Visit of Canadian Delegation.

Mr. J. Purcell (An tArd Reachtaire Cuntas agus Ciste) called and examined.

I welcome the delegation from the Senate of Canada. I hope its members have an enjoyable and fruitful visit to Ireland and learn something about our system. This is the Committee of Public Accounts. I understand the delegation comprises members of the Committee on National Finance, more the equivalent of our Committee on Finance and the Public Service than this committee. However, there is significant overlap and I hope we will be able to answer any queries from the delegation, which have already been forwarded to us.

As we are in public session, members of the press are entitled to be present and the meeting is being recorded for television. This is a normal Thursday meeting of the Committee of Public Accounts and the visit of the delegation is included in the agenda. Therefore, members of the delegation have come into a meeting in progress. In attendance is the Comptroller and Auditor General, Mr. John Purcell. He is a constitutional officer and because his office is enshrined in the Constitution he is independent in the exercise of his functions. He is appointed by the President on the nomination of the Parliament, Dáil Éireann, not on the nomination of the Government. This underlines the independence of his office. He is supported by a team of auditors and his remit is to audit the accounts of all Departments, all non-commercial State agencies and some, but not all, units of local government. Members of the secretariat, under the direction of Mr. Brian Hickey, are also present.

There are 12 members of the committee, six from the Government parties and six from the Opposition parties. Members present today include Deputy Michael Smith, a Government party member who has formerly held ministerial office for many years and extensive experience across various Departments. Deputy Curran is also a member of one of the Government parties and regarded as a valuable member of the committee. His colleagues believe he will be a future Minister. Deputy Deasy is a member of the Opposition representing Waterford and he too has a strong reputation in the House. I am the committee chairman. It has been established in law since the committee's foundation in 1924 that it be chaired by a member of the main Opposition party. This is part of the system of checks and balances.

The witnesses are welcome. This committee, similar to the committee in Canada, was based originally on the example in the House of Commons. As I said, it consists of 12 members. The Chair does not have a casting vote and the committee proceeds by consensus. It works closely with the Comptroller and Auditor General. I ask the holder of that office, Mr. John Purcell, to outline its functions and how it relates with the committee. After his presentation, we will proceed to the questions of the witnesses.

Mr. Donald H. Oliver

Perhaps I might briefly introduce the members of our group, although I realise the committee has received brief descriptions already. The vice-chair is Senator Joseph A. Day who is from New Brunswick in the eastern part of Canada. He has extensive experience in both provincial and federal politics and is active on a number of committees in Canada's Senate. Senator Terry Stratton is the deputy leader of the Opposition in the Senate and has extensive experience on the Committee on National Finance. He comes from western Canada and brings experience of leadership in the Senate to the committee. Senator Percy Downe is a member of the steering committee with Senator Day and I. Senator Downe comes from beautiful Prince Edward Island in the Atlantic Ocean and brings a wealth of experience from the public service. He also served in the PCO of the Prime Minister's office and brings a special knowledge of the way in which accounts, deputy Ministers and the clerks function in the Prime Minister's office. Senator Pierrette Ringuette comes from New Brunswick in Atlantic Canada and has experience of being an elected member of our House of Commons, the Lower House. Therefore, she has experience of both Houses. She has a special interest in the public service and its modernisation.

We are honoured to meet the Committee of Public Accounts, one of a number of meetings in the coming week. This is considered by us to be one of the most significant of these, as we are a parliamentary committee having discussions with members of another parliamentary committee who carry out similar functions. We have a special interest in the doctrines of responsibility and accountability of Ministers and deputy Ministers to parliamentary committees. We are also interested in whether a Minister, deputy Minister or Accounting Officer must come before a committee, and if so, how often this is done.

In Canada, deputy Ministers do not have to directly account to parliament. They cannot commit to a course of action that requires a decision from the Minister. Parliamentarians cannot mete out personal consequences for a deputy Minister in Canada. In that sense the system in Canada is different from the Irish example. We wish to hear about the Secretary General, the Accounting Officer, and how parliamentary committees are empowered to go about their work. The main mandate of the Committee on National Finance is to examine estimates, supplementary estimates and government spending.

Mr. John Purcell

I will be brief. Senator Oliver has outlined the areas with which his committee is concerned. To clarify, the senate in Ireland, the Seanad, does not have a real role in financial matters. This is a Dáil committee and my reporting relationship is with it; I do not report through any other committees. I am a permanent witness at all meetings of this committee, including private sessions. As my mandate is in line with that of Sheila Fraser, Canada's Auditor General, there is no need to elaborate on it. Our performance auditing mandate is a copy of the Canadian model in that respect, as this was decided in the mid-1990s when we placed value for money auditing on a statutory basis.

The Accounting Officers, the Secretaries General, are only in that role before this committee. They are not Accounting Officers before any other committees. If they appear before another committee, they do so in the role of Secretary General. I will not speak further at this stage, but we will clearly have a chance to elaborate on areas of concern during questioning.

I will describe briefly the manner in which the committee proceeds. The Comptroller and Auditor General, with a team of auditors, audit the accounts as described. Comments are published annually in a report, which is required by law to be published before 30 September each year. The report deals with the previous year's spending. This 2004 report was published in the last week of September.

Some of the audits are financial and do not require comment, and others receive extensive comment. The comments are contained in chapters in the report. For example, the Committee of Public Accounts might examine the chapter regarding the Department of Health and Children, placing it as the main agenda item for a meeting, and this would be coupled with consideration of the Vote. The meetings take place every Thursday. I am not sure if the same terms are used in Canada, but in referring to the Vote, we mean the total expenditure of a particular Department or agency.

Mr. Oliver

We use the same terms.

The chapter refers to the precise comments by the Comptroller and Auditor General and would be an agenda item. This would be paired with the total Vote, in order that a member could ask about any item on the Vote, even if it was not commented on by the Comptroller and Auditor General.

We are not, under law, allowed to examine policy issues. These are for the House and Ministers. We never summon a Minister or deputy Minister as a witness, as we deal with the public service. Our primary witnesses are the Accounting Officers, also known as chief executive or Secretary General of the Department or agency in question.

Mr. Oliver

Is it correct to state a Minister or deputy Minister would never appear before this committee?

Yes. At the beginning of every meeting I would, as Chairman, read a statement indicating that members should be mindful that the committee is not mandated to discuss policy. The committee examines financial audits. The primary question asked would be whether there has been fraud or misappropriation of funds. This is rarely the case as we have an honest public service. If it does occur it is usually of minor consequence or at some low level in the particular Department, involving minor amounts of money.

We would then examine value for money issues, how a particular Department estimated projects and what the outcome was. This is essentially how the taxpayer's euro were dealt with. Sometimes policy issues are implied in asking these questions, but overt questioning is not allowed.

Mr. Oliver


The line is thin, but the committee attempts to walk along it without criticising Government policy or Ministers. This is the manner in which the committee works in practice. The Department of Health and Children is on the agenda, it is chapter 10 in the Comptroller and Auditor General's report followed by the full Vote. The delegation may be aware how a Minister can evade a question when a second or third questioner intervenes and the topic changes.

Mr. Oliver


As our predecessors decided there was too much evasion of questions, they initiated a process whereby we have a first questioner and a second questioner at every meeting. The questioning moves around the 11 members by rota. The first questioner is allowed 20 minutes and the second, 15. As they are experienced parliamentarians, one can see the effectiveness for them of being able to ask supplementary questions over 20 minutes to elicit information. The generality of members are allowed ten minute slots. The following week two different members lead. It is not a major issue but as they are experienced parliamentarians, the delegation will be aware it is effective in practice.

Mr. Oliver

After the first questioner asks questions for 20 minutes, does the second questioner who has 15 minutes have to stick with the same general subject matter or can it be something different?

The subject is defined by the agenda. Sometimes, as Chairman, I would open the chapter which gives a very precise focus on the comments of the Comptroller and Auditor General and would not open the Vote until later in the meeting. Sometimes I open the two together but would be conscious of the importance of focus and not drifting across too many topics. That is how we organise it. Sometimes it works very effectively but at other times there is drift.

Mr. Oliver

Can the Chairman tell us how the committee is financed? If it needed a forensic auditor or to hire some outside consultants, does it have the funds and, if not, how does it go about getting the funds? What amount of money is available to the committee to do an in-depth analysis of the public accounts?

There is a major change in how the Houses of Parliament are organised and run in this jurisdiction. Until recently, all funding came from the Exchequer, through the Department of Finance. An independent Houses of the Oireachtas Commission has now been set up. It has a multi-annual budget and has control over its own finances and there is a certain amount of certainty about its budget for the next two years. That covers everything from the pay of the parliamentarians and the staff of the Houses to budgets for the committees. We have a total of 21 committees. There is a committee of Chairs of the committees which decides allocation on an equitable basis. The budgets for individual committees are small but each committee has a budget and the Committee of Public Accounts has a slightly larger budget than other committees.

In terms of research facilities, we have some money for the purpose of hiring outside consultants but we also have a system, which is a borrowing from the European Parliament, where we can appoint a member to be a rapporteur and give him or her a small amount of money to go away and do some research and come back with it. We had a very good example of that last week where Deputy Rabbitte, who is Leader of the Labour Party and a member of this committee, was mandated prior to the summer recess to do some research on how the parliament would examine the Government Estimates on a current basis rather than after the fact as we do. He reported to us after the summer recess and the committee examined his report. We published the findings yesterday. That was a very effective use of the power we have to appoint a rapporteur on which we got agreement.

We have a sum of €18,000 for consultants, some of which we spend on the drafting of reports. Rather than do all our own drafting ab initio, we have a consultant who does the first drafts and then we examine them. As well as the Comptroller and Auditor General issuing reports, after examining the witnesses we issue reports. That is one of our strongest powers. We draw conclusions in our findings and make recommendations. The recommendations are to Parliament in general but specifically the reports and the recommendations go to the Department of Finance. There is a requirement on the Minister for Finance to reply to the recommendations in what is called the “Finance minute”. If the Department of Finance does not accept a recommendation, we have the power to bring the Secretary General of the Department as Accounting Officer before us to explain why the Department has rejected a particular recommendation.

We are trying to improve on the follow-through and are getting there. We used to be a little out of date in our reporting systems but we are up to date now. The Comptroller and Auditor General's report for the 2004 spend which was produced in the last week of September 2005 is being discussed week after week by the committee. That is as up to date as we can get. Some of our reports are still a little out of date but we should be up to date by spring 2006 in order that we are reporting on last year's spend.

Mr. Oliver

That has been very helpful. A number of our Senators have questions for the Chairman and other members of the committee. As I like the idea of giving time, I will start with Senator Stratton, followed by Senator Ringuette, our vice-chairman, and Senator Downe. I will allow five minutes to Senator Stratton, five minutes to Senator Ringuette and ten minutes to our deputy chair——

Ms Pierrette Ringuette

Equal opportunities.

Mr. Oliver

——and five minutes to Senator Downe.

Mr. Terry Stratton

Part of the problem in Canada in terms of accountability is that the House of Commons, a lower chamber, has a financial operations committee that looks at the spending of the government. The problem with it is that as membership evolves in and out and few sit long-term because it is not what one would call a hot or sexy item where they can make political points, it is glossed over. Our committee, the Senate committee, has been fairly effective in the past in the sense of identifying problems but our basic problem is getting the government to listen when we report a problem in the finances. We have adopted the Irish committee's system of submitting a report and requesting a response from the Minister within a certain number of days.

Can the committee, which is a committee of the Lower House, tell me whether its membership is consistent or if it tends to evolve? In other words, how effective are these committees in determining the problem, submitting the report to Government and receiving a response from it that is effective? That is the core area of our problem. I would like to hear what the committee is doing.

I will invite others members to reflect on that matter as there may be different views. I think the Committee of Public Accounts is quite effective. It is a desirable committee as far as parliamentarians are concerned and there would be a certain amount of competition to be a member. On this committee, of the six Government members, two are qualified accountants. Therefore, they bring their own expertise to bear on the issue. Deputy Smith is a Minister of long standing, Deputy Curran has expertise in business and so on and I have been a Minister on a number of occasions. All members bring expertise to bear which is relevant to the functions of the committee.

Membership tends to last at least the duration of a parliament, but with some changes, while others are members of the committee over several parliaments. Members who may not initially have had a professional background which would be relevant but because they have been members for a while would be very proficient now in carrying out the business of the committee.

It is difficult to comment on the work of other committees. It appears most of the other committees debate policy and are politically contentious. Ministers appear before them and discuss policy. As to their effectiveness, they are effective if they do specific work, but if they discuss policy in general, there is the usual debate to and fro that there is in Parliament. It is difficult to measure effectiveness in that context.

The ineffectiveness of this committee was due to allowing the reporting system to drift and not following through. The way the system works is that when elected Members get media coverage after a meeting, the issue is highlighted and the television interviews are conducted, it is easy to lapse and not follow through in producing a report which makes recommendations and insists the Department of Finance implements them or, if it does not, explains the reason for not doing so. There is general consensus among members of the committee that we are sharpening up on that side and we have made significant progress. Would Deputy Curran like to comment?

The witnesses interviewed at this committee are the Accounting Officers. Frequently, the issues we address do not require the Department of Finance or Government to make a decision or change policy. The issue might relate to the internal running of a Department. When witnesses appear before the committee the following year, frequently they will indicate a change they made in response to a suggestion by a member of this committee or a suggestion by the Comptroller and Auditor General.

Two procedures run parallel: the reporting of matters to the Department of Finance which probably requires a decision of that Department or the Government, and the suggestions and recommendations made in face-to-face interviews at this committee. The Comptroller and Auditor General in his annual report will often make suggestions and changes are made subsequently each year along those lines.

We are only Deputies and the delegates are Senators. A famous Irish Senator who went to America one time and was accompanied by six Deputies introduced the six Deputies and was told that Senators in Ireland have a lot of Deputies.

There are examples of where the intensity of the work of this committee has led to significant changes. One case that immediately comes to mind is tax compliance by the major lending institutions. There are other examples which prove how effective it can be. When the Secretary General of a Department or the chief executive officer of the Health Service Executive comes before the committee, he or she does not do so without significant preparation in the weeks and days leading up to that meeting. There are occasions where the deliberations of this committee, which have been made public, invite changes or make significant recommendations which lead to better financial management of a Department and some of these changes would have been introduced by the Secretary General before he or she comes before this committee. The responses from the various Departments indicate a healthy respect — I do not want to use the word "fear" — for the type of questions they will face and the implementation of various recommendations. The Department of Finance is also involved and an official from it appears before the committee in conjunction with the Accounting Officer of the Department being interviewed. When recommendations are made, we also try to follow the line as far as we possibly can to ensure they are ultimately implemented.

Mr. Oliver

What level of official from the Department of Finance would appear before the committee?

If the chief executive officer of the Health Service Executive or the Secretary General of the Department of Health and Children were to appear before the committee, the official would be the relevant principal officer or an official at a higher level who deals with that Estimate.

Mr. Stratton

When the committee gives its report to the Government, I assume it is satisfied it gets an appropriate and effective response. In other words, the Government will do something about the matter or give it a response that it will not do so for various reasons.

As the process takes place over time, commencing with Mr. Purcell's scrutiny, his annual report and our hearings, the problem is identified as the process proceeds. Sometimes the change is made within the Department before we make a recommendation and we do not see the cause and effect in the process. We are pleased as long as the necessary changes take place.

Ms Ringuette

I have two short questions. If only the Accounting Officer from the various Departments appear before this committee, does that mean the Minister and Minister of State of the Department appears before the other committees which have a specific focus? In the case of a committee dealing with the agriculture sector, when a Minister appears before that committee, would he or she discuss expenditure issues?

Yes, but nobody appears before the other committee as an Accounting Officer. A Minister appears before the Joint Committee on Agriculture and Food to discuss agriculture policy but would answer questions as to the cost of a particular programme.

Elaborating on that point, the Committee of Public Accounts is viewed as the premier committee of the Houses. If it becomes seized of a matter, the other committee would have to cease its consideration of it.

Mr. Oliver

Ms Ringuette used the example of the agriculture committee and Minister appearing before it. Would the Minister answer questions before that committee about cost overruns or would that matter have to be referred to this committee?

A cost overrun must be dealt with by way of Supplementary Estimate. It would be presented in the main House of Parliament in the first instance and then passed to a committee for consideration.

Mr. Oliver

Is it this committee to which it would be passed?

No, it would be the committee dealing with that area, whether the Joint Committee on Health and Children or the Joint Committee on Agriculture and Food.

Ms Ringuette

Mr. Purcell indicated that he has a team of auditors. My question has a part A and a part B. Is his team of auditors located in his office or in different Departments acting as comptrollers? His title is Comptroller and Auditor General and that covers two different aspects. If a member of his team is co-located with a Department Accounting Officer, what would be the relationship between the two individuals?

Mr. Purcell

Some of our teams are located in the larger Departments such as the Revenue Commissioners, our tax authorities, or the Department of Finance, but most are mobile and move, as required, from place to place. The word "Comptroller" in my title is not the equivalent of a controller. There is a Controller General in Canada who is a type of a super financial controller in a commercial sense. The role of the comptroller does not involve that. It is largely symbolic, but not entirely. It relates to the release of moneys from the Exchequer to the Government, the relevant Ministries and so on. We check that process to ensure there is proper statutory authority for the release of bulk of moneys. It is not in any sense an a priori type audit.

To return to the question on the relationship with the clients, if one wants to call them that — where the teams are located in the Department — they have a good, healthy working relationship with them but it is not to be confused with the internal audit section of the Department. We would liaise with the internal audit and place reliance on their work in accordance with professional standards.

I wish to respond to Senator Stratton's question on the effectiveness of the committee. It is about accountability. We do not have much of that in our parliamentary system. From the early 1990s, the Committee of Public Accounts has been very successful, particularly when dealing with financial institutions. The public has great faith in the Committee of Public Accounts and, as result, politicians also have great faith in it. The strength comes from its non-political nature. There is as much trust here as there can be in politics in regard to doing the right thing. The committee has never had a vote since its establishment which says something about the way it works.

As the Chairman said, the calibre of the members is very important. The committee also needs a good Chairman, which we have. The Chairman has an immense institutional knowledge of Government having been a Minister. He is able to deal with the types of senior civil servants we come across each week.

In our Chamber, we have set pieces. We do not have a dispatch box. There is no great interaction. We have procedures intended to stifle debate generally.

Mr. Oliver

Such as?

Under the rules of the House, it is very difficult to ask a question outside the criteria laid down. On the Order of Business, one must limit one's question to when legislation or reports are due before the House. One cannot ask the Taoiseach about the detail of legislation. If one does so, one is essentially shouted down by the Chair.

As far as efficiency is concerned, we get things done. Our Executive and Legislature are rolled into one. If we had a free-for-all, we probably would not get anything done because the Opposition would use it for its own purposes. However, because there is that stifling effect within the Chamber, this committee is essential when it comes to accountability. The public has identified it as the only entity which can bring some of these people to account. It is non-political and Ministers and Ministers of State do not appear before it but it reflects on them because they make the decisions in some cases. When civil servants appear before the committee and are asked questions, the answers they give not only rest with them but they have implications and a ripple effect throughout their Departments and Government. The accountability element is not built into Government enough but this is the arena where most of it is to be seen.

Mr. Joseph Day

We do not have the concept of an Accounting Officer in Canada. We are trying to determine why, or if, we should introduce such a system. Does the committee debate, from time to time, whether it is a good idea? Is the committee so accustomed to having that process which is so fundamental to it, that it does not question why it has it and what it gives it? We bring deputy ministers, senior civil servants, before our committee. As they are requested to answer questions, we have the ability to bring them in without them being described as Accounting Officers.

There is a problem with the terminology. When we talk about a Minister of State or, sometimes colloquially, a deputy Minister, they are an elected person. He or she is a junior Minister in a Department. Mr. Day referred to deputy Ministers as the senior——

Mr. Oliver

Senior bureaucrats.

——bureaucrat who runs the Department. A Canadian deputy Minister is the equivalent of our Secretary General. Our Secretary General is also the Accounting Officer. When the Secretary General appears before this committee, he or she comes in to account for the manner in which the moneys voted by the Parliament were spent by the Department under his control. When he or she appears before other committees, he appears as the Secretary General who is the chief executive of the Department dealing with departmental issues but not particularly accounting for the spend. We have never discussed whether our system of Accounting Officer should be changed. We take it as essential to the work of the committee that the most senior person in the agency comes in, is accountable to us and has a specific accounting role to us. We see that as fundamental to the effective work of the committee.

Mr. Day

If we were playing with definitions, what are the consequences of that accountability to the committee with respect to spending? What does the Chairman mean? Is the Accounting Officer expected to tell the committee about things before it asks? Does the Accounting Officer have a responsibility to bring to the committee's attention matters in which all the rules might not have been followed?

The Accounting Officer has responsibility for full disclosure to the Comptroller and Auditor General in his audits and to the committee when it asks questions. There is another issue against which we have come up on a number of occasions where an Accounting Officer would seek to delegate. An Accounting Officer would bring a team of officials with him or her. We are very clear about the Accounting Officer being the primary witness. We will not accept an Accounting Officer saying he or she has a meeting in Toronto, so he or she is sending his or her number two. We will not allow this.

Mr. Purcell

The role of the Accounting Officer has been reviewed quite recently and I would recommend the report. A group was established by Government decision in May 2000 to consider the accountability of Secretaries General and Accounting Officers. That group was headed by a former Secretary General from the Department of Finance. It was a high level group to which I gave evidence and it produced a report in July 2002. That report is on the Department of Finance's website. It is a considerable report entitled the Mullarkey report because that was the chairman's name. That report goes into the business of what Secretaries General and Accounting Officers do. The Accounting Officer is appointed by the Minister for Finance. While he or she can delegate certain duties as Secretary General of a Department, he or she cannot delegate his or her function as an Accounting Officer.

Mr. Percy Downe

Have any of the Accounting Officers who have appeared before the committee been reprimanded during the years for not disclosing all they should have?

Under our reporting system, occasionally, there would be direct or implied criticism. Last year, in the context of the Department of Agriculture and Food, a pretty direct criticism was made of an Accounting Officer.

Mr. Downe

During the years have any of these people been punished in any way career-wise? Have any people been dismissed or held to account in any way?

Secretaries General are appointed under contract for seven years. It is very difficult to get dismissed from the Irish Civil Service.

Mr. Oliver

That is the line of the day.

Normally our work is more critical of the system or of systems used than of the individuals in charge. We try not to personalise it but we can be very critical about systems failures.

Mr. Downe

Part of the problem we are struggling with in Canada is that the auditor general has been recognised by the government for doing a good job of identifying problems. In fact, a few years ago the government changed the rules and instead of reporting once a year, she reports four times a year. She provides four separate reports to parliament. However, all the information is after the fact. I am sure today there is something happening in Canada about which the finance committee and the public will hear three to four years down the road. We seem to have a weakness in the system in that we cannot hold people to account for what is happening today. What I am hearing from the discussion this morning, on which I want clarification, is that the Committee of Public Accounts has some comfort that it is holding people to account for what is happening in this fiscal year.

No. We encounter the problem that Mr. Downe identified and we would have had exactly the same debate in which the Canadian committee seems to have engaged. As a matter of fact, yesterday we published a report making recommendations that the Select Committee on Finance and the Public Service, as distinct from the Committee of Public Accounts, should take on a specific function of examining Government Estimates before the money is spent so that if intervention or a change in policy direction proved necessary, it would be made. One of the comments made about our work is that the Committee of Public Accounts is effective and powerful but that it is always examining matters historically, locking the stable when the horse has bolted and hoping that the mistakes identified by the committee serve to correct performance in the future. It has also been stated that the public would like a more interventionist parliamentary function where some of the waste in public expenditure would not occur in the first instance.

Mr. Downe

I take it that these Accounting Officers do not make a difference, for all intents and purposes, in correcting ongoing problems. They are just accountable for what is happening.

No. The way it works is that we would hope that an identified problem which involves wasteful public expenditure would either be stopped if it was ongoing or would not reoccur if it was completed. However, the committee believes there is a need within the system for a function — it would not be for this committee but for the finance committee — which would examine the totality of the Government Estimates as part of the budgetary process in the months leading up to the start of the financial year in which the money will be spent. The system does not include such a function. Much of the scrutiny of Estimates in this Parliament is rubber stamp in nature, where no change takes place. We, and the public, are concerned about it. This committee took it upon itself to commence the debate and yesterday we published a report making recommendations on a solution. However, that is as far as it has gone.

Mr. Oliver

I am a little surprised that the Chairman stated that the Accounting Officers are appointed by the Department of Finance, yet, as he explained to Senator Day, they come before the Committee of Public Accounts where they must account. I am concerned that they are appointed by the Department of Finance. Are they accountable in any way to that Department?

Mr. Purcell

No. Technically, the Accounting Officer concept dates back to 1866 and we took on board the relevant legislation from the time when we were under British rule. There was no statutory basis in a sense for the term "Accounting Officer". Until 1993, it was done by convention rather than anything else. It is merely the person who is charged with drawing up the appropriation accounts of a Department. In that sense, the appointment is made. Invariably, it must be the head of the Department but, for the sake of formality, the Secretary General is chosen first. He or she must be a Secretary General before he or she can become Accounting Officer.

Mr. Oliver

I understand.

Mr. Purcell

It is a formality. Accounting Officers, under law from 1993, are solely accountable to this committee.

Mr. Oliver

I understand now. That is good to know.

Mr. Purcell

To take up a point about the timeliness, what the Chairman stated is correct and it has been of concern to the committee but perhaps what has not come out is that apart from the annual report, which is a fairly large event in that sense, my office also produces periodic value for money reports and also special reports from time to time. The committee, under law, can have an input into the shape of those examinations. Under its terms of reference, the committee can make suggestions to me as to the programme of work I am undertaking. Clearly, because of my close relationship with the committee, I will listen to what the committee has to say. Some of my special reports or some of the chapters in my annual report would be the result of requests by the committee or even by the House itself. Perhaps that helps to clarify that side of matters. There is much more frequent reporting as well as the annual report.

Mr. Day

I have one question for the Comptroller and Auditor General, Mr. Purcell. Does he report to Parliament or to this committee? I understand he works closely with this committee. Does he report to it?

Mr. Purcell

Technically, no. Under the Constitution, my reporting relationship is to the house of representatives, Dáil Éireann, but the latter set up this committee in order to consider the accounts audited by me and the reports made by me. That is the committee's raison d’être.

Mr. Day

Our researchers, in helping us prepare for this meeting, indicated that an Accounting Officer is accountable before this committee rather than to this committee. Is that merely a play on prepositions or is there a difference between being accountable before and accountable to?

I am not a lawyer and to go further might cost me money.

Mr. Day

That is good. Now I know how the Deputy was chosen as Chairman of this committee. Incidentally, I was going to ask this question. Is the Chairman of the committee chosen by election or merely by wit?

Mr. Purcell might have a better answer.

Mr. Purcell

In deference to the quality of their researchers' work, I would say that Accounting Officers are accountable through this committee, rather than to or before this committee.

Mr. Day

There is a third option. We were briefed on a situation where there was a disagreement between the chief executive officer or the Secretary General of the Department of Health and Children and the Minister which raised the interesting issue of what happens when there is a difference of opinion on how a matter should be handled within a particular Department. In some accounting officer schemes there is a formal dispute resolution process of putting in writing the disagreement. Does the committee get involved in that disagreement process or does it have a role to play in this?

Mr. Day

Can Mr. Purcell elaborate on that disagreement with regard to the Department of Health and Children?

Mr. Purcell

Generally, the committee might become involved after the event. The best way to proceed is to refer, because the relevant part is quite brief, to our public financial procedures, which state, on covering a difference of opinion between an Accounting Officer and a Minister that if, in respect of an area for which an Accounting Officer has a responsibility — for example, the propriety of a payment or the treatment of a receipt — a difference of opinion arises between the Accounting Officer and the Minister responsible for the service, the Accounting Officer should inform the Minister in writing of his or her view and of the reason for it and suggest a consultation with the Department of Finance. It is also stated that if, notwithstanding this, the Minister gives contrary directions in writing, the Accounting Officer should comply with them after informing the Department of Finance and the papers should be sent to the Comptroller and Auditor General when the directions have been carried out. Clearly, these things have happened but it would be rare. If, however, the matter was material, then I would report on it and it would ultimately be considered by this committee.

While Mr. Day's information is not completely accurate, at a recent meeting the chief executive of a subsidiary of a Department, as opposed to the Department's Accounting Officer, offered a long-term view that differed from what the Minister said. I have served in government and there are strong arguments at times between Ministers and Accounting Officers. They are always resolved amicably but the one outstanding issue for a long period in this country has been remaining within the Estimates. With regard to Mr. Day's worry regarding when the horse has bolted, that is a concern. We have tried in recent times to address that. Representatives of the National Roads Authority, which is responsible for major road developments, came before the committee. Concerns were expressed about overruns, delays and seepage, for which there were many reasons. Of the 22 projects under way, however, 19 will be completed ahead of time and under budget.

It is not always the case that, just because it deals historically with spending, the committee's recommendations fail to filter through and have a beneficial effect.

A number of my colleagues have left the meeting because a division has been called in the House. There is no discourtesy intended. I am paired with Deputy Smith and, therefore, we can continue before taking lunch.

Mr. Oliver

With regard to overruns, delays and so on in the Government's accounts and Estimates, would the committee like new or additional powers to help it do its job? What else would it desire to be more effective?

We would like our remit extended to cover local government. The country is too small to have two audit systems. A number of local government audits come within the remit of the Comptroller and Auditor General. That change has taken place in Northern Ireland, Scotland and Wales and we would like our remit extended to cover local authorities.

Mr. Oliver

Would the Chairman like anything else to happen in terms of giving more power to the committee to make it more effective in doing its job?

There was a major review of the committee's powers in 1992, which is recent enough in parliamentary terms. The resulting legislation revamped the committee. We have sufficient powers, although I would like a better basis in law for the response from the Department of Finance to our recommendations in order that we have an absolute follow through on the acceptance of recommendations. Other issues are within our control. For example, I was told that 90% of the work of the comptroller's office in Canada relates to special or value for money reports and only 10% relates to financial auditing.

Mr. Oliver


The proportions are the reverse here. There is agreement between the committee and the Comptroller and Auditor General that we should move towards special and value for money reporting. There is no legal constraint on us from doing so.

Mr. Oliver

How often does the committee meet? How much time is spent on Mr. Purcell's report?

We meet every Thursday, except during recess periods. This year, for example, our first meeting was in the last week of January and we met weekly until the end of July. We went into recess in August and resumed meetings in the second week of September.

Mr. Oliver

What is the duration of each meeting?

We commence at 11 a.m., work through lunch and normally conclude between 2.30 p.m. and 3 p.m. On other occasions, usually Wednesdays, we have additional meetings. We did not have a formal meeting yesterday but we launched two major reports. Reaching agreement on the reports can be detailed and tedious and, therefore, we take such deliberations in private session. When there is a backlog, we sometimes hold meetings on Wednesdays to get our reports under way.

Mr. Stratton

Part of the problem all governments have is that a Minister will get the bit between his teeth and decide to do something. Despite our committee reporting on overruns, such a Minister's legislation will result in more costs every year. We submit reports telling Government that this is a problem. Our House of Commons does the same but nothing happens. Are controls in place to prevent this from occurring? That is an ongoing process with which we still have difficulty.

The committee examines spending after it has occurred.

Mr. Stratton

We produce these reports after the spending has occurred, yet the costs increase year on year.

We get involved when the cost of the project is significantly more than the estimate. For example, Deputy Smith referred to the national roads programme. That went way over budget and it was ventilated strongly before the committee. We made strong recommendations. The issue went into the court of public opinion and the Government took action. It has come up with different contracts for major infrastructural projects, particularly roads. The Government has moved from the traditional contract system to design and build systems and public private partnerships where the contract involves design, construction, management and finance. Changes have taken place. We do not have the power to change the policy pursued by the Government or a Minister. As a result of the ventilation of the failings at the committee, public opinion gets behind the issue and change occurs.

That is true. Regrettably, we have come across examples of where somebody, independent of the committee, should have detected the leakage earlier. We generally support what Senator Stratton is saying. If a Minister has a pet project and it is not delivering, it is important to be able to call a halt. In fairness to the Irish system generally, the economy has grown phenomenally. Few countries have experienced similar growth over such a prolonged period. Expansive programmes were undertaken and the expertise was not built up quickly enough to manage every aspect of them. Allowances must be made for that but, by and large, the committee's work, public opinion and other aspects of the Government's operations are beginning to intervene much earlier, which is desirable.

Mr. Oliver

We must leave shortly to meet Julie O'Neill and others. Senators Downe and Day will ask the final questions.

Mr. Downe

Have Accounting Officers found restrictions on their authority or autonomy because of EU membership? In other words, does any collective role impact on Accounting Officers?

A great deal of money comes in from Europe and that is accountable, in the first instance, to the European Court of Auditors, even though it is disbursed in Ireland as if it was sourced domestically. It would change to some extent the way they inter-relate with the European Union. Are there any specific examples?

Mr. Purcell

No, it does not affect them to a great degree. As the Chairman said, the inward funding of programmes and so on takes on the character of Exchequer moneys and, as such, is subject to the audit regime. From time to time this committee will query the expenditure of European money as part of a general funding of the roads programme, for example. Accounting Officers do not have an inter-relationship with the European institutions. They may go to some of the high level negotiations in Brussels as part of negotiating teams, wearing their Secretary General hats. Generally speaking, in their capacity as Accounting Officer, they are not involved.

We had an example of a draft report on one of the Departments. Some €9 million from a European social fund did not come through because the Department did not claim it. There are some fairly adverse comments on it. We understand it is recoverable on a late application. If it had come through, it would be dealt with as Exchequer money and it would be subject to the same scrutiny.

Mr. Day

I would like to get back to the issue of whether the Accounting Officer concept delegates or reduces ministerial accountability to the Dáil. Deputy Smith and I could discuss the matter at length. It creates potential conflict if the Accounting Officer is accountable to a committee versus his or her relationship with the Minister. As we have run out of time, we will leave that subject until the members of the committee visit Canada.

Hearing the names around the table here makes me feel at home. We have a great deal of Irish ancestry in our part of eastern Canada. It has been a delight to visit the two Chambers of the Parliament. We enjoyed our time here. We understand the issue of pairing and why those who were not paired had to go, because we have a similar concept in Canada. Until we meet again, we thank very much the members for taking the time to help provoke our thought on this interesting issue.

I thank the delegation. Its members are most welcome. It was an enjoyable meeting and a very fruitful discussion. We may take them up on their offer to visit Canada.

The committee went into private session at 12.55 p.m. and adjourned at 1.10 p.m. until 11 a.m. on Thursday, 10 November 2005.