there is an issue with dental services across the State.

Deputy Cormac Devlin

Yes, there is an issue nationally. It is not just with it.

Chairman

The problem is that if we decide to take up a meeting with an issue in one locality, we could fill up a year on one subject alone. Do we do it on Laois the following week?

Deputy Cormac Devlin

Absolutely.

Chairman

I would like to discuss dental services in the midlands with the HSE. Unfortunately, they have collapsed, would be the best way to put it. I would suggest that on an occasion when the HSE is in, that we would flag those as particular items. To try to do a stand-alone meeting on one issue locally, unless there were a major issue to be addressed-----

Mr. Seamus McCarthy

I think the occasion that Deputy Devlin is recalling is that when its accounts and statements were presented, there may have been an issue around non-compliant procurement. However, it may not be enough for a full meeting of the committee. I think that was around September or October of last year. Even on a comparative basis, if you put them up against SEAI, the level of expenditure is four times as much. Also, even from a strategic national point of view, this morning, SEAI was mentioned and how grants for environmental improvements could have a significant impact on the rental market. There are many more issues that would arise generally coming out of SEAI.

On the IHRB, the audit of the 2020 financial statements is not yet complete. There is an issue holding it up. I am waiting for accounts to be submitted for signing. I do not think it is a candidate until that process has been completed.

Deputy Catherine Murphy

It is not that it does not merit consideration but rather whether it is sufficient for a full meeting and how it competes with other matters. We have no shortage of candidates.

Chairman

We have a long list.

Deputy Cormac Devlin

I accept what the Comptroller and Auditor General has said. It has a specific remit. I accept what the Chair said about the midlands. You could say that about any area in the country, in fairness, and it is the same for Dublin. I accept the Comptroller and Auditor General's points. If we were to include it with either the Department of Health or the HSE, in tandem as co-witnesses, that would be fine. We specifically put it on the work programme so that it was not forgotten and it is something that we should explore. The Comptroller and Auditor General is correct that it was about procurement concerns at the time.

Deputy Catherine Murphy

Could we do something on the procurement concerns? I presume we wrote to them.

Deputy Cormac Devlin

I do not think that we wrote to them. I think it was more that it was flagged at the time.

Mr. Seamus McCarthy

I do not recall a letter back from it. Certainly we could have a look at that. There is information in its financial statements about the procurement issues. Whether an amplification on that was sought I do not recall.

Chairman

I suggest that Deputy Devlin sends a note to the clerk as to the exact issue.

Deputy Cormac Devlin

I can do that.

Chairman

At the next meeting we can ask for an update on the position regarding improving procurement practices. Would that suffice?

Deputy Cormac Devlin

Yes, that is fine.

Chairman

The Sustainable Energy Authority of Ireland will appear before the committee on 24 March. The issue is timing. A lot of money has been spent on retrofitting. The grants are there. Major changes have taken place and the programme will be expanded. This is welcome but it is timely to have a look at how it has been performing until now and the value for money of the schemes. It is something that will reach into one in four households in the State in the coming years. For the benefit of members, we saw with the Residential Tenancies Board today that when items are flagged early by members they receive a better breadth of information. I ask them to send issues they have to the clerk.

On 31 March, we will commence a series of engagements on justice-related matters. Engagements have been confirmed with An Garda Síochána on 31 March and the Garda Síochána Ombudsman Commission on 7 April. Last week, we agreed to engage with the Policing Authority. The secretariat is working on scheduling that meeting for the afternoon of 7 April. We felt that boxing off a week for the Policing Authority might not be the best approach. In view of the fact that GSOC will appear before the committee that morning, we agreed the Policing Authority should appear in the afternoon. The clerk is trying to schedule that meeting at present. There are two non-sitting weeks scheduled for Easter. That has caught a lot of us because one of those weeks is before Easter. This means the following meeting will be on 28 April with the Department of Justice. We will have three justice-related hearings before and after Easter.

We have looked to engage with the University of Limerick, the Department of Finance and the Department of Public Expenditure and Reform after Easter. I have discussed UL with the secretariat this week. It has proved to be problematic to confirm a date to bring the chancellor before the committee. We have been trying to give UL as many options as possible. We will try to organise that for one of the hearings immediately after Easter.

Do members wish to raise any other matter regarding the work programme? No. We will conclude our consideration of the work programme for today. As there is no other business, we will adjourn the meeting. Our next meeting is on 3 March when we will have engagement with Home Building Finance Ireland on its 2020 financial statements.

The committee adjourned at 3.24 p.m. until 9.30 a.m. on Thursday, 3 March 2022.