Business of Committee

Are the minutes of the meeting of 22 October 2015 agreed? Agreed. On matters arising from the minutes, last week we had a note on HL Commodity Foods which was circulated to members. The clerk is doing a background note to inform members of where the issue stands now and we will have it next week.

We will now deal with correspondence from Accounting Officers and Ministers. Correspondence has been received from the Secretary General of the Department of Education and Skills, Mr. Seán Ó Foghlú on UCC's compliance with the public sector pay policy, to be noted and published. Correspondence dated 30 October 2015 has been received from Mr. Seán Ó Foghlú in regard to the delay in the presentation of audited account of Mary Immaculate College, to be noted and published.

Correspondence dated 3 November 2015 has been received from NAMA, a follow-up to our meeting on 1 October 2015. It relates to a legal position and I suggest we refer that letter to the legal advisers to the committee and ask for their response to the matters raised to give us a clear understanding of what action might have to be taken after that. Is that agreed? Agreed.

We now come to individual correspondence. No. 3B.1 is correspondence dated 12 October 2915 from Ms Frances Ryan Chairman of the Board of Directors, New Ross Community Hospital Limited, to be noted. The issue relates to the delay in registering nurses, a matter on which the Secretary General of the Department of Health has promised to report back to the committee. We will forward this correspondence to the Department so that it can be considered as part of its response. The situation with the Nurses and Midwifery Board of Ireland is not satisfactory. I raised this with the Secretary General of the Department and asked that it be investigated. Those returning to Ireland who want to have their qualifications acknowledged are delayed in taking up employment because of the inefficiencies of that system. We might send a reminder to the Secretary General of the Department requesting a speedy response.

No. 3B.2 is correspondence dated 30 September 2015 from Mr. John McCarthy, Secretary General Department of the Environment, Community and Local Government in regard to the application of non-domestic water charges by Kildare County Council, to be forwarded to Ms Julie Gibbons.

We will now deal with documents relating to today's meeting. Nos. 3C.1 and 3C. 2 are the briefing documents and opening statement for today's session, to be noted and published. No. 3C.3 is reports, statements and accounts received since our meeting on 22 October. In regard to No. 4.1, I will ask the Comptroller and Auditor General, Mr. McCarthy, to take us through his comments on the National College of Art and Design.

Mr. Seamus McCarthy

The National College of Art and Design's financial statements for the year ended 30 September 2012 have been presented. In the audit certificate, as well as drawing attention to the recognition of a deferred pension funding asset, which is a standard paragraph in certificates for third level education bodies, I referred to the governance issues in NCAD, which I have reported on previously. The statement on internal financial control gives an extensive report by the college on the state of play in regard to those matters. It continues to be an unsatisfactory situation.

I have qualified the audit opinion regarding the keeping of proper books and accounts. The next set of financial statements are currently being audited. We received them just last week and the audit on that is progressing, but there will continue to be delays because of the extensive difficulties with the keeping of books of accounts in the college.

Has the committee some unfinished business with the college from the last time it was before the committee?

Mr. Seamus McCarthy

I do not believe so. The issues were relatively well ventilated in discussion with the committee. The matter is ongoing, and we will keep it under review and continue to report.

It is quite unsatisfactory that we are getting the 2012 accounts. Did you receive the 2013 accounts?

Mr. Seamus McCarthy

Yes, only in the last week.

When will the 2014 accounts be expected?

Mr. Seamus McCarthy

The indicative suggestion is that we will have them around February 2016 to begin audit.

Regarding the issues in relation to governance, procurement, documentation procedures and processes, are they all in place? Is the college catching up on paperwork that it has, or is it that it does not have the paperwork?

Mr. Seamus McCarthy

There is very poor paperwork for some of the transactions. I believe the system is being rectified, but it cannot be rectified retrospectively when it comes to preparing the financial statements. We expect the situation will improve once we get to the 2014-2015 set of financial statements, and then we should be able to bring them back on track.

Is it possible for the committee to get a note on the big issues, or are they contained in the statements?

Mr. Seamus McCarthy

They are contained in the statement on internal financial control. I believe the committee had a letter last week from the Department in which the Secretary General drew attention to the appointment of a new board chaired by Professor Brennan. There is a very significant process in place within the college to rectify the problems.

Professor Niamh Brennan?

Mr. Seamus McCarthy

Yes.

Of DDDA fame?

Clerk to the Committee

She came in to clean up the DDDA.

And the person who did not come before a meeting of the Committee of Public Accounts.

Clerk to the Committee

That is correct.

That is correct. Maybe when Professor Brennan comes before the committee to discuss the National College of Art and Design we can extend our questions to cover the past.

She definitely will not come in then.

Mr. Seamus McCarthy

I believe the chief officer of the college is the accountable person.

That is the get-out clause.

Could the Comptroller and Auditor General clarify where the college stands now on the 2015 work in terms of governance, oversight and record keeping? Has there been substantial change there?

Mr. Seamus McCarthy

Yes, there has.

Is the Comptroller and Auditor General happy that the 2015 accounts will be presented in 2016 along with the 2012, 2013 and 2014 accounts?

Mr. Seamus McCarthy

Given that we still need to do the 2013 and 2014 accounts, it will certainly be the back end of 2016 and possibly into 2017 before the 2015 accounts are presented.

How long, in your estimation, will it be before the college is up to speed and running a normal set of accounts?

Mr. Seamus McCarthy

It can move to running a normal set of accounts in the current year, and I think substantially it is doing that.

Is that from an audit statement point of view?

Mr. Seamus McCarthy

From an audit statement point of view, it will be the 2014-15 set of financial statements.

Which will probably be received in 2017.

Mr. Seamus McCarthy

I imagine those accounts will come before the committee by early 2017.

The Deputy might get a chance to look at those.

The Chairman will be here then, or he might be Minister for Education and Skills.

Could the clerk circulate the note from the last meeting about the letter and the note about the accounts for the information of members?

I will now turn to Teagasc. Attention is drawn to its disclosure of a settlement with the Revenue Commissioners in relation to the non-payment of VAT amounting to €399,000.

Mr. Seamus McCarthy

That is correct. There was a technical problem in Teagasc and incorrect computations were being done. Teagasc has rectified the matter and the Revenue Commissioners are satisfied.

The disclosure was its own?

Mr. Seamus McCarthy

I think so, yes.

Would Teagasc be similar to a company, or similarly the HSE, it that it makes returns and is inspected by the Revenue Commissioners?

Mr. Seamus McCarthy

Yes, it would certainly be subject to audit. The Revenue Commissioners have carried out audits. However, in this case Teagasc discovered internally that there was a problem, researched it and made a disclosure to the Revenue Commissioners, and a settlement was made.

We will note all those accounts. With regard to the work programme of the committee, in the next few weeks we are to meet with the Director of Public Prosecutions, the Attorney General, the Office of the Chief State Solicitor, the Office of Government Procurement, Bord na gCon and the Department of Finance, and on 10 December we will meet Waterford Institute of Technology and Cork Institute of Technology.

With regard to the Department of Public Expenditure and Reform and the Office of Government Procurement, the committee had suggested - or maybe I did not - that when the representatives from the Office of Government Procurement appear at the committee we should deal with the tendering arrangements for the Aran Islands air service, the construction of the contract and the tenders within the office. The committee should make it absolutely clear that those issues are on the agenda for that meeting. The witnesses will have to outline to the committee how the tender document was constructed and how it is being dealt with now, including the differences due to the fact that the contract is being incorporated into the new tender arrangement. They will have to explain to the committee how they could get something so horribly wrong, such as its failure to check whether one of the tenderers had a licence to land and take off. Actually, it was the company that was eventually awarded the contract, and it was the preferred bidder in that case. That was a failing by the Office of Government Procurement which it will have to explain to this committee.

That is fine. We will ask the clerk to flag that to the office so that its representatives are absolutely clear about what is expected when they come here. Deputy Connaughton raised an issue with regard to the meeting between the Department's procurement section and the group that came before the committee. Did we get a report back on that? I think they met one group but did not meet the other.

No, they met after that. There were actions to be carried out, but I will be in touch with them before.

So you will raise that at the meeting.

The work programme is agreed. I will now turn to any other business.

I was missing for the last meeting. Is there any update on the issue with regard to the University of Limerick which was raised at the committee previously?

I asked this question before, but it might have been dealt with. When the representatives from NAMA were here they gave us a figure for the number of social housing units that were rejected by local authorities in Dublin and other areas of Leinster. Has NAMA provided further details on the actual locations of those houses?

On the day of the committee meeting NAMA representatives had a list but they did not provide it. It was to be provided to the committee the following week. There is a list in front of us on the screen-----

-----which sets out the different figures for you.

That shows house completions rather than-----

Are you looking for the 6,500 houses that were offered and refused?

It was suggested here at the meeting that we ask the local authorities in question the reasons the houses were refused.

We also asked NAMA for its list and did not receive it. We did not get either piece of information, so we will remind them again.

At the end of the meeting with NAMA I gave the representatives a list of queries about Project Jewel. Deputy Deasy attended that meeting.

We toured the site and saw it at first hand. I asked NAMA to answer the questions submitted to us by representatives of families but it did not do so, except to say that the site is sold. Some of the questions relate to the attitude of NAMA towards this group in the period leading up to the sale. I want to get the answers to those questions. I ask the clerk to the committee to remind NAMA that this information is outstanding and that it should submit its response to the committee. While some of the questions do not necessarily apply now because the property is sold, an explanation as to what happened beforehand is required.

On the subject of housing, the completion of the Tipperary hostel and the State money spent on it comes up here time and time again. In the context of the provision of accommodation, given the current demand, it would be no harm if someone would look at it. It may provide an opportunity for the State to intervene, fund its completion and put the property to an appropriate use. I ask the clerk to write to the Department and ask it to review that property in that context, thereby saving some of the taxpayers' money that has already been spent on that building and preventing its further dilapidation.

I ask the Chairman to outline the position on the University of Limerick issue.

We got a protected disclosure relating to the University of Limerick and we are not finished with that yet. I understand that an explanation was given as to how those people were employed.

I am asking about the expenses issue.

We are not finished with that yet and will process it further.

Mr. Seamus McCarthy

Was the Deputy not raising the point relating to supernumerary staff and the-----

That was at Limerick Institute of Technology, on the other side of the Shannon but in the same city.

It is a Limerick thing.

Is there any other business? No. We will move to the main part of today's meeting, which is to deal with the accounts of the Department of Justice and Equality. I invite the witnesses to attend.