Dáil Éireann Debate, Wednesday - 29 September 2010
102 Deputy Fergus O’Dowd asked the Tánaiste and Minister for Education and Skills the nature of the audit findings into FÁS funding to date; when the latest audit by the European Commission into the use of funds by FÁS will be finalised; the public funds that have been returned to the European Commission to date; when it will be known whether any further public funds will need to be refunded; and if she will make a statement on the matter. [33903/10]
View answerIn Ireland, selected FÁS activities are co-financed by the European Social Fund and the Exchequer under the 2007-2013 Human Capital Investment Operational Programme, which has a 41% average ESF aid rate. This operational programme has an overall allocation of €375 million in European Social Fund moneys with expenditure from 1 January 2007 until 31 December 2015 being eligible for ESF assistance. The final payment application for this programme is due to the European Commission by 31 March 2017.
FÁS has been allocated €211 million in European Social Fund moneys under this operational programme. This allocation has been committed to FÁS programmes that deliver skills training for the unemployed and job seekers and to in-company training to the amounts of €201 million and €10 million, respectively.
FÁS submitted its first claim under this operational programme in October 2008 for a €23 million European Social Fund, ESF, drawdown in respect of training for the unemployed and job seekers programmes. In 2009, the European Commission undertook an audit of this claim and raised issues about it. As a result, in 2009 it was decided to postpone claiming European Social Funds from FÁS expenditure until these audit issues were satisfactorily addressed and the necessary recommendations implemented. To date, Ireland has met the deadlines for the full drawdown of available ESF moneys. It is intended that alternative FÁS spending on skills training for the unemployed will be substituted for the amount of €165,000 in the next claim and, therefore, there will be no loss to the Exchequer over the programme period.
After FÁS addressed the issues raised, the position was presented to the Commission for its opinion. The Commission then completed a follow-up audit in March 2010 on these re-presented costs. The Commission released its draft audit report on 16 June to which my Department responded on 24 August. After review, analysis and further consultation, the Commission will issue a final position in connection with the audit. Therefore, it is hoped that this process will allow for the submission of a FÁS claim and the related European Social Fund moneys to be drawn down in the near future.
The question was to ask the Minister of State about the nature of the audit findings. What were the findings of the FÁS audit in December?
The issues of concern to the Commission related to the methodology used in respect of numbers and costs, to tendering and procurement and to the extension of contracts. These were the main issues raised by the Commission and, as I noted, processes are being put in place to deal with such matters. I hope this answers the Deputy's questions.
Did the audit not find that no proper paper trail existed? At a meeting in December 2009, was it not agreed that the omission of a proper paper trail following the first audit meant that it would be necessary to examine all funds going back to 2000? Is it not the case that there is no paper trail and that while estimates were given, the Department must now revert and get a paper trail that did not exist and was not available to FÁS at that time?
The Minister of State to reply.
The first area in which issues arose from this audit pertained to some documents relating to contract extensions and tendering procedures not being available for inspection at the time of the audit. This will require a substitution of expenditure of €20,040 or 0.1% of the total claim. The second and main area in which the issues arose related to the accrual accountancy methodology used by FÁS for reconciling the initial cost estimates of contracted training for the unemployed with payments made in respect of a number of actual participants. The adjustment to convert from the estimated accrued cost to the actual cost was not calculated correctly to the tune of approximately €165,000, which represents less than 0.2% of the overall FÁS claim. Alternative FÁS spending on skills training for the unemployed will be substituted for both of these amounts in the next claim and, therefore, there will be no loss to the Exchequer.
Is FÁS not a festering sore and did the question that the Minister of State stated was raised by the European Union not relate to the tendering process for FÁS courses? Is it not a fact that a significant number of course providers in Ireland have corrupted examination results and that the Q-Mark they provide constitutes a question mark over the results they produce? While the vast majority of companies are excellent and first class, a significant minority continue to abuse the system. Is it not true that the recent report by the Comptroller and Auditor General identified more corruption in the provision of services to FÁS? I refer to courses that were supposed to have been attended but for which signatures were forged and where no course actually took place. Nevertheless, those concerned got the money and the taxpayer lost out. In addition, the results in hundreds of cases have been held up.
There are certainly legacy issues in FÁS that need to be and which are being addressed by the new director general, the new chairman of the board, the new board and the Minister for Education and Skills.
The issues arise today.
A parliamentary question that is to be taken later deals with contracted training, particularly in the north east. Deputy O'Dowd raised this issue in the context of Question No. 102. In the vast majority of cases in regard to contracted training and the issue of certificates, it was not a case of corruption or malpractice.
It was.
It was a case of problems in regard to the methodologies——
It was fixing the results. It gave the result before the day. What the Minister of State is saying is rubbish.
The Minister of State should be allowed to reply.
With respect, that is not true.
The Deputy must not shout down the Minister of State.
With respect to Deputy O'Dowd, I am entitled to my time in which to reply.
That is correct.
I thank the Leas-Cheann Comhairle.
The Minister of State in possession should be allowed to answer to a listening Dáil.
I thank the Leas-Cheann Comhairle.
A disbelieving Dáil.
I hope we will get to the question on contracted training in respect of the north east and the issue of certificates.
We need to move on to the next question.
In the vast majority of cases, it was to do with methodologies used in regard to marking and not malpractice.
