Deputy Michael Lowry gave me notice of his intention to raise the matter as to the current position in respect of applications to the Tipperary Enterprise Board for grant aid under the Leader programme. Deputy Lowry has five minutes to present his case and the Minister of State at the Department of Agriculture, Food and Forestry, Deputy Hyland, has five minutes to reply.
Adjournment Debate. - Tipperary Enterprise Board.
I appreciate your giving me the opportunity to raise this issue, which I know is of particular interest to yourself, Sir, and, indeed, to all public representatives in County Tipperary. It is with a deep sense of frustration and annoyance that I again raise the issue of the administration of the Leader programme by Tipperary Enterprise Board. I will not repeat the history of this debacle. It is well recorded and documented. The last time I raised this issue in Dáil Éireann I had some harsh things to say about Tipperary Enterprise and their incompetence and negligence. It has been a shameful episode inflicting considerable grief and distress on many people. Ultimately, the responsibility for this fiasco rests with the Minister and the Department. They have been passing the buck and side-stepping the issue. The Commission in Brussels are conveniently used as pawns to deflect attention from the Department and are used regularly as an excuse for inaction.
The Minister has confirmed that the Garda were instructed to commence an investigation into suspected fraud. Did this investigation commence, has it concluded, what are the findings? If it did not commence, why not? Who stopped the investigation?
I also received a commitment that the Department would take full responsibility for resolving all outstanding claims by applicants. I was assured that this matter would be conducted expediently and sympathetically. Twelve months later the trial of broken promises and misery is stronger than ever. There are still numerous companies awaiting payment. The promoters of these projects have had their aspirations and ambitions dashed by State bureaucracy and bungling of an unprecedented nature. Their personal lives have been cruelly damaged, their very future and that of their dependent families has been jeopardised. They are the innocent victims of this tragic avoidable disaster. They are highly critical of the Department. They justifiably claim that they have been ignored, fobbed-off and in some cases dismissed as cranks because they continued to pursue their legitimate entitlements under the Leader scheme.
I have heard and read appalling stories arising from this totally unacceptable situation. The following are extracts from some of many letters I have received, outlining harrowing stories:
If the Department of Agriculture was truly and honestly concerned about the treatment we got from Tipperary Enterprise, they could have acted 12 months ago. By not acting at all they have worsened our situation to an extent that we are close to ruin. Our production plant is working for one day per week.
My personal interpretation is that the Department had no interest in bringing light into the whole story, they were not sincere in their announcement to help the victims of Tipperary Enterprise. Their strategy obviously was to wear people out so that they are in the end happy with any money at all coming from the Department.
Had the Department acted in time they not only had avoided the worsening of our financial and economic situation, they also would have avoided huge claims for compensation which will now come before the High Court.
One letter concludes:
And this is only the economic situation of our Company, not to mention the effects this all had on our personal situations. My wife developed a heart rhythm problem, depression has moved in where once was a whole bunch of energy. This nightmare has changed our personalities.
Another letter reads:
I was promised £25,000 in February, 1992 for my knitwear project. I raised and spent £42,000. They reneged on the grant. I got no money. I have three quarters of a knitwear collection which may never be finished. I have run out of money completely. My life is shattered. I am now unemployed.
Another says:
I sought £35,000 for my project. I received verbal assurances that this project had been approved and would be funded. I was told the project fitted all the criteria, and that other Leader groups had sanctioned similar projects. The money never came. Michael, I was forced to sell stock and then my milk quota. The interest charge has crippled me. I will never recover.
That is an example from the catalogue of cases I could cite.
Does the Department intend paying outstanding money and when will the rightful entitlement be paid to those unfortunate applicants? Where has the money gone which was supposed to be given out as grant aid and who were the beneficiaries? Who benefited from the fact that £500,000 of taxpayers' money seems to have gone missing? How much did the liquidator of assets realise, and who was the legal owner of the Tipperary Trading Company premises at Bird Hill? Was this building available to the liquidator as a saleable asset? How much money did the liquidator have at his disposal from the sale of assets? How was the money disbursed? What is owed to the creditors and has the money lost to the Department been recouped from the insurance fund? If not, will the Minister give a categorical assurance that the money is redeemable through the insurance company? Will he belately acknowledge that his Department exercised insufficient supervision and control and that it must ultimately take the responsibility? Will the Minister once again give an assurance that the promises made by agents acting on behalf of the Department will be honoured? Will he ensure that justice is done and bring this appalling saga to a satisfactory conclusion?
Hear, hear.
As the House is already aware, the agreement between my Department and Tipperary Enterprise was terminated on 18 February 1993 following my Department's investigation of the mismanagement of the affairs of the group. I made a very detailed statement to this House on the matter on 11 February last year.
Following consultations with the European Commission, it was agreed that my Department would take on the administration of the programme in Tipperary in so far as it related to honouring commitments made to project promoters by Tipperary Enterprise. Having regard to the rules of the Leader programme, we and the Commission agreed to honour such commitments on the following basis.
First, projects must be eligible for Leader funding and there must have been a clear commitment by the board of the company to the project. For this purpose we accepted either a written contract between Tipperary Enterprise and the promoter, a record in the minutes of a board meeting of a decision to grant aid the project or any other convincing written evidence indicating a commitment by the company to grant aid a project. Alleged verbal promises of aid cannot be accepted.
Claims for payment of grant aid would be entertained only in the case of projects which were completed or where work had actually commenced. Where work had not commenced the commitment was deemed to have lapsed and the promoter was advised to submit a new application for grant aid to the new Tipperary Leader Group.
Payments in settlement would only be made on the basis of submission of a fully documented claim showing that the work involved had been completed, that documentary evidence of payments to builders and suppliers existed by, for example, production of paid invoices, that where necessary the planning laws had been complied with, and that the beneficiaries' tax affairs were in order etc. This is the normal procedure followed by Leader groups in committing funds to projects and processing the resultant claims once the project have been completed.
This is the only practical and equitable approach which the European Commission and my Department could take to resolving the difficult situation which arose. My Department is obliged at all times to act responsibly and prudently in the administration of public funds and to verify that expenditure from public funds is justified.
Following our investigation of the company's records we wrote in April 1993 to those project promoters whom we identified as having made applications for aid to the company. In those cases where the records showed that a commitment of aid clearly existed we invited the promoters to submit a claim on the lines I indicated on completion of the project. If the project had not in fact commenced then the promoters were advised that the commitment had lapsed and that he or she should apply instead for aid to the new Tipperary Leader group.
Where no evidence could be found in the company's records of a commitment to aid a project, we invited the promoters to submit any evidence that he or she might have. There was also, at that time, one case in which legal proceedings had been instituted against the Minister.
To date my Department has paid £186,000 to nine project promoters. A further four claims are being processed and I expect that it will be possible to finalise payments in these cases in the near future. To a large extent my Department is dependent on the promoters concerned submitting the necessary documentation to enable the claim to be finalised. I should add there are a further six cases where the promoters have not, to date, submitted fully documented claims.
A small number of the cases I mentioned are particularly complicated. We are in regular discussion with the European Commission on these with a view to reaching a satisfactory resolution.
My Department has acted sympathetically and as helpfully as possible towards the promoters involved, within the constraints placed upon us. Where promoters submitted all the necessary documentation we have made payment as quickly as possible. Where it has not been possible for my Department to establish that a commitment was made to a promoter, either through our own examination of the company's records or where the promoter has been unable to establish such a commitment himself, the Deputy will appreciate that my Department has no authority to disburse public funds. Where this is the case we have encouraged the promoters to submit applications to the New Tipperary group.
In conclusion I want to reassure Deputy Lowry that sufficient funds exist to meet all valid claims that may be made to us.
Will the Minister inform me in writing of the response to my questions and what happened to the Garda investigation?
The Minister's reply concludes the dabate at this time.