asked the Minister for Finance the procedures that exist within his Department for monitoring public expenditure; and if he has any proposals to change those procedures.
Ceisteanna—Questions. Oral Answers. - Public Expenditure Monitoring.
1.
A continuous monthly expenditure monitoring system has been in operation in the Department of Finance for almost 20 years. The purpose of the system is to provide up-to-date information on expenditure trends both capital and non-capital. This enables the Government to track potential budgetary variances from an early stage in the financial year and to take corrective action when necessary. At present, under the improved arrangements which have been in operation over the last two years, at the beginning of the financial year, each Department compile a profile showing month by month how they intend to spend their approved budgetary allocations, both capital and non-capital. When these profiles have been approved by the Department of Finance, they provide the framework for monitoring expenditure trends during the year. The spending Departments report each month to the Department of Finance on how actual expenditure is progressing by reference to the profiles. This information is incorporated in monthly budget trends reports prepared by my Department for the Government.
The effectiveness of the monitoring system has made an important contribution to ensuring that overall budgetary targets for public expenditure in recent years have been adhered to. The monitoring arrangements are reviewed from time to time, however, to ensure that they continue to generate good quality information on expenditure trends. In this regard, work is proceeding in my Department on computerising the processing of the monthly returns.
The Minister has pointed out that there has been a monitoring procedure in his Department for 20 years and suggested that this is now being computerised and I should like to know if he will explain to the House why the Government have found it necessary to appoint a committee, under the chairmanship of the Minister for Defence, not Finance, to monitor public expenditure in the fashion which has always been the responsibility of the Minister for Finance.
The last matter raised by Deputy O'Kennedy does not have anything to do with the subject matter of the question. It does not have anything to do with monitoring expenditure.
I should like to refer the Minister to statements issued last week through Government spokesmen to the effect that a committee of the Government, under the Minister for Defence, was being set up to monitor public expenditure. Is that not an indication that the Government have found that the Minister for Finance is ineffective in his job in his Department? Will the Minister indicate the role of the committee under the Minister for Defence in terms of monitoring public expenditure or will he repudiate what has been said by a Government spokesman and reported in at least three newspapers last week?
It falls to me to say — I say it with every confidence — that the Government have, I think I may say, complete confidence in the Minister for Finance in so far as the discharge of his functions in relation to public expenditure are concerned. I should point out that the Government would be confirmed in that view by looking at how things have progressed since 1980 and particularly in each year at the difference between the original budget figures and the final outturn figures at the end of the year. We have enormously improved budgetary forecasting and we have also demonstrated that if Governments wish to do so they can ensure that expenditure remains on target. That is the purpose of the process which was the subject of my answer. The job being done by the committee referred to by Deputy O'Kennedy, under the chairmanship of the Minister for Defence, is a completely different job. It illustrates how the Government take very seriously the principle of collective responsibility. It is one manifestation of the Government's intention to review critically all areas of public expenditure to ensure that taxpayers are getting good value out of the way the Government spend their money.
The Minister is not prepared to indicate how the committee will monitor public expenditure beyond making the general statement that it is in line with Government policy. In view of the provisions of Article 28.4.3º and Article 28.7.1º of the Constitution which clearly imply that the control of public expenditure is a matter for the Minister for Finance, does the Minister not acknowledge that this seems to suggest that the Minister is not effectively discharging his responsibility in the view of the Government? Will the Minister agree that it is totally unprecedented to have any Minister other than the Minister for Finance, and his Department, monitoring public expenditure? Will the Minister comment on the fact that the role of the committee, as stated by the spokesman, is to effect savings in view of the fact that already the budget will be off target by £50 million due to wrong projections for unemployment benefit and the impact of the consequences of the Government's dollar borrowing policy?
The setting up of the committee does not suggest any of the things which Deputy O'Kennedy in his wistful wishful way has suggested. The setting up of the committee does not in any way interfere with or cut across the statutory and constitutional duties of the Minister for Finance. For Deputy O'Kennedy to try to suggest otherwise is, I suggest, downright plain mischievous. The function of the committee is completely different. Its function is to review overall public expenditure with a view to ensuring that we find ways of making certain that the taxpayer gets good value out of public expenditure. It is a completely different matter altogether and one on which the Government are properly taking a collective view. Deputy O'Kennedy is barking up the wrong tree. The claim he makes about the budget being off target at this stage is not justified by reference to any other matters he referred to. It might be interesting to give the figures. The difference between the budget projected expenditure and the final outturn on the current side in 1980 was £186 million; expenditure was £186 million over the projected target. In 1981 the difference was £397 million. In 1982 expenditure was £92 million below the budget target. In 1983 current expenditure was £8 million over the budget target and in 1984 current expenditure was £57 million below the budget target. That indicates clearly that I, and my Department, in the exercise of our control functions in relation to public expenditure have been discharging that duty with an improved degree of effectiveness over the past two years.
I should like to ask a further supplementary.
This would be all very interesting to read in the budget debate which is going full steam ahead.
My question arise from statements made by Government spokesmen on this Cabinet decision. What the Minister presents as progress means that we have the highest budget deficit target and I should like to ask the Minister if that means that we have the highest budget deficit target already of £1,234 million and the highest on record in terms of GNP percentage. Will the Minister acknowledge that £50 million is the figure being mentioned in comments on the committee? Will the Minister agree that the only way the Government can reach that £50 million which is a consequence of his wrong calculations on unemployment and borrowing is to cut back on normal services, be they social welfare, health or otherwise that were originally sanctioned in the Estimates published——
That is a very general question that could not possibly arise here.
It does. It is monitoring public expenditure.
It is about procedures here and the Deputy is now going into items of the budget.
Would the Minister guarantee to the House that the monitoring would not involve further cuts, in addition to the savings of £28 million already announced since the budget on essential services, be they educational, social or economic?
I feel that I would be in difficulty with you, Sir, if I were to answer that question. Deputy O'Kennedy is now raising as many hares as he possibly can because he has realised that his original question was ill-advised and ill-placed.
Not a bit. I do not need a lecture from the Minister.
The Deputy will get one every time he sticks his head out.
The Minister should do his job.
We have only speeches and then lectures from the other side, but one begets the other.
It makes life very difficult for you, a Cheann Comhairle.
It makes it impossible, Deputy. I would not like to see Deputy Flynn up here from his own place.
I could handle them for you, a Cheann Comhairle. The Ceann Comhairle is not tall enough to look into the Minister's eyes.
He can look me straight in the teeth.
Sometimes.
I should put my questions to the Minister for Defence. He is in charge of the Department now.