Dáil Éireann Debate, Thursday - 6 May 2004
11 Mr. P. McGrath asked the Minister for Finance if a review will be arranged of the policies and practices in relation to the disposal of equipment and stocks which are surplus to requirement by public sector bodies to ensure that value for money from such disposal is maximised. [12900/04]
View answer102 Mr. R. Bruton asked the Minister for Finance if he has satisfied himself that disposals of equipment or chattels by pubic bodies are arranged in such a way to maximise return to the taxpayer; and if he will make a statement on the matter. [13035/04]
View answerI propose to take Question Nos. 11 and 102 together.
Primary responsibility for the management and disposal of assets rests with Departments and public bodies under their aegis. As Accounting Officers, Secretaries General of Departments are personally accountable to the Committee of Public Accounts Committee for the regularity and propriety of transactions, including disposal of assets, and for economy and efficiency in the use of resources and systems in their Departments. My Department has a strong concern to ensure that all public assets are properly managed, accounted for and disposed of in a manner which secures maximum value for money for the taxpayer and there are a number of arrangements in place to ensure that this is the case.
The Department of Finance, Public Financial Procedures, or blue book, provides general guidance to Civil Service Departments on asset management. Departments are required to have asset management systems in place which ensure that assets are acquired only when needed, are adequately controlled and maintained, are properly safeguarded and disposed of, and that utilisation is monitored.
Each Department-office is required to maintain an assets register recording the description, historical cost, rate and method of charging for depreciation, present value, that is, depreciated historical cost or valuation, date of acquisition and physical location of each material capital asset, that is, an asset intended for use on a continuing basis for more than one year. The assets register must be available to the Comptroller and Auditor General during the annual audit of the Appropriation Accounts. A statement of capital assets, compiled from the assets register, including details of disposals, must be included in the Appropriation Accounts which are subject to annual examination by the PAC. Guidelines on internal audit standards provide that the range of activities conducted by internal audit functions in Departments and offices should include reviewing the compliance with procedures for the acquisition and disposal of assets and their safeguarding.
My Departments 1994 Guidelines on Public Procurement, or green book, which apply throughout the public sector, state that the disposal or letting of property should be dealt with by competitive tendering or by auction in order to ensure that disposals are both transparent and likely to achieve a fair price. It also provides for the possible disposal of surplus materials elsewhere in the public sector and directs that this possibility should be investigated before disposal by contacting other likely users.
In relation to IT disposal, Department of Finance circular 30/03 sets out the principles, intended to maximise value for money, which should be applied by Departments-offices. Among the requirements are that disposal of unwanted equipment should be carried out in the most financially advantageous manner possible, including minimising storage and removal costs and that it should be sold at market value, in accordance with the general guidelines for the disposal of State assets, regardless of the depreciated book value. This may include sale to staff.
As regards semi-State bodies, the Code of Practice for the Governance of State Bodies addresses in considerable detail the disposal of assets by any State-sponsored body, whether commercial or non-commercial. The code was approved by Government in October 2001 and is binding on all State-sponsored bodies. Under the code it is necessary to ensure that transparency applies and that a fair market price is achieved. The disposal of assets with an anticipated value at or above a threshold of €70,000 should be by auction or competitive tendering. Any exceptional cases, where assets above the threshold have been disposed of without auction or competitive tendering, must be set out in detail and explained in the chairperson's annual report to the relevant Minister. Chairpersons are required to affirm, in their annual report to their respective Ministers, that the disposal procedures set out in the code have been complied with.
In relation to health boards and local authorities, I am informed that recent legislative changes should assist in better management of assets by these agencies. Accordingly, the arrangements which are in place in relation to the management and disposal of assets provide sufficient guidance to Departments and public bodies to enable them to secure value for money in relation to the management and disposal of their assets.
