I welcome my constituency colleague, the Minister of State at the Department of Education and Science, Deputy Treacy, and his officials, Mr. Jack O'Brien, Mr. Tom Boland, Mr. Dick Sweeney and Ms Gillian Ryan. This is the first meeting of the select committee. I suggest we continue consideration of the Bill without a break until we have completed business. However, if the meeting continues beyond 1 p.m. I suggest we take a sos at that time and resume at 2 p.m. Is that agreed? Agreed.
Scientific and Technological Education (Investment) Fund Bill, 1997: Committee Stage.
Is it the case that we will not break for the Order of Business at 10.30 a.m?
Normally business would continue unless there is a vote, in which case we must break.
In a previous committee in which I was involved it was possible to break at 10.30 a.m. if Members so wished. That would be my preference but I will be guided by you, Sir.
I will leave it to Members to decide to break at 10.30 a.m. However, it is my intention to proceed without interruption.
I am delighted to be here with my officials. I congratulate Members for their appointment to this historic committee and you, Sir, on your appointment as Chairman. As a constituency colleague for 16 years I am delighted with your appointment. I wish the committee success. This is a historic day because in its first meeting the committee is to consider one of the most important proposals put forward by my Department since 1966.
SECTION 1.
Amendments Nos. 1, 2, 5 and 8 are related and may be taken together. Is that agreed? Agreed.
Does that mean that they will be discussed together but will be taken separately for voting purposes?
Yes.
I move amendment No. 1:
In page 3, subsection (1), line 16, after "Act" to insert ", except where the context otherwise requires,".
This is a standard technical amendment. It is necessary because the word "Minister" is used in a different context, for example, in section 6, to the meaning ascribed to it in section 1. Will the Minister of State comment?
I propose to respond to all these amendments together and if any specific points arise thereafter I will deal with them. However, I would prefer Deputies to move all the amendments in the first instance.
I will move amendment No. 2 when it is appropriate. The purpose of the amendment is to define the investment account, which is the key provision in the Bill. Section 2(5) states:
Moneys standing to the credit of the investment account which are not, for the time being, required for the purpose of making payments out of the Fund under section 4 shall be invested by the Minister for Finance in securities issued by the State.
The proceeds of that investment will be ploughed back into the fund but the definition of "the investment account" confines it only to private donations. A fund of £250 million will be created by the taxpayer which will be supplemented by private donations. The Bill provides that while the private money will be invested, with the benefits accruing to the fund for the benefit of education, the investment income accruing on the taxpayers' investment of £100 million early next year will not benefit the fund but will be returned to the Exchequer. That defeats the concept of a fund, which is to place resources in it, manage them efficiently in terms of investment with benefits accruing to the benefit of the fund. Payments are then made from the fund to worthy projects.
The Department of Finance has adopted a cheapskate approach to the fund. It is creating a reserve of £100 million which it will spend when required. That is the wrong approach. The State money and the private funds should be managed jointly. If they are put into Government securities for six months or a year while suitable projects are being identified then the fund will benefit. On present standing the fund would earn 6 or 7 per cent per annum. Potential annual income of £16 million is being wiped away from use in the education sector by the existing provision. My suggestion is education should benefit from that potential and not the Minister for Finance.
Amendment No. 5 is similar except it is made in a different part of the Bill, as is amendment No. 8. The central thrust is that we should treat private and public money the same within the fund and education should benefit from the investment income, not the Minister for Finance.
I thank the Deputies who have moved these amendments.
I am advised that amendment No. 1 proposed is unnecessary from a drafting viewpoint. This Bill provides that the fund shall consist of two separate accounts, the first in the Office of the Paymaster General, the officer who pays all State expenditure, into which Exchequer contributions will be made, and second a private donations investment account into which private donations may be made. Our objective in providing that there should be two accounts is to ensure that donations to the fund from private individuals or bodies are kept separate from public funds. The distinction will provide reassurance to donors that their contributions will be applied for the purpose that they intended and will not be subsumed into general Exchequer expenditure.
The effect of the proposals in amendments Nos. 2, 5 and 8 would be to eliminate the distinction between the two accounts and could deter some donors from contributing to the fund. Deputy Richard Bruton might have an underlying concern that the Government might not be committed to meeting its obligations under the terms of the Bill but I assure this committee, the House and the Deputy that this is not the case and re-emphasise that the Government is wholly committed to the allocation of £250 million to the fund. Further reassurance may be taken from the fact we agreed in the Seanad to amend section 3 of the Bill in order to strengthen further the legal basis for our commitment to allocate the full £250 million. As a result of a number of amendments tabled by all parties in the Seanad, we accepted this change, amended the Bill and there is an absolute commitment to providing the £250 million.
It would not be good practice to have Exchequer money lying in a fund having been invested. The money will be better used to recover and underpin the national debt in accordance with the law and the National Treasury Management Agency use it in that way. As I am sure the committee is aware, the Minister for Finance is a constitutional office and he is charged with certain obligations to run the Exchequer in a particular way. We established the National Treasury Management Agency to ensure we could control the national debt in the interest of efficient management of public expenditure. We are assembling a dedicated fund of £250 million out of the Exchequer into the agency for its use in the normal criteria under which it operates. It has a unique track record of fund management. It has managed our international finances well. It has consistently reduced the national debt and it has ensured GDP and the national debt are linked.
We must take account of the legislative and constitutional situation pertaining to the management of public funds in that the National Treasury Management Agency, acting on behalf of the Minister for Finance, must ensure it uses its funds wisely. We are dedicating this fund to it but conversely we are also ensuring the private donations will go to the National Treasury Management Agency and will accumulate to the benefit of the fund. We have a good balance — protection of public expenditure and incentive for the private sector to make donations in the knowledge they are secure in Government stocks and securities. That is what is best for the State.
With the greatest respect, the Minister is talking nonsense. He is seeking to conceal the real purpose of what he is doing. It has nothing to do with the fear of deterring investors because it is clear in section 7(1) that donors can spell out conditions on how the money is to be used. The fact the Minister is rejecting this has nothing to do with the operation of separate funds. Investors have cast iron guarantees that they can make whatever conditions they like as to how their money is used. The commitment I seek from the Minister is that taxpayers' money be treated in the same way and benefit from wise investment by the NTMA in Government securities guaranteeing a good yield and be available for education, not creamed off by the Minister for Finance.
If the Minister wants separate accounts I have offered him two variations on this amendment. The opportunity to maintain separate accounts still exists but they will be managed in such a way that the investment income will accrue to the benefit of education. The Minister has briefed us from prepared notes. He should look at the issue. The earnings on £100 million next year, potentially £7 million, can either be leeched by the Exchequer or made available for education. I have no doubt it should applied for the purposes intended. The idea of the fund is to support science, technology, education and research. Any person asked what would happen when a fund is established would say the money would be reinvested to bear fruit for the purposes specified in the Bill. The Minister is seeking to renege on that basic ingredient of the fund. I do not accept his response to the amendment.
I support the proposed amendments for two reasons. The Minister mentioned the underpinning of the national debt. The income from this fund is being used to underpin the national debt on the basis of the Minister's words here this morning. We should not do what we did with lottery funding. The majority of that money was to go to sport. I looked at the figures last night and realised that 70 per cent is going to other areas. The Minister is going the same road here. The same officials in the Department of Finance want control of the extra income. I ask the Minister to reconsider the amendments as I believe that is what will happen — the Department of Finance will take on board the extra money from the income raised. We should be building up the fund to increase the investment in the area we are discussing.
The case made by my colleague, Deputy Richard Bruton, seems eminently sensible. If one has a fund which is invested for education, any interest or dividend accruing to that fund should remain within it and hence enlarge the fund. The ordinary individual would feel that should be the case; likewise, people who make contributions to the fund would feel that should happen. I cannot understand why the Minister is so reluctant given his brief to promote education. I cannot see why he would want the dividends accruing from this fund to go back to the Exchequer rather than to his Department and be available to provide additional services.
The Minister said that the NTMA had reduced the national debt. I am sure he did not mean to say that. Maybe it should be put right for the record. I do not think the national debt has reduced for some considerable time. What the NTMA has done is reduce the State's service payments on that debt. It has worked remarkably well. I know the point the Minister is trying to make, but the NTMA has not actually reduced the national debt.
If the Minister is happy that the word "Minister" is sufficiently defined and clear, I am prepared to withdraw that amendment.
I am very disappointed that I have been taken out of context not once but twice. If Deputy McGrath listened carefully, he would have heard me say that the NTMA's function was to reduce the national debt and it had done tremendous work to reduce it in line with our GDP performance. Regrettably, the overall debt has not decreased.
Deputy Richard Bruton, for whom I have tremendous regard and with whom I have served on committees and in the House for a long time, has used three words, one of which was "nonsense", and I would hope nobody at this level of public life would speak nonsense. Another was "cheapskate"; there is nothing cheap about what we are doing, that is setting up a dedicated fund of £250 million. The third word, which I liked, was "creaming". On behalf of education, we are certainly creaming off a dedicated fund of £250 million. We are dedicating £250 million to scientific and technological advancement in education and this has never been done before. It will provide three years of planned, guaranteed funding. We are giving the private sector the opportunity to contribute to a fund which will accumulate as a result of the NTMA's performance.
If we were to take what the Deputies have said to its logical conclusion, we should be handing over all money voted to the various State agencies each January and say "invest that money and perform". That is not the way this country allocates public expenditure. Estimates are allocated and money is handed over at least four times per annum to the various Departments and State agencies. In that way we manage the national funds in a very efficient manner. It would be foolish to hand over the total fund of £250 million and have it accumulating because somebody would have to pay for it. The chances are that the fund's first £100 million, which will be created next month, will probably be borrowed money and we would have to pay the interest on it. The NTMA has a responsibility to ensure that it borrows wisely, uses the money properly when it has the use of it and makes the maximum contribution to the public expenditure demands of this nation. We are giving the NTMA the responsibility because it has a track record. The fund is guaranteed and performance is expected. I am confident everybody will know where they are going in the interests of education.
I agree with the Minister that we are a long time struggling in this House together. Indeed, I have sat down on occasion and played cards with him. I am afraid that somebody on his behalf sat down with the Minister for Finance, who, with his usual Kildare cuteness, pulled a fast one. The Minister is undermining the principle of this fund.
The Minister of State is not correct in drawing a parallel with other agencies. When we fund IDA Ireland, Forbairt or other agencies we are not setting up a fund. We do not say we have an investment fund created for indigenous development, for example. However, on occasions we have set up venture funds into which the private sector puts money to match State funds. Such money is in a fund and it is drawn down. Therefore, the Minister is not right in saying that the Exchequer does not do this sort of thing. When we set up funds, this is what we mean by "funds". For example, The IFI fund is made up of money provided by different countries. The money is available to the fund, it is invested by the fund and then drawn down for worthy projects.
The Minister is trying to draw a parallel, saying that this is a new departure. What we are trying to do is make a new break. The Minister is saying that having a fund is a great new idea. It is a good idea. However, an essential ingredient is that the fruits of the investments in the fund accrue for the purposes of the fund, and I cannot accept the Minister's approach. This is an important principle. In recognition of what we are trying to do here, Government Deputies should support this modest change in the approach being taken in the interests of education.
Deputy Bruton and I will agree to differ on this point. The money is being dedicated. It must be managed. It may be borrowed and then it will have to be repaid. It will be available. The private sector contributions will be accumulating to the fund.
What does the Minister mean by "repaid"? That is a new dimension of the fund. We never heard before that the money had to be repaid.
The Deputy should not misinterpret what I say. The £100 million, which will be available next month to this fund, may be borrowed money. If it is borrowed money, it must be repaid so there will be interest to be paid on that £100 million in 1998 for which the NTMA will have responsibility. That is its function. As regards the fact that the fund is dedicated and the money will be available on that, we must agree to differ. We will leave it to the NTMA to manage the funds in the best interests of Ireland.
The same is true of the private sector. The private sector may be borrowing money to put into this fund, but we are not saying that any surplus on that money will be refunded to it. The Minister is making fish of one and flesh of the other. He is asking the private sector, which has substantial borrowing, to dip into its coffers. The private sector has its own substantial debt/equity ratios. The Minister is asking the private sector to chip in, with what is effectively borrowed money, to support education and to let its money accumulate in the fund for the benefit of education, but he is not willing to do the same.
We are investing money in a fund which is to be spent on education, science and technology. It is not a commercial fund. It is public expenditure on education, science and technology. We are investing money which is to be spent on a dedicated focused area, that is education. We are not investing money in a commercial venture, such as that to which the Deputy referred, where it would accumulate, we would see how the stocks, shares, gilts perform and we would decide what to do. That is the business of the NTMA. We are leaving that to the professionals. The focus of this Bill, which is not a financial Bill but an education Bill, is the dedication of £250 million. It is a matter for the NTMA to manage the money and we will spend it.
I do not accept that. I drew on venture capital funds which are operated by Forbairt as an example, but equally one could look at the International Fund for Ireland, the principle of which is the same.
That is an international fund.
The principle is the same. Perhaps we are getting to the truth about this Bill. The Minister does not really have in mind a fund in the real sense of the word, where money is set aside, independently managed and earnings accrue to the benefit of the purposes of the fund. This is not what is there and we will see that as we examine the Bill. This is just a vehicle for the Minister to continue doing as he has in the past in that it is he who makes decisions on which projects qualify. He will not give to any fund, board or independent evaluators any power over how this is to be run or how the money is to be used for the best projects put forward. The power will be kept in his Department and it will decide which projects will go ahead. The approach to this amendment is symptomatic of a deeper problem with the Government's approach to what is a good idea. The Minister has killed a good idea with his approach.
Amendment, by leave, withdrawn.
I move amendment No. 2:
In page 3, subsection (1), line 21, to delete "(b)".
Amendment put.
The Select Committee divided: Tá, 7; Níl, 8.
Tá
- Bruton, Richard.
- Farrelly, John V.
- Hayes, Brian.
- McGrath, Paul.
- Naughten, Denis.
- O’Shea, Brian.
- Sargent, Trevor.
Níl
- Carey, Pat.
- Ellis, John.
- Hanafin, Mary.
- Keaveney, Cecilia.
- Kitt, Michael P.
- Moloney, John.
- Treacy, Noel.
- Wade, Eddie.
Amendments Nos. 3, 13, 23 and 24 are related and may be discussed together. Is that agreed? Agreed.
I move amendment No. 3:
In page 3, subsection (1), between lines 22 and 23, to insert the following definition:
" 'An tÚdarás' has the meaning assigned by section 4(3)(a).".
I tabled these amendments because the Labour Party is concerned that the position of the Higher Education Authority may be undermined in the context of what is concluded in this Bill. An tÚdarás is not mentioned until section 4(3)(a). We seek to amend section 4. A definition of "An tÚdarás" is necessary on that basis alone but we believe that a definition is necessary in any case.
The functions of the Higher Education Authority under the Higher Education Authority Act, 1971, are the funding of universities and designated third level institutions, the development of third level education to meet the needs of the community and an advisory role in relation to all third level education.
The first mention of An tÚdarás in the Bill is that the Minister shall consult with it. We do not see that as a full recognition of the role of An tÚdarás as per the 1971 Act and amendment No. 23 seeks to delete "consult with" and substitute "not make such a payment unless he or she [the Minister] has received a request to that effect . . ." We object to the idea of the consultation role. We believe that under this legislation An tÚdarás — the Higher Education Authority — has a wider role which is being diluted and reduced in this Bill. Amendment No. 24 seeks to give An tÚdarás a further role in the context of the guidelines which may be issued in relation to the legislation's provisions.
We want the full statutory role of An tÚdarás recognised and the Bill should not dilute that role.
I support the principle of this amendment. We are looking solely at Regional Technical Colleges, Dublin Institute of Technologys and universities at present as the main bodies and, in that respect, over time the Higher Education Authority will become a key body. I understand that the Regional Technical Colleges are not within the ambit of the HEA, so pending a Government decision to alter that, I am not sure of the statutory position. While the purpose of the amendment is correct and I would like to see an acceptance of the approach in principle, some tidying up of the amendments may be needed. We should be looking at PLCs and vocational education committees as bodies equally eligible for access to this fund. In that sense not every such disbursement from the fund could be at the HEA's recommendation. We should be examining parity of esteem between the traditional higher education sector and the less traditional post-secondary level education sector, and I will refer to this in later amendments.
I agree with Deputy O'Shea's amendments. We have a well qualified Higher Education Authority whose purpose is to look at higher education needs and make recommendations on the number of students we need, whether we need new colleges, the sort of research we should undertake in higher education colleges and to propose funding to the Minister on an annual basis. It is reasonable that their expertise should be given greater statutory recognition than is currently given under the present provisions.
I also support Deputy O'Shea's amendments. The phrase "to consult" while being well meaning are often little more than a smokescreen and does not carry any requirements other than the cosmetics of consultation. That is to be regretted but it is based on experience when consultation is considered sufficient.
Ba cheart míniú a chur ar "An tÚdarás" mar a mhol an Teachta O'Shea mar is minic in áiteanna ina mbeadh údaráis eile i gceist agus tugann sé aitheantas don Údarás atá i gceist anseo má bhíonn míniú níos soiléir sa Bhille.
This Bill gives the Higher Education Authority full functions to operate in appropriate sectors. Any perusal of the Higher Education Authority Act will show that its function is to advise and make recommendations to the Minister and the Department of Education and Science. Obviously the Higher Education Authority will be a key body in advising us on all of this. As a result of this Bill we propose to establish expert groups on future skills and high level management implementation. The Higher Education Authority will be de facto members of these groups. It will also be advising and making recommendations in its normal statutory functions to the Minister and the Department vis-à-vis education, most specifically in the delivery of an education service across the land.
I am advised by the parliamentary draftsman that it not necessary to define the term "An tÚdarás". The term only appears in section 4(3) where the full title of the body is given. This body was established by statute in 1971 so it is clear without further definition what is being referred to in the subsection.
At present the Bill provides that the authority must be consulted in relation to the funding from the fund of programmes in institutions of higher education. It also provides that any payments to those institutions must be made through the Authority. Under the Higher Education Authority Act, 1971, the Higher Education Authority has a general advisory and funding role. The provisions in the Bill are entirely consistent with that role because we have the utmost respect for the Higher Education Authority and its contribution to education.
I have a difficulty with the word "consult" as against the word "advise". We can consult somebody by discussing a particular issue with them but by definition that does not mean we must take that advice.
The White Paper provides that all third level funding comes within the remit of the HEA. I am not sure if it is the Government's intention to proceed along this line. Under this Act the Minister must consult with An tÚdarás before a payment is made. That could mean that at official level a particular payment is agreed and consultation will be little more than informing the Higher Education Authority that this payment is being made. Under the next section the Higher Education Authority has little choice whether it pays off that money.
I intended to bring the Higher Education Authority Act with me. Is it not the case that where a college approaches the Higher Education Authority with a project, it assesses it and recommends it to the Minister for funding? Is the Minister not reversing that procedure here where effectively it will be the Minister who assesses projects, only consulting the HEA? Effectively the line of communication from the college to the Higher Education Authority to the Minister is being changed. We will now have two parallel types of approach, one from the college to the Minister and the other from the college to the HEA. It does not seem sensible when we have an expert body to appraise individual university type investments that the Minister cuts out the role of the HEA. This is how I interpret section 4 (3)(a) which states: "The Minister shall consult with An tÚdarás. . . . . before making such a payment". Previously it was the other way round. An tÚdarás would have to make recommendations before the Minister would consider making a payment. From my last reading of the Higher Education Authority Act I think the Minister is making a change which undermines the traditional role of the Higher Education Authority which has worked well.
The Deputy is correct in the first half of his contribution. The 1971 Higher Education Authority Act gives responsibility to the Higher Education Authority for designated educational bodies, such as the universities, the NCA and the NCAD to make recommendations to the Minister and Department of Education and Science pertaining to projects and expenditure. We intend to enhance the role of the HEA. Not alone will it advise, recommend and collaborate with all bodies but we are enhancing the role of the Higher Education Authority in the Bill in that they will be members of particular groups who will manage and advise on funding.
To which section is the Minister referring? He will find that is not there.
I am telling the Deputy what the position is pertaining to the HEA.
The traditional relationship was from the college to the Higher Education Authority who appraised projects and made recommendations to the Minister who then sanctioned those for approval. The Minister is now providing that the Minister will have direct appraisal which will result in two parallel appraisal systems. The Minister doing his appraisal of projects on one side and in competition the Higher Education Authority doing theirs. He is breaking down the traditional route that all worthy projects in the third level university sector were evaluated by the Higher Education Authority which made recommendations to the Minister to make a decision and approve them. That is being changed; now the Minister will disburse the money and all he is required to do is to consult the HEA, which is a different approach to that in the Higher Education Authority Act.
The "roofs" to which the Minister of State refers may be here today but they could be gone tomorrow because they have no statutory underpinning in the Bill. They are solely advisory. The traditional approach which has served the university sector is being broken. It seems that change is being made inadvertently rather than as a conscious decision that the Minister is not happy with existing policy.
I would not like the Deputy to get bogged down on any particular body. If he views the Bill in its totality and examines all its sections he will see an enhanced consultative and advisory role involving various State agencies, whether the Council for Science, Technology and Innovation, the Higher Education Authority or the universities themselves. These are professional groups involved in delivering education services and we are bringing them together in various groups. Not alone will they have their statutory function but they will also have a co-ordinating and advisory role through a committee advising the Minister and the Department on the projects. However, the buck must stop with the Minister — that is why he is appointed and why Governments and politicians are elected. The Minister is responsible to the Parliament and the people for the expenditure, but he will be guided by professionals — people who have a track record of service in a field of education. There is nothing new about this. We are giving the Higher Education Authority an enhanced role.
Will the Minister of State clarify the matter for me? My understanding is that if the Minister is approached by a college and agrees to fund a project, he then informs the Higher Education Authority and the money is provided to the Higher Education Authority who must pay it on. As the Bill is drafted the Minister can unilaterally side-track the Higher Education Authority legislation. All he must do is to consult. I have a difficulty with this section. A future Minister could legally act in this fashion.
If the Minister was approached by a particular college he would seek a detailed submission on its proposal and it would be considered by the appropriate body and a decision would be made ultimately. There would be no private meetings with colleges and agreements to fund projects. That cannot be done with public funds. We must make sustainable decisions based on the merits of a proposal and on the money available.
Section 8 of the Higher Education Authority Act will be in operation at all times. Any request by an institution of higher education for a State subvention shall be submitted by the institution to An tÚdarás in such a manner as An tÚdarás may require. That will continue to be the position. We are not changing the 1971 Act; the link, collaboration, the co-operation, the advice, the communication and the service available from the Higher Education Authority will be utilised fully and its role will be enhanced. The consideration of projects for universities will be dealt with in the normal way. This part of the Bill refers to payment. Before a payment is made we will consult the Higher Education Authority again. We are not changing section 8.
The Minister has indicated that before payment is made the Minister shall consult the Higher Education Authority again but as drafted, the Bill may be in conflict with the Higher Education Authority legislation.
I agree. The Minister intends that the money would go through the normal system but it is not mentioned in the Bill that projects proposed by universities will be evaluated and recommended by the Higher Education Authority before the Minister considers them for payment. That is what the Minister intends but that is not in the Bill.
These are not trivial matters. There was a famous case a few years ago with regard to the IDA, which has a similar relationship to the Government as that of the HEA. The IDA must recommend the grants to be given to companies and the Government has no right of direct negotiation. It can accept, reject or agree to pay less in grants, but it cannot pay more. The Government is constrained in its ability by legislation. It cannot just decide to give more money to an industrialist than is recommended by the IDA. In this case the Minister is constrained by the Higher Education Authority evaluation. He cannot decide to favour one or other project and give it more funds. These are not trivial matters and it is worth taking another look at the provision for Report Stage.
Based on what Deputy Bruton has said, I will have a look at it for Report Stage.
On foot of the Minister's undertaking I will withdraw the amendment.
Amendment, by leave, withdrawn.
Section 1 agreed to.
SECTION 2.
Amendments Nos. 4, 10, 39 and 41 are related and will be taken together.
I move amendment No. 4:
In page 3, subsection (1), line 36, to delete, "(Investment)" and substitute "Investment".
This is a drafting amendment. I see no reason, grammatical or other "Investment" should be in brackets. It is a superfluous construction.
As the Deputy will be aware, this Bill has been drafted by the parliamentary draftsman. While the Houses of the Oireachtas are entitled to determine the content of the Bill it is at least prudent that we accept the advice of the draftsman on how that content is expressed. The Title of this Bill and the title of the fund were specifically discussed with the draftsman assigned to this Bill who was of the view that, for presentational reasons and in accordance with drafting conventions, the word "Investment" should be in brackets. The committee should accept the view of the skilled draftsman.
Apart altogether from drafting considerations, placing the word "Investment" in brackets gives it an added emphasis. This is appropriate as the Bill is motivated by a desire to invest in our education system and in the future of our society and the use of brackets brings a focus to bear on that. It is also conventionally appropriate to use them. I hope the committee will accept this.
This is a drafting amendment and is not of major consequence. However, the Minister is saying that we should accept the use of brackets because it was always thus and this is the way the draftsman drafted the section. The cogent point made by the draftsman is that the section gives greater emphasis to the word "investment". I am not sure whether this is true but I do not intend to pursue the matter to the death. It seems there is no reason for having those brackets. However, I am prepared to withdraw my amendment on foot of what the Minister has said.
Amendment, by leave, withdrawn.
Amendment No. 5 not moved.
I move amendment No. 6:
In page 4, subsection (3), line 10, after "may be" to insert "but not later than 3 months".
This amendment seeks to ensure that the period from the end of the financial year to when the Minister submits the accounts of the fund to the Comptroller and Auditor General for audit should not be greater than three months. This is reasonable in the context of our parliamentary democracy and of a commitment to accountability and transparency.
I support the amendment. We should as a matter of standard practice, include such provisions in Bills. It is a matter of good and disciplined management.
While I understand the objective of setting time limits for the submission of the fund accounts to the Comptroller and Auditor General, I consider the amendment unnecessary. The Bill already provides that the submission of accounts must take place "as soon as may be". This is a standard phrase in legislation ensuring submission occurs within a reasonably practicable time. The Deputy is aware of the extensive role and powers of the Comptroller and Auditor General. Any unreasonable delay on behalf of a Minister in submitting accounts to him would be liable to adverse comment from his office. This in itself is a sufficient guarantee of promptness on the part of the Minister and I do not consider that the provision needs further strengthening.
Many of us have been Members for a number of years and we have never encountered a situation where a Minister or Department did not submit its annual report on time for consideration by the C & AG. I have never heard of such a difficulty being encountered. The tradition is that the accounts are forwarded by the Department to the C & AG on a regular basis as soon as the year concludes and we can expect the same to happen in this case.
The Minister said no Department has been late in meeting its deadline. At issue here is the setting of a deadline three months after the end of the financial year. This account will be of significant interest not only to the education sector but also throughout the industrial sector. It is important that the public and Parliament know how the money is being dispersed and for what it is being used at the earliest possible time. "As soon as may be" is not a definitive phrase: it is dependent on the interpretation of the Minister. A Minister could delay submission of the accounts to the C & AG if he or she so wished. A time limit of three months is reasonable and should be easily met.
I am disappointed that what appears to be a sensible and reasonable amendment is not being accepted by the Minister. The amendment would considerably strengthen the hand of the C & AG and the controls in place to ensure the public is given access to the fund as quickly as possible. There will be tremendous interest in how the fund is dispersed between the various institutions and the criteria used in so doing.
I take exception to what the Minister said about Departments producing accounts. Perhaps Departments produce accounts on time, but not all institutions within the remit of Departments do so. This fund will be administered by a section within the Department and we would be anxious that its production of accounts be kept up to date. For example, Westmeath Vocational Education Committee did not have audits done on time, leading to the difficulties of which we are now aware, so much so that a Garda investigation is being carried out into the matter at present. Had there been tighter controls — in part exercised by the Department — on the finances of that organisation the difficulties may not have arisen.
The amendment will add to the restrictions and controls in the operation of the fund. While the Minister has suggested the amendment is superfluous, we cannot be too careful in demanding accountability in the context of public finances. The amendment would ensure a definite time frame was included within which accounts could be produced. I will be most disappointed if the Minister does not accept the amendment.
It is important to establish deadlines which should become customary. The funding of education has been bedevilled as those working at constituency level know. It is not deliberate, but students seem to encounter difficulties getting funding at the required time and they are left at the mercy of banks, etc. We need to grasp the responsibility of establishing clear deadlines. Phrases such as "as soon as may be" may be convenient from a public service point of view but they give rise to difficulties for students who should be at the forefront of our minds.
Will the Minister say when the last annual report of his Department was published and what period of time elapsed between its publication and the end of the financial year? This would give us an indication of the track record of his Department and may have a bearing on the matter.
I do not propose to comment on the affairs of Westmeath Vocational Education Committee other than to say that I was pleased to serve for six years on Galway Vocational Education Committee, an efficient body with excellent members and officers. I hope the future of Westmeath Vocational Education Committee will be enjoyable.
In my previous response I spoke of Departments and did not speak about State agencies or agencies of any Department. The Secretary General is the Accounting Officer in each Department and it is their function to ensure efficiency and transparency in the management of accounts and their reporting, which is done on an annual basis. In response to Deputy Bruton's question, there is no statutory obligation on any Department to produce an annual report, but Departments do produce them by way of information on performance and as an indication to the public of what they are doing. In the last five or ten years, Departments and State agencies have been very innovative in the type of reports they have produced.
Does the Minister have a date?
No, it is not available to me at this stage.
It is germane to this matter.
I am coming to that and I think I will be able to help the Deputy. Deputy O'Shea's amendment, wise though it may be, is superfluous. Section 8 of the Bill covers what the Deputy wants to include. Based on what is contained in section 8 I hope we will be able to reach an amicable solution to the withdrawal of amendment No. 6.
Does section 8 not relate to the annual report as distinct from the accounts? We are not talking about the same thing.
No, but the annual report would have to include gross expenditure and income otherwise it would not be an annual report. It does not have to include the detailed inventory or breakdown of expenditure or income creation, but it certainly would have to have a conclusion as to how the figures were created and what was the total expenditure. On that basis, if one has to have those figures in an annual report, it is obvious that the other thing would follow.
I would be happy with that if the Minster can assure me that the actual amounts allocated to various institutions, and the reasons those capital sums were allocated to them, were included in the annual report.
It is my desire that that would be the position.
The Minister's desire is admirable but can I have an assurance that it would be, and that that is how he interprets what is here? That is my difficulty.
I will give the Deputy every assurance that my desires will be fulfilled in so far as they can be.
But that is a personal undertaking rather than something that is written into legislation.
I will give the Deputy that assurance. I will do my utmost to ensure that they are contained therein.
Will the Minister amend section 8 to state that the actual allocations for various projects will be included in the annual report?
I will consider section 8 when we come to it.
Is the Minister prepared to accept an amendment which would indicate that?
I will consider section 8 when we arrive at it.
The Minister is playing games with us.
I am not playing games.
This is a serious amendment moved by Deputy O'Shea, yet the Minster says it is superfluous. If so, why not insert it to be sure? The Minister says it will not improve anything that is in the Bill, but inserting this restraint will certainly not disimprove the Bill in any way and it could have a significance in future. In that regard it would be a worthy addition to the Bill.
In deference to the request by Deputies O'Shea, McGrath and Bruton, between now and our conclusion of section 8, I am prepared to consider what they have suggested. That will give me some time to think about it.
Maybe we could look at that on section 8.
I am happy to agree to that.
Is the Deputy withdrawing the amendment?
I have the option of resubmitting the amendment on Report Stage. The Minister has agreed to deal with this in the context of section 8.
Amendment, by leave, withdrawn.
Amendments Nos. 7, 26 and 28 are related and may be taken together by agreement.
I move amendment No. 7:
In page 4, lines 18 to 20, to delete subsection (4).
This amendment seeks to delete the central role of the Minister for Finance in managing the fund. I strongly believe that the fund should be managed independently by a board that would have a wide range of responsibilities, including the management of the fund. I would be happy for them to choose the NTMA as an agent to manage their investments. However, it is out of place that an education fund should be established for educational purposes and we then find that the Minister for Finance is managing it.
We have already discovered the first evidence of the role of the Minister for Finance in that he will not allow the earnings accrued from investment in the fund, as far as his money is concerned, to roll up and be available for the purposes of the fund. It is a mistake to have the Minister for Finance in pole position on this matter.
As part of a more deep rooted reform of this Bill, I would like to see a strong independent board comprised of people of excellence both in business and education. They would manage the fund and advise on disbursements as well as evaluating projects coming before the fund. That is the central thrust of amendment No. 7.
Amendment No. 26 is the approach that should be taken by the Minister in response to the use of the money. Since its publication a few weeks ago, we have seen that the Minister has already earmarked virtually the entire £250 million. Some £25 million will go towards computers in schools, £80 million to regional technical colleges and so on. The Minister should step back from this, however, and, rather than just letting pet projects roll up from within his Department and its various agencies and institutions, he should invite applications for financial support from anybody who is willing to submit them. He should let people compete with their ideas.
He should listen to the ideas that come forward and, in advance of conducting this competition, he should publish criteria and procedures by which he will select the projects. Amendment No. 26 includes in subsection (2) of that new section the type of criteria that could be included. One is that proposals are innovative in conception and/or in delivery, for example, if it is decided to use information technology to deliver a course remotely and available in many regions and dispersed centres but tapping the excellence of one particularly skilled person or central resource.
Ideally it should have a number of partners. We would like to see business as well as educational institutions being involved in successful projects. There should be a local contribution to cost so that if colleges or businesses come forward with ideas and seek funding from the fund, they should be willing to put some of their own money on the line.
It should contribute to regional development. Coming from a Minister who represents a western constituency, I am surprised that nowhere does the Bill refer to the need for money in the fund to be used for regional development. Many people from regional technical colleges around the country and from centres with no regional technical colleges would like to see a conscious acknowledgement that regional development — and regional disparities in access to education — will be of concern in using the fund.
The last item I put in would contribute to supporting equality of opportunity. We want to see more people from disadvantaged backgrounds getting access to technological and scientific education. In whatever order one chooses to take them, those are among the criteria one should use. However, I am not saying that the Minister will not come up with better or additional ones.
The thrust of amendment No. 26 is that Minister should not use all the £250 million in this way but that, in respect of some or all of it, he should hold a competition for people with good ideas. I would especially like to see applications from PLC colleges. Ballyfermot Senior College is doing marvellous work, for example, and Coláiste Dhúlaigh in my constituency is doing interesting things. They have as much right to stake their claim to such a fund as the regional technical colleges and the universities, and the competition should be opened up to allow them enter. The Minister should set the criteria and procedures, request applications and then examine the results. I expect he would be surprised at the innovative and interesting proposals which would come forward.
This is a much better approach more in tune with what the public will think when it hears such a fund is to be established. The public will not expect the Minister to have £80 million of projects from the regional technical colleges which he will feed out gradually. This is something new with a different approach in that it will be competitive with the best being selected by evaluation at arm's length from the Department. People with expertise from outside the Department will evaluate the applications. This is a worthwhile amendment more modest than an earlier amendment disallowed by the Chairman. This amendment is a good halfway house to what I believe is the ideal.
Amendment No. 28 inserts a new section which states explicitly that, in allocating moneys from this fund, the Minister shall have regard to regional disparities in educational choice and regional development needs. The Bill should not be enacted and the fund established without the acknowledgement that there needs to be regional balance. There is no point developing scientific and technological excellence solely in the large cities of Galway, Cork and Dublin and, perhaps, Waterford, with its new institute of technology. Access to scientific and technological education must be dispersed through the country. There is no excuse for not being radical in this area because the technology exists.
In my experience, traditional third level colleges still think predominantly in terms of full-time students. They have not woken up to the potential of technology to break up courses into modules, thus making them available at more suitable times and at a distance from the centres of education. Inserting in the Bill the need to concentrate on regional disparity will ensure the development efforts of counties such as Donegal will be underpinned in the legislation. Such counties and the Border counties might traditionally have been forgotten in this area as they do not have a large industrial base of high tech industry. It was interesting to hear the Taoiseach speak in Washington of the needs of the Border counties. There is an opportunity in this Bill to underpin his ambitions.
I welcome these amendments which go some way towards offsetting the impression that the Bill is more concerned with promoting the Department's commitment to technology than in tackling in a fair and equitable manner areas of disadvantage and the growing developments in education which go beyond the limits of formal education. The Bill is restrictive in its allocation of resources to institutes of formal education.
The headline in today's Irish Independent concerns people leaving formal education earlier as job opportunities arise. The Bill has lost sight of the need to address that trend and the growing gap between advantaged and disadvantaged, which is now reflected in the education system having first become apparent in the economic system. The education system is unfortunately following the same trend and areas of disadvantage are suffering not only from lack of computers but also from an inability to address basic numeracy and literacy problems. I welcomed this IT 2000 package when I first heard of it, but I also hoped it would not become a marketing tool to cloud or distract from other basic needs in the education system which remain to be addressed.
These amendments are important. There will be general support for them because they aim to broaden the scope of the legislation to tackle disparity in education, both regionally and individually, and to allow bodies other than formal education institutions to get a look-in when it comes to technological education. Youth organisations are probably more in touch with young people than academic institutions, yet they do not seem to have a means of access to this funding according to the legislation. The amendments are necessary so that the Bill does not bolster the disparity which already exists in the education system.
I support the three amendments, especially amendments Nos. 26 and 28. It is important there is a public competition to invite applications from different organisations, such as PLC colleges, and to encourage them to submit projects. They do not have the same contacts or support systems as universities. It is important there is another outlet for these groups to submit projects and receive a funding allocation.
I wholeheartedly support amendment No. 28. Section 7 allows benefactors to the trust to set conditions, which means there will be an automatic bias towards universities. The best example of that is University College Cork, where, in the 12 months since I left it, every new piece of concrete has a name on it. Many people who donate to this fund will prefer a lecture theatre in a university to be named after them rather than a lecture theatre or room in an regional technical college. There must be a bias towards the regional colleges, especially in that part of the fund over which the Minister has control. Colleges such as Athlone Regional Technical College, where the facilities are inadequate and there is a severe overcrowding problem, need resources and there must be a bias in the Bill towards them. Private sector benefactors favour universities because there is publicity value in funding universities rather than Regional Technical Colleges, unless the benefactor is based locally. On a national scale we must try to counterbalance the bias in favour of funding of universities.
Amendment No. 26 in the name of Deputy Bruton seeks to put important principles into the Bill which are an essential part of any legislation involving funding. We have a terrible notion that every new pool of resources must be divided sector by sector or even constituency by constituency. Principles such as regional development and extending opportunities to disadvantaged areas are important. If we lose sight of these principles the IT revolution will have no beneficial effect on the lives of people in disadvantaged areas and particularly in areas far from the major industrial centres. It is important that we have an evaluation of the spending. If we are to take the traditional approach of first, second and third level sectors we will not get value for money. There is a range of educational approaches involving regional technical colleges and further education courses. Amendment No. 26 will provide for this range.
We do not provide adequate resources to the public library system. Many unemployed people and people trying to upgrade their skills use the public libraries. They are seriously under-resourced when it comes to information technology and access to computers. The Bill, as is outlined in section 4, does not provide for a local authority to receive a small tranche of money which could help to upgrade facilities in local libraries which are the first port of call for many people seeking educational opportunities.
Nearly one third of the people attending the regional technical college in Tallaght attend evening courses. Much of the financial support for this comes from industries. Will these people be able to benefit from the Bill? The principle Deputy Bruton is establishing in amendment No. 26 should be accepted as a modern approach to the allocation of funds.
On amendment No. 7, how will students benefit from the Minister for Finance managing the fund? On the one hand we have a dilution of the role of the Higher Education Authority and on the other we have the Minister for Finance coming into the education area and gaining statutory control over a very important fund. Why can the Minister for Education not be trusted in this area?
I support amendments Nos. 26 and 28. The south east region was identified by the steering committee of the Higher Education Authority as suffering from a deficit in the allocation of degree places. The recommendations of this report were accepted as a bench mark by the then Government. Is this still the case and will these recommendations be borne in mind when the funds are being allocated? During my time as Minister of State at the Department of Agriculture, Food and Forestry I was impressed by the number of people in the food industry who were very anxious to gain further education and training. Hygiene and other standards in the industry change constantly and people in that industry, of which I have direct experience, are greatly motivated to pursue further and continuing education.
Worthwhile progress has been made this year in re-employing the long-term unemployed. Many long-term unemployed people have a very low skills base. Any educational funding should make substantial provision for people who have fallen out of the job market. In many cases the skills they can offer attract salaries which are little better than social welfare payments. This is not a desirable situation. Is the Government and the Department committed to making a substantial part of this capital funding available to people who wish to upgrade their skills and improve their chances of employment?
This is a capital investment. I am not convinced the requisite parallel revenue funding is being provided. Revenue funding is particularly important in areas where there is under provision of education.
I thank all the Deputies for their contributions on these amendments. This legislation meets a pressing and current need in the educational sector and in society. We have decided to create this dedicated fund to respond to these needs which have been identified in a number of reports. When the fund was launched on 6 November in Dublin Castle seven areas to which funding would be allocated were identified. We had a spending plan. We could not present this legislation to the Houses of the Oireachtas or to a committee and not give some idea why £250 million was needed and where it might be spent. If the economy was over-heating and there was a need to spend surplus funds a Government might propose to spend £1 billion. Our economy, although it is buoyant, is not over heating.
We must ensure we manage the finite resources available to the nation. We have introduced the Bill for this fund and have shown clearly where we need to spend money. When we made the statement on November 6 we stated it was only an approximate breakdown and that exact allocations would be subject to evaluation of proposals received from the various institutions. That statement made by the Minister was confirmed by the Tánaiste and the Taoiseach on that day.
There are numerous reports and studies including the skills need study, chaired by Professor Francis Ruane and the 1995 Regional Technical College report showing a need for £400 million investment in infrastructure and equipment in the regional technical colleges and various other indicators. There is a skills shortage and a need for apprenticeships. We have consulted widely and based on those consultations it is proposed to spend £60 million on the skills need initiative. It is proposed to spend £20 million on the needs of the hotel and tourism industry, £20 million on vocational education, £18 million on infrastructural development and £30 million on third level equipment renewal, an area of major importance to the regional technical colleges.
Deputy Naughten raised the matter of Athlone Regional Technical College. I am proud to say my constituency has the highest number of students in that Regional Technical College. It is an excellent institution doing a great job. The regional technical colleges have been crying out for investment in equipment for years. Their equipment is obsolete and outdated. We propose to address that by allocating approximately £15 million to research and development and approximately £25 million for IT for schools. Decisions will be based on demand, the proposals which come in and on the involvement of the Higher Education Authority and the expert groups who advise us. Ultimately decisions will be taken in response to the huge need in an ever changing society where technology moves quickly. We have made vast strides over the past century and we must now move quickly to ensure we are not left behind as other small nations move forward. Europe is not as advanced as the United States and other places in adaptation of technology and investment in the education sector.
On amendment No. 7, the issue is the removal of management of the fund from the Minister for Finance. In view of the amount of money involved and given the statutory role of the Minister for Finance in relation to Exchequer money, his functions under the Bill must remain. It is intended that the financial management of the fund on behalf of the Minister for Finance will be delegated to the NTMA and the Bill provides for that. There will not be an educational function for the NTMA. The management of the fund pertaining to expenditure and investment in education will be undertaken by the Minister and the Department of Education and Science on the advice of the statutory bodies and expert groups available. I stress the involvement of the Higher Education Authority and the other bodies will be paramount in ensuring the right decisions are made.
Section 4 (i) (e) provides a catch-all provision where any scientific, technological or vocational education and training programme will be considered for funding. This section gives opportunity for proposals to be considered. There is a need for this fund, we have given indicative parameters where we will spend the money and we are flexible. We will have professional advice. There are ample reports showing the need for this fund and we are rapidly responding to these reports. We believe this is the best way to go.
The Minister has given good account of why he will accept amendment No. 7. Amendment No. 7 symbolises the way in which this is not genuinely a fund in a meaningful sense.
It hurts me that the Deputy says that.
That is the reality. When an education fund is established anyone would think there would be an independent group to identify priorities, to invite and select applications, all within the broad remit of Government policy. One would expect the money in the fund to accumulate until suitable projects are found. We are discovering that all the ingredients one would think were the supporting pillars of the structure have been dismantled.
I am not worried about amendment No. 7 but I am exercised about amendment No. 26. I see it as formalising in a transparent manner what the Minister says he wants to do. He says the allocations are not hard and fast, they depend on the quality of proposals put forward. He may decide the research proposals are not good enough and give more to the regional technical colleges. He may decide to give less to the universities or skills shortages are not solely in the software area which is the only area mentioned in the skills initiative and will absorb the whole £60 million. There are many other skills and we will divert money from the fund to skills which had not been considered to be in short supply. If the Minister is to approach the fund in this way amendment No. 26 asks that he put into the public arena, that he will evaluate projects on their merit and that there are no guarantees to any pet proposals. Proposals will stand on objective evaluations. That is what people want. They are fed up with the suggestion that some people have the inside track because they come from a traditional institution with traditional links with the Department rather than from a PLC working in much more difficult circumstances which cannot bring in consultants to put a fancy gloss on proposals.
We want to see clear criteria that the Minister will invite applications for proposals which look at areas of concern such as educational opportunity and equality of access to technology for people from disadvantaged backgrounds. That is why I am encouraged by the Minister's response when he says we are on the right track with this amendment. In deference to the Minister, I will be happy if he wants to modify some elements and come back with a more polished version of amendment no. 26 on Report Stage. The public deserves a degree of respect from the Minister and the Department. What he plans to do should be set out in law so that even if there is a different Minister in the future managing this fund, the same approach will be taken. We should not have to take what the Minister says on faith; it should be enshrined in legislation.
Perception is always different from reality. This is a dedicated fund. This has not been done before. We will continue with annual Estimates, annual budget lines and annual expenditure for education. This fund is above and beyond that.
There is an in-built bias towards the regional technical colleges. They have fallen behind and they need facilities, including physical facilities such as infrastructure, equipment renewal and new equipment. We are committed to moving them forward. They produced a report in 1995 which indicated a shortfall of £400 million to meet their requirements. It is time we addressed the matter and this Bill will do so.
We have made it clear that the primary and secondary sectors will get computers. We must then deal with the PLCs, apprenticeships, the hotel and tourism industries and the regional technical colleges and research and development. This is all taken into account. We have outlined a broad, detailed programme with an overview and plan within which we will operate. The enactment of this legislation will enable us to proceed.
We have been open and fair. We must ensure that we move quickly to respond to expressed needs, otherwise education will be left behind.
Will the Minister accept that the spirit of the strategic management initiative, as developed by all Departments, and the spirit of funding mechanisms put in place by the State in recent years requires that criteria and procedures for the selection of projects, as set out in amendment No. 26, would be clearly enunciated and that the public would be duly informed? In establishing this in the Bill will he also accept that he will put into practice a recent innovation in Government thinking and policies that such criteria and procedures are clear to all? That is the essential principle which the amendment seeks to implement.
It would appear from what the Minister of State has said that he agrees with this, that his Department does not want to accept the amendment, but wants to continue with the system it is used to operating which entails the various institutes submitting their plans to it. We all know how frustrating it can be to have proposals submitted to the Department followed by endless correspondence on their approval. People appear to be happy with this Dickensian approach to approving public funding. We should leap forward to the modern age. When we obtained £6 billion from the EU and started to disburse it——
It was £8.22 billion.
We used these suggested procedures to disburse that money and successfully brought forward many innovative projects from community groups which the Minister's and other Departments would not even have been aware of; their ideas would not have been considered. However, when we got access to EU funding and the EU stipulated that inclusion, regional help and proper evaluation was required, we complied. We then discovered a wealth of ideas and vigour in community groups and different institutions who were willing to forge national and international partnerships to develop excellence in their proposals.
The Minister has funding at his disposal dedicated to a need which we all recognise is a priority. Let us unleash some of the potential that has proven itself to be available. To what part of amendment No. 26 does the Minister of State object? Is it in the idea of having to invite applications, to publish the selection criteria or to make clear that he wants to promote equality of opportunity in the selection of proposals? Is it in the requirement to have them evaluated objectively, which would be similar to most of the EU Structural Funds. Indeed, he introduced a group that was not solely departmental, but included different expertise from the unions, the employers and the third strand, as it is currently known. It resulted in a sense of dynamism in the process of spending. Multipliers filtered throughout communities and members of the committee do not need to be told of the impact of some of those schemes and programmes.
The Minister now has a golden opportunity to embark on the same course of action with regard to the most important sector for the future of this country. Our survival depends on skills and quality of our people. Here, we will invest considerable sums of money and the Minister has the opportunity to draw on the best in the community by throwing this open to competitive tender and by inviting the creation of partnerships to draw down the money. Everything about his approach suggests that this is the correct way to proceed yet he will not take the extra step by enshrining it in legislation and instructing his officials to advertise in the newspapers from 1 January and to be creative in the use of these resources. He will not instruct them to set maximum impact and multipliers by sucking in support from business and other community groups. That is the kind of dynamism he is capable of creating with this proposal. It is within his grasp and he should proceed.
I am my own man on all issues but I am glad of my excellent professionals who have the nation's interest at heart. If I was to ask anybody here for his or her priority for the fund, I would get different individual lists. We were fortunate to be able to negotiate huge resources — £8.22 billion — from the EU. They made a major contribution to the country. Much more is needed and it is our job to get it. In all the negotiations the principle of subsidiarity applied, giving us the right to decide the priority of the projects once we operated within the parameters laid down for the funds.
This situation is different. It addresses a clearly identified need. It has been proven conclusively by the various reports and recommendations that have been produced across the educational spectrum, and by the professionals in education, that there is a huge need to be filled. We have responded to that need, introduced the legislation and created the dedicated fund. It would be unwise at this stage to enshrine a list in law which cannot be amended.
The Minister is missing the point.
We must ensure that the best decision is made at the time which will be based on the reports available, the advice we will receive, the decisions to be taken and the funds that are available. We cannot decide now what those decisions will be and legislate for that. Flexibility must be allowed. Responsible people are involved in the entire process. I am confident that when the legislation is passed excellent decisions will be made and the future of science will be sustained to serve the needs of the nation as we face the new millennium.
This is the most important amendment under consideration because it goes to the heart of the matter. Has the Minister of State read the amendment? It would be worth his while to do so.
I read the amendments in detail.
The amendment does not call for a given allocation. It does not seek to tie it to universities, equipment in the regional technical colleges or to schools. Amendment No. 26 requires the Minister to act in respect of some or all of the moneys and he may decide certain projects have proven themselves. That is why I say "some or all". I recognise that in regard to software engineering, for example, some colleges are ready to roll and this money should be released to them because they are good projects. What I am saying is that in respect of some or all of the funds — there is £250 million to be spread over the next three years — the Minister should seek submissions for proposals through advertisements and not through the traditional structures of the Department. The advertisements should state that the Department will spend money under named headings. He has seven headings but he could do this in respect of, say, three where he wants to encourage innovative thinking and he should state that he will judge the projects against specific criteria.
The Minister may say that the crucial thing at the moment is responding to the skills shortage in electronic engineering, technicians, etc., but that allows him to state the criteria against which he will judge quality. At least they will include reference to some of the things most Members feel are important, such as equality of opportunity and regional development and they should embrace a number of partners and not come from one source which has not sat down with business and other groups to enhance the quality of what they are doing. They should be innovative.
The Minister is saying that this is what he would like to do but he will not go the extra step. I ask him to reconsider his position on this because if he will not take this open and transparent approach, he will fail to tap into a great deal of potential. I have managed the employment, Horizon and Now funds and I have been amazed at what comes forward you would never dream of. If I asked my officials in what was then the Department of Enterprise and Employment to come up with ideas to spend £20 million on disability, they would have come up with much poorer ideas than those put forward in an open public competition. It would be better to have a committee sift through these proposals and then award the money to the best. That will encourage those who were not up to scratch this time to try again. That is an option. From experience as well as in principle, this would be the way to go.
Therefore, I ask the Minister to reconsider this. If he wants time, I am happy to give him until Report Stage tomorrow. He should go down this road. I am saying that this should apply to some or all of the money. I am not requiring him to say that all bets are off with people who are up to the starting line. I admit we should address the needs of software engineering. He will thank the committee when he comes back in three years and sees the impact of his fund.
The Minister indicated that section 4(1)(e) covered what Deputy Bruton was trying to achieve with his amendment. This subparagraph is the only place in section 4(1) where the phrase "with the consent of the Minister for Finance" is included. I understood from an earlier contribution that the Minister for Finance would not have a management role in relation to education. That is specifically what this is all about.
This section is very cumbersome in how it authorises various programmes irrespective of how they have been established. The fund, the Departments of Finance and Education and Science would react quite slowly in this context. The consent of the Minister for Finance is superfluous. The way Deputy Bruton proposes to deal with this particular issue is the better way.
Deputy Bruton is trying to decide how we might spend the money whereas section 4 is deciding how the money will be paid out.
With regard to Deputy O'Shea's reference to section 4(1)(e), we would be obliged to consult the NTMA on behalf of the Minister for Finance pertaining to funding because at a particular time the fund may be exhausted and one cannot continue to spend money which does not exist. There would have to be consultation. There would be private sector donations. The money would be accumulating and there would be resources adding to that.
In deference to Deputy Bruton who made a strong case for amendment No. 26, I am prepared to consider — during the break we intend to take between now and the moving of amendment No. 26 -the position pertaining to it and I will take what Deputy Bruton and Deputy O'Shea have said into consideration.
I thank the Minister for his attitude to amendment No. 26. I hope he will act positively in that regard when we come to it.
Amendment, by leave, withdraw.
Amendment No. 8 not moved.
I move amendment No. 9:
In page 4, subsection (5), line 24, to delete "in securities issued by the State".
This amendment relates to how the fund may be invested. I tabled this question as much to ask a question as to make a statement. My essential question is: within the context of the Single Market, can we impose this restriction where funds can be invested? In other words, are we entitled to include in legislation a restriction to securities issued by one member state as against another?
The effect of this amendment would be to empower the Minister for Finance and, through him, the NTMA to invest the resources in the fund which have been contributed by donors in any way he or the agency thought fit.
The Bill, as published, provides for investment only in Government securities. I accept that the approach in the Bill to investment is a conservative one but it is a very prudent one. I would doubt if donors would take too kindly if their hard earned gifts were used to play the stock market, even if that was being done by such prudent investors as the Minister for Finance — the committee knows how shrewd he is — and the NTMA, under the tremendous stewardship of Dr. Somers. In my view, the provision as it stands guarantees the security of any gifts made while permitting some growth through investment in Government securities.
The answer to the specific question raised by Deputy O'Shea is that under subsidiarity we are entitled to include this provision if we so wish. The donors would be happy to know that the money is in Government securities. It is a de facto investment which is copperfastened. It is being managed by the NTMA and it will accumulate. It will contribute to the fund and the State will get more value from the investment in that way. I am happy that is the road to go and I am sure the committee will agree.
I accept the Minister's explanation.
Amendment, by leave, withdrawn.
Amendment No. 10 not moved.
Section 2 agreed to.
NEW SECTION.
I already notified Deputy Bruton that amendments Nos. 11 and 12 are out of order.
I do not wish to question the ruling of the Chair but amendment No. 12 seeks to ensure that the fund is not terminated in the third year, thereby leaving open the possibility of Exchequer funding via the Minister for Finance — so impressed might he be with the performance of the Minister of State in running the fund — and ensuring moneys are allocated in 2000 and thereafter. It involves additional funding but the principle is one which the Minister should consider. Perhaps we can consider this when discussing the section.
Amendment 11 calls for the establishment of a board to manage the fund. Why does the Chair see this as involving a charge on public moneys since it would involve a board managing a fund which is being provided for?
It is proposed that the board have general functions, inter alia, in promoting science, technology and vocational education and to disburse moneys from the fund established by the Bill. The costs, particularly staffing and administration costs, would clearly involve the imposition of a charge on public moneys and the amendment must, accordingly, be ruled out of order.
The Minister could easily second people to support a board in its work. The people in his Department who will carry out this work could provide the necessary support and analysis upon which the board could make decisions. A board or committee deciding on priorities would not necessarily involve a charge.
I have been informed that the costs of staffing and administration would involve a charge on public funds.
Who is the oracle deciding such things?
The amendment is ruled out of order by the Bills Office. I am informed by the Clerk of the Committee that the issue of accommodation, which would result in further costs, also arises. As the Deputy is aware he can raise these issues when discussing the section. A board would involve a charge on public moneys and I must therefore rule the amendment out of order. Does the Deputy wish to speak on the section?
Amendment No. 11 not moved.
SECTION 3.
Amendment No. 12 not moved.
Question proposed: "That section 3 stand part of the Bill."
Everyone welcomes the allocation of money and the pinning down of the allocation effected through the Seanad amendment. Previously there was some doubt as to whether all the money would be allocated to the fund. I do not understand the thinking of the Government which leads to the conclusion that by 2000 there will be no further need for a Scientific and Technological Education Investment Fund. It is counter-intuitive that, at a time of mounting needs in technological education, the Government's fund, a bold initiative, will finish its work in three years with no further money being made available. The fund should be open ended. The Minister alluded to the fact that the Regional Technical Colleges have identified a need for £400 million; the steering group on higher education identified a need for £390 million in the university sector to facilitate new places; the steering group on information technology recommended an investment of £150 over five years in technology in classrooms; the CIRCA group recommended an investment of £60 million in research and the list goes on. There is no doubt that the total sum involved in those lists would, at a conservative estimate, reach £1 billion with a recommended timescale for expenditure of four to five years. We know that many of those £1 billion projects are only expressing hopes: the Government will not finance them all. However, it is a clear signal that the upgrading of our technological education will not end in three years. It is not possible for the Minister to get us over the hump in one big push, after which everything will be downhill and funding will be easier.
As Ireland's direct payments to industry come under scrutiny from the EU — it is already under serious scrutiny — the £200 million which we directly invested in companies on an annual basis will be questioned. These companies will have to stand on their own feet and will turn to examining the quality of the personnel they employ. Investment in education will become more important as other supports to industry are whittled away due to EU policies. I do not understand why the Minister, in bringing forward his ideas for an education technology fund to Cabinet, was of the opinion that the needs would be satisfied in three years and that we will not have a continuing need for an innovative fund to examine new ideas and challenges.
We should entrust management of the fund to an independent board which would bring to it outside skills and expertise. Perhaps the Minister can go some way towards meeting my concerns by accepting amendment No. 26. Perhaps he will explain why he has decided that the fund should only run for three years.
This section is one of the most significant provisions of the Bill providing a mechanism whereby public moneys totalling £250 million are to be placed at the disposal of the fund over a period of three years. As I stated on Second Stage, this provision represents a radical departure from previous capital provisions for our Department. Statutory provision for the payment of £250 million into a special fund will facilitate a rolling programme of capital investment over a number of years. The money will be voted on the Estimates for our Department in the normal way and I assure the committee that payments into the fund will be additional to the normal annual capital Estimates for the Department.
This is a clear demonstration of the Government's commitment to capital investment in education in a way never before provided for. It will provide certainty of planning and encourage the associated educational institutions and private donors to engage pro-actively with our Department in developing those institutions. The fund and the statutory provisions underpinning it will also demonstrate to national and international investors that, as a community, we recognise the central role of a high quality education in our social and economic development and that we are committed to building on the successes which our education system has provided.
The new fund provides for payments in 1998, 1999 and 2000. The matter will be considered further at the end of the three year period. If at that time it is decided to continue the fund by allocating further funding an amendment to the Act can be inserted to enable it continue into the future. The Act will become permanent and will be a vehicle for investment in technological and scientific education at this important time. The legislation can be amended at any time. To continue the fund after three years' experience would only require an amendment and I am confident there will be many reasons to do this.
It is very unusual to frame legislation whereby a Minister makes a commitment to amend it in three years' time. I agree there should be a rigorous evaluation at the end of the three years to see if it achieved the aims set for it. However, it is good basic housekeeping to add a provision allowing for other funds in subsequent years as the Minister decides, with the consent of the Minister for Finance. That should be inserted now rather than leaving it until later when it will require a new Bill which will have to go through the process of being enacted. I do not understand why the Minister states he will introduce an amendment in three years' time as opposed to now.
Deputy Bruton misinterprets me. We are doing something new by providing dedicated funds over three years to a Department. This was never done before for specific reasons. We intend spending £250 million as well as whatever is received from the private sector. Based on the experience garnered over the three years of the use of these funds, the effect they have on the country and the major impact they have on the scientific and technological underpinning of education, the strategy will be reviewed and someone — it may be me or someone else — will then amend the Bill. We are doing something new and special for an important purpose. We need the time and experience of three years to decide what to do thereafter. Because the system is being changed completely and the dedicated fund is being created, time is important and the three years should be taken to obtain the experience to shape the following years.
Time is important but in many areas this Bill bears the marks of a rushed job. Some aspects should have been handled differently. Time is important but it is better we have a Bill over which we can stand. It is unsatisfactory that the Minister must consider alternatives overnight and return with them to this committee tomorrow. I suspect he will return with bad news which, although he will not say it, will reveal de facto that the Minister for Finance will not agree to changes which might improve the Bill or that the Minister cannot put these matters to him because there will be no Cabinet meeting before the date upon which this Bill must be enacted. This is an unsatisfactory way to conduct business. We are trying to examine this Bill in detail on Committee Stage as it will be important for many years to come. I do not know how the Minister can consult with other colleagues on significant details of this Bill overnight.
Deputy Bruton should substitute "responsible" for "rushed". He would then know where we stand.
Question put and agreed to.
SECTION 4.
I move amendment No. 13:
In page 5, subsection (1), line 12, after "may," to insert "at the request of An tÚdarás,".
On the basis that the Minister has agreed to return to the matter of the Higher Education Authority on Report Stage, I withdraw the amendment but reserve the right to resubmit on Report Stage.
Amendment, by leave, withdrawn.
Amendments Nos. 14, 17 and 18 are related and may be discussed together by agreement.
I move amendment No. 14:
In page 5, subsection (1), line 13, after "Fund" to insert "to a person or body who, apart for this section, is in receipt of public funds for educational or training purposes and complies with any requirements, including requirements as to tax clearance certificates, as may apply as a condition of receipt of such funds".
The tabling of this amendment relates to the funding of private institutions. I do not have a problem with them except that there should be equal access for all students to private colleges. The criteria I am endeavouring to have included in the Bill are that such an institution should already be in receipt of public funds for education or training purposes and should comply with any requirements, including tax clearance certificates. In other words, if the Minister proposes at any time that money should go to a private institution it should already be in receipt of public funding for either education or training and should have its tax affairs in order among other requirements.
I agree with what Deputy O'Shea is attempting to achieve with his amendment. Amendment No. 17 is in my name and, in much the same way as amendment No. 18, it attempts to broaden the scope of the fund to give parity of esteem, as Deputy Gilmore described it, between traditional universities, regional technical colleges and the Dublin Institute of Technology and other colleges which are proving themselves increasingly capable of providing excellence in education and training. That is why my amendment states that a college within the meaning of the Vocation Education Acts, 1930 to 1970, should be included in paragraph 4(1)(a). It explicitly provides these colleges with the opportunity to submit applications and obtain funding.
Excellent work is being done by the vocational education sector, an area which falls into a twilight zone between second and third level under current legislation. The sector provides post-leaving certificate courses and I know from his questioning in the Dáil that Deputy Carey is keen to see a structured development of the PLC sector, and I agree. They have great potential and parity of access should be provided.
The Minister referred earlier to paragraph 4(1)(e) as a means by which to creep in the back door, but it is one which has triple locks put on it by the Minister for Finance. The requirement of his consent in this context is not in case the money has been spent, as the Minister suggested, but because he will want separate approval if the Minister considers allocating funding to a PLC course as it opens up a new area, something he may not want. He may prefer for the Minister to confine himself to his remit. This is a restrictive gate through which the Minister expects the vocational education committees to go.
It is even more restrictive for private colleges. If the Minister were to receive an excellent idea from a private college and he requested funding for it from the Minister for Finance, he would not receive it on the basis that it would open up the possibility of fees payment and maintenance grants for those in private colleges. That is what would happen and the Minister will probably receive a briefing to the effect that it would be unthinkable because it would open up this terrible vista. It needs to be inserted in legislation that the Minister will consider vocational education committees, private colleges and other groups on a fair basis. That is how he will receive the best proposals.
I was disappointed that, when his Department considered some of the existing skills needs, none of the private colleges which tendered for that work was successful. I suspect that when you look behind why that happened, you will find that it was not that they were not coming forward with good ideas or worthy proposals, but that the Department and the Department of Finance together felt that opening up the provision of scarce skills to private colleges would be the thin end of a wedge to opening up the agenda on whether private colleges should have access to maintenance and fees support for students. If that is the thinking that I suspect is going on behind the restrictive framing of this section, it is a pity. We should welcome the best proposals for educational development, from whatever quarter they come.
It is particularly ironic because the Minister of State is asking the private sector to provide money, yet in the small print he says that if a private college seeks to use that money it will receive a frosty response from the Department. Section 4(1)(e) is a narrow gate with lots of triple locks on it, so you can be sure that the Department of Finance will not let it be opened.
As this Bill is framed the Minister of State will have huge difficulty doing the sort of things I am sure he wants to do with new areas of education. He should try to take on board some of these amendments which would place him in a better position to use this fund creatively.
Amendment No. 18 is in similar vein to Deputy Bruton's. The restrictive nature of the Bill is reminiscent of the time warp we now observe in the Seanad with the university seats issue. At the time, the votes of graduates of the National University of Ireland and Dublin University seemed sufficient to deal with the area of third level education representation in the Seanad but as the Minister knows, that has given rise to great criticism, in hindsight, that it is not adequate.
We should look into the future and try to see the pitfalls. My amendment is restrictive in the sense that it asks for youth organisations to be included in the Minister's remit as well as being recognised and grant aided through the youth works grant schemes and other such schemes administered by the youth affairs section of the Department of Education and Science.
I am asking for organisations to be included in the Minister's remit which have been vetted, are bona fide and have received recognition as being of great benefit and service to the community and the people who, I presume, are being targeted by the Bill. Yet, they will be bypassed unless my amendment is accepted.
The fact that the Bill is so restrictive is a fundamental weakness. Already we see the telltale signs that formal education will only be one part, although quite an important one, of the overall needs for training and education and the development of IT skills needed in society generally. It will be badly thought of unless this Bill grasps the nettle to have a much broader remit to cover youth organisations as proposed in my amendment.
Amendment No. 14 has two main objectives: first, it would limit the use of the resources of the fund to publicly funded institutions and, second, it would require those institutions to have a tax clearance certificate before receiving money.
As to the issue of confining the fund to publicly funded bodies, I am not satisfied that this restriction is either necessary or desirable. While the bulk of any money from this fund will be spent on publicly funded bodies, which will have more than enough eligible programmes for funding, it would be undesirable to create the kind of inflexibility which the Deputy proposes. There may be circumstances where the more cost efficient way to approach a particular funding issue may be to enter into arrangements with the non-publicly funded body. I see no advantage in ruling that eventuality out at this stage. There is also a danger in ruling out purely privately funded institutions for this might run counter to the wishes of a donor in any particular case.
On the taxation issue, the publicly funded institutions — which will receive most, if not all, the money from the fund — have charitable status, so the issue of tax clearance does not arise. Where institutions in receipt of funds do not have charitable status, then the normal Government procedures in relation the dispersal of public money and the availability of tax clearance would apply. There is no need to specifically provide for this as it is standard in all types of activity in the disbursement of public funds.
As regards amendment No. 17, Deputy Bruton proposes the inclusion of vocational schools and other colleges within the terms of subsection (1)(a). This provision is aimed specifically at third level institutions so it would not be appropriate to include these schools and colleges in this paragraph. However, the schools and colleges are provided for, although not specifically mentioned, in paragraphs (b), (d) and (e). These provisions will allow for a wide range of courses and programmes in second level schools and other institutions. In my speech on Second Stage I outlined the programmes on questions including post-leaving certificate courses and apprenticeship education.
Amendments Nos. 17 and 18 refer to PLCs. The training given to students on PLC programmes has enabled them to acquire relevant and marketable skills. Through the knowledge, competencies and expertise gained from these programmes, PLC graduates can contribute to economic development and meet, through their specific skills, many of the needs of modern enterprises.
Capital investment is required for infrastructural development in the PLC sector. Many PLC centres need to have their physical facilities upgraded and expanded to prepare their students more effectively in both traditional and developing areas of science, commerce and technology. We propose an investment of about £20 million from the fund for the purposes of capital infrastructure in the PLCs and apprenticeship areas.
With regard to amendment No. 18, youth work organisations do much good work and Deputy Sargent made this point on Second Stage also. They can be accommodated in so far as they are engaged in education programmes covered in paragraph (e). We are taking all opportunities on board and will allocate funds; the PLCs in particular will receive support. This section definitely covers all the eventualities to which Deputies alluded in their amendments.
The Minister is right in saying that there are ways in which PLCs could get through the tangle and gain access to funds, but it is clear that he expects them to carry top weight and that it will be difficult for them to get through. As regards gaining access, they will be very much disadvantaged compared to their colleagues in universities, regional technical colleges and the Dublin Institute of Technology. They will have to prove to the Minister that they are catering for some special undefined need and that will be far more restrictive — universities do not have to establish anything in terms of special needs — or they will have to get a special individual personalised sanction from the Minster for Finance, which will be another insurmountable object for many outside groups, such as those mentioned by Deputy Sargent or those mentioned in my amendment.
The Minister may be correct in saying that technically they can get through, but he is not giving them equal terms of access. They will have to get through the eye of a needle to gain access to significant funding for innovative projects in this area. If the Minister's interpretation of Deputy O'Shea's amendment is correct, I do not support it. We should not exclude private colleges from the possibility of drawing down money. I thought the amendment provided that private colleges should produce a tax clearance certificate. However, the Minister said they will have to do so in any event without legislative provision. I am, therefore, satisfied with the section.
The Minister should be aware that he is not giving parity to the different sectors and that, by and large, students going to the sectors he is down-grading and for whom he is making life more difficult, are those with greater disadvantage. The traditional institutions which mainly cater for middle class children will get favoured access to this fund in comparison to those more innovative but perhaps less chic and sleek institutions which are less well funded and established. Such institutions are, by and large, catering for children from disadvantaged backgrounds. Eighty per cent of students attending PLCs are entitled to maintenance grants as their parents' incomes are below the income limits of £17,000 to £20,000; the comparative figure for universities is between 35 and 40 per cent. Either inadvertently or deliberately, the drafting of this section makes it more difficult for colleges catering for more disadvantaged children to gain access to this fund. This is a mistake which should be reconsidered.
The Minister's claim that there is no problem for youth organisations is difficult to believe. Paragraph (e), which states that "such other scientific, technological or vocational education and training programmes (howsoever established) as the Minister, with the consent of the Minister for Finance, considers appropriate", is far from the definition of youth organisations in the amendment I submitted. Perhaps the Minister is trying to soft soap us in which case this is the best he can do. However, he will have to insert an amendment because I do not think youth organisations are included in the present text. Those youth organisations capable of finding a way through the challenging maze, as alluded to by the Minister, are those least in need of the IT training and servicing which this Bill will provide. We should keep to the forefront of our efforts those who need to be clearly informed that assistance is available; those who have been extremely disadvantaged and have felt like second class citizens for a long time. The wording of paragraph (e) sounds as if it provides for groups which are well organised and part of the formal education system or one step removed from it. The breadth of educational opportunity is widening but is not open to everyone because of our two tier economic system.
The Minister said private colleges could be precluded from receiving gifts if my amendment was accepted. Section 7(3) of the Bill states that "The Minister shall not accept a gift of moneys, land or other property if the trusts or conditions attached to it would be inconsistent with the functions of the Minister or the Minister for Finance under this Act." Such a gift would be made directly to the institution. There is nothing to gain under current tax laws by making a payment to the fund as distinct from directly to the institution. By making a direct payment to the institution the donor would have more control over the donation and would receive more credit if they so wished. Therefore, the argument being put forward by the Minister is, per se, not valid. My amendment would not preclude a private donation to a private college.
I do not seek to exclude private colleges from receiving donations as a matter of principle; neither does the legislation. However, funding should go to existing, recognised educational establishments already in receipt of public money. The principle of equality of access should apply to private institutions and in this context such colleges should have an element of public funding. I am trying to avoid controls in relation to moneys paid which might allow a future Minister to use this as a slush fund to provide money for a particular college.
The Minister said the provision of a tax clearance certificate is already provided for. It is provided for under other legislation which could be changed in the future, although that is unlikely.
One great man designed the tax clearance system — the creation of which involved much pain — and it has underpinned and sustained the State in the transfer and protection of resources. I do not think anybody in our time is likely to consider revisiting it, considering the pain in achieving it and its beneficial results.
There is absolute equality of access. It is not necessary to be either chic or slick to gain access to this fund. We have clearly specified that the vocational education needs are costed at £20 million. This will underpin the vocational education sector and provide for PLC courses and apprenticeships. There is no question of these institutions having to do anything special to receive equality of consideration. There is no doubt but that money will be spent in these areas.
Youth organisations have problems, but once they are engaged in education programmes they are included in the Bill for consideration under paragraph (e). Youth organisations will always have problems: they exist to solve problems and do tremendous work. Funding is always a major problem for them but, in so far as they are involved in education programmes, they will be considered in regard to this fund and the effects of this Bill under section 4(1)(e).
The Minister and I are at variance with regard to the private colleges; it may have been my fault. When I spoke of equality of access for students, I meant that students would not be prevented on financial grounds from attending a particular college.
That is a fair point and we will take it on board.
I cannot accept what the Minister is saying — that he is letting the PLCs in on equal terms. That is clearly not the case. He is providing that if they are to get access they must come in under section 4(1)(b) where they must prove "there is a need" which the Minister has identified. Effectively the Minister is saying that the PLCs will remain as an ad hoc resource. From time to time the Minister will allow them to meet a skills crisis, but he will not allow them to develop structurally like other education institutions under this Bill. They must prove each time that the Minister is happy they are fulfilling a specific special short-term need which he has designated.
This sector deserves better. It needs to be developed in a coherent way. It needs a structure which will help it develop and it needs to have access on fair terms. The Minister is condemning it to remain as a source of courses which meet particular needs. He will give them a few bob from his coffers when it suits him. If the PLCs are not able to fit into his immediate needs, they will not develop structurally. That is not right. If they must go through section 4(1)(e), they have no hope because they will not get the nod from the Minister for Finance. The idea that they must get the sanction of the Minister for Finance creates a hill too high for them to climb. They will be in endless correspondence with officials in the Departments of Finance and Education and Science so they will never succeed.
I do not accept that the Minister is giving parity of access. This is justified by the topsy turvy way the PLCs have grown up. They are now a good resource and they should be given recognition. They should be strengthened and developed not put into a second division when it comes to this fund.
It is interesting to hear the Minister state that this Bill is already adequately able to deal with the concerns which have been raised. I am extremely unhappy that he seems content to talk about access to youth organisations where the Minister for Finance sees appropriate. It is the politics of the moveable feast. It will mean that all sorts of considerations will be given to what is appropriate to the point of not knowing. The resources of youth organisations, both time and money, are scarce enough without being spent trying to second guess the Minister with regard to what is or is not appropriate. I ask the Minister to consider making some reference to organisations involved in youth work and training which are officially recognised, sanctioned and already vetted by his Department so that they will know at least that the Minister is thinking of them and has not been caught in the headlights of the formal academic institutions, which have a powerful lobby to which they do not have access.
This will interest both Deputies. Earlier Deputy Bruton stated that these people could not get through the eye of the needle. I can assure the Deputies that this is a £250 million gold bar one can access from both sides. Equality of access is certainly available to the PLCs.
To date the PLCs have not received recognition but we are committed to them. We are allocating £20 million. The Minister made a de facto statement that as of next year, grants will be available to students attending the PLCs. This proves we are supportive of the PLCs who are providing a major service for the State. They fill a niche in the marketplace. They link with industry, they upskill and reskill and provide skills for people to take up jobs directly. That is an important role.
At this stage of development, it is important that we recognise, and prepare people for, the link between education and industry. This new investment fund is specifically related to scientific technological and vocational education. There may be needs in the youth area and these will be addressed in the normal way, through the Department's dealings with the youth service. The Bill, however, relates to specific areas. It is only where programmes are in the field of scientific, technological or vocational education and training that payments can be made from the new fund. If youth groups meet that particular criterion, they will be eligible for consideration and support. I am confident that consideration would be given to them and I hope we will be able to support them because they are doing tremendous work.
Amendment put and declared lost.
Sitting suspended at 1 p.m. and resumed at 2.20 p.m.
Amendments Nos. 15, 20 and 22 may be discussed together by agreement.
I move amendment No. 15:
In page 5, subsection (1), line 14, after "expenditure" to insert ", or such current spending paid on a once-off basis to seed fund innovative proposals which would not otherwise occur,".
Rather than confining the fund solely to capital expenditure, this amendment creates the possibility of once-off seed funding for innovative projects. It would have to be made clear that it was on a once-off basis. If worthy proposals came forward whose needs were not confined to equipment or buildings but were of a once-off nature, such as upskilling trainers, it would be open to the Minister to consider them. The amendment would allow flexibility to do this in certain circumstances.
Amendment No. 20 seeks to delete subparagraph 4(1)(c)(ii) where the Minister proposes to make funds available to a college to make use of the results of any new research for commercial purposes, including the process of manufacturing. The Minister proposes that the educational technology fund would be used to commercialise research. I have no problem with that, but I am strongly of the opinion that that is not the business of the Minister for Education and Science but the Minister for Enterprise, Trade and Employment. Such commercialisation should be done through Forbairt. While the Minister for Education and Science has responsibility for research, it is a mistake to confuse the provision of education and funds to provide research and education facilities with the commercialisation of that research. This should be done using money allocated for industrial development purposes. Otherwise, it is going beyond the proper role of the Minister for Education and Science. If the Minister wishes to use some of the fund for such a purpose, he should insert a separate section in the Bill whereby certain moneys will be provided to the Minister for Enterprise, Trade and Employment who shall deploy that money for commercialising research under whatever rules she devises. It is a mistake to confuse the provision of education and research facilities with the commercialisation of research.
Amendment No. 22 proposes additional areas where money can be spent. It allows the Minister not only to fund research facilities in colleges but also those which are partnerships between businesses and colleges. This is not investing in the commercialisation of ideas but allowing the Minister to explicitly support joint research facilities between colleges and businesses. One of the significant long-term challenges is ensuring the tremendous stable of multinational companies to carry out research, especially with the colleges. While I do not envisage this money being used to commercialise ideas, it is legitimate to provide it for joint research facilities between business and colleges.
The other area to which I envisage money could go would be the provision of matching funding for research applications funded by EU bodies. The Finns have made significant strides in this area by setting up a board to examine in detail the funding of research in Finland. They have successfully prioritised what research they wish to do and have provided matching funding for projects funded by various EU sources. There is a case for doing that here. It would have been tied in with my earlier proposal of a board with a remit to promote strategic areas of research in Ireland. This may suffer somewhat if the Minister is to be the sole guardian of the fund.
Those are the areas in research where the fund could be used to put Ireland on the map. It is worth spelling out in detail the sort of research activity the fund should support. I admit that provision is already made in the Bill for conducting research but the amendment aims to give it more focus and direction.
These are different amendments. The first suggests leaving open the possibility of once-off seed funding for non-capital purposes. The second suggests that we should not use this money to get involved in the commercialisation of ideas which is properly the task of the Minister for Enterprise, Trade and Employment. The third suggests we should give greater strategic focus to the type of research activities we would like to see this fund support.
Will the Minister elaborate on the status of campus companies which are allowed under the Regional Technical College and Dublin Institute of Technology Acts and permissible in the university sector? If such companies receive moneys from this fund for research or manufacturing as is permitted under the Bill, who receives the profits? Who will receive the proceeds of royalties? Could we confine the outcome of research to that which benefits the public good where the nation would benefit from any substantial breakthrough? Does this section provide for a private company, involved with a college which sets up a company so that, if the project is unsuccessful, the college will not be exposed to financial losses?
The purpose of this new fund is to support capital investment projects. It is additional to the normal expenditure voted in the Estimates. Additional recurring funding will be made available from other sources to take account of the recurrent cost implications of certain provisions in the Bill. For example, the Schools IT 2,000 project will have recurrent cost implications and £20 million will be allocated in the normal Estimates to provide for the costs of appropriate training for teachers.
Similarly provision has been made in the 1998 Estimates for an additional £5 million for recurrent costs associated with expanded research and development activities. It is open to the Minister for Education and Science to consider supporting seed funding proposals involving recurring costs on their merits in the normal way.
I can assure the committee that the recurrent costs of projects supported by the fund will not be neglected. Since the fund aims to support enterprise and innovation, the committee may be assured that any such proposals will receive careful consideration. Given the rapidity of technological change, it is crucial to invest in research and development in order to develop new and existing products and enhance the means of production. Failure to do so has serious implications in the competitive global market.
The inclusion of a specific heading for research and development demonstrates the extent of the Government's commitment to investment in this field. In framing the terms of the fund we have taken account of the findings of the report of the Circa group, which identified the need for a significant increase in the level of public funding available for university research and the need for reforms and research management in the university sector, and also the earlier recommendations of the Science, Technology and Innovation Advisory Council.
Our commitment to continuing the process of widespread consultation with the various interested parties, including those in the research field, is a matter of record. This process will facilitate access to the views of established experts in the fields of research. Decisions concerning allocations for research and development will also be informed by the advice of the Higher Education Authority and the findings of the recent Circa and STIAC reports. The Circa report in particular emphasised the necessity for rigorous evaluation of research projects.
The consultation process will also facilitate dialogue between the education and industry sectors. Strong links have already been forged in many cases and I am satisfied that partnerships, such as those described by the Deputy, will continue to play a key role in the identification and funding of applied research projects.
I believe that there are sufficient safeguards in the Bill to ensure that all proposals which are approved for support from the fund will meet the highest standards and will satisfy a specific need in industry or the economy.
The terms of section 4 should not be regarded as exclusive of all other matters but as summarising the key areas which will be assisted from the fund. Under the terms of section 4(5) the Minister for Education and Science is required to issue appropriate guidelines concerning research and development activities. These are guidelines which would have the approval of the Minister for Finance. The advice of the Higher Education Authority would also be available in any particular case. In the circumstances commercial development envisaged in the Bill would be subject to careful scrutiny. I would take the view that it would be more effective to deal with issues such as those raised by the Deputy in this way rather than including references to such specific matters in detail in the Bill.
I wish to confirm that nothing in the terms of the Bill prohibits the allocation of matching funding for research projects funded by the EU or other bodies. Consequently, it is not necessary to include a specific reference to this effect in the Bill.
In defence of amendment No. 15, it is clear from its phraseology that I had not in mind the recurring costs of investments which the Minister might make. It is clear that if one provides work stations for software training, one will have to pay the recurrent costs and that will come under the universities' budget. I was thinking of projects which might get off the ground by investment in the training of trainers. That would be the key up front cost which is not capital in nature. We should be open to that possibility.
The Minister seemed to think I was suggesting that the normal recurring costs of employing teachers, etc., could be drawn from the fund, but I would not support that in any way. I had in mind rare good projects which had available space and equipment in place where the key factor would be that they wanted investment in special training. I will not go to the ramparts defending that particular amendment. It was meant to give the Minister flexibility.
The one I feel most strongly about is undoubtedly amendment No. 20. It would be a mistake for the Minister to go down the road of bankrolling the commercial application of research. That is not what is envisaged by an education Bill. He and his officials would not have expertise in evaluating good commercial investments in this area. There are established venture funds which are operated by the State. There are also the programmes in advanced technology, known as PATs, which are the responsibility of the Minister for Enterprise, Trade and Employment. The existing vehicles are adequate to take on this role.
I did not hear the Minister state why section 4(1)(c)(ii) was included. It is out of place. The Minister should not get me wrong; I am in favour of commercialising the product of Irish research, but it should not be done from an Education budget and evaluated by people, such as those surrounding the Minister, who could not be expected to be engaged in venture capital assessments of research ideas. That is not what the Department of Education and Science has set itself up to do and we should not ask it to do so. The PATs and venture capital funds, some of which have specific mandates for particular areas of the science and technology brief, are adequate vehicles to carry on the work.
I accept what the Minister said about amendment No. 22 — that it is not necessary to include these as specific remits in the Bill. Nonetheless, the Minister should be conscious that these are directions which I, representing the Fine Gael Party, would like to see him explore because there is a need to take a more strategic look at research investment. If he is to set up a fund to bankroll more investment in research and development a strategic approach should be adopted. I do not know what outside expertise it is envisaged bringing in to guide the investment in research and development in the colleges under this fund but since most of the research and development advisory groups are established under the education side of the Department, I do not know how the evaluations under paragraph (c)(i) will be carried out. Perhaps a board or other advisory body should be established to carry out evaluations of the ideas put forward. One needs sharp evaluation to decide whether research proposals are worth funding.
Deputies Bruton and O'Shea raised some interesting questions. Deputy Bruton asked why paragraph (c)(ii) is included in the section. Linkages between education and industry are important. We have had a good education system over the years but there has been a failure in that, to a certain degree, education has operated in isolation from the needs of industry. Education should be focused on ensuring graduates are able to commercialise the opportunities available to them. Great efforts have been made in third level institutions with campus companies and other centres of excellence where great research is being done.
The Government has an enterprise ethos and it wishes to ensure that we can capitalise on the skills and opportunities available in the education sector to sustain economic growth. It is incumbent on the Government if it is to drive the third level institutions in that direction to provide funds to support them. Traditionally, the Department of Education and Science has supported research and other work through the HEA. Deputy Bruton will be aware of the work of the Department of Enterprise, Trade and Employment, with Forbairt which has an innovation fund, and we hope to enhance that and support it to capitalise on the opportunities.
Many reports have been produced providing academic conclusions which could have been converted into commercial realities, but that did not happen. We wish to ensure that such opportunities will not be lost in the future.
Why not do it with the funds already in operation?
We want to be in a position to draw down funds for these purposes and unless we specify in the Bill that we require the funds for that purpose we will not be able to draw them down.
Why not provide that the Minister for Enterprise, Trade and Employment will disburse them?
I am trying hard to procure funds for that Department also. I had a heavy meeting late last night on that matter. There will be complete consultation between the Minister for Education and Science, the Minister for Enterprise, Trade and Employment, the Secretaries General of those Departments, the relevant officials and the various other agencies to ensure that we all follow the same direction and that the funds are used to maximum advantage. There will be full consultation involving the specialist officials in the Departments and advice from the semi-State bodies, Forbairt, IDA Ireland and others.
The campus companies in the universities are doing tremendous work in research and development. There are specialist areas of research in different universities — for example, the Micro Applications Centre in the University of Limerick — which have track records as centres of excellence. We want to capitalise on that by bringing them together and co-ordinating them, using funds available in both Departments which can support relevant projects. We must agree after consultation on what we think is best so that we might capitalise on the market opportunities in the world economy.
Does the Minister of State feel there is a danger of duplication in this regard? He speaks of the excellent work of the third level colleges and the campus companies but he must realise that this measure puts an extra burden in place for which they are not ready. This Bill sets up a new research and development layer, although there exists already a research and development section in the Department of Enterprise, Trade and Employment. Is it implied that the existing function is not sufficient? Would it not be better to provide more funds rather than proceed as in this proposal?
Will it be possible to obtain matching funds on the basis of the money provided by the State or must they be claimed on the basis of the private sector funds? If one is using local authority funds one cannot draw down matching funds for projects. We should be clear about the basis on which we can draw down matching funds.
Research and development are vital to the country's future. I do not have the full details of the industry programme but in the food subprogramme substantial funds were made available for research and development. However, those funds were available to the food industry where the benefit of the research would be for the public good. An expert committee was put in place and submissions were made to it from which projects were selected. In the case of companies doing research for products confidentiality would apply. However, in the subprogramme the emphasis was on the science as it would apply to the industry; in other words; the education element, although important, was secondary.
With regard the provisions in this Bill the emphasis is different. Funds for research for the public good are fine because everybody benefits. However, if a company is involved and research and development are carried out on a confidential basis, the benefit may not extend far beyond those who carry it out.
Will funds be made available to Teagasc bodies, such as the National Food Centre at Dunsany or Moorepark, which do important research? I take it they are not excluded.
They are not. Nobody can operate in isolation. Great research is being done by State agencies, in the private sector and in the universities and it is important to try to bring them together. In response to Deputy Farrelly, we are not creating a new structure; rather we are trying to co-ordinate that which we have so that we can make maximum use of the resources available.
The problem to date is that there has not been sufficient money available for research in any Department. There are three Departments which do not have sufficient funds — Education and Science, Enterprise, Trade and Employment and Agriculture and Food. We are addressing that insufficiency with this measure. If good proposals are made we are duty bound to consider them no matter what their origin. I see no impediment in that regard.
We propose the establishment of a business education partnership forum which will be co-chaired by the Tánaiste and the Minister for Education and Science. It will be representative of the business and education sectors, the trade unions, Departments and the development agencies. We hope to establish an expert group which will advise on future skills needs and forecasting techniques. This group will include representatives from the Departments of Education and Science, Enterprise, Trade and Employment and Finance, the Higher Education Authority and the development agencies.
A high level management implementation group comprising the chairman of the expert skills group, the Secretaries General of the Departments of the Taoiseach, Education and Science and Enterprise, Trade and Employment, the Second Secretary General of the Department of Finance, the chief executive officer of Forfás and the chairman of the HEA. We are bringing together the political, governmental, State and semi-State, science, education and industry interests in a co-ordinated fashion with the support of the Government. Everybody will be aware of the goals, the parameters of the environment and the opportunities that will available.
What about matching funds?
Matching funds required by the EU can be drawn down by the private or public sector. I see no reason money provided from this fund, from whatever account, will not be acceptable to the EU.
Under the provision of section 4(1)(c)(ii) the Minister for Education and Science will become a venture capitalist. However, there is not much evidence of venture capitalist experience in the Department with which to decide where to invest State funds. When the EU decided to support our approach of seed funds managed by the State, it insisted that the fund management would only be on a joint venture basis. The £34 million fund operated under the aegis of the Department of Enterprise, Trade and Employment may only provide venture capital on the basis of joint private and public sector funds managed by the private sector. There can be no question of the State propping up lame ducks or companies which fail. However, in this case the Minister for Education and Science will become a venture capitalist for the commercialisation of new, high risk projects without the basic protections built into the operation of the seed funds in the Department of Enterprise, Trade and Employment.
It is wrong for the Department of Education and Science to seek to adopt this role. If the Minister wishes to allocate some of the £250 million to the commercialisation of research, let him do so through the venture funds already available. A sum should be added to the £34 million to set up a fund. A private sector partner should be found to match the funds and it should be used for the commercialisation of research in the higher education institutes. An experienced venture capital manager should be appointed to manage such a fund.
It is wrong to give the Minister a mandate to invest in the commercialisation of research which is beyond the remit of his Department. If such a proposal involved a local authority it would be acting ultra vires. The Minister has neither experience nor mandate in this regard and should not be involved. It is an important principle. We should not agree to the provision in section 4(1)(c)(ii).
There are no lame ducks. Research has been carried out over many years and the opportunities were not fully exploited. We are promoting research and development so that we can keep pace with global performance. There are tremendous people working in the third level institutes——
Read subparagraph (ii). It does not refer to creating research but to the use of research for commercial purposes, that is the results of research.
Absolutely; commercialising them. No lame ducks.
The commercialisation of research is a high risk activity and the Minister of State proposes to bankroll such investment projects. The Minister and the Department has neither mandate nor experience in that field and it may become an area in which no money will be spent. If it is to be done, let it be done through the Department of Enterprise, Trade and Employment.
Under the European Regional Development Fund programme, for example, projects in the areas of science, micro-electronics and marine science were approved by the Minister for Education on the recommendation of the Higher Education Authority and others. Many of those projects have resulted in college and university activities which relate to production processes in what might be termed "pilot plants" or innovation centres and there are such centres in most of the universities. It would be wrong to prevent the commercialisation, through licensing or otherwise, of these new products. It is important that research be carried out at the various stages of the process — basic and applied research and in pilot plant operations.
Surely the Deputy does not suggest that universities, Regional Technical Colleges or institutes of technology which operate under the aegis of the Minister for Education and Science should not have the capacity to carry out research and exploit it in commercial opportunities which will sustain economic growth through product and job creation by capturing domestic and international markets. We wish to co-ordinate this activity. We are not entering into risk business, although every activity has a risk associated with it. There will be high quality professionals involved. Decisions will have to be taken on drawing down money from the fund to support research and development. If we do not adopt this approach we will miss the opportunity to capitalise on the benefits which education can bring.
The Minister of State is missing the point. I do not object to the commercialisation of research. I object to the Minister for Education and Science setting himself up as a venture capitalist, selecting research projects and investing taxpayers' money in high risk ventures because he does not have the capability or the experience to do so.
If he wishes to adopt this policy he should set up a venture fund under the aegis of the Department of Enterprise, Trade and Employment, which has the expertise; let him bring in joint venture partners and manage the fund on a proper venture capital basis. Let us not get into spending money on commercialisation by the back door. I am not suggesting, as the Minister of State has sought to suggest, that Regional Technical Colleges do not have the capacity to develop and sell good research ideas, they do. However, it is not the role of the Minister for Education and Science to put money into those projects, yet this is what this is providing for.
We are simply not precluding the commercialisation of research. Any such investment from the fund will be subject to strict guidelines to be agreed with the Department of Finance and the Minister for Finance. All payments will be made in consultation with both the Minister for Finance and in particular the Minister for Enterprise, Trade and Employment. It is very unlikely that the Department of Education and Science or any other Department would, in those circumstances, get involved in high risk capital ventures. I hope that reassures the Committee.
Amendment, by leave, withdrawn.
I move amendment No. 16:
In page 5, subsection (1)(a)(i), line 18, to delete "body" and substitute "university".
I do not intend to take time over these amendments, but I would like to ask the Minister why the word "body" is used in section 4(1)(a)(i), to which section 4(1) of the Universities Act, 1997, applies. Why not call it a university?
This is essentially a drafting point. Whether the Bill refers to a body or university makes no practical difference. The word "body" is used is because all the universities are corporate bodies. I consider the provision should be left as drafted and I do not propose to make any change. I hope the Committee agree.
What is new?
We are all very fine bodies here.
In view of that profound piece of logic, I withdraw the amendment.
Amendment, by leave, withdrawn.
Amendments Nos. 17 to 19, inclusive, not moved.
I move amendment No. 20:
In page 5, subsection (1)(c), to delete lines 32 to 35.
Amendment put.
The Select Committee divided: Tá, 6; Níl, 8.
Tá
- Bruton, Richard.
- Farrelly, John V.
- Hayes, Brian.
- McGrath, Paul.
- Naughten, Denis.
- O’Shea, Brian.
Níl
- Carey, Pat.
- Ellis, John.
- Hanafin, Mary.
- Keaveney, Cecilia.
- Kitt, Michaael P.
- Moloney, John.
- Treacy, Noel.
- Wade, Eddie.
I move amendment No. 25:
In page 6, subsection (5), line 21, before "for" to insert "and laid before the Oireachtas".
This refers to the guidelines the Minister proposes to publish in respect of his new activities as a venture capitalist. The guidelines should be laid before the Oireachtas in the usual form. This may require another amendment on Report Stage if the Minister of State is willing to accept the principle. Subsection (5) provides that where the Minister is involved in commercialisation projects the activity may only be carried out in accordance with guidelines that may be issued by the Minister with the consent of the Minister for Finance. The Oireachtas has a right to see the guidelines because this is a new departure, one with which we in the Opposition are not happy. It is reasonable for the Minister to lay the guidelines before the Oireachtas so that we may see how he proposes to operate this new power.
The guidelines for research and development activities will take account of the report of the Circa group and the earlier recommendations of the STIAC. The views of research bodies and established experts in the various fields of research, which will be obtained through a process of widespread consultation, will also be taken into account in framing the guidelines. The guidelines will then be in the public domain and will be widely available. In addition, the Bill provides for an annual report on the operation of the fund to be laid before the Oireachtas. This will allow sufficient scope for the Oireachtas to oversee the implementation process. Therefore, I consider that laying the technical guidelines before the Dáil and Seanad is unnecessary.
I do not accept that. The Minister of State wishes to make "also rans", so to speak, of the Oireachtas in this matter. The guidelines will be given to all manner of interests in the research and development field but will not be laid before the Oireachtas which sanctions the money it is proposed to spend. It is high handed of the Minister of State to approach the Oireachtas in that manner. I am surprised he does not consider my proposal to be eminently reasonable. If he were in Opposition I am sure he would lead the charge in promoting the right of the Oireachtas to see the guidelines.
This policy is a new departure in the way in which money will be spent and it is open to question. If, as I understand it from the Minister of State, the guidelines are to be published in any event, the Oireachtas should see them first and have the usual period within which to seek to have them amended or rescinded. It would not cause any delays; it is a standard provision in legislation. I do not seek the right of approval of the guidelines, merely the standard right to delay them by 21 days if we are unhappy with them. The Minister has not yet made any concessions and he should make this tiny one.
I would like to concede to Deputy Bruton's request. As regards technical guidelines, we will consult widely with professionals in the area. As a result, these guidelines will be in the public domain. The Dáil will have ample opportunity to question the Minister and to ask him to account and to publish. Most Ministers are reasonably generous with information. An annual report about the operation of the fund will be produced, published and laid before the Oireachtas, something which is obligatory under the Bill. This report will also be in the public domain. This will grant the Dáil more scope and allow it more involvement. However, it is unnecessary to specify in terms of technical data and guidelines something best left to professionals. At the end of the day, the Minister will be responsible to the Dáil and Seanad and he will have to answer any queries raised.
The Minister is seriously mistaken. Subsection (5) was inserted because the Department was aware that new ground was being broken and that guidelines should be put in place. If the Minister has the right to publish the guidelines, we who sanction the funding have every right to see them before they are promulgated and become the basis upon which potentially huge amounts of the £250 million will be allocated. I do not accept for one minute what the Minister says; he should take time to consider this for Report Stage.
We are not discussing a small amount of money but a new concept and venture. The Minister informed us of the different bodies which would be eligible for the funds being made available. When the Comptroller and Auditor General examines this area in two or three years' time I believe he will state that the Oireachtas should have been given the opportunity to examine and approve the guidelines. That is natural and the Minister should accept the spirit of the amendment in the interest of fair play and everything being above board. It is not as if it will overturn anything the Government wishes to do. It just gives those who approve the fund of £250 million the opportunity to examine the guidelines for its allocation. It is not too much to ask. The Minister should reconsider what my colleague requested.
I am disappointed with the Minister of State's attitude that the only source of knowledge emanates from his side. There are other points of view as shown by the amendments tabled. The vast majority are reasonable and express the concerns of intelligent and reasonable people about the provisions in this Bill. It is reasonable that the guidelines for distributing £250 million of taxpayers' money should be discussed in the Dáil. I resent the Minister's remark that it should be left to the professionals who will do a good job. We are professional politicians who are answerable for the spending of this money. Surely we should have a say in the guidelines for allocating it. I do not know exactly to whom the Minister refers when he says it should be left to the professionals. He must take the political responsibility to ensure this is done properly. To do so, he should submit the relevant criteria to be used for discussion in the Dáil or, if not, it should be passed by way of negative impact. It is a reasonable proposal and I hope the Minister can see some way to include it in this Bill.
It is not a question of using all the £250 million for research, so the technical detail and criteria will not impinge on the entire fund, only on a certain amount. There will be absolute transparency pertaining to the expenditure of the £250 million. Given what the Deputies have said, I am prepared to consider this overnight in the context of Report Stage.
I thank the Minister for agreeing to examine the matter. In drawing up the guidelines he should also consider consulting the Comptroller and Auditor General. This is a new departure and those guidelines should receive his approval as well as that of the Oireachtas, something to which I hope the Minister will agree tomorrow.
Amendment, by leave, withdrawn.
Section 4 agreed to.
NEW SECTION.
I move amendment No. 26:
In page 6, before section 5, to insert the following new section:
"5.—(1) The Minister shall from time to time publicly invite applications for financial support for some or all of the monies in the Fund from eligible bodies for qualifying purposes.
(2) The Minister shall publish the criteria and procedures by which he shall select projects, which shall include inter alia the extent to which:
(i) the proposals are innovative in conception and/or in delivery,
(ii) embrace a number of partners,
(iii) generate a local contribution to the cost,
(iv) contribute to regional development, and
(v) contribute to supporting equality of opportunity.".
This has already been discussed with amendment No. 7.
I understand from what the Minister said this morning that he was to comment on this today.
The first part of amendment No. 26 allows for the requesting of submissions from various institutions and other bodies. I believe this to be an operational rather than a legislative matter. I assure the committee that the level of consultation with other Ministers and various authorities provided for under the terms of this Bill will more than adequately address the issues Deputy Bruton raised. In addition, my Department, the Higher Education Authority and the institutions engage in a broad consultative process not only through representation on the various national committees but also within their own organisations through links with industry. In this way, I am confident that all significant projects will come before the Department for consideration. As regards the infrastructure of institutions in the technological sector, the skills shortage, the provision of craft apprenticeships and the provision of vocational preparation programmes, the Department already has a substantial number of significant and worthwhile proposals before it.
The second part of the amendment relates to the publication of criteria and procedures for selection. This suggests concern that allocations from the fund may not be made on the basis of objective criteria. I assure the Deputy and the committee that this is not the case. The emphasis in the Bill is on consultation and we intend to consult as widely as possible to maximise the effective allocation and use of resources. Structures will be put in place to ensure appropriate interests will have an opportunity to make their views known and to advise on the allocation process. The Bill defines the purposes for which funds may be allocated and I outlined the specific aims of the fund. Furthermore, section 8 requires me to produce, publish and lay before the Oireachtas an annual report on the operation of the fund. The fund is directed at seven broad areas and it will be difficult to produce a sufficiently flexible set of criteria and procedures to encompass all possible scenarios. However, I assure the Deputy that criteria such as those identified by him in the proposed amendment will be taken into account in the selection process. I hope what I have said reassures the Deputy and that he is satisfied.
I am not satisfied but I will resubmit the amendment on Report Stage.
Amendment, by leave, withdrawn.
SECTION 5.
I move amendment No. 27:
In page 6, line 25, after "of" to insert "the Fund or".
The thinking behind this amendment is that section 5 should read: "Moneys standing to the credit of the Fund or the investment account shall not be used for any purposes other than those specified in this Act". If restrictions are placed on how the money in the investment account is used, it is logical that the same restrictions should be placed on the fund.
The effect of this amendment would be that public moneys which are to be voted to the purposes of the fund could not be used for any other purpose. This is not practical. As it stands, section 5 ensures that the resources contributed by donors can only be used for the purposes of the fund. This is done to ease the concerns of donors that their gifts might pass into general Exchequer use.
The same considerations do not apply in the case of public moneys. Such moneys earmarked for specific projects are not left aside until needed. They are used in the day to day funding of the State through the operation of accounts by the Paymaster General. The moneys are disbursed from Exchequer funds only as and when needed. This ensures the effective use of public resources at all times. The moneys in the fund will be dedicated, allocated and made available when required. The Bill ensures that they will be at the use of the State until such time as they are required when they must be drawn down and made available.
We may be at cross purposes. The money in the investment account is to be used for purposes identical to the funds in the other account. Conditions can be placed on the money in the investment account. Is the Minister saying that the money in the fund may be taken back and used for other State purposes? The other point is not clear.
The money will be allocated and dedicated to the fund. Until such time as it is required it will be used for other State services. We have to use the capital available to the maximum advantage of the State to reduce our dependence on borrowing, control the national debt and improve the balance of payments.
Effectively, at no stage will State funds be standing to the credit of the fund. Is this the logic of what the Minister is saying?
Funding will be made available to the National Treasury Management Agency. Next year we will be allocating £100 million. This money will be available to the NTMA for use as it sees fit. However, the money must be made available when required by the Department. That is normal procedure.
This is the opposite to what the Minister stated this morning. There is no fund. If the Minister had said so this morning we would not have had to discuss the availability of the interest on the £100 million.
I made that quite clear.
The Minister did not make that clear. He said the perception given was that there was £100 million in this fund. Deputy Bruton asked that the money should be accumulated and used for education. The Minister replied that this was not the case and that he wished to use the money for dealing with the national debt. The perception given was that the fund existed and the accumulated interest would go to finance the national debt. The Minister is now saying that the fund will not exist until projects are approved.
I am confused. I hope this is a result of the way the Minister is putting the case rather than the Minister being confused. I am beginning to think that no funds will be created but that the NTMA will be told there is a notional figure of £100 million which may or may not be needed. That money will not gather interest. If that money is not fully utilised by the end of the year it disappears into the Exchequer. I am concerned about this. There was a recent announcement of this huge amount being made available; I am beginning to think that money is evaporating. I hope I am not correct. Is there a fund? Will there be £100 million? Is this money ring-fenced so that it cannot be used for any other purpose?
The penny has dropped. This is not a fund in any meaningful sense of the word. It is normal capital spending under a new heading in the Minister's Estimate, with £100 million this year and £75 million for each of the next two years. Deputies were taken in by the PR but the penny has dropped. It is good to invest money in this area but it is not a fund. That is the disappointment of this Bill. The Minister could have done something worthwhile but he has failed to do so. If one put £1,000 million into the fund and saved it until the end of the year one could say we had knocked £1,000 million off the national debt.
I will talk to the Deputy if he can procure £1,000 million. I would not wish anyone to be in any doubt. The situation is clear. The Government has decided to create a £250 million dedicated educational investment technology fund over three years. We will invest £100 million in 1998 and £150 million thereafter. In 1998, £100 million will be allocated to the NTMA in a dedicated, ring-fenced, protected fund. The resources which that money will generate and the borrowing requirements which may impinge on it will be expertly managed by the NTMA within the overall management of the State's finances. As required, the NTMA will make moneys from the fund available to the Minister for Education and Science. If, on 31 December 1998, we have spent £91 million, the balance will remain in a dedicated, ring-fenced fund topped up the following month by the 1999 allocation. On 31 December 1999, the total fund allocation will be £250 million and the gross expenditure will also be £250 million. This is similar to when one obtains a mortgage. One goes to a bank to encash the mortgage with a letter of guarantee to obtain bridging finance. As required one draws down funds from the bank to purchase or build a house. When one has reached the gross figure, one encashes the bridging finance against the mortgage. Both figures are equal and one pays the interest. It is a balanced book. This fund is the same. It is a dedicated amount over three years.
There is no interest on this fund.
We will not have to be involved in Estimates, negotiations or worry about allocations. This is dedicated, allocated finance. The interest goes to the State. That is good business. This is dedicated money for educational investment technology managed by experts in the interests of the nation. I cannot see how we can do things better. If someone comes up with a better alternative I am prepared to listen.
This morning I understood that the Minister for Finance would delegate his management function of the fund to the National Treasury Management Agency. Is it the case that the NTMA will decide whether moneys sought by the Minister for Education and Science are within the terms of the Bill? Is this how the money will be safeguarded as I am trying to do by my amendment? What is the procedure for the Minister for Education and Science to call down funds for specific projects? Does he have to make a submission to the NTMA which decides whether the project is within the remit of the Act?
No. The NTMA will manage the funds on behalf of the Minister for Finance. A high powered committee will decide which projects are funded and the Minister will sanction projects based on the committee's recommendations. A requisition will be sent to the NTMA to transfer funds to the Vote of the Department of Education and Science. The NTMA will have no say in the projects funded. Its function will be the management of the fund and the transfer of resources as required.
The Minister stated this morning that the financial management of the fund would rest with the Minister for Finance.
The Minister will transfer that to the NTMA.
Section (4)(1)(e) states that the Minister for Finance would have to consent to specific training programmes. The Minister for Finance appears to have a second function. If there is a requirement on the Minister that the investment account shall only be used for the purposes of this Act, where is the safeguard for the public in terms of the Minister acting ultra vires in relation to the fund?
Section 4(1)(e) states:
such other scientific, technological or vocational education and training programmes (howsoever established) as the Minister, with the consent of the Minister for Finance, considers appropriate.
The Minister for Finance will decide whether organisations presenting proposals are appropriate to be considered within the terms of public expenditure. This refers to financial mechanisms. The merits of the projects will be decided by the high powered, expert committee which will make recommendations to the Minister for Education and Science. The public funds are protected as they are dedicated through the Minister for Finance, who instructs the NTMA to create and manage this fund. The annual report of the NTMA will have to refer to the creation and management of the fund and its exigencies of the fund as it affects the overall management of the national finances.
To expedite matters I withdraw the amendment and will resubmit it on Report Stage.
Amendment, by leave, withdrawn.
Section 5 agreed to.
NEW SECTION.
I move amendment No. 28:
In page 6, before section 6, to insert the following new section:
"6.—In allocating monies from this fund the Minister shall have regard in particular to disparities in educational choice and regional development needs.".
Deputy Bruton wishes to move an amendment to his amendment No. 28 because of a typing error.
I move amendment No. 1 to amendment No. 28:
In line 2 to insert the word "regional" before the word "disparities".
Amendment No. 1 to amendment No. 28 agreed to.
How stands amendment No. 28 as amended?
I will withdraw it and resubmit it on Report Stage.
Amendment, by leave, withdrawn.
Amendments Nos. 29 and 30 not moved.
Section 6 agreed to.
SECTION 7.
Amendments Nos. 31 to 36 are related and may be taken together.
I move amendment No. 31:
In page 7, subsection (2), line 10, after "other" to insert "real or personal".
This is a drafting amendment to ensure that all other property is included within this subsection. Amendment No. 33 relates to the fact that it seems that a donor is excluded from making land or other real or personal property available for the purposes of the Bill. It seems that all gifts other than cash must be converted to cash before they can be used. I would be happy with a brief response from the Minister.
My amendments are along the same lines. If the Minister receives a contribution of computers from industry it seems ridiculous that he should have to dispose of them when he could easily apply them in the education sector. He may have to dispose of the computers under rules of open tender and no one knows who would buy them and they may not end up in schools. It seems sensible to allow the Minister some flexibility.
Amendments Nos. 31 to 36 which propose to insert the words "real" or "personal" to qualify the word "property" are unnecessary. "Property" is used in the widest sense and there is no basis for contending that it does not include real and personal property. For the same reason, I do not propose to accept Deputy Bruton's reference to equipment as it is comprehended within the word "property" and an amendment such as No. 32 is therefore unnecessary.
The other amendments arise from a misunderstanding of the purpose of this section, which is to specifically permit the Minister for Education and Science to accept gifts for the fund made for the purposes of converting them into money and transferring it to the fund until it is needed. This section does not interfere in any way with the general powers of the Minister to accept gifts of property under any conditions and using it for the purposes of the fund. Subsection (5) makes it clear that the Minister's powers in this regard are not affected by the provisions in the section relating to the conversion of gifts of property into money. The proposed amendments are unnecessary. If a donor makes a gift of property, for example, equipment, and specifies that as a condition of the gift the equipment is to be used for the purposes of the fund, the Minister will be legally and morally obliged to abide by that condition. I hope this clarifies the matter.
If a gift of property is made to the fund and there is no direction or condition by the donor, is it incumbent on the Minister to convert it into cash?
No, it is not necessary to convert it into cash but, were he to do so, he would be obliged to adhere to existing legislation and criteria for the disposal of property.
Amendment, by leave, withdrawn.
Amendments Nos. 32 to 36, inclusive, not moved.
Question proposed: "That section 7 stand part of the Bill."
Will the Minister clarify the tax status of gifts made? There has been some dispute. The Minister of State, Deputy O'Dea, led me to understand from his concluding comments yesterday that contributions to this fund were tax allowable under section 16 of the Finance Act. That was the first time I heard that referred to. It is not immediately obvious to me that that is the case. Will the Minister clarify that?
The most up to date information I have is that tax relief on donations to the Department of Education and Science's education investment fund will be examined in the context of the preparation of the Finance Bill, 1998. Apart from the issue of introducing a specific relief for the education investment fund, it will also be necessary to consider the relevance of existing provisions and to determine if they can be used if it is decided a relief on donations is appropriate. It will also be important to ensure the various existing similar provisions, for example, section 16 of the Finance Act, 1997, are consistent with each other. I assure the Deputy the issue of a tax relief will be raised with the Minister for Finance. He assured me as a result of a meeting I had with him last night that he will take everything into consideration in the context of the Finance Bill, 1998.
It seems bizarre that we are enacting legislation to set up a fund to which private donations can be made and we do not know whether these will be tax allowable. I do not understand it; it is a mystery to me.
The de facto position at present is that they may be allowable, but we must be absolutely certain about it.
Is it intended that they will be made allowable and that whatever needs to be done in the Finance Bill to make that happen will be done?
Absolutely.
That was not clear from what the Minister read out.
Question put and agreed to.
NEW SECTION.
I move amendment No. 37:
In page 7, before section 8, to insert the following new section:
"8.—In seeking to promote contributions to the Fund, the Minister shall be mindful of the fact that educational institutions themselves have the right to accept gifts and shall—
(a) engage in regular consultations with the education partners to ensure that his activities do not preclude the funding of other desirable education projects,
(b) appoint a group to review from time to time the impact of the Fund on the fundraising activities of such institutions.".
This is a simple provision which, if necessary, I shall resubmit on Report Stage. The Minister should bear in mind that other education groups are in the business of private funding and are using section 16 of the Finance Act, 1997. He should ensure his fund does not crowd out other worthwhile investments which have a local partnership element. To that end, he should consult the education partners to ensure he does not crowd out other projects. He should also periodically review the impact of the fund so that it can be seen if others lost out because all available money was sucked into the Minister's fund and none went to the development of Ballyfermot's computer resource centre, for example.
I agree with Deputy Bruton. Nothing in this Bill restricts in any way the capacity of any educational institution to solicit and receive gifts from donors. Consultation with the education partners is now a well established aspect of the work of the Department of Education and Science and is enshrined in very specific terms in the recently published Education Bill. I understand the objectives of the Deputy's amendment. However, I believe it would be very difficult if not impossible to give practical effect to the issues he seeks to address. The issues are also aimed at what appears a remote possibility that the operation of the fund would cause gifts to specific educational institutions to dry up. By and large, donors prefer to give gifts to named institutions and even for specific projects in those institutions. It is most unlikely this will change through the operation of this Bill. I have met with the heads of the universities and their advisers to assure them that we in no way want to impinge on their tremendous ability to draw down private funds for the development of education in the third level sector.
I will withdraw my amendment and resubmit it on Report Stage. The Minister will appreciate that, as we pass this legislation, we have not yet seen the provisions of the Finance Bill. We must blindly accept the Minister's assurances because we do not know what provisions will be made in the Finance Bill.
Amendment, by leave, withdrawn.
SECTION 8.
Amendment No. 38 not moved.
Question proposed: "That section 8 stand part of the Bill."
I will table an amendment on Report Stage seeking to have published some form of evaluation at the end of the second year.
Did the Minister get an opportunity over lunch to consider, in the context of an earlier amendment on the annual report and the discussion thereto, the inclusion of a proviso that details would be given in the annual report of all projects approved and that it would be published within the first three months of the new year? Will the Minister be tabling an amendment on that?
It is one of many things we considered over lunch. All I can say is that we will have further discussion on it and I hope we will be able to consider it again tomorrow.
The Minister is giving us much hope, but I do not know if he is giving us anything else.
Hope springs eternal. I am positive by nature and performance.
Question put and agreed to.
SECTION 9.
Amendment No. 39 not moved.
Section 9 agreed to.
TITLE.
Amendments Nos. 40 and 41 not moved.
Title agreed to.