Vol. 411 No. 1
45 Mr. Pattison asked the Minister for Energy if, in the light of recent scandals, he will outline the steps he has taken to review the codes of standards governing members of State boards under his control; and if he will make a statement on the matter.
47 Miss Flaherty asked the Minister for Energy if, in view of the recent concerns about managerial practices in semi-State companies, he has reviewed structures and regulations in the semi-State companies under his Department; and if he has satisfied himself that monitoring by his Department is adequate.
88 Mr. Shatter asked the Minister for Energy if he will outline in relation to each State and semi-State company under the aegis of his Department the companies which have a code of conduct delineating the activities which board members and employees of such bodies can engage in to ensure that an actual or potential conflict of interest does not arise vis-á-vis their duties as members and/or employees of such State bodies and other activities; the way in which this code of conduct, if any, is monitored by his Department; if he will make available in full, any such code of conduct stating the State and semi-State bodies to which it applies; and if he will make a statement on the matter.
I propose to take Questions Nos. 45, 47 and 88 together.
The legislation and, where relevant, memorandum and articles of association governing the State-sponsored bodies under my aegis set out the accountability, control and methods of reporting of the boards of these bodies. The legislation stipulates that for items such as major capital expenditure, increases in borrowing limits or the establishment of subsidiaries, the prior sanction of both the Minister for Finance and myself is required. In the case, for example, of legislation in respect of the Electricity Supply Board, Bord na Móna, Nuclear Energy Board, Coillte Teoranta and Bord Gáis Éireann these matters were recently brought before the Houses of the Oireachtas for passage into law.
The question of managerial practices and codes of standards in State-sponsored bodies are matters for the boards and senior management of these organisations. I am aware that these matters are fully addressed through a combination of requirements of legislation, provisions in memoranda and articles of association and systems of codified company circulars. These codes of conduct set out standards, authority levels, systems, procedures and controls which govern all matters of financial control, accounting, procurement, contracting, income and expenditure control.
With regard to conflicts of interest at board level, the boards of the Energy State-sponsored bodies apply the following broad rules: where any board member, otherwise than in his/her capacity as a director, is in any way whether directly or indirectly interested in a matter he or she shall at the meeting disclose to the company the fact of such interest and the nature thereof. The board member shall not take part in any deliberations of the meeting relating to such matter save to the extent as the chairman may permit. In such instances the board member shall not vote on a decision relating to the matter. Any such disclosure shall be recorded in the minutes of the meeting.
I have no reason to doubt that the legislation governing these bodies together with their internal systems of control are adequate with regard to the Energy State-sponsored bodies.
I would not wish to prejudice the proceedings of the various inquiries currently underway other than to say that any improvements in this regard which comes of these inquiries will be implemented by my Department.
A review is currently being carried out by the Minister for Finance concerning the principles which govern the relationship between Departments of State and the State-bodies under their aegis together with subsidiary and associated companies which take account of the procedures at present in place. I expect that this review will be completed in the near future and I am open to any suggestions for improvement in this area. My Department have examined recently the arrangements in place in relation to each of the State bodies concerned and are not aware of any incidents which give rise to concern. Nevertheless, I am conveying to the chairmen of each State-sponsored body under my aegis the Government's concern and requesting a written assurance that the desired standards of conduct and the highest levels of personal integrity are being followed.
I note from what the Minister has said that he is carrying out the review. May I ask him in that context if he considers that it is within the code of standards that board members of State companies may also be members of boards of subsidiary companies of the main State company, having regard to the fact that as members of the State company they receive a fee of approximately £800 per annum and in some cases as members of the subsidiary board they may receive fees of £5,000 per annum? I would like the Minister's view as to whether that is within the code of standards as he would like to see it.
As the Deputy is aware, it is only in recent times that legislation has been enacted here which empowers semi-State bodies, certainly in the energy area, to form subsidiary bodies, and some of them have done so. The practice to which the Deputy referred of appointing persons to the subsidiary boards, be they directors of the main board or senior management of the company, has resulted in a position where some of the controls that apply to the parent board, the semi-State body, may not in all cases apply to the subsidiary body. This is a matter which is at present under examination. The instance given by the Deputy of directors of subsidiary boards being paid sums in excess of that which is allowable to the parent company is a matter about which I am concerned and I am having examined at present.
Has the Minister investigated in particular the allegations or questions raised in relation to Bord Gáis Éireann which have an enormous land bank in the city of Dublin, and their relationship with NCB?
If the Deputy wishes to put down a specific question in relation to any specific matter that affects any of the boards under my control as Minister for Energy I would be very pleased to answer the question in the Dáil. I am not aware of what the Deputy is seeking to get at. If she is more specific I will try to be helpful.
The Minister indicated in his earlier reply that he had reviewed all the bodies under his control. Perhaps he has not been reading the same paper as I have but certainly public concern has been expressed and indeed Bord Gáis Éireann have publicly given an explanation of NCB's role in relation to their land bank. I am asking whether the Department have considered this matter in the context of the general review referred to by the Minister. I am stunned if he is unaware of it. Is the Minister satisfied that everything in that area is above board?
I am glad the Deputy has explained the matter. I would like to explain to her that because I read things in the papers does not mean I always accept them as fact. I only have to look at the front page of this morning's Irish Independent to check on that matter. The matter which the Deputy has raised has been brought to my attention. I have inquired about it and I am satisfied through my investigations that it does not require any further examination by me.
A Cheann Comhairle——
I want to get on to other questions. It must be a brief question, Deputy Flaherty.
In view of the substantial value to the State of the property and assets of the agencies under the control of the Department of Energy is the Minister satisfied that there is sufficient State representation on boards and that those who are representing our interests are adequately trained and briefed to be able to monitor in our best interests the issues that arise?
On boards?
Yes, and as regards reporting to the Department.
In regard to board appointments on which I have had to make a recommendation or a decision, I have always sought to appoint people whom I thought had special skills or ability which they could bring to the board, and I have done so to the best of my ability across the political divide.
