COMMITTEE OF PUBLIC ACCOUNTS díospóireacht -
Thursday, 30 Nov 2023

Business of Committee

An Cathaoirleach

The public business before us this afternoon is as follows: minutes; accounts and financial statements; correspondence; work programme; and any other business.

The minutes of the meeting of 23 November have been circulated to members. Do members wish to raise anything from the minutes? Are the minutes agreed? Agreed. As usual, they will be published on the committee's web page.

Moving on to accounts and financial statements, ten sets of accounts and financial statements were laid before the Houses of the Oireachtas between 20 and 24 November 2023. I ask Mr. McCarthy to address these before we open the discussion up to the floor.

Mr. Seamus McCarthy

Gabhaim buíochas leis an Cathaoirleach. No. 1 is the Insurance Compensation Fund for 2022, which received a clear audit opinion. No. 2 is the Commission for Railway Regulation for 2022. That received a clear audit opinion. No. 3 is Letterkenny Institute of Technology for the period 1 September 2020 to 31 March 2022. It is an extended period because these are the last accounts for Letterkenny Institute of Technology. It received a clear audit opinion. No. 4 is the Institute of Technology, Sligo, for a similar period of 2020 to 2022. It received a clear audit opinion. That is also a dissolved body. The Letterkenny and Sligo institutes amalgamated with Galway-Mayo Institute of Technology to become the Atlantic Technological University from I think 1 April 2022. No. 5 is the land bond (winding-up) account for 2022. That received a clear audit opinion. No. 6 is the Local Loans Fund for 2022, which is effectively a dormant account or a dormant fund. That received a clear audit opinion. No. 7 is the Intestate Estates Fund Deposit Account for 2022, which received a clear audit opinion. No. 8 is the Ireland-United States Educational Fund for 2022. It received a clear audit opinion. No. 9 is the Travellers' Protection Fund investment account for 2022. That received a clear audit opinion. Finally, the Housing Agency for 2022 received a clear audit opinion, but I draw attention to chapter 11 of the report on the accounts of the public services for 2022, which looked at the progress made on the utilisation of the sites that were taken in under the land aggregation scheme, which I think the committee is shortly to examine.

An Cathaoirleach

It will be the week after next. On this day two weeks-----

Mr. Seamus McCarthy

Correct.

An Cathaoirleach

-----we will have that Department in on those matters. It is the issue Mr. McCarthy highlighted in his annual report.

Mr. Seamus McCarthy

That is correct.

An Cathaoirleach

There are some of them there that at this stage are almost wound up or have minimal amounts of money in them in terms of accounting period and turnover. One of them is the land bond (winding-up) account. What is that?

Mr. Seamus McCarthy

We are probably familiar with the history of the land bonds. I think it was in 1990 it was decided a certain amount of money would be put into the land bond (winding-up) account to, if you like, redeem the bonds that had been issued as and when they came up for reclaiming.

An Cathaoirleach

For the Land Commission divides.

Mr. Seamus McCarthy

Effectively, yes. The land would have gone into the Land Commission, but the estates were paid for using the land bond issues. Effectively, they projected forward how much was going to likely be needed to redeem the bonds when they came to maturity or otherwise when they were presented. They have all been presented, with the exception of €137,000 worth. That remains in the land bond (winding-up) account. There were no transactions in 2022 and there have not been-----

An Cathaoirleach

Which Department is it under?

Mr. Seamus McCarthy

The Department of Finance.

An Cathaoirleach

All right.

Mr. Seamus McCarthy

It is really a kind of residual thing. The Local Loans Fund was effectively for lending to local authorities before the Housing Finance Agency was established. All the loans have been repaid, so effectively there is nothing further to be transacted through that account, but it will have to be, if you like, eliminated through a legislative change. A nil account will have to be presented until such time as the legislative change is made.

An Cathaoirleach

What about uimhir a seacht?

Mr. Seamus McCarthy

Intestate estates are where someone dies and has assets but no next of kin to claim them. The estate becomes liable for surrender to the Exchequer. The committee will see that assets worth €259,000 came into the account in 2022. The balance in the account on 31 December was €1.34 million. Typically what happens is that once the assets are liquidated, the money is brought into the intestate estates account. Until all the legalities are complete and a cooling off period for next of kin to come forward has passed, the money is held in the intestate estate account.

An Cathaoirleach

What has happened in the past. Does it generally go into general Government funding?

Mr. Seamus McCarthy

The expectation is that-----

An Cathaoirleach

It is not earmarked for any particular community fund or such thing.

Mr. Seamus McCarthy

No, it goes into the Central Fund.

Deputy Catherine Murphy

Where there is a winding up and a nil balance and the Comptroller and Auditor General has a responsibility to audit, who pays the audit fees and are there other residual costs?

Mr. Seamus McCarthy

It is fairly minimal at that stage, if there are no transactions. We generally do not charge an audit fee for an audit of a departmental fund. We bear the cost of the audit.

Deputy Catherine Murphy

Are there many of these? If legislation is needed, I presume it can deal with a multiplicity of them. We will not need individual Bills.

Mr. Seamus McCarthy

Yes, it could. It could be done as part of the finance Bill.

Deputy Catherine Murphy

To tidy that up.

Mr. Seamus McCarthy

Yes, to tidy up those things. There is a handful of them in the sector.

An Cathaoirleach

Can we agree and note the listing of accounts and financial statements? Agreed.

As usual, the accounts and financial statements will be published as part of the committee's minutes.

I will move on to the third item on our agenda, which is correspondence. The previously agreed items that were not flagged for discussion at this meeting will be dealt with in accordance with the proposed actions that have been circulated. The decisions taken by the committee on correspondence are recorded in the minutes of the committee's meetings and published on the committee's website.

The first category is category B, correspondence from Accounting Officers or Ministers and follow up to meetings of the Committee of Public Accounts.

No. 2241B is from Judge Rory MacCabe of the Garda Síochána Ombudsman Commission, GSOC, dated 16 November 2023. This item provides further information requested by the committee about an investigation. I propose that we note and publish this item of correspondence. Is that Agreed? Agreed.

Deputy Catherine Murphy flagged this for discussion.

Deputy Catherine Murphy

Yes, because it comes up routinely. We have expectations that oversight bodies can do the job. They cannot do the job if they are challenged by not having the resources to do it. I have asked numerous parliamentary questions about the length of time investigations take. It is not unusual to be told in the reply that one is taking five or six years. Even in cases I would expect to be urgent, investigations still take a couple of years. Attention has been drawn again to the resourcing issue here. There was an allegation about the use of force and cases went to the ombudsman. We need to see issues not going to GSOC, if it is not appropriate for them to go there or if the complaint relates to something that training could alleviate. I do not have a problem with the Policing Authority coming up with a definition, but it comes down to An Garda Síochána to review training so that GSOC does not end up with cases that should not go to it. Clearly GSOC is needed as before it was set up gardaí were was investigating gardaí.

Unless the Government resources the ombudsman, we will see these delays continue. Several of the replies I received talked about gardaí who were not working because a complaint was being investigated. Until a decision is made - it will either be dropped or go to the Director of Public Prosecutions, DPP, and charges will ensue - there is a vacuum. We should write to the Department of Justice about this because it is not good enough that GSOC does not have adequate resources to do the job. Five Garda officers were seconded to GSOC to do some work. The secondment ended before the completion of the investigation and while material from the European Commission was outstanding. This comes back to the Templemore issues that were raised several years ago. GSOC investigators who had not previously been involved in the investigation progressed and completed the investigation and generated a report that was considered by the commission. It looks like the work they were doing was interrupted. That is not a good way of doing things.

The other issue is that we count those gardaí in the complement of gardaí who are sworn members. We also count the number of sworn members in the corporate enforcement agency. There was a big row about the resourcing of that agency and it is difficult to be sure that the resourcing is adequate. We cannot ignore the general resourcing issue.

Does the C and AG audit GSOC?

Mr. Seamus McCarthy

Yes.

Deputy Catherine Murphy

Perhaps we could include it when the Department of Justice is before the committee or perhaps we could combine the two. There is a cost to be paid if these organisations do not function.

An Cathaoirleach

We have had complaints over the weekend from gardaí and their representative bodies saying that investigations about complaints lodged with GSOC about individual gardaí can take years. They outline the matter in stark terms. Judge Rory MacCabe stated that a further issue was that of resourcing. He stated: "The committee will – at the risk of my rehearsing the broken record I and my predecessors have in the past articulate to your members – be aware that GSOC continues to experience serious challenges with respect to resourcing, which has and continues to have a significant impact on our capacity to deal with an ever increasing caseload and on the duration of investigations." This letter is dated 16 November, so it was written and sent to the committee before the hullabaloo at the weekend and all that happened at the end of last week.

Deputy Catherine Murphy

Hullabaloo is an understatement.

An Cathaoirleach

Unfortunately.

Bringing GSOC before the committee at the same time as the Department would be useful. There may be a case for inviting An Garda Síochána. Perhaps An Garda Síochána and GSOC could appear on one day. That would be useful.

Deputy Catherine Murphy

We had a session this morning that was very routine. I have made the case on a couple of occasions that we should be looking where there is an obvious failure we can interrogate. We are looking for value for money. Some gardaí may well have a case against them being looked at by the ombudsman that does not progress to any kind of sanction and they are not free to work because of it.

An Cathaoirleach

Or under investigation for years.

Deputy Catherine Murphy

You could have somebody who is rightly being investigated but whose investigation has been going on for years. Justice delayed is justice denied. That goes for members of the Garda as much as anybody else. In the interim, we should write to the Department of Justice and express our serious concerns about the resourcing issue concerning GSOC and the length of time it takes to deal with cases as a consequence.

An Cathaoirleach

I propose adding a discussion with either the Department or the Garda to our work programme for the date we have. We need to have the Garda Accounting Officer and GSOC representatives in on the same day.

Deputy Catherine Murphy

That could be a real powder keg.

Mr. Seamus McCarthy

It might be. The Accounting Officer for the Garda Vote is the Commissioner.

An Cathaoirleach

That is correct. It is Commissioner Drew Harris.

Deputy Catherine Murphy

However, if someone is on secondment, the Commissioner will be responsible for taking them back from secondment-----

An Cathaoirleach

There were five on secondment.

Deputy Catherine Murphy

-----and may well decide whom he can send, which is another matter.

An Cathaoirleach

In the period the Deputy is referring to, from 2017 to 2020, there were five on secondment. We can add it to the work programme.

Deputy Catherine Murphy

Do we agree to write as well?

An Cathaoirleach

And write to express our concern. There is a genuine issue. Also, it is a question of deficiency in respect of the time taken to carry out investigations. If what the Garda Representative Association is saying is true, some of the investigations are ridiculous.

Deputy Catherine Murphy

There is a value for money aspect as well in terms of the wider understanding of value for money.

An Cathaoirleach

I thank the Deputy for that.

We will move on to category C, correspondence from and related to private individuals, and any other correspondence. No. R2243 C, dated 20 November 2023, is from Deputy Imelda Munster, a member of the Public Accounts Committee. She has forwarded correspondence from an individual concerning Greyhound Racing Ireland and the Horse and Greyhound Racing Fund. In our report on Horse Racing Ireland, the committee recommended that the Department of Agriculture, Food and the Marine conduct a full review of Exchequer funding to the Horse and Greyhound Racing Fund and report to the committee by May 2023 with a view to examining four areas. The first is the social and economic impact of the fund, including its efficacy in supporting the development of both sectors, the broadest cohort of those involved in both sectors, and rural communities. The second concerns whether the use of the fund to subsidise prize funds represents the best value for money. In this regard, members will recall the question of such a large amount of funding going towards prize money in the horse racing sector. The third area is the efficacy of the fund in ensuring the highest levels of animal welfare standards, and the fourth is the appropriateness of pro rata distribution as a funding mechanism for both the horse racing and greyhound racing sectors.

The Department of Agriculture, Food and the Marine has partially responded to the recommendation. It committed to sending information in September but it has not been received. The Department has stated the appropriateness of pro rata distribution as a funding mechanism for both the horse racing and greyhound racing sectors is a matter of policy. I propose that we request an update on the recommendation and inform the correspondent accordingly. Is that agreed? Agreed.

That concludes our consideration of correspondence. I will now move on to the work programme. Members have been given a draft work programme discussion document, which is displayed on their screens. Next week, on 7 December, we will meet officials from the Department of Health to examine the 2022 appropriation account for Vote 38 and the following specific areas of interest: establishment of the new regional health areas; budget controls and governance; budget outcomes; agency costs; and service level agreements with section 38 and section 39 organisations. On 14 December, we will meet officials from the Housing Agency and the Department of Housing, Local Government and Heritage on Chapter 11, Utilisation of the Land Aggregation Scheme Sites, the Housing Agency's 2022 financial statements, and programme A of Vote 34 – Housing.

On 18 January 2024, we will meet with the Department of Social Protection to examine the 2022 appropriation account for Vote 37, the Social Insurance Fund, the relevant chapters from the C and AG's annual report and the misclassification of workers. That will be interesting. I heard this morning that the insurance fund was cleared out during the Covid period. There was over €3 billion-----

Mr. Seamus McCarthy

I believe it was €3.5 billion.

An Cathaoirleach

Am I correct in saying that, during the financial crash, the fund was raided for something like €8 billion or €9 billion?

Mr. Seamus McCarthy

It is not so much that it was raided, but the drawdown basically depleted reserves that had been built up.

An Cathaoirleach

Was €8 billion or €9 billion taken out of it for shoring up?

Mr. Seamus McCarthy

I am not sure if it was that much but there was certainly a substantial amount in billions.

Deputy Catherine Murphy

The pension fund?

Mr. Seamus McCarthy

That is separate. That was also depleted. Maybe that is the one the Chairman was referring to. That was €20 billion.

An Cathaoirleach

I am sorry. That was the one.

Mr. Seamus McCarthy

The package acquired at the time of the crash was about €64 billion for the banks, with another €20 billion required. There was a total of €84 billion but we had about €20 billion in the pension fund.

Deputy Catherine Murphy

Can I ask about that? Reference is made continually to the cost of the banks – €64 billion – as if it were compartmentalised. Owing to the crash, Government borrowing went sky high, not for the banks but for the purpose of meeting-----

Mr. Seamus McCarthy

Day-to-day-----

Deputy Catherine Murphy

-----the deficit related to unemployment and all the things that happened as a consequence of the crash. Has there ever been a net amount-----

Mr. Seamus McCarthy

I have reported on this on three occasions, looking back at the total cost of banking stabilisation, but not the total cost of the crash because that is reflected in the huge increase in State borrowing. A total of €64 billion was put into the banks, but we obviously got some of that back in the form of sales of assets, dividends and so on. Therefore, there has been money coming back. I reported most recently that the net outcome of the cost of banking stabilisation was in the region of €40 billion to €45 billion.

Deputy Catherine Murphy

That is bank stabilisation but there was a cost to the economy as a consequence of it that was a non-banking cost. There was a multiplicity of factors. You cannot even quantify-----

Mr. Seamus McCarthy

There was a global crash at the time.

Deputy Catherine Murphy

-----the cost of the loss of services, for example. People paid in terms of some of the changes made to their pension entitlements, for example. I get quite annoyed when it is said that we bailed the banks out and that the only banks that really cost us money were Anglo Irish Bank and Irish Nationwide, which IBRC succeeded. The fact that they crashed so spectacularly – the property bubble caused that – led to other economic costs, including a huge amount of additional borrowing. It tends to be inappropriately compartmentalised but there has not-----

An Cathaoirleach

Regarding the figure for the effect on overall borrowing, you would have to examine the level of borrowing in 2007 and 2008, and then look at it----

Deputy Catherine Murphy

Yes, but-----

An Cathaoirleach

-----but you could be looking at another €60 billion or €80 billion.

I do not know, but something like that.

Deputy Catherine Murphy

Yes, the banking crash cost us more than the banking crash.

An Cathaoirleach

From this morning anyway - the Deputy might have missed the last piece as she had to go to another committee - €28 per worker per week is the cost of servicing it.

Deputy Catherine Murphy

Yes.

An Cathaoirleach

That is according to John McCarthy this morning. That is not insignificant.

Deputy Catherine Murphy

No, not when it is your €28, especially if you happen to be on minimum wage or whatever.

An Cathaoirleach

That is what I am thinking of; €28 is a bit of a hit.

Mr. Seamus McCarthy

I do not have the exact figures here, but going back to around 2008 the level of State debt was I think about €40 billion. By 2013 it had gone to €200 billion, so that is an increase of €150 billion. One could say €40 billion of that was related to the banking rescue, but the balance of it was related to other impacts.

Deputy Catherine Murphy

If we add in the pension reserve fund it goes up again, because that would not be included in it.

Mr. Seamus McCarthy

That is true.

An Cathaoirleach

I am sorry, will Mr. McCarthy say that again? It was €40 billion in 2008.

Mr. Seamus McCarthy

It was €40 billion, give or take, and by the end of 2013 it had gone up to €200 billion. Then it was fairly level from 2013 until 2018 and then it started to drift up. Obviously with Covid there was additional borrowing.

An Cathaoirleach

So it went up by €150 billion to €160 billion.

Deputy Catherine Murphy

Plus.

Mr. Seamus McCarthy

Correct. Of which a net €40 billion is related to the banking. As the Deputy has pointed out, there was also other expenditure because we were able to draw on the pension reserve fund for about €20 billion.

An Cathaoirleach

The collateral damage was €100 billion.

Mr. Seamus McCarthy

It was €100 billion to €130 billion, maybe.

An Cathaoirleach

Very painful.

Deputy Catherine Murphy

Plus the loss in services we have never caught up on.

An Cathaoirleach

There were huge consequences with the cutbacks and everything else that had to come on the back of it.

On 18 January we will have the Department of Social Protection in order to examine the 2022 appropriation account for Vote 37, the Social Insurance Fund, the relevant chapters from the Comptroller and Auditor General's annual report and the misclassification of workers. The Social Insurance Fund has been laid before the Houses, so we can examine that. We will also examine the misclassification of workers when we meet the Office of the Revenue Commissioners on 25 January to examine the 2022 appropriation account for Vote 9 and the relevant chapters from the Comptroller and Auditor General's annual report. Last week we agreed to meet the Department of Tourism, Culture, Arts, Gaeltacht, Sport and Media, Sport Ireland and the Football Association of Ireland on 1 February. I propose we discuss the details of that meeting further on in the meeting. Is that agreed? It is.

A draft discussion document listing potential engagements for the new year has been circulated to members. I will list the ones that have been suggested by members. First is the Department of Justice and An Garda Síochána. I suggest we add GSOC. We can discuss how to sequence it, but that body needs to be in the frame. Then there is the Department of Defence, the Department of Transport, the National Transport Authority, the Department of Agriculture, Food and the Marine and the Irish Horseracing Regulatory Board, IHRB. On the same day we bring in the IHRB, we might bring in Horse Racing Ireland. The last three on the list are Inland Fisheries Ireland, the Office of Public Works and the Department of Foreign Affairs and international co-operation. We had a morning hearing with Inland Fisheries Ireland back in midsummer, but it is clear from that we need to bring it back in again. I propose we agree at least three more engagements for the new year before we break for the Christmas recess so the secretariat can have the necessary homework done and make the required arrangements. That will bring us up to St. Patrick's week. That is how quickly things are moving. Meetings are agreed up to 1 February, so the next free slots are-----

Deputy Catherine Murphy

There is a possibility of another meeting before the end of the year-----

An Cathaoirleach

There is.

Deputy Catherine Murphy

-----with RTÉ. Obviously there is some correspondence, but that is not completely off the table.

An Cathaoirleach

Meetings are agreed up to 1 February, with that proviso. We left that there for if the need arises to bring RTÉ back in again. The next free slots are 8, 15 and 22 February. Do members have any views on suggested meetings or any other proposals? They do not. That concludes our consideration of the work programme.

The last item on the public agenda is any other business. I take it members have no other matters they wish to raise. We will briefly go into private session and then adjourn until next week, when we will meet the Department of Health.

The committee went into private session at 2.06 p.m. and adjourned at 2.36 p.m. until 9.30 a.m. on Thursday, 7 December 2023.