Dormant Accounts (Amendment) Bill 2011 [Seanad]: Second Stage (Resumed)

Question again proposed: "That the Bill be now read a Second Time."

I welcome many aspects of this Bill, which contains many important provisions. I want to highlight the decision made to dissolve the Dormant Accounts Board and transfer of its functions and capacities back into the Department of the Environment, Community and Local Government. In this era, when we need to ensure taxpayers' money is spent as well as possible, such moves must be welcomed and form an essential part of what Fine Gael said it would do at the last general election.

In making this change, we must acknowledge the work the board was doing is not going to go away. The work was crucial for the implementation of the spending of dormant accounts in that area. It is important we ensure that work continues from a different place in the Department and if needs be some of those involved in doing the work will have the opportunity to continue that work, albeit in a different place. We can make the mistake in dealing with rationalisation of State bodies of assuming that because the body will not be there in the future, the work it did was unnecessary or will disappear. The work will continue, it just must take place elsewhere.

I also welcome the focus in the Bill on the Minister being compelled to draw up an action plan each year on the use of dormant accounts. This is similar to some arrangements already in place on the use of disbursement schemes and putting together these plans will be done in consultation with other Ministers. It is my understanding that a copy of the plan and a document supporting it must be laid before the Houses and I hope that will offer an opportunity for us to debate it.

I say that because we are all aware of the great work the board has done in our constituencies and the activities it has funded. It is important that use of money, where it is coming from and how it is spent are maintained and that we ensure the activities funded by the board in the past continue to receive funds regardless of how the new scheme is implemented and regardless of where it is sourced from.

My constituency colleague, Deputy Maureen O'Sullivan, asked a question about the status of the dormant accounts inspection reports, their contents and if they would be available to the Minister. The answer indicated there were no plans to publish the reports and that the Minister himself, at that stage, had not seen the report. I believe that report contains information on the number of different institutions that participate in the dormant accounts fund and the contribution they may or may not have made to that fund each year. In the context of this Bill and the work of the Dormant Accounts Board being moved back into the Department, I want to see this being reviewed and looked at. It is appropriate that citizens have an understanding of where the money is coming from, who is contributing it and, in the context of taxpayer investment in the banking system, access to it. Also, the variety of institutions that are capable of contributing to dormant accounts is larger than we would suspect. It would be helpful for evaluating the operation of the scheme and in the name of transparency that these reports, or their main conclusions, be made available to the public so people can understand where the money comes from and who contributes what. I understand some of the reluctance around the publication of the reports might involve the fact that they are produced as part of the regulatory role of the Central Bank. If aspects of them are commercially sensitive or that might impede on the ability of the Central Bank to deliver its regulatory role, I would still hope other parts of the report, particularly on who is contributing what and where the money comes from could be published.

Credit unions do not contribute to the dormant accounts fund. There were good reasons for this at the time and I understand that at the moment the credit union movement faces many challenges of its own and is looking at changes that will take place in its structure and regulation. At the very least, given the change that is taking place on policy on dormant accounts, this should be reviewed to understand if the decision that was made by the then Minister for Finance, Charlie McCreevy, is still the right decision and if not, why not. Looking at this from outside the sector that manages dormant accounts, if a particular form of account, regardless of where it is held, meets the definition of dormant as laid down in legislation, I cannot see why that money cannot be sourced from any institution, credit union or otherwise.

I ask the Government to consider the provision on what happens to funding if it has not been claimed in an account after a certain period of time. As this Bill moves through the Dáil, I would like to find out if the money reverts back to the State if it is not used in the dormant accounts fund or lies in a dormant account beyond a certain period. I am unsure where that stands at present.

A feature of the Bill is that all of the powers of the Dormant Accounts Board are being moved back to the Department and the Minister. If other sources of funding become available in the future, I would like consideration to be given to providing the Minister of the day - by means of the introduction of a statutory instrument under the provisions of this Bill - with the ability to classify particular accounts and stores of wealth as meeting the definition of what constitutes a dormant account. He or she would then be able to bring such accounts or stores of wealth within the framework of dormant accounts and trigger the steps that are necessary for the money they contain to be spent in good ways across different communities.

As stated at the outset, I welcome both the measures contained in the Bill and the steps the Minister will be obliged to take to ensure the work being done in this area will continue. I touched on four areas which, in the context of the legislation and the change that is going to be taking place with regard to how dormant accounts are dealt with, I would like to be the subject of discussion. One of the points I raised relates to what will happen to the moneys involved after a certain period and I would appreciate some clarity on this.

My contribution will be quite short because, relatively speaking, this is quite an uncontroversial proposal and one which deserves our support. Before I outline the single net point I wish to make, I endorse what Deputy Donohoe just stated in his characteristically clear and thoughtful way in respect of transparency. The Deputy made a very strong point on the reporting requirements. Where information cannot, should not or will not be placed in the public domain, best practice should be to make the reasons for this public. I accept that when one is providing such reasons, it is often possible that one will, quite unwittingly, reveal the actual information itself. I am of the view, however, that best practice should be to publish and be damned. If it is not possible or appropriate to reveal information, then the public and the Parliament should be informed as to why that is the case.

It is hardly controversial that the process relating to dormant accounts should be subsumed within the Department in order that it will fall within the remit of the Minister of the day. The question that arises for me relates to the rationale behind giving responsibility for this process to a separate agency in the first instance. As the Minister and Deputy Donohoe stated, namely, that in light of the current economic crisis and the financial pressures relating thereto, it makes sense for bodies to either be merged or to be subsumed within their parent Departments. Perhaps when he is replying, the Minister might indicate the rationale for establishing the Dormant Accounts Board in 2001. In my limited research on this matter, I have not been able to discover the nature of that rationale.

The work of the Dormant Accounts Board relates to the management of the fund and to the disbursement of moneys therefrom to different Departments. As the Minister outlined with great clarity, we must remind ourselves that the accounting approach taken to these moneys when they are being disbursed is that they are liabilities of individual Government Departments and recovery is made later by the Exchequer from the dormant accounts fund. At virtually all stages, this appears to be a Government activity. I have no wish to seek an inquiry with regard to what happened ten or 12 years ago, although such an exercise might be interesting. I am merely seeking to understand the rationale for placing responsibility for the dormant accounts fund with an outside agency. In turn, this will allow us to understand whether it makes sense, as seems to be the case, to take the fund back within the control of the Department.

In fairness, when welcoming the introduction of the Bill, Deputy Niall Collins of Fianna Fáil stated: "For too long my own party was at the forefront of diverting decision making from the relevant Ministers towards third-party quangos." That was a refreshing statement on the Deputy's party. Perhaps the Minister, when replying, might outline the position in respect of this matter. I accept there might have been governance reasons for bestowing responsibility for the dormant accounts fund on a separate agency. I do not have sufficient expertise to know whether such reasons exist or whether we might just be missing something. We are engaged in laudable efforts to reduce the number of quangos that exist and to rationalise the position in respect of the diffusion of powers across the public service in respect of the implementation of policy. Everyone understands and agrees with the need for this, particularly in light of current economic circumstances. However, it might not make sense to take the type of action envisaged in the Bill in every instance. It appears it makes sense to do what is envisaged in this case but perhaps the Minister might take the opportunity to indicate whether any governance concerns arise. Perhaps those concerns are to be found in the historical background to the establishment of the Dormant Accounts Board ten or 12 years ago.

The Bill is clear in its intent. It involves the transferring the function relating to the dormant accounts fund to the Minister. It is easy to see how this will be done. Effectively, the Minister will assume responsibility for the fund and the Dormant Accounts Board will be abolished. The Bill indicates the various assets and liabilities involved will be taken over by the Department. I presume this includes staff, etc. and that it will, perhaps, lead to savings being made in respect of premises. In view of the fact that what is being done has been presented as an exercise in economics, will the Minister indicate the net saving to the Exchequer from the abolition of the board and the transfer of its functions to the Department?

As stated, what is being done makes sense. However, we owe it to those whom we represent to delve slightly deeper in the context of whether there were any issues which encouraged the then Government to give responsibility for the fund to a separate agency in the first instance. I accept such concerns could have been misplaced, but equally they may have been well-founded. All I am seeking is an indication as to what they might be.

I welcome the Bill. The key question in respect of it was asked by Deputy White, who inquired as to why the Dormant Accounts Board was established in the first instance. The Deputy was too polite to answer that question or even to make a political point in respect of it. However, he pointed us in the direction of realising that this particular body was unnecessary. There was an extraordinary proliferation of bodies which were not necessary in or around 2001, when the Dormant Accounts Board came into being. The then Fianna Fáil-led Government was flush with money and was very happy to set up a large number of bodies, similar to the board, which were not necessary. Between 1997 and 2007, Fianna Fáil-led Governments established well in excess of 200 bodies. It is doubtful whether many or any of these were necessary. It seems there were reasons for each of them but not good ones. This is, I hope, the first of a number of such Bills which the Government will introduce to abolish unnecessary quangos set up for reasons which are quite apparent now. In the case of the Dormant Accounts Board, a large sum of money was spotted as being available in dormant bank accounts. Politicians, being as they were at the time, regarded this as fair game for distribution in a way which they found would be convenient, suitable and politically advantageous.

The Dormant Accounts Board started off with a significant inflow of approximately €200 million in 2003 which, according to the latest accounts, has been depleted to between €30 million and €40 million. It will obviously be reduced to zero. If this is the beginning of a quango cull by the Government, it is a welcome move. Deputy White asked how much will be saved but it will be small. My concern, therefore, is that this may just be a nominal and token attack on these unnecessary bodies while the majority of them will remain. I remind the Fine Gael Party that in 2008 it issued a good paper which identified Ireland as the land of 1,000 quangos. Now that it is in government, the speed at which it is removing them is extraordinarily slow. If this is the start, it must be welcomed, however. I hope there will be a concerted attack on unnecessary State bodies from now on.

The argument that these moneys could have just as easily been managed by the Department is unanswerable. The procedure for distributing these moneys was that the Dormant Accounts Board produced a plan which went to the Department, then to the Minister and finally to Cabinet. It was a way that allowed the then Government and politicians to get their hands on small sums of money, in terms of the overall position, but large if they could be used for political advantage and targeting certain areas under the guise of going to particularly worthy projects. We must be careful when we see, as in this case, large sums of money being targeted at what are obviously good causes. They could be done by those who are not politicians and who can claim credit for them. One defence the national lottery always puts up when it comes under criticism for its operations being too costly is the do-not-touch-me-when-I-have-got-the-baby-in-my-arms defence. It points to all the good it does when it puts in front of its critics the extraordinary and worthy projects it supports. What it does not look at is the cost or, in fact, the provenance of those who pushed the money in that direction. The dormant accounts fund was a means of putting large sums in the hands of politicians to distribute to their political advantage. I welcome the fact the Government is putting a stop to this.

The late Jim Mitchell, Deputy Donohoe's constituency and party predecessor, called the Dormant Accounts Board, when he was in opposition, the ultimate quango when it was established in 2001. Charlie McCreevy, the then Minister for Finance, said it was not as the board would operate at arm's length. No quango operates at arm's length. What happens is the body operates under the watchful eye of a Minister who ensures it operates to his advantage and decides who is on the board. To have a body like this with a board in 2001 might have been easy for the State to finance as we were moving into a period when enormous sums of money went through the Exchequer. The board of this particular body has been treated the same way as any other body.

I know I am not meant to mention names and I will not. However, the last Dormant Accounts Board was certainly full of the usual suspects, identifiable by their membership of and commitment to Fianna Fáil. On the last board, there by right, was a conglomeration of the usual social partnership junkies who were appointed because they delivered the national pay deals on time, such as IBEC and ICTU. This board then delivered for the Minister. I will not name those on the last board who fitted into this description but they were there. They were the same suspects one gets on other State boards. They are professional State board officeholders who are rewarded with small sums, €7,000, a year. If one gets enough appointments, however, they become large sums. There were people on this board who were planted there as a reward or to do the Minister's bidding.

Apart from the social partnership appointees, there is at least one who I spotted immediately as a Fianna Fáil activist, which is never mentioned in his CV. There is another who is not only the chief executive of the Irish Banking Federation but was formerly the general secretary of the Fianna Fáil Party. It was and remains a disgrace that these boards are treated in this way by successive Governments. One has to be suspicious that the specific reason this body was set up was because there was money available that could certainly fund looking after a fewprotégés of the Fianna Fáil Party. The only reason the Dormant Accounts Board was set up was that the fund provided sufficient funding for that and a great cover for those people who had to be looked after by the Government in power at the time.

At the end of the day, it was the Minister who made the decision as to where this money went and he, or someone in his party, got the credit for it. It is very sensible to abolish the Dormant Accounts Board for that reason and now that the fund is so small it can certainly be administered by the Department. The Act actually states the board can provide independent advice to the Minister as to where the moneys will be distributed. No board appointed by a Minister with the same colouring as this one, what with a Minister's favourites andprotégés, can provide independent advice. The advice such a board provides is the advice the Minister requires. That is why they are there. The way Ireland is, they always get reappointed.

On top of that, this particular body used a public relations company specifically identified with the party that was in power at the time. Let us not look at it then as some sort of little benign State agency or authority. It was a State agency which was used for party political purposes. I hope this will not continue under this Government. One reason this board is being abolished, which I welcome, is because the Government wants to send out a strong signal that this type of patronage and cronyism is now over. I say that more in hope than expectation but it would be a welcome sign if that happens.

I note the money will be given to the National Treasury Management Agency in the meantime, with a certain amount kept on deposit to meet various claims that may be made by dormant account beneficiaries. What is the infatuation in this and the last Government with the NTMA which is, after all, a State monopoly, a super-quango, full of people appointed, continuously and historically, on the same basis as those appointed to the quango we are now abolishing? The NTMA, to which the money will be given, would be held in far higher esteem if it was not used as a slot for the followers of the political party in power. Let us not be too starry-eyed about it or talk off the tops of our heads as if we knew nothing about it, which is what people tend to do. We should not see it as a God, an icon or a deity in the financial firmament of the State. Successive Taoisigh and Ministers for Finance have paid tribute to its work month after month, year after year without knowing what they are talking about. They have not made a proper analysis of what goes on, as the results produced by the NTMA with this fund are laughable. I examined the return some months ago and it had produced no performance assessment. The results produced by it with other funds are nothing like as good its spin. It is receiving these funds, but in gauging its performance one should not measure it against the National Pensions Reserve Fund, although some like that comparison.

NTMA officials repeatedly appear before Oireachtas committees, brief the press and tell Ministers of Finance and Taoisigh - who know no better - that it beat the average Irish pension fund by a certain percentage. They are dead right and Ministers for Finance swoon with admiration. What they do not realise is that the average Irish pension fund is the worst performer in the world and the NTMA is setting itself against a benchmark that is so bad a babe in arms would have beaten it. A monkey throwing darts at a target would beat the benchmark. Therefore, we should not be starry-eyed and assume the money is safe in the hands of the NTMA. It is in the hands of a body which, if compared to other bodies, does not perform particularly well; it is not the worst, but it is certainly no star. When it sets itself against the benchmark set by the National Pensions Reserve Fund, it seems like a big star because it is competing against the worst in the world.

Figures have come from the NTMA for the salaries of its top people and they are absolutely disgraceful. I am surprised the Government has continued to tolerate these figures and fees. The chief executive has taken a cut, but it is not nearly enough and he still receives a banking-type salary for a moderate performance. We all know bankers are paid far too much, but the head of the NTMA received a salary of €495,000 up to last year and we knew this was far too much. The NTMA is part of the banking bonus culture, to which we thought we saw an end, and although it has suspended the payment of bonuses for one year, it gave them when the banks gave them, despite a very moderate performance.

When the Minister of State considers this issue, will she indicate if this is the forerunner to a process to abolish many of the quangos? The Labour Party's colleagues in government promised that they would be culled, abolished and reduced. This should not equate to half a dozen being eliminated or lead to the creation of more quangos. This should be the forerunner to a logical forensic examination and analysis of some of the quangos which are much bigger than the one with which we are dealing. It should also mean we will no longer be frightened to criticise those icons which have frightened or dazzled us. The Minister and the rest of the Cabinet should examine the National Treasury Management Agency with a critical eye and not be besotted by the figures it gives. We should know when something is wrong and there is underperformance. The NTMA is an icon which deserves criticism, as it does not stand up to normal performance criteria. If that is the spirit in which the body dealt with in the Bill is being examined and abolished, I welcome the legislation.

Tá mé buíoch go bhfuil deis agam labhairt ar an mBille tábhachtach seo. Níl mé i gcoinne bunaidhm na reachtaíochta, ach ní aontaím le roinnt de na forálacha atá inti. Measaim go bhfuil sé ag dul sa treo mícheart.

During the years funds from the dormant accounts fund and the work of the Dormant Accounts Board have benefited many communities, especially those in areas which are socially and economically disadvantaged. There are many projects and programmes which have benefited from the grants paid which nobody would dispute, although some of the reasoning behind the refusal of applications of some groups has been questioned. In the main, however, the funding from the dormant accounts fund has had a positive effect on communities in helping projects and schemes to get off the ground and allowing others to develop. This occurred in an period when other funds were available, but we are now entering a different era. The bulk of the money in the dormant accounts fund has been expended and is no longer available for disbursement. This Bill changes some of the nature of the original ideal behind the dormant accounts process. I have some sympathy with those who wish to get rid of the dormant accounts board and see that responsibility ceded back to a Department and Minister but it is not the correct step. A board like this dormant accounts board should be in place, although the members should not be paid; instead, it should be an honour for people to serve on it. There is an example of how that facility has worked, with community participants, elected representatives, council officials and gardaí attending joint policing committees. They discuss policy and take decisions but nobody is getting paid specifically to sit on those board. There is not a significant administrative cost either, so it is an example of how we could have a more democratically reflective board to deal with dormant accounts. That is in preference to ending the process completely and ceding the responsibility to a Minister, leaving that Minister open to the accusation that the fund would become a ministerial slush fund. If the Minister intends proceeding that way, an Oireachtas committee should have oversight or at least should have to be consulted by him or her prior to making a decision or the committee could make the decision which would be rubber stamped by the Minister. That would allow for the transparency everybody seeks and prevent a single vested interest taking the decision, thereby dismissing charges of political favouritism that could be levelled. For example, when Ministers had the opportunity to administer grants under the sports capital programme, their constituencies benefitted much more than others. I do not have an expertise in this area but I read about these charges being levelled against some Ministers. The Minister should not open up that possibility. At the very least, therefore, the Oireachtas should have oversight of the dormant accounts fund through a committee or, preferably, a stand alone body should oversee the fund but it should not pay the attendance fees of its board members. People who are grounded in the community and who have expertise will, hopefully, offer their time for the benefit of their communities. The reason the fund was set up was to use money in dormant bank accounts, which was only benefiting the financial institutions, for the good of all. That is why I support the ideal of the fund. If the board comprised volunteers who were not paid fees, the membership could rotate and three-year terms of office could be used rather than five years. That would provide for through flow in expertise that would reflect the different fields covered by the grants and the population spread in Ireland, which is important.

Deputy Ross raised the question of the NTMA controlling the fund. The Minister should invest the money in An Post savings bonds rather than use the NTMA as the holding company for the fund, as this would boost the assets of An Post. Somebody who invests in one of the company's savings accounts is better off than those who invested in NTMA pension funds, which are under severe strain. The savings accounts yield a greater return with the NTMA not being as effective in using moneys invested with it to generate a good return. The agency may be good at managing money but it has not generated great returns for the Government. The money from the dormant accounts fund could also be invested in Government bonds which would be cashed in as required. Last year, the national solidarity bond was announced and money could be invested in that, although it is managed by the NTMA. If the money was invested in Government bonds, it could be drawn down as required when grants are paid out.

While my concerns are minor criticisms, I do not oppose the Bill. The amount in the fund is reducing and I wonder whether the fund could be enhanced. How could we boost this fund to address shortfalls in funding of community groups, in particular, and other projects in disadvantaged areas? Money confiscated by the Criminal Assets Bureau or the courts is diverted to the Exchequer because it is treated as revenue when, in fact, it is the proceeds of crime following the sale of cars, yachts and houses. I have argued with previous Ministers about this but they said such moneys could not be ring-fenced. However, I have proven that this is done. For example, the plastic bag levy is ring-fenced for environmental purposes. CAB confiscated moneys should be diverted to the communities most affected by crime. In most cases, these are disadvantaged communities. This pot of money could be transferred to bolster the dormant accounts fund and enable it to fulfil the role it was established to play.

In addition, judges often direct that money be put in the poor box. While this is administered by the Courts Service and a number of charities benefit, this process is not transparent and we do not know where the money goes. The charities that benefit know, but if this money was transferred to the dormant accounts fund, it would be recognised publicly. If the money was transferred to the fund, it could be administered openly to the benefit of all.

This is not a contentious Bill but I am adamant that a Minister should not have it within his or her gift to administer the fund. The pot of gold available to community groups in recent years has reduced and it looks like the finance available to them will be restricted for another few years. This means they have had to cut back on programmes and they have been forced to scour everywhere for money for summer projects for senior citizen outings, further education, keep fit groups etc., and for the refurbishment of community halls and so on. Previously, they could access money from local authorities or the sports capital programme but this funding has been squeezed repeatedly. If the dormant accounts fund was enhanced in the ways I suggest, that might restore the faith of some struggling communities. They have to fund raise among their own people who have been hit in their pockets through increased taxes and the increased cost of living. Many community organisations have had to scale back their hours and the opening times of their centres or had to cancel projects altogether. That is why I support an enhanced fund to ensure the community programmes administered by various Departments can be fully funded as they were previously. I appeal to the Minister to find additional sources of money, ring-fence them for the dormant accounts fund and keep the money on deposit with An Post. This would benefit the company, as its balance sheet has been struggling. It would be nice for An Post to have this pot of gold on its balance sheet and, therefore, there would be a double benefit. It would also take some of the pressure off the NTMA, which has not been delivering in terms of returns on other investments it has been asked to deliver upon.

I hope the Bill will be altered on Committee Stage to reflect some of the points made by other speakers but also to reflect some of my points. It could never then be levelled at us that we put together a Bill which ended up doing exactly what it set out not to do, namely, promote political patronage. We do not want that, and it is one of the criticisms the Dormant Accounts Board had levelled against others. We want to make sure that whatever happens here is as transparent as possible and that this is not a political slush fund for whoever is in government to disperse in specific constituencies or on specific projects for electoral purposes. This area is too important for that.

The fund is to address disadvantage, and I do not mean disadvantage that emerged this year or last year. Some of the areas that have benefited in a small way from the moneys in dormant accounts have been disadvantaged for many generations. While this pot will not solve their problems and will not address all of their issues, it might help with some of the smaller issues or give a leg-up to some of the projects and schemes, whether it is a case of educational schemes, after-school clubs, crèches, school arts and music programmes which try to lift an area in general, or the whole range of other programmes which have been affected.

In my area many people have benefited and have been very welcoming of this fund, and they were concerned about what would happen when the fund ran out. This is why I suggested the use of CAB moneys, court moneys or a similar, once-off pot of money that had not been accounted for in the past. For example, the DIRT inquiry brought in a lot of money. When money comes in which is outside the normal, it should be ring-fenced and used for abnormal projects. These projects are abnormal because they are addressing key problems and key areas of inequality in our society, which is a good thing. I hope the Minister will reflect on the points I have made.

I will begin by responding to one point made by my colleague Deputy Ó Snodaigh. For many years, I have heard about the diminishing amount in the dormant accounts fund. I can never understand this. Dormant accounts, as the description entails, should mean they are accounts that become dormant in the natural course of events over a period of years. However, that should be an ongoing development and this should not only apply to last year, five years ago or ten years ago. However dormant accounts occurred, the same occurrence must continue into the future, unless there is some point I do not understand.

I raised this issue previously by way of parliamentary questions in recent years. While the replies to those questions stated the funds accruing from the dormant accounts were diminishing, I still do not understand how this could be. Dormant accounts occurred as a result of people being untraceable and their accounts falling into the hands of the lending institutions at a time before the Dormant Accounts Board was set up by the State. I was a member of the Committee of Public Accounts at the time the investigation took place which was the foundation of, and as a result of which agreement was reached on the setting up of, the dormant accounts fund. I agree with other speakers that a great deal of very useful work has been carried out through the funding that came from that body over the years. However, I must return to my original point. If accounts became dormant during, say, a ten year period in the 1980s and the fund then grew in the 1990s, which would have happened unless moneys were disbursed to some or other quarter, which would have diminished the fund, nonetheless, there would always be a naturally upcoming tranche of newly dormant accounts that would be transferred to the dormant accounts fund for disbursement at the discretion of the board.

I cannot for the life of me understand how the incoming amounts could have diminished or slowed down. Surely the same number of people are dying as died before and the same average number of people are dying intestate or dying without having left any direction in respect of insurance investments or bank accounts. The question arises, therefore, as to the amount which is about to be transferred having diminished. I have no difficulty with the transfer to the Department of the Environment, Community and Local Government and I have no doubt the funding will be disbursed in a proper and orderly way. The question remains, however, as to why the fund should be diminishing. The answer always given, of course, has been that the funds have been disbursed. How did the funds grow in the first place, however, other than through the means to which I have just referred?

The question I would love to know the answer to, although I think I know the answer, is what has happened since the setting up of the Dormant Accounts Board whereby the funds flowed into the hands of the State as opposed to previously flowing into the hands of the lending institutions. What has happened that has changed that inflow in the period since the board was set up? The Minister of State might make some comment on that in her reply, which would be very interesting.

Reference was made to the NTMA. With the passage of time we tend to become critical of bodies and boards, for one reason or another. The NTMA has a very difficult job to do and it has done a fairly good job. It got the job of managing and trying to wrestle with the debt that arose in the 1970s, which is still hanging around our necks and has not been paid off yet. What happened in the meantime is that growth and inflation caught up and the amount diminished as a proportion of GDP. Of course, we had the more recent ground shuddering events which saw the explosion of the Celtic tiger. We now know that increased management of funds will be required in respect of which the greatest degree of expertise ever known will be required in order to manoeuvre our way through the obstacle course that lies ahead of us.

A point that needs to be made in passing, and reference has been made to it in the course of this debate, concerns NAMA. There are many criticisms of NAMA, with some of which I agree. However, we need to know also that NAMA and everything that goes with it is owned by the taxpayer. When NAMA was set up - I was in the House on the night of the debate - its purpose was ultimately to achieve the best possible result for the taxpayer in the disposal of its assets at a later stage. While it is laudable for people to say we should dispose of as much as we can through local communities for their enjoyment, and this would be some recompense for hardship and so on, that is not what is was set up for. It was set up in order to address the incredible plunge in terms of financial and banking services and the property sector, in particular to address the diminishing value of collateral that was held by the banks or lending institutions. It is easy to understand why some suggest some of the funds should be allocated to various deserving groups, but that is not why the fund was created. The duty of the State is to maximise its value and dispose of whatever it can in whatever way it can to secure recompense for the taxpayer who, ultimately, must pay for all of this. The day when some things were free is long gone; there are no free lunches anymore.

It is no harm to reflect on these matters. The dormant accounts fund concept was good in the sense that instead of the proceeds filtering into financial institutions which were the custodians before the introduction of the legislation and the establishment of the board, it was deemed preferable that the funds flow to the State. This is because, at least, the State has some responsibility to look after the citizenry, to whom it has a duty of care.

The McCarthy report suggested €1.7 million could be saved by the transfer of the functions of the board to the Department of the Environment, Community and Local Government. This may be the case, but it brings to mind that awful word "administration". Administration nowadays is more circuitous, long-winded and expensive than it was 25 or 30 years ago, although the opposite should be the case. In the days before computerisation there was a direct system, under which, in so far as possible, administration was curtailed to maximise the impact and ensure the minimum of interference and red tape. Unfortunately, nowadays the reverse is the case. While I welcome the reduced costs of administration of the fund as a result of the proposed change, I have serious doubts about the way society is progressing, with particular reference to the cost of various administrations. I wish to illustrate this point. The simplest of application forms a citizen must use to apply for anything may run to 20 pages. Boxes must be ticked which are then scanned by computers. Consequently, the forms must be filled in a particular fashion. I imagine the Acting Chairman and the Minister of State have had similar experiences. What was the person who created the form thinking when he or she couched certain questions in a given way? This is especially the case if the same question is asked again two or ten pages later. It is as if he or she does not believe the answer from the citizen in filling in the application form. The idea appears to be to ask the same question again and if the same answer is given, the authority presumes it is the truth, but, if it is not, it assumes the citizen is lying either in the first or second instance. My comments relate simply to the cost of administration which has gone through the ceiling and it is not totally the result of cost of living increases. Costs have escalated because administration has become more circuitous and detailed, to the extent that in some cases the details are irrelevant and make no difference. God be with the days when one could use a simple application form to do a simple job and achieve simple results for one quarter of the cost. Let us remember that every document to be filed or filled in requires another person to examine it who sometimes must examine it twice.

The Acting Chairman and the Minister of State will be familiar with the following example of administration costs at their worst. Let us consider the case of a person applying for a local authority house. He or she must fill in an application form and state he or she did not have a house previously. He or she must write to the Revenue Commissioners to get proof of this. Revenue will stamp the form and return it to him or her, perhaps three weeks later, by which time he or she will wonder why he or she had to fill in the form in the first place. It will then lie dormant in the household for several months until the public representative writes to the local authority to explain that the applicant has heard nothing and ask for an update. It will then emerge that the form and the certification from the Revenue Commissioners were not forwarded because had elapsed.

Let us suppose a person applying for a given service or facility is divorced or separated and had previously, either jointly or individually, taken out a mortgage, in respect of which he or she had claimed mortgage interest relief from the Revenue Commissioners. The Revenue Commissioners, correctly, cannot approve such a form. However, the applicant is obliged to send it to them in order that they can reply indicating that they cannot approve such an application because the person had previously claimed income tax relief on a mortgage. Is it necessary to go to these extremes to prove a point? These are simply two examples of the way administration costs have gone mad.

I hope the proposed figure of €1.7 million can be saved as part of the proposal, but I am unsure. We must wait and see. I sincerely hope whatever good uses to which the funds have been put will be mirrored in the future to the benefit of taxpayers and the citizenry, which is as it should be.

There should be designation of disadvantaged areas, which is good. However, I am somewhat concerned about the concept of ring-fencing programmes funded by the taxpayer or which fall under the authority of the taxpayer. There is a problem if a programme has been specifically designed to be implemented in one direction only. This becomes administratively costly and the general good of the community is not necessarily always met as intended.

I am still in a quandary and have no doubt the Acting Chairman is in the same position. I cannot understand why the funds are diminishing. For example, if there were 20,000 dormant accounts in a 20 year period between 1960 and 1980, how could the number diminish in the period between 1980 and 2000? This will remain a mystery. Like all things, however, I must accept that certain matters remain a mystery until such time as someone decides to enlighten me. Perhaps the Minister of State will be good enough to take me out of my agony, to some extent at least, if not to the extent I desire.

I thank the Deputies on all sides of the House who have contributed to the debate. Several contributors focused on the nature of dormant accounts, apart from the provisions of the Bill which serves to tidy some administrative matters, as well as dissolving the Dormant Accounts Board which will give rise to modest annual savings. I realise Deputies White and Ross sought a more accurate figure of the savings to be made, but "modest" is the term I offer. We will probably have more accurate accounts at a later stage.

When dormant accounts legislation was first introduced, the priority was to ensure the large financial institutions would not benefit from the money, that it would either be returned to account holders or be used for the benefit of the community by people who were deprived or disadvantaged. The application of unclaimed funds lying in dormant accounts where the legal owners cannot be identified has proven very successful in making resources available to assist community projects and to tackle disadvantage. Since its establishment in April 2003 to the end of December 2011, the transfers of the dormant accounts fund have totalled €631 million, which includes interest earned of €35.5 million. Funds reclaimed in that period by account holders amounted to approximately €228.9 million, with almost €247.5 million disbursed from the fund.

These moneys have been applied to the public good rather than making a contribution to the bottom lines of financial institutions. That said, at a time of severe budgetary pressures resulting in reduced allocations across Departments, there is a need to prioritise and to try to main existing funding programmes in the first instance. Expenditure on new dormant accounts measures or programmes could potentially reduce spending on other existing programmes and would serve to increase Government debt levels as the money belongs to the account holder who can reclaim it at any time and not to the State. Consequently, every euro spent from the fund is regarded in accounting terms as a potential Government liability and, therefore, dormant accounts funding cannot be regarded as free money.

This Bill, which allows for the dissolution of the Dormant Accounts Board, will transfer the statutory functions of the board to the Minister for the Environment, Community and Local Government. It will assist with the requirement to reduce the number of State bodies which, as the Minister, Deputy Hogan, indicated to the House previously, is part of this Government's strategy to streamline Government business.

I apologise for interrupting the Minister of State but we must adjourn the debate as it is now 3.42 p.m. and we are required to move on to the Topical Issue Debate.

Should I finalise the debate rather than bring the House back on the same issue?

If the Minister of State so wishes. I am sure the House will agree to that.

I again thank everybody concerned and point out that the disbursement will continue to be made from the fund through the Votes of the relevant Departments, and it will be Exchequer neutral. Also, it will be laid before the House because there was some concern that questions could continue to be asked about it. The relevant joint committee of the Oireachtas has separate powers to require the Minister to appear before it.

Unfortunately, I cannot answer Deputy Durkan's conundrum at this stage just as he has not been able to answer it over the years. There will be an opportunity on the further Stages of the Bill for other issues to be teased out, and perhaps Deputy Durkan's issue can be teased out in those debates. I commend the Bill to the House.

Question put and agreed to.