COMMITTEE OF PUBLIC ACCOUNTS díospóireacht -
Thursday, 13 Mar 2008

2006 Annual Report of the Comptroller and Auditor General and Appropriation Accounts. Vote 10 - Office of Public Works.Chapter 1.3 - Agency Services.Chapter 4.1 - Discrepancies at Two Heritage Sites.VFM Report 56 of the Comptroller and Auditor General: Chapter 19 - Cross-Cutting Reports.

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

Mr. S. Benton (Chairman, Office of Public Works) called and examined.

Chairman

I welcome everybody. Witnesses should be aware that they do not enjoy absolute privilege. As and from 2 August 1998, section 10 of the Committees of the Houses of the Oireachtas (Compellability, Privileges and Immunities of Witnesses) Act 1997 grants certain rights to persons identified in the course of the committee's proceedings. These rights include: the right to give evidence; the right to produce or send documents to the committee; the right to appear before the committee, either in person or through a representative; the right to make a written and oral submission; the right to request the committee to direct the attendance of witnesses and the production of documents; and the right to cross-examine witnesses. For the most part, these rights may be exercised only with the consent of the committee. Persons invited to appear before the committee are made aware of these rights and any persons identified in the course of proceedings who are not present may have to be made aware of them and provided with the transcript of the relevant part of the committee's proceedings if the committee considers it appropriate in the interests of justice.

Notwithstanding this provision in legislation, I remind members of the long-standing parliamentary practice to the effect that they should not comment on, criticise or make charges against a person outside the House, or an official, either by name or in such a way as to make him or her identifiable. Members are also reminded of the provisions within Standing Order 158 that the committee shall refrain from inquiring into the merits of a policy or policies of the Government or a Minister of the Government or the merits of the objectives of such policy or policies.

I welcome Mr. Seán Benton, chairman of the Office of Public Works and invite him to introduce his officials. I also welcome the officials from the Department of Finance.

Mr. Seán Benton

I am accompanied by Mr. Joe Farrell, accountant, Mr. David Byers, commissioner responsible for the property dimension of the OPW, Ms Clare McGrath, commissioner responsible for all the major projects, and Mr. Tony Smyth, director of engineering services. The officials from the Department of Finance will introduce themselves.

Mr. Eric Hartmann

I am in the budget section of the Department of Finance.

Mr. Frank Griffin

I am in the sectoral policy division of the Department of Finance.

Chairman

I invite Mr. Purcell to introduce Vote 10, chapters 1.3 and 4.1 and the value for money report 56, part C, chapter 19. Chapters 1.3 and 4.1 read as follows:

1.3 Agency Services

The Office of Public Works (OPW) acts as agent for other Departments and Offices in the purchase of sites and buildings, the procurement and management of construction type contracts, and the maintenance of public buildings. Public Financial Procedures (PFP) provide that OPW requests advances from any Department or Office (as principal) prior to entering into contracts or meeting any costs. The costs are charged to a Department’s Appropriation Account when the amounts involved have been certified by OPW as having been duly disbursed by it. Where it may be some time after the end of the financial year before OPW can determine the precise amounts disbursed, a Department may, in order to close its Appropriation Accounts on 31 December, charge an agreed estimated amount in respect of agency services.

If expenditure is not significant OPW as agent may make payments in respect of the service from its own voted moneys on a suspense basis. OPW should secure recoupment from the Department concerned within the year in which the payments have been made.

These rules derive from the cash based accounting system statutorily used by Government Departments and Offices under which Dáil Éireann annually votes the sums to be made available for each service. Under this system, amounts not spent in any year are required to be surrendered to the Exchequer. Each year, I confirm that the amounts for surrender recorded in the Appropriation Accounts for the previous year have been duly surrendered.

Audit Examination

The Appropriation Account for Vote 10 – Office of Public Works shows in its Statement of Assets and Liabilities, net credit balances in suspense accounts amounting to more than €48m at 31 December 2006. This amount consists primarily of unspent balances (mostly advances) from clients totalling €62m, partly offset by amounts due from them totalling €14m for agency services provided without prepayment. The Appropriation Accounts of Departments and Offices that made advances to OPW should reflect, in their Statements of Assets and Liabilities, corresponding debit balances.

As part of my audit of the 2006 Appropriation Accounts, I selected for examination a sample of the significant credit balances recorded by OPW. Examination of the underlying transactions in this sample indicated that the amounts shown in the suspense accounts of Departments/Offices providing the advances did not agree with the corresponding amounts shown in the OPW suspense accounts.

Table 4 Comparison of OPW and Departmental Suspense Account Balances 31 December 2006

Department/Office	OPW CreditBalances €m	Departmental Debit Balances €m
Department of Education and Science	31.969	nil
Department of Finance	3.193	nil
Department of the Environment, Heritage and Local Government	2.325	1.340
Office of the Revenue Commissioners	1.207	0.783
Department of Agriculture and Food	1.619	nil

In the light of the variations between these balances, I sought the views of the Accounting Officers concerned.

I also asked them to outline the procedures in place to ensure that the appropriate expenditure was charged to their respective Appropriation Accounts at the proper time.

Department of Education and Science

The Accounting Officer, Department of Education and Science said OPW acted as agent for the Department in the sourcing and purchasing of sites for schools, management of the asbestos remediation programme in schools and the provision, maintenance and furnishing of its office premises network. For many years, the Department charged amounts advanced to OPW for these services directly to the Appropriation Account. The Department was unaware that it was in breach of prescribed procedures. Its payments to OPW in respect of the site acquisition and asbestos remediation programmes were made in respect of multi-annual rolling programmes of work. The Department complied with requests from OPW for payment prior to work commencing and charged these payments to the Vote subheads rather than to suspense as required. It also believed that building and remedial work were fixed sum contracts and as such did not anticipate there would be credit balances remaining in OPW suspense accounts.

She informed me that while the Department received and examined annual statements for site acquisition and asbestos remedial work it did not in other cases obtain annual certificates of expenditure from OPW. The Department and OPW liaise regularly on the management of the Department's site acquisition programme and OPW supplies the Department with monthly progress reports. In regard to the office premises the Department liaises with both the OPW architect and the contractor to ensure work is completed to the required specification.

While pointing out that the problem highlighted by my audit was one of accounting treatments and conventions rather than improper use of funds, the Department accepted that it needed to review its procedures in consultation with OPW. It would be necessary for the Department to obtain the assistance and agreement of OPW to the preparation, on a timely basis, of quarterly statements on the transactions on each account in order that the appropriate charges might be made to the Vote for agency services in the future.

She added that arrangements had been initiated, internally and with OPW, to ensure compliance with the correct procedures.

The Appropriation Account for Vote 26 – Education and Science – has been amended to reflect the correct charges for OPW agency services, in respect of site acquisition and asbestos work, involving some €30.3m in 2006. This increases the surrender to the Exchequer from €36m to €66m.

Department of Finance

The Accounting Officer, Department of Finance informed me that in the case of his Department the advances made to OPW were charged directly to the relevant subhead of the Vote for Finance and not to suspense as required. A certificate had not been obtained from OPW to support the charge to the Vote.

He indicated that two items making up the OPW balance for his Department did not relate to projects chargeable to Vote 6 – Finance.

He agreed that the correct procedures had not been adhered to in respect of these transactions. The 2006 Appropriation Account for the Vote had been amended to reflect the appropriate charge. As a result the amount to be surrendered to the Exchequer in this case has increased by €2.3m to €16.5m.

He was satisfied however, that on-going and continual liaison with OPW architects for all projects ensured appropriate signoff on completion of jobs and that no loss of public funds occurred as a result of the accounting treatment of these transactions.

He went on to state that when these matters were drawn to his attention he availed of the opportunity to remind staff of the Department of the importance of complying with Public Financial Procedures. As the matter had relevance beyond his Department he indicated that he had written to all Accounting Officers reminding them of the correct procedures to be followed in this matter.

Department of the Environment, Heritage and Local Government

The Accounting Officer, Department of the Environment, Heritage and Local Government in her response agreed that the OPW balance did not accord with the corresponding balance recorded by her Department. The Department had been in touch with OPW and confirmed that some balances go back a number of years. It was the Department's belief that one credit balance for €511,000 described as relating to the Custom House was incorrectly held as an advance for works that had been completed for some time. A definitive reconciliation of payments made to OPW would be carried out to address disparities between the Department's suspense account balances and those of OPW. She has instructed that guidelines be issued to all staff involved on the financial and accounting procedures to be observed in making inter-agency payments, and to ensure that a full reconciliation is effected at year-end.

In general, payments made to OPW were correctly charged to suspense accounts but it had come to light that two payments amounting to €200,000 which should have been charged to suspense accounts had been charged directly to Vote expenditure. In addition, there were further payments to OPW charged to Vote expenditure where it was not possible in the time available to verify beyond doubt that the full amounts were correctly chargeable in 2006. As the combined amounts were not material to the Department's overall expenditure, there was no requirement to amend the Vote.

Department of Agriculture and Food

The Accounting Officer, Department of Agriculture and Food, informed me that the nature of the services for which advances had been paid is such that final statements had not issued in the year in which the advances were made. In these circumstances, the practice has been to charge these amounts to the relevant subhead in the Department's Vote.

Bearing in mind that amounts charged to the Vote in this way are immaterial in the context of the total Vote expenditure in the year and that the difference between OPW records and those of the Department has been reconciled to my satisfaction, I have not insisted on a change to the Appropriation Account as presented.

However, in future, the Department should change its practice and charge the advances to a suspense account in the first instance. The charge to the Vote can only be made when OPW confirms its inability to give, on a timely basis, a definitive amount for expenditure incurred within the year and has agreed with the Department an estimate of the sums spent on the service.

Office of the Revenue Commissioners

The Accounting Officer of the Office of the Revenue Commissioners informed me that advances made to OPW were charged in the first instance to suspense accounts and that these suspense accounts were correctly discharged on the basis of disbursement certification by OPW. The difference between the amounts recorded by OPW and the Revenue Commissioners has been reconciled to my satisfaction.

Office of Public Works

The Accounting Officer of the Office of Public Works, in response to my enquiries, informed me that his Office managed a wide range of services on behalf of client Departments and Offices involving several hundred accounts and expenditure in excess of €75m a year.

As a general principle, OPW opens a separate account for each project and does not normally offset a credit balance in one account against a debit balance in another belonging to the same Department until projects have been completed.

As agency work typically involves contracts between OPW and external contractors, OPW required that clients maintain their accounts in credit so as to ensure that there were always sufficient client funds available and accessible to meet payment demands. These funds are held in an interest bearing account with the Central Bank. The Appropriation Account for Vote 10 – Office of Public Works – for 2006 showed a credit balance in its account with the Central Bank of €122m (€89m when outstanding cheques were taken into account).

The Accounting Officer stated that OPW Business Units regularly briefed client Departments on the status and progress of projects, including the financial position. He cited as an example, the service OPW provided for the Department of Finance for the procurement of crèches at various Government offices. He pointed out that a monitoring committee representing the Department and OPW met regularly to plan, discuss and monitor all aspects of the management and delivery of the programme, including the financial dimensions.

In the case of the Department of Education and Science, OPW provided a hugely important and complex service to the Department – the acquisition of school sites. OPW had a longstanding prudent policy of seeking and accepting funding from the Department only when the finalisation of the legal stages of acquisition was imminent. He said that there was no doubt that in the event of funding not being available immediately on close of sale some deals would fall through. The balance on this account, €23m at 31 December 2006, was reduced to €12.4m by end January 2007 and to €8.6m at end June 2007. OPW provided annual financial statements to the Department of Education and Science.

He added that OPW took a conservative and careful approach to reducing balances to zero and closing suspense accounts. They preferred to keep accounts open until it was clear that there would be no further costs payable.

The Accounting Officer also informed me that, notwithstanding the arrangements already in place for the supply of information to clients, he had decided to introduce a formal procedure of regular notification of project financial statements to client Departments.

Office of Public Works

4.1 Discrepancies at Two Heritage Sites

Background

The Office of Public Works (OPW) manages 747 Heritage Sites and 19 Historic properties of which 89 are open to the public on a seasonal or annual basis. The Heritage Service within OPW has responsibility for the conservation and presentation of built heritage sites and the provision of safe public access to them.

The public are charged admission at 50 of the 89 sites. In 2006, over 2.2 million people visited OPW staffed heritage sites. The income generated from admission fees and sales over the last three years is shown in Table 25.

Table 25 Income at Heritage Sites

	2006 €m	2005 €m	2004 €m
Admission Fees	5,274	4,307	4,118
Tour Operator Receipts	397	536	579
Heritage Cards	370	397	361
Publications/Postcards	480	415	461
Total	€6,521m	€5,655m	€5,519m

OPW procedures require each heritage site to make a weekly return to its Visitor Service Section including

Details of cash received for admission fees and sale of heritage cards and publications

Details of cancelled tickets, heritage card returns, etc.

A bank stamped copy of the receivable order reconciled to the return.

The original receivable order is transmitted to the Accounts Division where details are recorded in the ledger under Appropriations-in-Aid. Visitor Service Section is required to confirm, on a weekly basis, bank receipt details, as recorded by Accounts Division, with the weekly returns from the various heritage sites.

Discrepancies at Two Sites

In the first of these cases, concerns with the operation of controls first emerged in July 2006 when Visitor Service Section discovered discrepancies between the weekly returns and bank lodgments at a particular heritage site. The OPW Internal Audit Unit was requested to reconcile the returns against lodgments made by the site for 2004, 2005 and up to June 2006. The site was open for 44 weeks during this time and discrepancies were found in 25 of these weeks – no lodgments had been made in 17 of these. The first irregularity was pinpointed to have occurred in August 2004 and, although the sum missing has yet to be fully determined, it has been estimated to date to be in excess of €11,000. An Garda Síochána were informed and investigations are ongoing.

In the second case, an unusually large cash lodgment was made by another heritage site in October 2006. This warranted investigation as the requirement to make weekly returns and lodgments had been put in place to prevent the accumulation of large sums of money and limit the risks to security, error and misappropriation. It emerged that the lodgment was an accumulation of receipts from mid July 2006 to mid September 2006 and was in fact in order. However a detailed examination of returns for this site, going back as far as 2004, when OPW took over the particular heritage responsibilities from the Department of the Environment, Heritage and Local Government, indicated that receipts, due to be lodged between July and December 2005 amounting to €21,831 were missing. This irregularity is at present under investigation by An Garda Síochána.

A common theme emerging from these cases was failure to lodge moneys on a weekly basis as required and the failure by Visitor Service Section to detect this in a timely manner.

As a result of these incidents the Office of Public Works engaged a consultant to review its cash handling procedures. The review focussed on the systems, procedures, and controls underpinning the handling and bringing to account of its non-invoiced receipts. This review included both the Heritage Service and other operations within OPW. The consultant's recommendations, which essentially endorse the enforcement of present procedures, are currently being acted upon.

The Internal Audit Unit also reviewed procedures within the Heritage Service and reported in August 2006, making 11 recommendations. Significant concerns raised were; management failure to complete and sign off on risk assessment issues in the Heritage Service; and the failure to enforce existing procedures. The review also noted that only weekly returns for 2006 were being examined and that returns for 2004 and 2005 had not been examined. It recommended that the 2004/5 returns should be examined as soon as possible.

As I was concerned that the delay in detecting these defalcations was brought about by the failure to enforce existing controls and procedures, I sought the views of the Accounting Officer.

Office of Public Works Response

The Accounting Officer stated that in May 2004, responsibility for the management of significant aspects of the Heritage Service returned to OPW from the Department of the Environment, Heritage and Local Government. Certain other functions had at that stage already been allocated to the Department of Community, Rural and Gaeltacht Affairs leaving a limited pool of resources to ensure continuity in the tasks required. The transfer to OPW ultimately excluded responsibility for key aspects of policy and particular Heritage functions including National Parks, certain Historic Properties, parts of Architecture and the entire Archaeological Service. The final transfer to OPW included general day-to-day responsibility for the management of a large number of Heritage sites nationwide, including management of the Guide Service and the delivery of visitor services at certain sites within the portfolio.

This split of the Heritage function resulted in a dilution in corporate knowledge and the diversion to other Departments and areas of certain key and experienced personnel and resulted in a situation where there was considerable disruption in the continuity of staff within the Heritage Service. He stated that ongoing consistent management of the function throughout the entire portfolio was difficult to achieve as more experienced staff were either transferred out of the area or diverted to other functions. Steps have since been taken to significantly increase staffing levels in Visitor Service Section to enable the necessary levels of scrutiny and control to be consistently and properly applied.

He stated that it was clear from the internal and external examinations carried out, that the procedure for the recording and checking of returns from heritage sites was not in itself fundamentally flawed and did, in fact, result in the detection of the anomalies.

He added that there was a general requirement that staff dealing with incoming returns check the returns received against a list of sites actually open for visitors. If any open site had not made a return for the week in question, staff were required to bring this to the attention of management for action.

He was gratified that the external consultants had independently endorsed the OPW procedures now in place and that these had been embedded into normal operational practice within the Visitor Service. He was also satisfied that the planned enhancement of staff resources and the delivery of a structured training programme would contribute to a more robust system for managing these activities more efficiently.

The Accounting Officer confirmed that the Internal Audit Unit's recommendations had already been implemented or were being prioritised. He provided me with a status report on progress in this regard.

Mr. John Purcell

We will start with chapter 4.1. That draws attention to financial irregularities at two heritage sites operated by the Office of Public Works. While the amounts involved are not particularly significant in the overall context of the Vote, the irregularities serve to illustrate what can go wrong when basic financial controls are not implemented in a timely and consistent manner.

There was nothing wrong with the controls per se, in fact they eventually brought the cash discrepancies to light, it is just that the failure to operate them as envisaged meant that detection was delayed and misappropriations of €21,800 and €11,000 were allowed to build up. As the Accounting Officer pointed out, the irregularities took place at a time when responsibility for heritage functions was being divvied up and swapped around. In such circumstances it is often the case that staff take some time to become familiar with the requirements of the new working environment. This, coupled with the loss of key personnel, can expose an organisation to financial loss. It is important this reality is recognised and that compensating controls are put in place to plug gaps at the appropriate time.

I refer briefly to Chapter 1.3, which the committee considered a few weeks ago when the Accounting Officer for the Department of Finance was before it. Members may recall that large advances to the OPW for capital works were being charged to the Votes listed in the chapter even though the amounts in question had not been disbursed by the OPW before year end. While the Accounting Officer for the OPW was generally satisfied with the existing arrangments, in the light of the difficulties identified by the audit he indicated that he had decided to introduce a formal procedure of regular notification of project financial statements to client Departments. This should help to prevent a recurrence of problems encountered.

Turning to the Vote, one will see that the OPW underspent its Estimate provision by 10% in 2006. This was almost entirely due to delays in several major projects. Other than that I have no observations to make on the Vote account. On value for money training, the OPW rates quite well in the follow-up report so I do not have a problem in that respect.

Chairman

I thank Mr. Purcell and invite Mr. Benton to make his opening statement.

Mr. Seán Benton

I am pleased to be before the committee today to discuss the appropriation account for the Office of Public Works for 2006.

I will deal with the three items listed on today's agenda, namely, the misappropriation of funds at the two heritage sites, the operation of agency services and staff training.

In his report the Comptroller and Auditor General set out the facts surrounding the misappropriation of funds at two sites. The systems of controls and checks which were in place nationwide were in these two cases not applied with the consistency and vigilance that I would expect. Had they been, the problems would have come to light much sooner. I am satisfied that revised cash handling procedures which have been introduced incrementally since 2005 and extended throughout the OPW in 2007 are sufficiently comprehensive and clear to ensure that any future irregularities will be detected quickly.

The new controls and procedures have been externally validated by independent auditors and they consider them to be adequate and appropriate. As important in my view is the fact that I have assigned additional staff to the management of visitor services at a national level and that regimes of staff training, including training in cash handling for frontline and management grades, are now an integral part of the annual programme. All staff are also provided with a copy of the detailed written procedures.

In addition to these measures I appointed a firm of external accountants and asked them to examine current systems, procedures and controls that are being operated in practice at sites nationwide. The review included on-site inspections at a sample of sites as determined by the consultants. The consultants’ findings were that, in general, procedures were understood and were being implemented to a satisfactory level. A further measure we took was to examine various weekly returns to visitor services for periods in 2005 against bank records. This has not revealed any cause for concern.

The key in this matter, as with so many others, is clear and comprehensive procedures, staff training and effective enforcement and oversight, including external audits. I am satisfied these conditions now apply.

I will turn briefly to agency services, to which the Comptroller and Auditor General referred. In addition to the projects and services covered by our Vote, the OPW provides a range of professional services to other Departments and agencies. Examples include building construction, maintenance and repair services, the purchase of sites and a number of other services that I can detail if the members wish. The key point is that the client bears the cost. The annual value of agency services carried out by the OPW in 2006 was in the order of €132 million.

In a typical agency arrangement, the OPW is the contracting authority and we bear the legal responsibility to pay contractors' claims on time. For this reason, the general accounting regulations allow us to require client Departments to keep us sufficiently in funds on each project to meet expected liabilities. This is done by the creation of suspense accounts in respect of each specific project.

The issue in question here is the treatment and accounting for funds transferred between the client Departments and the OPW. There is no suggestion of loss of public funds, bad value for money or failure to comply with procurement and project management standards. All agency projects are handled and managed by the OPW to the same high standard as projects funded from our own Vote.

The Comptroller and Auditor General's investigation revealed a need for greater clarity and understanding of existing accounting regulations regarding the treatment of funds for agency services and the management of suspense accounts, including in the OPW. While it has always been our practice to provide any financial information requested by the client, I have now put arrangements in place to advise all Departments, as a matter of course on an annual basis, of the financial status of each project, and to formally issue a closing financial statement on final completion. All Departments are being provided with financial statements setting out the position and financial history of each project as at 31 December 2007.

On training, the OPW is committed to a policy of ongoing staff development and training. It is a core part of our strategy for the development of the office. This is reflected in the process of continuing professional development, CPD, which involves annual upskilling, for architects and engineers. We are equally committed to the development of all staff so as to maximise their potential and enable them to deliver a high quality of service to our customers.

PMDS is the main process used in the identification of staff training needs. The link between annual business planning - ours is quite detailed and specific - and individual PMDS engagement allows for a strong focus on the aims of the OPW and the skills and competencies needed to deliver those aims. We have also taken steps to encourage staff to be proactive in their own personal development. The Civil Service-wide refund of fees scheme has been very successful, with a significant uptake every year. We have also introduced a voluntary scheme whereby staff can avail of emotional intelligence testing and feedback for their own personal development. Such testing involves a scheme to assist staff in coping better with a highly pressurised work environment demanding a high output and productivity. It has been quite successful. Interview coaching is also available to staff on a voluntary basis. The initial take-up on these schemes has been very encouraging and reflects well on the commitment of OPW staff to lifelong learning and personal development. Both of these initiatives are supported by in-house qualified staff.

Where possible we avail of the OPW's own professional expertise in the upskilling of staff. This is not always possible and there may be specific areas in which we must rely on outside expertise. However, to a large extent, and possibly more than most, we rely on our own internal resources.

This mix of training providers has proven to be very beneficial in terms of quality of training provided. By having a very focused approach to identifying training needs and by continuous monitoring of the quality of that training, I am happy we obtain value for money in our training interventions.

We have made good progress in recent years in the appraisal, planning, management and review of major contracts. There are detailed step-by-step procedures in place for the continuing assessment of all aspects of major projects from initial concept right through to post-completion assessment of outcome, including performance and cost. OPW staff are fully trained in the operation of the controls and techniques and this training reflects well on the outcome and management of the projects.

That concludes my general statement. I will be happy to hear members' views on the 2006 account and will do my best to answer any specific questions.

Chairman

May we publish the statement?

Mr. Seán Benton

Yes.

Deputy Jim O’Keeffe

The OPW manages 747 heritage sites and 19 historic sites, amounting to a total of 766. I note that 89 are open to the public, in respect of 50 of which fees are collected. Is the taxpayer getting a fair return in this regard? The OPW spent over €18 million in the year in question on the upkeep of the sites while the fees amounted to €6 million.

Mr. Seán Benton

I do not wish to be flippant but I must state that if we are spending €18 million and only charging €6 million, the taxpayers are getting a very good deal. It is they who avail of the services and I would like to seem them getting an even better deal.

Deputy Jim O’Keeffe

Are there sites open to the public in respect of which a charge could be levied? Are there sites with no admission charge that are occupied? In such circumstances, do the occupiers make a contribution towards the upkeep? Must the taxpayer meet the total cost in such cases?

Mr. Seán Benton

There are a number of sites where there is no charge to the public. We recently removed charges at some sites, particularly where the number of visitors was small. We were anxious to determine whether we could improve access and increase the number of visitors to those sites by removing charges. We got a very encouraging response. When we removed the charges at locations with low visitor numbers, there was a significant increase in numbers, bearing in mind that the charges were not very high in the first place.

Deputy Jim O’Keeffe

What is the position on sites on which taxpayers' money is spent yet public access is not granted? Of the total of 766 sites in this category, the public has access to only 89.

Mr. Seán Benton

There are two categories, national monuments and historic properties. National monuments account for the bulk of those projects to which the Deputy referred. Some of these can be in remote and isolated areas and not accessible by road or even pathways. For 46 historic properties there is a charge. The remaining sites do not have a charge but have services, guides and products available for purchase. They would be handling money as well.

Deputy Jim O’Keeffe

Apart from the money, only 10% of the sites managed by the OPW are open to the public. Is Mr. Benton happy with this?

Mr. Seán Benton

A number of those sites are in guardianship and on private land. It is not easy to make them accessible. I would like to see--

Deputy Jim O’Keeffe

Between 85% to 90% of these properties are not open to public.

Mr. Seán Benton

That is correct. They would largely be monuments on private land.

Deputy Jim O’Keeffe

Does the public have access to them?

Mr. Seán Benton

In some cases access is facilitated by private owners and in others we have made arrangements. In some cases, they are on very remote sites and the public access them by hiking through the hills to celebrate, say, weddings and anniversaries at them. I would not consider them accessible.

Deputy Jim O’Keeffe

Does Mr. Benton believe all sites in the care of the OPW should be open to the public?

Mr. Seán Benton

I would like to see as many sites as is possible and reasonable to be open to the public. There are many other issues surrounding making sites open and accessible. It is not always possible either because they are in private ownership or due to health and safety reasons. In all cases, it is possible for people with an interest in a monument to make arrangements to visit it.

Deputy Jim O’Keeffe

The amount realised in charges came to €6.5 million in 2006, greater than was expected. What is the reason for that?

Mr. Seán Benton

There was an increase in the number of people visiting the sites.

Deputy Jim O’Keeffe

There is a note that it arose from the recovery of outstanding arrears from tour operators. Is that a fact?

Mr. Seán Benton

I do not think it is a significant fact. There are separate arrangements for tour operators. The main reason for the increase was that when the properties came back into our care in mid 2004, we engaged in a marketing exercise to promote the sites. We worked closely with the tourism agencies in counties where sites are located to promote their availability.

Deputy Jim O’Keeffe

Do tour operators pay on a cash or invoice basis?

Mr. Seán Benton

They pay in respect of all people, be it for five or 500 people, on their tours. Rather than pay each day, they would make a single payment at the end of the week or month.

Deputy Jim O’Keeffe

Why did the arrears accumulate? What is the reason to the reference in the note of an excess of €900,000 that rose from the recovery of outstanding arrears from tour operators?

Mr. Seán Benton

There were some arrears when the service transferred back to the OPW and we pursued them.

Deputy Jim O’Keeffe

Are there currently significant arrears?

Mr. Seán Benton

No. I am quite happy that this area of our visitor services operations is up-to-date with no outstanding moneys.

Deputy Jim O’Keeffe

I find it confusing that tour operator receipts only came to €397,000 in 2006 whereas there is a note concerning outstanding arrears of €900,000.

Mr. Seán Benton

I am not aware of any problem with it but I will come back to the Deputy before the end of the session.

Deputy Jim O’Keeffe

My main concern is that there is a system in place where such matters are up-to-date and moneys are dealt with in a business-like fashion.

Mr. Seán Benton

I am happy with the arrangements. Outside consultants examined the controls in place. There was an examination of how the controls are implemented. In both cases, I was given comfort by the consultants' findings.

Deputy Jim O’Keeffe

What were the two sites where, as it was delicately referred to, discrepancies occurred?

Mr. Seán Benton

I would prefer not to go into detail. In both cases there are ongoing investigations and I do not want to say anything that might prejudice their outcome.

Deputy Jim O’Keeffe

I understand Mr. Benton may not want to go into detail on the matter but our job is to find out what is happening.

Mr. Seán Benton

I am reluctant to mention the sites because if I did, individuals could be identified. I do not wish to go down that road.

Deputy Jim O’Keeffe

I am concerned about certain aspects arising from these discrepancies. The amounts involved are not, in national terms, large but they are of some consequence. Have these amounts been recovered?

Mr. Seán Benton

The investigations in both cases are ongoing. I am precluded from making any further comment.

Chairman

I understand Mr. Benton's reluctance as individuals may be identified. We will take his good faith on this matter.

Deputy Jim O’Keeffe

I do not want to press the issue unduly. However, I am not sure what the extent of my function is if it is not to investigate the obvious issues.

Mr. Seán Benton

I assure the committee we have reviewed all of the procedures. I am satisfied that in all sites, including the two in question, there is full compliance with the controls in place.

Chairman

I am not trying to control the Deputy's questioning but, considering the ongoing Garda investigations and the possibility of criminal charges, we should come back to this at a later date.

Deputy Jim O’Keeffe

I am guided by the Chairman's advice. As these matters are four years old, I would hope the issues will be concluded without further undue delay.

Accounting for weekly admission charges at 50 sites, it appears manual returns may not be the best way. Is there an automated process for admission charges which can be reconciled with a bank lodgement? Is there an early-warning mechanism if there are discrepancies? Is such a business-like system in place?

Mr. Seán Benton

There is such a system in place. We are able to do a quick reconciliation from the stamped lodgement slips that are returned and information available from our central bank account. That is done on a weekly basis.

Deputy Jim O’Keeffe

There was a reference to further checking back arising from the initial discoveries. Have those checks been made as far back as 2004?

Mr. Seán Benton

We have done some sample checking on that for 2005, and nothing has come to our attention that would give cause for concern.

Deputy Jim O’Keeffe

Is Mr. Benton fully satisfied that the system in place will at least pick up discrepancies very quickly? That did not occur in this case.

Mr. Seán Benton

The Comptroller and Auditor General made the point that the controls in place were adequate. The issue was the extent to which there was compliance in implementing those controls. The amount of time it took to identify where there was a lack of compliance was a concern. I am now happy that all of the issues have been addressed and that we have an early warning system if there is any discrepancy.

Deputy Jim O’Keeffe

That is good. With regard to the Estimate, I would like to talk about subhead C2, which deals with grants for certain refurbishment works. There was an estimated provision for €7.6 million, but there was an underspend. What is the criteria for qualification for these refurbishment works?

Mr. Seán Benton

I am not quite sure what question the Deputy is asking.

Deputy Jim O’Keeffe

On what kind of properties are these moneys spent? What is the criteria for such expenditure?

Mr. Seán Benton

It is usually a decision of the Minister for Finance. The works are often announced around budget time. Our role is to administer the grant.

Deputy Jim O’Keeffe

I see. The underspend refers to a deferral of grant payments in respect of the Mariners' Church in Dún Laoghaire.

Mr. Seán Benton

Work there did not proceed as quickly as it had been anticipated. In many of these grant cases, we are not involved in the direct management of the projects. Our responsibility is to be satisfied that the projects have been carried out and that the expenditure has been incurred. In this case, there were significant delays on the part of the authorities in moving the project along.

Deputy Jim O’Keeffe

So the OPW does not actually do the work itself.

Mr. Seán Benton

No. We oversee the administration of the grant. It is quite different from our standard involvement in both our own projects and in the work we do on an agency basis for other Departments.

Chairman

Does Mr. Benton know about the criteria to which Deputy O'Keeffe referred?

Mr. Seán Benton

The decision is usually taken around budget time and it is often announced in the budget.

Deputy Jim O’Keeffe

If this money is being spent on a church, is there not a constitutional provision about the State endowment of religion?

Mr. Seán Benton

The Mariners' Church is actually a marine museum.

Deputy Jim O’Keeffe

I want to ask a question on the figure in subhead E, which deals with the new works alterations and additions. There was an estimated provision of €191 million, but the outturn was only €138 million. That seems to be a huge underspend of €53 million. There was a reference to a delay in major projects. What kind of projects?

Chairman

There was an underspend of €57 million the previous year.

Mr. Seán Benton

The difference between the allocation and outturn was €55.7 million and it all dealt with capital works. Of that amount, almost €31 million is the capital allocation which the OPW was allowed carry forward from 2006 to 2007. To a large extent, the capital carry-forward allocation relates to projects which have a contractual commitment that arose during the course of the year, but for which the projected cashflow is slower than anticipated. This is not unusual, particularly with large capital projects. That is why the carry-forward provision, which was introduced in recent years, is so helpful in managing the Vote.

The remainder of the difference between the allocation outturn amounted to €24.7 million. That relates to projects which were expected to be contractually committed in 2006, but did not actually happen. It can arise for a number of reasons. It covered about four areas, namely, rationalisation of office accommodation, flood relief work, some decentralisation projects and some work for the Garda Síochána. Whether it is planning considerations, procurement difficulties or whatever, the nature of those projects is such that they can often move from one year into the next. The €30 million in carryover that was provided would have come into next year's budget, and all those projects would have been taken up.

Deputy Jim O’Keeffe

Is it unexpected every year? The underspend the previous year was €57 million.

Mr. Seán Benton

There was a significant provision for decentralisation the previous year. We would have looked at--

Deputy Jim O’Keeffe

Was it not all spent?

Mr. Seán Benton

On the capital side it might not have all been spent, but while we anticipated at the start of the year that many of the projects for decentralised offices would be provided by construction solutions, in some cases we were able to lease properties. In other cases, properties were being built that we were able to acquire, so they are not reflected in subhead E.

Deputy Jim O’Keeffe

I know we do not yet have the audited accounts for 2007, but does Mr. Benton have any idea if there is an underspend for that year?

Mr. Seán Benton

It was around €35 million and that is being carried forward to this year.

Deputy Jim O’Keeffe

Is it accepted as normal that there is always an underspend for these new works and major contracts? Is that the best way of doing business? Why are the accounts operated in that fashion?

Mr. Seán Benton

There is not always an underspend. There certainly is not always an underspend across all areas of activity.

Deputy Jim O’Keeffe

In a three-year period there is an underspend of €150 million.

Mr. Seán Benton

I will give an example. We would have been committed to the development of a decentralised office at Knock Airport. When we are profiling our expenditure, we make certain provisions for planning and so on. In that case, the planning was granted by the local authority, but it was turned down on appeal by An Bord Pleanála, which necessitated a new procurement process. As a result, a significant amount of money could not be spent and that happens with major projects.

Deputy Jim O’Keeffe

Is the objective to narrow that gap and have the Estimate roughly in line with the outturn? If that is the objective, is there some way it could be achieved to better effect?

Mr. Seán Benton

Flexibility is needed on capital projects. The flexibility allowed is 10% and that is probably reasonable for work of this nature.

Deputy Jim O’Keeffe

We are talking about 25% with regard to expenditure and outturn under this subhead.

Mr. Seán Benton

No. In general, it is within 10% and would have been 10% for 2007.

Chairman

I do not understand that. As Deputy O'Keeffe said, in 2006 there was an estimated provision of €191 million and the outturn was €138 million, and in 2005 the estimate was €180 million and the outturn was €123 million. Mr. Benton said that for 2007 there will be an underspend of approximately €30 million. What was the overall figure?

Mr. Seán Benton

It is 10% on the entire Vote.

Deputy Jim O’Keeffe

I was clearly referring to this subhead.

Mr. Seán Benton

Decentralisation was a particular issue. If one isolates decentralisation - we can certainly talk about that - and looks at the other projects, it will be seen that there was not any significant underspend on the rest of the projects that we deal with.

Chairman

It might help if Mr. Benton broke down the figures for us. He has lumped in flood relief but I cannot understand why he has done so. Flood relief comes under subhead H2.

Mr. Seán Benton

It is capital expenditure.

Chairman

Will Mr. Benton break down the figures for Deputy O'Keeffe?

Mr. Seán Benton

I will have those figures worked on and I will come back to the committee on them.

Chairman

Perhaps Mr. Benton could identify some projects.

Mr. Seán Benton

I will get the figures on decentralisation, general projects and flooding.

Deputy Jim O’Keeffe

Mr. Benton is pointing the finger at decentralisation as being the main factor. These figures do not add up.

Mr. Seán Benton

It is a significant factor. In many cases we identified property solutions other than construction projects. At the time, we would have been--

Deputy Jim O’Keeffe

So the money was never spent.

Mr. Seán Benton

That is correct.

Deputy Jim O’Keeffe

Was it possible at the time to factor this into the figures?

Mr. Seán Benton

It was not known at the time.

Deputy Jim O’Keeffe

In general, I would like more information on these figures because substantial money is involved.

Mr. Seán Benton

I will get back to the committee on that.

Chairman

There is a difference between the area Deputy O'Keeffe was addressing and the other subheading, H2, which deals with flood relief. To me, that is capital spending also.

Mr. Seán Benton

Yes.

Chairman

There is a blurring of the boundaries. Decentralisation and flood relief are in different programmes. It would help if Mr. Benton gave us an example of projects where there was an underspend and the cause for that underspend, other than for the project at Knock. We want a satisfactory response to Deputy O'Keeffe's questions.

Mr. Seán Benton

I can identify the locations where we came up with a property solution other than a construction project. I will gladly send them on to the committee.

Chairman

Does Mr. Benton have those examples now?

Mr. Seán Benton

I may be able to retrieve them. If I can, I will do so.

Chairman

That is fine.

Mr. Seán Benton

In regard to the capital expenditure on flood relief, our experience was that the lead-in time required to process the flooding schemes through all of the stages of planning takes longer than was originally anticipated. I am confident that this will not be an issue this year. Certainly, we were over-optimistic initially with regard to the extent to which we could process those works, in many cases for reasons outside our control.

Chairman

Mr. Benton could come back to us when he has the information we require.

Mr. Seán Benton

Yes. When we were originally looking for the allocations, we anticipated that in the case of Carrick-on-Shannon, Navan, Limerick, Ballina, Listowel and Kilrush there would have been a construction solution. In fact, we have leased properties in those cases. That forms a significant part of this. It will be seen that it does impact on the construction projects.

Deputy Jim O’Keeffe

Operating by lease was obviously not the original preference. Is the taxpayer getting the best return in this situation given the switch from a construction solution to the possibility of paying high rents over a long number of years?

Mr. Seán Benton

No. We do not always pay rents. We sometimes make milestone payments where we would purchase the property over four or five instalments, or with a once-off payment.

Deputy Jim O’Keeffe

Is that done on a phased basis?

Mr. Seán Benton

Yes. However, where we purchase with a once-off payment, it is not reflected in the subhead E budget. In all cases, we benchmark the costs against what we know the constructions costs will work out at. We have our own internal guidance for different types of office accommodation in different parts of the country. Where we are satisfied that we can get better value, we take it. In addition, it can result in a much speedier solution. Obviously, if there is an office block under construction or if an office becomes vacant in a town, it allows staff to move there quickly and have a presence. In all cases, we have to be satisfied we are getting good value.

Chairman

I have seen too much evidence over the years of public bodies leasing properties on long-term leases, which basically propped up private developers. For example, there are many examples in the Cork area of the then health board entering long-term leases which did not give good value to the taxpayer. It seems incredible that over a short span of time between the announcement of decentralisation and the date of these records for 2005 and 2006, there was a change of mind between build and lease. To be fair to the committee, so it can assess whether the taxpayer is getting value for money, it is important we would in each case get full details of the contracts that were entered into, including with whom they were entered into, the terms and the assessment done in regard to lease versus build.

Mr. Seán Benton

I have all of those details and I am happy to provide them in each individual case.

Chairman

One example with which I am familiar is the decentralisation to Limerick of Irish Aid. The proposal was initially to build but, as I understand it, it then became a lease arrangement.

Mr. Seán Benton

The Chairman is correct. There is a lease arrangement. From memory, that is one case where we are getting extremely good value but I will get the details for the Chairman.

Deputy Jim O’Keeffe

This is an important issue that might need to be examined in its totality at some stage. What is the general approach? Is the preference to buy or build as opposed to paying rent? When I was Minister of State at the Department of Foreign Affairs, which is going back a long way, I was appalled at the amount of money being spent in other countries on leases when properties could have been acquired and the taxpayer could have got a much better long-term value on the basis that we would be maintaining our embassies in those countries for years. Is there an approach or preference to own as opposed to lease?

Mr. Seán Benton

In general, if we take the portfolio as a whole, including Dublin, we own approximately 65% of the space we occupy and we lease approximately 35%. The leased arrangements, where we are happy we are getting value for money and where we are beating the market rent, give us the flexibility in regard to that space so it is often adopted as an approach. In the case of decentralisation, it is fair to say there was not a huge office market in many of the towns identified for decentralisation so initially we would have anticipated that the solution would be design and build projects. Of the approximately 50 cases, there were six where lease-type solutions offered themselves and we were satisfied that when benchmarked against the cost of design and build, we were getting good value for money and earlier access than might normally be the case. That is why we opted for this approach in those instances.

Deputy Jim O’Keeffe

It was I who mentioned the embassies. Is it the OPW or the Department of Foreign Affairs which makes the decisions in regard to all the new embassies which have been established in recent years such as those of the new countries in eastern and central Europe?

Mr. Seán Benton

That is a matter for the Department of Foreign Affairs. We have no direct role in the matter.

Deputy John Curran

On the Vote, under subhead E, the underspend in the year under review was €53 million. The underspend in the previous year was €57 million and Mr. Benton has indicated that the underspend in 2007 was €35 million. Over a three-year period, therefore, there was an underspend of some €145 million. This suggests that the forecasted or predicted expenditure for each of these years was out of sync with what was delivered.

I do not necessarily have a problem with Mr. Benton's statement that the OPW has made strategic choices not to build in certain cases and has instead entered into leasing arrangements. However, I would like to see the cost-benefit analysis underpinning that strategic change. We must ensure we do not end up in situations where a lease turns out to have a significantly higher cost than anticipated. Mr. Benton will probably tell me my figures are wrong but my reading of them as presented in the accounts indicates a substantial underspend under this subhead on a year-on-year basis. I have listened to his explanation, which I accept, but I would like to see the cost-benefit analysis on a project-by-project basis. A substantial sum of money was not spent in the manner originally intended.

Mr. Seán Benton

The underspend is not cumulative. In other words, the first sum we will spend in 2008 is the €35 million we carried forward from 2007. It is not correct to add the figures to arrive at a total underspend for the three-year period.

Deputy John Curran

Will Mr. Benton explain that more clearly? In the year under review did the OPW underspend by €53 million?

Mr. Seán Benton

That is correct, but there was a sum carried forward of €31 million which we spent the following year.

Deputy John Curran

Is Mr. Benton not simply saying the programme is progressing much more slowly than anticipated?

Mr. Seán Benton

No, I am saying the underspend was €23 million and the programme took longer than expected.

Chairman

In its negotiations with the Department of Finance, the OPW was surely aware of this substantial underspend of €53 million. Therefore, its request or demand for funding for the following year would have been based on the knowledge that there was an underspend in the previous year. Why would the OPW then seek an amount that would almost guarantee a further underspend?

Mr. Seán Benton

In virtually all cases the projects in question would be contractually committed; therefore, the spending would occur on those projects the following year.

Deputy John Curran

My point is that for three years in a row, that spending did not occur. In those three years - 2005, 2006 and 2007 - the estimated outturn was out of synch with what transpired as a significant underspend. This brings me back to the Estimates process. Why was the Estimate so high?

Mr. Seán Benton

The general point I would make is that the provision in respect of decentralisation was greater than was required for the years in question. That is the main explanation for the underspend. It was envisaged that the programme could be completed in a relatively short timeframe and the Estimates reflected that target. It was not possible, however, to achieve that level of progress. This, for the most part, explains the underspend.

Deputy John Curran

I take that point and fully agree with Mr. Byers's remarks about the programme becoming protracted. My point is that the Estimate has not reflected that, year on year; rather, it has stayed at a level that has been significantly underachieved in the last three years. My concern relates not only to the underspend but also to the estimation. I do not wish to dwell on this, however, and take Mr. Benton's point. I am interested to see the cost-benefit analysis undertaken of the various projects that have gone from new build to a leasing arrangement or some other contractual arrangement. I ask Mr. Benton to supply that information in his own time.

Mr. Seán Benton

We have all that information and I will convey it to the committee.

Chairman

The point I am about to make may not be fair but I will make it anyway. A cynic might suggest the OPW took the lazy option of leasing instead of building and that the ongoing underspend reflects the fact that the decentralisation programme is not proceeding successfully.

Mr. Seán Benton

I am not cynical and I know the Chairman is not either. The reality is that the decentralisation programme is firmly embedded and there is progress to be seen throughout the State. The major construction sites in Trim, Wexford, Killarney, Clonakilty and elsewhere are all part of the decentralisation process. Some projects may have taken longer to get under way than was originally anticipated but they are all happening. This year and next there will be vastly accelerated progress in all these areas. I would not be at all concerned in regard to decentralisation. It is happening.

As to the suggestion that we might have taken the lazy way out, it was more a question of availing of opportunities that presented where it made good sense to do so, where they offered value for money and a timely solution and where staff were available and could occupy the space.

Chairman

Will Mr. Benton produce the evidence to the committee?

Mr. Seán Benton

I will be happy to do so.

Deputy John Curran

I thank Mr. Benton for his response.

Returning to Deputy O'Keeffe's comments on chapter 4.1, regarding discrepancies at the two heritage sites, I understand there are 50 sites throughout the State at which visitors are charged for admission. We have been talking vaguely about sites. Will Mr. Benton provide examples of the sites to which we are referring? I do not mean the sites where the discrepancies occurred but the 50 sites throughout the State.

Mr. Seán Benton

A popular site is the Rock of Cashel. There are several such sites throughout the State.

Deputy John Curran

In table 25 the income is made up under several headings, with a figure of €397,000 for tour operator receipts. The Comptroller and Auditor General has included a note beside this figure, indicating that tour operator receipts are accounted for centrally and are not part of local heritage receipts. What does this mean?

Mr. Seán Benton

The tour operator pays the money directly to the central office in Dublin rather than at the local site.

Deputy John Curran

What is the standard adult admission price to some of these sites?

Mr. Seán Benton

It varies but is usually in the region of €7 or €8.

Deputy John Curran

In regard to the tour operators, I assume the bus arrives at the Rock of Cashel, for example, with 20 people. They are given their tickets to enter the site and the tour operator subsequently sends the cheque to Dublin, rather than paying at the site.

Mr. Seán Benton

Yes, that is how it works.

Deputy John Curran

My wife and children often complain because we have only holidayed abroad once. I enjoy holidaying in Ireland because I understand and like it. I have been to the Rock of Cashel and many other such sites and I am often struck by the number of coaches I see. The figure of €397,000 seems low. Given that there are 50 sites, it works out at an average figure of only €8,000 from tours, or €180 per week, per site. However, as a lay observer, I note that provision is made for coaches at many sites and certainly during the summer many coaches arrive at them. Consequently, I am slightly taken aback that the level of income from coach tour parties is so low because it does not equate with my experience when I visit such sites. The Office of Public Works has provided coach parks and parking spaces and, in many cases, buses have priority to get nearer the entrance, yet the average figure is approximately €8,000 per site, or €180 per week. Given my observations of what happens at such sites, this appears to be a very small amount.

Mr. Seán Benton

I think I can explain this. First, not all coaches are operated by tour operators and, second, not all tour operators pay through the central arrangement we have in place. I understand some pay locally.

Deputy John Curran

Does Mr. Benton have a breakdown?

Mr. Seán Benton

While I do not have it to hand, I would be happy to forward it also.

Deputy John Curran

I was somewhat taken aback because, in my experience, many coaches visit such sites and provision has been made for them. This made me turn to the main Appropriation Accounts, Vote 10. I am unsure who will be obliged to help me in this regard. I refer to the section pertaining to appropriations-in-aid on page 61. No. 9 pertains to charges at national monuments and historic properties and records that while the estimated figure was €4.8 million, a sum of €5.671 million was realised. The sum of €5.671 million is made up of €5.274 million in admission fees and €397,000 in tour operator receipts. I had got my head around this until I read the note in the Appropriations Accounts that explained the reason for the discrepancy between the amounts estimated and realised in this regard. It stated the reason for the excess was that it had come from tour operators. As the excess figure was €900,000, I could not see where that sum was accounted for in the figures. Does the Chairman understand where I am coming from?

Mr. Seán Benton

Deputy Jim O'Keeffe raised the same question.

Deputy John Curran

I raise it specifically in respect of these figures. Where is it accounted for?

Mr. Seán Benton

I must check this out. Off-hand, I am unable to give the Deputy an explanation with which I would be satisfied. Consequently, I would like to check before speaking definitively on it.

Deputy John Curran

While I am not disagreeing with Mr. Benton, I cannot discern where the €900,000 has gone.

Mr. Seán Benton

Mr. Farrell may be able to explain this matter.

Mr. Joe Farrell

While the information I have to hand provides total figures amounting to €5.6 million for approximately one dozen particular locations, I do not have a breakdown. The figure for tour operator receipts is €397,000.

Deputy John Curran

Yes, that figure is present. However, I refer to page 61 of the Appropriation Accounts, Vote 10. The explanatory note on the variation between the estimated and realised figures in respect of charges at national monuments and historic properties states "the excess arose from the recovery of outstanding arrears from tour operators". The excess figure was almost €900,000. My question is: where can one see the figure of €900,000 materialising in the accounts?

Mr. Joe Farrell

The only specific reason cited pertains to the recovery of arrears from tour operators, which comprised €400,000 of the figure of €900,000.

Deputy John Curran

Mr. Farrell has lost me.

Mr. Joe Farrell

The actual amount realised on charges at national monuments and historic properties was--

Deputy John Curran

The OPW has stated it received arrears of €900,000, which is the reason the realised figure was higher. I do not have a problem with this. However, I want to know where can one see this figure?

Mr. Seán Benton

I think the arrears were recovered across the sites. I would like to give the committee a detailed response to explain this matter fully because in simply picking through the notes, I am unable to--

Deputy John Curran

Does Mr. Benton understand where I am coming from?

Mr. Seán Benton

I understand precisely.

Deputy John Curran

That is all I am asking because I might not have explained it very well.

Mr. Seán Benton

I certainly will send on the details.

Deputy John Curran

The second part is worrying. I expressed my concern that the figure of €397,000 appeared low, given the level of activity. If €900,000 is a true figure, either there was a poor operation historically that allowed such a small annual figure to become €900,000 or the figure of €397,000 is an understatement. Does Mr. Benton understand my point?

Mr. Seán Benton

I do and I will write to the committee with an explanation. I understand the point made by the Deputy.

Deputy John Curran

I am not finished on this issue. I have one or two other minor points. Obviously, one of the issues concerns the OPW's sudden discovery that money was not being lodged into the bank. I have an ordinary bank account as I am not too good at using all the facilities available. However, I am able to look at my bank account on-line in my office to check what lodgments, withdrawals or direct debit payments have been made. Does the OPW have centralised automated access to those account centres or is it dependent on manual statements?

Mr. Seán Benton

Yes, we now are able to do this automatically.

Deputy John Curran

What of the returns? Obviously, the OPW employs people who sell 1,000 tickets per week or whatever the figure is. Do they make a manual return or is a computerised system available?

Mr. Seán Benton

Such returns are still made manually.

Deputy John Curran

The OPW had an internal audit in this regard and underwent a review process which recommended that it should examine the figures for 2004 and 2005. I note that Mr. Benton in his presentation mentioned that the OPW had carried out a certain review of the figures for 2005. How extensive was that review? In other words, did the OPW review the figures for each of the 50 centres?

Mr. Seán Benton

We did a full review in 2005. As I said, nothing of concern was indicated.

Deputy John Curran

Although Mr. Benton used the word "full", that is not the way it read. He stated it was "to examine various weekly returns". Did the OPW examine the entire returns?

Mr. Seán Benton

For 2005, yes.

Deputy John Curran

At all 50 centres.

Mr. Seán Benton

Yes, at all centres. I may have referred to a sample.

Deputy John Curran

I will leave that issue and turn to another. While it is not a problem area, it is of interest. During the year the proceeds from the sales of property were €220 million. The gain on disposals over their book value was €207 million, which made me realise the book value was very low. Obviously, it was an historical book value. Is that the normal procedure and is this the best way to reflect the value of assets? In other words, the OPW had assets with a book value of €13 million that realised a sum of €220 million on disposal.

Mr. Seán Benton

It was an historic value. The issue for the OPW is whether it should value all of its properties every year.

Deputy John Curran

While I do not suggest it should do so every year, obviously a long period was involved to move from a figure of €13 million to €220 million.

Mr. Seán Benton

It was. There was one highly significant sale in that year. However, the book values were very much out of date.

Deputy John Curran

Will Mr. Benton provide a breakdown of the properties that accounted for the figure of €220 million?

Mr. Seán Benton

There was one highly significant sale in which we sold a couple of acres of land on Shelbourne Road for approximately €170 million. That was the main sale. We also sold properties in Inchicore for approximately €7 million and on Gardiner Street for €4 million. We passed on the property at Broc House for social and affordable housing. I have the total retail values to hand which I can pass on to the committee. Alternatively, I can run down through them, if members wish.

Deputy John Curran

If it is not too long, could Mr. Benton do so?

Mr. Seán Benton

The one with which we struggled at this committee for several years is Lynch's Lodge Hotel in Macroom, which we sold for €2.3 million.

Deputy John Curran

Very open.

Deputy Jim O’Keeffe

What did the OPW pay for that one?

Mr. Seán Benton

There was a loss at that time. We bought it as a going concern. There were various reasons, with which all the members are familiar, why it could not proceed. We sold it back to the market.

Deputy Jim O’Keeffe

Did the OPW have difficulties?

Mr. Seán Benton

We did, but the good news is that we sold a few acres in Ballsbridge for €171.5 million. A site to the rear of Athboy Garda station was sold for €32,000. The faculty building on Shelbourne Road was sold for almost €36 million. We sold the Parnell West Hotel, which is another famous site, for €7.2 million. They are the main features. There were other small disposals from a few thousand euros to a few hundred thousand euros and they are listed in this. I am happy to pass it on to the committee.

Chairman

Was there a loss of more than €1 million in Macroom?

Mr. Seán Benton

It was about €1 million.

Chairman

Maybe it is history but I was not a member of this committee at the time. The OPW bought it for more than €3 million. There was no planning for the use proposed.

Mr. Seán Benton

Commissioner Byers is familiar with the background of that so I will ask him to answer that.

Mr. David Byers

From memory, we bought it as a going concern. It was felt at the time that using it as a hostel for asylum seekers was encompassed in the hotel use. We were taken to law on the grounds that the hostel use was not hotel use. We were trying to stretch the definition of hotel.

Deputy John Curran

My final question on this section is closely related and concerns page 58, Vote 10. I suppose it is the next item and goes on to say that the gain and disposal figures do not include a gain of €207 million and the net book value of a number of properties sold or transferred in 2006 as these would substantially reduce and, therefore, distort the operating costs of the OPW. These were properties that were involved in transfers of properties under the affordable housing scheme.

Mr. Seán Benton

I do not think so. Maybe I misunderstood the question. Many of our disposals are not reflected in the Vote. They are windfall gains and go straight to the Exchequer.

Deputy John Curran

The OPW specifically transferred four properties to the affordable housing initiative.

Mr. Seán Benton

Yes.

Deputy John Curran

They had a book value of €28 million. Obviously, many people would have debated whether the OPW should be involved in this type of transfer or whether it should have valued the land and sold it. I have no doubt that a cost benefit analysis was carried out. Is this correct?

Mr. Seán Benton

There was a Government decision in respect of making sites available for social and affordable housing. We identified a number of sites in our portfolio which we felt were not needed for our requirements and could be usefully used by the agencies involved in the social and affordable schemes.

Deputy John Curran

I fully accept that. The question I am asking is whether it was the OPW that negotiated. Obviously, a site was identified but a value had to be put on that site. I do not mind if Mr. Byers answers that question.

Mr. David Byers

The sites in question were selected because, in conjunction with the affordable housing initiative, the OPW felt they were the kind of sites that would be of interest to the people who would give them the affordable houses. In essence, we were offering sites that were more interesting to residential developers. That is the basis. There was a Government decision to supply some property so they are the ones we supplied to the affordable housing initiative so that it could swap them in its process. The affordable housing initiative used a competitive process to extract the maximum number of affordable and social houses from the deal in respect of the sites.

Mr. Seán Benton

We were not engaged in that process.

Deputy John Curran

I understand that a site was effectively swapped through a competitive process for a number of housing units. The question asked is whether a cost benefit analysis was carried out during the process? Were the sites valued, it being known that the site was worth "X" million euro, which would buy the equivalent of ten or 20 units? It was not a question of swap at any price? Does Mr. Benton understand where I am coming from?

Mr. Seán Benton

It is essentially a matter for the agency which must be satisfied that it was getting value in return for what it was offering.

Deputy John Curran

So the OPW had no hand, act or part in it?

Mr. Seán Benton

We were not involved in that part of the exercise.

Chairman

Perhaps Mr. Purcell would like to comment?

Mr. John Purcell

This is something that has concerned us as well. We also do the audit of the affordable housing partnership. Some months ago, I asked that we would examine the value obtained from the deals done by the partnership in respect of two of those sites. What would happen is that the partnership would put the sites out to tender and see what proposals it would get on a competitive basis. There would be a quid pro quo in terms of some houses that were already built. There are questions like whether the affordable housing partnership should buy at the top of the market and so on. We are examining these matters and I hope a report in one form or another will come before the committee in due course.

Deputy John Curran

The OPW's only direction was to identify the sites. It was not part of the evaluation process.

Mr. Seán Benton

The direction to us was to identify sites and offer them over.

Deputy John Curran

Who owned those sites?

Mr. Seán Benton

The Department of Finance owned some of the sites, while we owned other sites but all the sites were in State ownership obviously.

Deputy John Curran

Would it have been helpful or unhelpful or would it have made any difference if from a book point of view, those sites had current market values rather than a historical book value as was the case with other sites sold by the OPW?

Mr. Seán Benton

Offhand, I do not think it would have made a blind bit of difference.

Deputy John Curran

I thank Mr. Benton.

Chairman

Before I call on Deputy Broughan, I wish to put a few questions. Mr. Benton mentioned flood relief projects and the underspending earlier on. There is a separate subhead for the flood relief projects which shows that in 2006, the Estimate was €20 million and the outturn was €14.2 million. When one looks at the previous year, one can see that the Estimate was €20 million and the outturn was €16 million. We have been told that the saving was due to less than expected expenditure on the strategic development programme and delays in settling some major compensation claims.

What is the strategic development programme and how much does it cost? What were the major compensation claims? Subhead H3, the drainage maintenance programme, is coupled with this. Maintenance had an Estimate provision of €17.7 million for 2006. The outturn was less than €1 million - €16.7 million. In 2005, the figure was €15.9 million, while the underspending was about €100,000.

Even last week, we read of flooding around the country and damage to properties. In this context, it seems ironic that our flood relief projects are underspending, both in capital projects and maintenance.

Deputy Thomas P. Broughan

In the UK, people are familiar with being able to log on to the UK equivalent of the OPW or one of its departmental maps to get an exact flood risk evaluation of every district if, for example, they are going to purchase a new home. Either the OPW or the Department of the Environment, Heritage and Local Government has a map but it is very vague. The Chairman is also aware that we have allowed considerable building on the flood plains of various parts of coastal areas of the country. Should there be more spending on flood evaluation and provision of good advice to the Department of the Environment, Heritage and Local Government and planning authorities on the building of flood plains given the likely future cost?

Chairman

Under subhead G, the estimate for an engineering plant was €2.7 million and the outturn was €5.3 million. What was the unexpected event that almost doubled the cost?

Mr. Seán Benton

The Chairman raised a number of questions. Initially, he queried the strategic approach, which involves a number of ongoing studies and reviews, including the flood studies update, the hydrometric review and various research programmes on climate change and flood hazard mapping. Our map is sophisticated and gives much information on areas prone to flooding, but we want to move to the level of detail about which Deputy Broughan spoke. Currently, historical data is contained in the maps. One can check any area on the website to determine whether it flooded historically, which is useful information. We are proud that this system is on-line, but we will move to predictive mapping, which will factor in a number of other issues as well as historic data. That project is well advanced.

On underspending, we have learned since becoming the lead agency that the complexities involved in processing any major flooding project are more difficult and time consuming than anticipated. From simple matters such as the aesthetic of a scheme to issues of environmental impacts on schemes, it takes time to push them through the requirement. We have passed all of the hurdles in respect of many of the major schemes. I am confident we will spend all of our allocated expenditure of €50 million for this year because many projects are at contract stage or have started. The difficulties in getting planning permission and community buy-in to our proposals and in addressing all environmental issues took longer than anticipated.

Chairman

My other question was on major claims.

Mr. Seán Benton

I have some information. We were working on a number of schemes at the time and I am happy to state that the Kilkenny flood relief scheme - despite all of the matters raised during our discussions with the committee - has proven successful during periods of serious flooding, but the claims for compensation amounted to approximately €3 million. While claims have been made in respect of the Clonmel scheme, compensation has been paid in respect of the Kilkenny scheme.

Chairman

Have the claims been settled?

Mr. Seán Benton

Not yet.

Chairman

What is the estimate for both?

Mr. Tony Smyth

Compensation was only paid in respect of Kilkenny. We estimated compensation of €3 million for that year and paid approximately €500,000, but three or four large claims are being negotiated with affected landowners. This is not a question of compensation for flood damage, but of compensation for the scheme's construction process when we worked on people's lands or properties.

Deputy Jim O’Keeffe

Are they special claims under the Arterial Drainage Act?

Mr. Tony Smyth

Yes, for interference with people's property during construction. We do not buy the property.

Mr. Seán Benton

The Chairman asked about the purchase of plant. We used an opportunity to modernise and upgrade our plant for what we knew would be increased demands on it in the years to come.

Deputy Thomas P. Broughan

I was one of the Deputies who were delighted one month or two months ago when the Office of Public Works proposed moving the Seanad to the National History Museum. The latest proposal is to base the Seanad in this room, but I presume the OPW's refurbishment of the museum, the home of the literal dinosaurs, is still under way. During my career, many summers have seen refurbishments of the Oireachtas. Are the Dáil and the Seanad safe?

Mr. Seán Benton

It is a large campus. The building in focus structurally is the house itself, namely, the building one sees when standing on the plinth. The Dáil Chamber and associated accommodation are safe, as are the committee rooms and so on in Leinster House 2000. The structural concerns regarding the original house must be addressed. We proposed this plan to the Houses of the Oireachtas Commission.

Deputy Thomas P. Broughan

We did not develop that plan. Given the age of the National History Museum, why were the problems that caused the near disaster not detected in prior checks in the past ten years or 15 years?

Mr. Seán Benton

Small works were carried out during summer recesses in recent years. It is easy to look back now and ask why we did not reasonably anticipate the problem created by the increased pressure placed on a building that, having once been a domestic house, is now being flogged as a major business unit housing the weight of offices and the associated filing. Obviously, we have been conscious of health and safety issues. As part of opening some of the building for other works, we discovered problems and had them examined as a matter of urgency. The advice given to us by the structural engineers is that, while the building will not fall down, the risk will be increased if we continue to use it as we have been doing. We advised that the rooms should be vacated to reduce the stress on the building and that the structural shortcomings should be addressed during a short period instead of incrementally over six years or seven years. From last year's experience of small works conducted in an eight-week period, we were able to project accurately how long it would take to address the house's shortcomings. We are confident that we can do this as a continuous project during the course of one season. The alternative was disruption for six years or seven years.

Deputy Thomas P. Broughan

I apologise for missing part of the meeting, as I needed to attend another. In terms of general historic and heritage sites, why are so few properties open to the public? Of the 89 heritage sites, only 19 are open to the public.

Mr. Seán Benton

Deputy Jim O'Keeffe raised that issue.

Deputy Thomas P. Broughan

In general terms, what is the total value of the property owned by the OPW at net current values?

Mr. Seán Benton

We have a figure of almost €2.5 billion. That includes all of the owned properties.

Deputy Thomas P. Broughan

How many staff members does the OPW have and how many vehicles?

Mr. Seán Benton

We have about 700 general, administrative and professional Civil Service grade staff. We have 1,400 industrial grades and seasonal additions of up to a couple of hundred. It is about 2,300.

Deputy Thomas P. Broughan

Are there many contracted workers such as security companies?

Mr. Seán Benton

Yes, we have those in various places throughout the organisation.

Deputy Thomas P. Broughan

Mr. Benton mentioned decentralisation and how sales were dealt with in accounting terms. The OPW seems to be renting rather than constructing local government offices.

Chairman

We have been through the detail and will receive a report on it.

Mr. Seán Benton

That is not the case. We are renting or leasing in six or seven out of 50 locations.

Deputy Thomas P. Broughan

With regard to one, with which I am familiar from my previous portfolio, was the West Cork Technology Park selected after a tender?

Mr. Seán Benton

This is in Clonakilty.

Deputy Thomas P. Broughan

Yes, it is Bord Iascaigh Mhara, BIM.

Mr. Seán Benton

There are two elements to the question. One is the permanent building, a construction project that is under way, which has gone through all of the procurement processes. The other is temporary accommodation for an advance party in a leased building. As with all leased arrangements, we try to get the best deal. We do not necessarily have a tender process when renting a building.

Deputy Thomas P. Broughan

There was no competition for the West Cork Technology Park.

Mr. Seán Benton

It is a five-year temporary lease for the advance party.

Deputy Thomas P. Broughan

Why was there none? That became a concern, given that a party connected to the company that ran the park was appointed chairperson of BIM.

Mr. Seán Benton

We were satisfied that it was available and presented good value. That is the only criteria we use in seeking accommodation.

Deputy Thomas P. Broughan

Is Mr. Benton telling me that in all renting, of which there is quite an amount in respect of the decentralisation programme, there is no tender process?

Mr. Seán Benton

In most of the towns in rural Ireland, there is no existing office market with a high level of available accommodation. What we do, as we do in Dublin or elsewhere, is review accommodation for our particular need. We consider what fits the need and meets the operational requirements of the agency. We have regard to market values of rents in the areas. If we can get a fit that is good value for us, we take it.

Deputy Thomas P. Broughan

What was the cost of the rental contract for the West Cork Technology Park?

Mr. Seán Benton

We promised to send all of the information to the Chairman but if I can pick it up quickly, I will. There are two leases. The rental costs in one case was €157,480 and in the second case €118,910. The area was 1,152 sq. m. and in the second case it was 870 sq. m.

Deputy Thomas P. Broughan

Perhaps the Comptroller and Auditor General will advise on general accounting rules. If a contract for €300,000 is being granted by the State, is it not appropriate to have a tender process?

Mr. John Purcell

It depends on the situation. In the situation described by the accounting officer, where there is a limited amount of available suitable accommodation, it is not needed. However, if one seeks accommodation in Dublin 4 or the docklands, where there is a range of options, one should try to get the best accommodation at the best price. That might involve - subject to correction - seeking expressions of interest in the proposal.

Deputy Thomas P. Broughan

We have a representative from Clonakilty at the meeting and I wish the town all the best. Castletownbere might have considered itself a more appropriate location for the marine section of the relevant Department, given its history. Is it not the case that in towns identified there was a movement to develop properties so that the OPW would eventually occupy some of them? Is there not a danger that the public will get a raw deal and the decentralisation programme will turn out to be a complete ripping off of the public finances?

Chairman

We have been through all of this.

Deputy Thomas P. Broughan

No, we have not. I tried to get information on this issue before but it was impossible. There was the added factor of a connected party being appointed to the board of a national authority by the Minister concerned.

Chairman

If the Deputy had allowed me to finish, I was making the point that we asked Mr. Benton to supply details of all situations where there was a proposal to build and the building went ahead or where there was a decision to lease. Clonakilty will be included in that request and we expect a full report on construction and leasing. That was agreed in the Deputy's absence. Deputy Broughan has valid questions with regard to Clonakilty but it is in the context of all other locations where there was an option to lease instead of construct.

Mr. Seán Benton

In that report we will identify that in virtually all cases it was for temporary advance accommodation, which was short-term leasing.

Deputy Thomas P. Broughan

This is something on which this committee must undertake a major examination, given that the decentralisation programme is far behind target. In instances where the OPW decided to build, how did it decide on a site? Was there a tender process?

Mr. Seán Benton

It is very different for sites, as distinct from buildings, in terms of engaging in a contract. We advertise and invite people to submit proposals for sites. We evaluate these under various headings and contract the best deal from our point of view. That is a public tender process.

In respect of leased accommodation, where there is more than one suitable building we play one off against the other and try to get the best deal.

Deputy Thomas P. Broughan

With regard to existing offices, one of which is in my constituency, is there always a tendering process for services provided by contractors?

Mr. Seán Benton

I believe so. The general principle is that all contracts have a tender process.

Deputy Thomas P. Broughan

With regard to the global issue of decentralisation, does the Comptroller and Auditor General intend to conduct a cost-benefit analysis at some stage? Let us take, for example, the former Department of Communications, Marine and Natural Resources. When one of it's units was decentralised we heard of situations where people who were still based in Dublin, for some unknown reason, were travelling to Clonakilty, on to Greencastle and then back to Dublin. It appears there is now a kind of carousel or merry-go-round of civil and public servants under way. Does the Comptroller and Auditor General feel he has a responsibility to carry out a serious evaluation of this, given the fact that we heard a great deal of waffle about video conferencing, broadband and so on. The reality is that some key personnel must meet each other. Is this something the Comptroller and Auditor General is examining? I know it is not the primary responsibility of Mr. Benton.

Mr. John Purcell

As I indicated when we made a presentation to the committee when it was first formed late last year on our work programme for 2008, one of the projects included on that programme was decentralisation, involving examining the human resource aspects, the success, impact and so forth. Property issues would also be included in that. That is ongoing. It is a very extensive study and I cannot give the Deputy a date for the report on it as yet. However, there is work going on in that regard.

To return to the Deputy's question about leased accommodation, we had a case here several years ago, during the tenure of the previous committee, where Ordnance Survey staff in Tuam wanted to transfer back into the centre of town. In that case, a number of property owners had the opportunity to offer accommodation for the staff. I know it caused some problems because the person who offered it at the best price did not get the contract. It was eventually sorted out. A satisfactory solution was arrived at whereby the new accommodation was better and staff were happier, even though the cost to the State was higher. From my experience, where there is a choice of properties available, tendering procedures come into play.

Deputy Jim O’Keeffe

Can we take it, as a general rule, that the best price is accepted, from the taxpayers point of view?

Mr. Seán Benton

All other things being equal, the best price is accepted.

Deputy Jim O’Keeffe

Would it only be in exceptional circumstances that the best price would not be accepted?

Mr. Seán Benton

There is a number of considerations. The location of a building might be totally unsuitable for the function to be discharged. If it is, for example, a service to which the public must have access but premises are offered which are not accessible by public transport, that would be a matter of concern to the agency. If an office cannot be located five miles outside a town, but must be in the town itself, then location would be the key factor. The quality of the accommodation is also important, as is the cost of energy consumption in a premises.

Generally in towns there are market rates and depending on what generation of accommodation one is examining, one would be talking about choice within a small band. One tries to get the value and to drive the best price but location can be key for our client Departments.

Deputy Jim O’Keeffe

With all things being equal --

Mr. Seán Benton

Obviously where all things are equal--

Deputy Jim O’Keeffe

--would it be the case that where owners in a particular location are asked to submit figures, Mr. Benton's office will opt for the best priced accommodation?

Mr. Seán Benton

Obviously, where everything else is equal, yes. It is a "no-brainer" and it would not make sense to do anything else.

Deputy Jim O’Keeffe

Would it be referred to senior levels if the best price was not accepted?

Mr. Seán Benton

Where everything else is equal, I cannot recall a situation where we did not go for the lowest price. Even where there are issues for the client, we would test those as best we could, without second-guessing how they do their business, to satisfy ourselves that, for example, location is an important factor. We would analyse whether a more expensive property is really the most practical solution for them. We would test that, though. We do not simply take it at face value.

Chairman

Deputy Broughan has raised serious questions regarding Clonakilty. Deputy O'Keeffe would know it better than I would but the premises is not exactly in the town. It is a fair distance outside the town.

Deputy Jim O’Keeffe

My questions did not relate to Clonakilty.

Chairman

I know that.

Deputy Jim O’Keeffe

Clonakilty is different in that the technology park is outside the town and there would not be any alternative within, beside or adjacent to the technology park.

Deputy Thomas P. Broughan

On a related issue, regarding new OPW buildings on long-term rent around the country, one of our Oireachtas colleagues criticised the OPW last year with regard to heating systems. He referred to an old-fashioned approach being taken to heating and insulation standards. I think the specific premises he referred to was in Buncrana. The OPW had a new office and was installing an oil heating system. Everyone knows that oil systems give one a sore wrist from writing cheques. Donegal is now in the gas catchment area for the Corrib field and the question raised was why the OPW did not opt for a cheaper energy solution. We are all being asked from the beginning of 2009 to have top-class, modern, low-carbon heating. In that context, why did the OPW build state of the art State buildings and not use the most up-to-date heating and cooling systems?

Mr. Seán Benton

I will deal with the general question first and then the specifics. In general, I could not accept that criticism that we are not state of the art in terms of energy efficiency. In fact, I would say we are at the leading edge. The specifications for our design-build projects for decentralisation are model. Any analysis of the buildings which have been built, like in Longford, where we have the prison services, will demonstrate that our energy consumption is now at approximately one third of that in similar buildings. We are quite proud of what we are achieving in the area of sustainability. It is a top priority for us as an organisation. Parallel with what is happening at a national level, we are setting local targets for sustainability and will publish our own report on that in a few months.

Deputy Thomas P. Broughan

What about the Buncrana case? Why did the OPW use oil?

Mr. Seán Benton

In the Buncrana case there were different views as to what was the best solution for that location. The choice was between oil, wood pellets or wood chip and issues of supply were raised. At the time there were genuinely held views on both sides of the argument. That is now changing and we are pushing ahead with alternative energy solutions in many areas, including here. We have approximately 20 sites identified at present. So, not only in the case of new buildings, but in the case of existing buildings, we are looking for opportunities.

I do not accept the criticism that we are using old technology. In fact, I would say we are models in that regard.

Deputy Thomas P. Broughan

Is the OPW still planning to turn Mountjoy prison into an hotel?

Mr. Seán Benton

A local area plan is still being developed and we have some very exciting ideas for the redevelopment of that area, which will be revealed in time.

Deputy Thomas P. Broughan

Is it a strong possibility that the prison blocks - which I have been to many times, visiting constituents and others - will be converted into a hotel?

Mr. Seán Benton

It is a protected structure. We are considering various options, including the significant potential for a hotel.

Deputy Thomas P. Broughan

Regarding the discrepancies in the heritage site, has anyone been prosecuted?

Mr. Seán Benton

I made the point earlier that both cases are currently under investigation. I am precluded from commenting on individual cases.

Deputy Thomas P. Broughan

Will a file be sent to the DPP?

Mr. Seán Benton

I do not wish to comment on either case at this stage.

Deputy Thomas P. Broughan

When will we know?

Mr. Seán Benton

As soon as I hear.

Chairman

A spokesman for the Department was reported as saying that "very significant progress" had been made and that decentralisation for civil servants would be more or less completed by the end of next year. Does Mr. Benton think that will be the case?

Mr. Seán Benton

We will have made significant progress by the end of 2009.

Chairman

Will it be completed?

Mr. Seán Benton

It will, subject to everything going well, although one or two areas may remain to be completed.

Deputy Thomas P. Broughan

Is it not correct that by last December only 2,000 had moved under the current programme?

Mr. Seán Benton

Was the Chairman referring to the Office of Public Works?

Chairman

Yes.

Mr. Seán Benton

Our building will be completed in the first half of next year and we will move to Trim. We also envisage that the offices in Claremorris and Kanturk will be available. We will move to three locations.

Chairman

The Irish Independent of Friday, 11 January reported on flood control problems encountered by the OPW in Fermoy. Will Mr. Benton update us on that issue? Serious flooding occurred in Mallow and Fermoy. A spokesman was quoted in the newspaper as laying the blame on local residents for slowing down the flood prevention programme.

Mr. Seán Benton

My focus is on getting the job done. I understand we should see a start on the site in August. What has happened has happened. I made the point earlier that the issues are complex and local communities have genuinely-held views concerning the impact of these schemes. Equally, other environmental issues have to be considered. Aesthetics are important to any community or town so resolving these issues can be time-consuming. Fermoy will start in the autumn.

Chairman

I will be even more parochial by speaking about the banks of my own lovely Lee, along which significant flooding was once again experienced in January. What level of interaction exists between the OPW and Cork city and county councils in regard to the ongoing situation?

Mr. Seán Benton

We co-operate closely with officials in Cork. We are working together on a major whole catchment area study, which is the first of its kind. That study will be available before the end of the year.

Chairman

Is it agreed that the committee notes Vote 10 and disposes of chapters 1.3 and 4.1? Agreed.

Deputy Thomas P. Broughan

We are to get a report on decentralisation

Chairman

I thank Mr. Benton and his colleagues and the officials from the Department of Finance for their co-operation and responses this morning. We look forward to receiving their report on the decentralisation, construction and leasing programme.

The witnesses withdrew.

Chairman

Is it agreed that the agenda for Thursday, 3 April will be as follows: Vote 15 - Valuation Office and the special report No. 60 of the Comptroller and Auditor General on November 2007 concerning the valuation office; the value-for-money report No. 56 of the Comptroller and Auditor General, Improving Performance: Public Service Case Studies; and chapter 19 - training and development? Agreed.

The committee adjourned at 12.35 p.m. until 10 a.m. on Thursday, 3 April 2008.