Residential Institutions Redress Board: Departmental Presentation.

We will commence the discussion with the Department of Finance on the residential institutions redress issue. I welcome Ms Ann Nolan and Mr. John Conlon from the Department who are in attendance to brief the committee on the Department's involvement in this issue. As members will recall, this matter falls under the remit of the Department of Education and Science but the Department of Finance has a role to play which is why its officials are here today. I thank the officials for attending the meeting at such short notice. It was decided to issue the invitations only last Wednesday. I appreciate that the officials were under a great deal of pressure to prepare for today's meeting. I suggest that we invite Ms Nolan to make the presentation to the committee to be followed by a question and answer session.

I wish to remind visitors that while the comments of members are protected by parlimentary privilege, those of visitors are not. Members are also reminded of the long-standing parliamentary practice to the effect that members should not comment on, criticise or make charges against a person outside of the House or an official by name, or in such a way as to make him or her identifiable.

I invite Ms Nolan to make her presentation to the committee.

I am the principal officer in the public expenditure division responsible for the Department of Education and Science Votes. Accompanying me today is Mr. John Conlon, assistant principal. I apologise on behalf of Mr. Jim O'Brien, the Assistant Secretary in this area who is abroad on annual leave.

We are glad to try to assist the committee in its examination of the agreement with religious congregations on their contribution to the residential institutions redress scheme and the indemnity they received in return for that contribution. As the committee will be aware, the Department of Finance was involved with the lead Department, the Department of Education and Science and the Attorney General's office at different stages in the process leading up to the agreement, particularly up to 16 October 2001 when negotiations between officials and the religious congregations came to a standstill and after 30 January 2002 when the Minister for Education and Science announced that he had reached agreement in principle with the religious congregations.

It may be useful to briefly place the issue of compensation for victims who suffered abuse while resident in residential institutions in the overall policy context. As the committee will aware, the policy background is that on 11 May 1999 the Taoiseach made an apology to the victims of childhood abuse and went on to outline a number of measures, including the setting up of a commission on childhood abuse. The Commission to Inquire into Child Abuse Act 2000 became law in April 2000. In October 2000 the Government agreed in principle to establish a body to compensate people who as children were victims of abuse while in the care of institutions in which they were resident and in respect of which the State had regulatory or supervisory functions. In February 2001 the Government approved the proposals for a compensation scheme.

As the committee will be aware, the Residential Institutions Redress Act which brought that scheme into effect and provided for the establishment of the Residential Institutions Redress Board, was passed by the Oireachtas in April 2002. Both the Commission to Inquire into Child Abuse and the Residential Institutions Redress Act were sponsored by the Minister for Education and Science, who is the Minister with policy responsibility in this area. It is clear that the residential institutions redress scheme was a major part of this general approach to try to bring some healing and closure to the victims of child abuse. The Department of Finance would of course have had an input in the normal way by providing observations - and briefing notes for the Minister for Finance - on the various memoranda for Government. That is those dealing with the approval in principle of the redress scheme on 3 October 2000, the Government approval of the proposals for a compensation scheme in February 2001 and subsequent submissions to Government as part of the process of having the redress Bill published, and enacted.

The role of the Department of Finance in this matter was consistent with its general role of advising the Minister and Government - by way of observations on memoranda for Government - on the financial aspects of policy proposals from line Departments. In January 2001 the Department of Education and Science invited the Department of Finance to participate in a group of officials - also including officials from the Department of Education and Science and the Attorney General's office - for discussions with representatives of the religious congregations on the question of a contribution from the congregations towards the proposed redress scheme. This group of officials, which was chaired by the Department of Education and Science, met representatives of the religious congregations, and a senior counsel advising them, on a number of occasions during the period 7 February 2001 to 26 June 2001 and again on 16 October 2001. The purpose on the official side was to explore whether the religious congregations were interested in making a contribution towards the redress scheme and, if so, the amount of such contribution.

It was clear within the officials group, and it was made clear to the religious congregations, that the final decision on whether or not to grant an indemnity on the basis of a contribution towards the redress scheme was to be one for Government. It was also made clear in those discussions that, as far as the official side was concerned, nothing was agreed until everything was agreed. The Minister for Finance wrote to the Minister for Education and Science twice during that period in relation to the contribution issue. His first letter, dated 7 March 2001, was in the context of the drafting of the heads of a Bill for the compensation scheme. In that letter, the Minister raised with the Minister for Education and Science the question of having the Bill drafted so as to limit the State's liability for awards under the scheme to a proportion - say 50% - and to limit a waiver by claimants on accepting an award to the State only in the event of the religious congregations deciding not to contribute to the scheme.

In late April 2001, the officials group sought clearance from their respective Ministers for the parameters of what would amount to a reasonable contribution by the religious congregations. This was in order to be in a position to react to any offer to be made by the religious congregations - which in the event did not happen until 26 June 2001. The group agreed to recommend to the Ministers that the minimum amount required in the context of a full indemnity for the religious congregations against claims relating to past abuse in residential institutions for which the State had inspection and supervisory functions would be 50% of the cost but that it would be subject to a cap to be negotiated but not one less than £100 million.

The Minister for Finance gave his approval to proceed on that basis on 27 April 2001. In the event, the offer made by the religious congregations on 26 June 2001 fell considerably short of £100 million. At that point, the Minister for Finance wrote a second letter to the Minister for Education and Science, dated 29 June 2001, to the effect that in his view the offer made by the religious congregations on 26 June 2001 fell considerably short of what would amount to a meaningful contribution in the context of a full indemnity.

The final meeting of the official group with the religious congregations took place on 16 October 2001. At that meeting the chairman of the group, the Assistant Secretary in the Department of Education and Science, informed the religious congregations that the group would be prepared to recommend an approach based on a fifty-fifty contribution and also to recommend to the Government that the contribution be capped at a figure of £100 million. In return, the participating congregations would receive a State indemnity against litigation in cases which come under the remit of the redress board.

The reaction of the religious congregations was that the gap between their offer in June and the minimum contribution of £100 million required was unbridgeable. No further meetings of the negotiating group took place. It is understood that the then Minister for Education and Science had further contacts with the religious congregations, who, we understand, consulted each other, and that on 30 January 2002, he informed the Government that he had reached an agreement with the religious congregations. He subsequently issued a press statement to the effect that he had reached an agreement in principle on the amount of a contribution and on an indemnity for the congregations concerned against all present and future claims arising from past child abuse which are covered by the Residential Institutions Redress Bill 2001 - as it then was - and that the Government had agreed in principle to the proposals.

The Department of Finance had no contact with the negotiations during the period from 16 October 2001 to 30 January 2002. Following the announcement by the Minister for Education and Science on 30 January 2002 that he had reached agreement in principle with the religious congregations, a Department of Finance official attended a meeting in the Department of Education and Science on 13 March 2002 on the modalities of advancing the agreement in principle announced on 30 January 2002. Representatives of the religious congregations with Arthur Cox, Solicitors were also present. The Attorney General's office was not present and an indemnity agreement was not discussed. It was decided that the Department of Education and Science would arrange a meeting between Arthur Cox and the Office of the Attorney General within the next week to tease out the extent of the indemnification.

A further meeting between officials of the Department of Education and Science, the Chief State Solicitors' office and the religious congregations took place on 12 April 2002. While the Department of Finance did not attend this meeting, Department officials discussed the matter with officials of the Department of Education and Science before and after the meeting and a minute of the meeting was forwarded to the Department of Finance.

Further meetings involving Department of Finance officials took place on 7 May 2002 with Department of Education and Science officials, at which issues to do with the property transfers part of the agreement were discussed; and on 16 May 2002 with officials from the Department of Education and Science and the Office of the Attorney General. At that meeting a number of changes to the draft text of the indemnity were discussed and subsequently carried through.

The Department of Finance also wrote to the Department of Education and Science on 29 April in regard to the property transfer part of the agreement, pointing out that in order to ensure maximum value for money for the State, all properties to be included in the contribution to the redress scheme should have full and clear titles and be capable of being economically utilised or disposed of commercially by the State. The inclusion of properties that will not be in full State ownership and may be transferred to non-governmental organisations run by other religious institutions does not ensure that the State will achieve optimum value for money from such property transfers. Subsequent to this letter, and during the course of the meetings to which I referred above, it was agreed that transfers of property to voluntary bodies which are registered charities established for purposes relating to general public welfare would be accepted. Such transfers must contain a covenant that for a period of 25 years from the date of transfer the transferee can dispose of that property only with the prior consent of the Minister for Finance.

The Department of Finance made observations on the draft memorandum for Government by the then Minister for Education and Science seeking Government approval for the agreement with the religious congregations and prepared a note for the Minister for the Government meeting which took place on 5 June of that year. A Department of Finance Assistant Secretary signed the indemnity, having secured the approval of the Minister of Finance, on 5 June 2002 on behalf of the Minister. It had earlier been signed by the Minister for Education and Science and by representatives of the 18 religious congregations.

At this stage it is difficult to estimate the overall cost of the redress scheme. The only information on the number and nature of cases at the time the agreement was signed was that available to the Department of Education and Science and the Office of the Attorney General. The Minister for Finance was not named as the defendant in those cases and therefore had no information on or access to the cases. When Government approval was sought by the Minister for Education and Science for the indemnity agreement in June 2002, approximately 2,600 cases were identified in which the State had been put on notice. In seeking approval it was estimated by the Minister for Education and Science that the final cost could be in the region of €250 million to €500 million.

The report of the compensation advisory committee, that is, the Ryan report, proposed compensation amounts of up to €300,000 for the most severe types of abuse, with the potential for a further 20% to reflect aggravated damages where appropriate. The Residential Institutions Redress Board, which is independent in the performance of its functions, has to date received about 1,300 applications for redress. The total number of applications will not be known until the board has completed its work, which, as members know, will take a number of years. Figures on which to base any revision of the estimate are not yet available.

I thank the principal officer and the assistant principal for their presentation, which was very concise. Did the Department of Finance ever seek legal advice on the degree of liability that lay on each side? Was this fifty-fifty divide which seemed to develop based on some notional allocation of responsibility? Where did it come from? Against a background of a possible €500 million in liability, how was the cap of £100 million, €127 million, decided, given that they were working on a general basis of fifty-fifty liability? That seems to be well short of what might be an equal share in responsibility.

In this three-and-a-half month period in which the Department of Finance seemed to be out of the picture - the negotiations had broken down - and the Department of Education and Science continued to make the running, did the Department of Finance put down any markers of what would be acceptable as the basis of an agreement in principle from the so-called good news Department, which was simultaneously issuing good news on other issues at the same time?

Only good news.

The negotiations broke down on the basis that there was an unbridgeable gap. Were any markers put down as to the shape of the agreement that might emerge? Within what parameters was it intended to stay?

After the agreement in principle the Department set out its limitations: there would have to be a clear title transfer to the State. It subsequently agreed to this transfer to registered charities. Has the Department done any sort of evaluation of the equivalency of these two from the taxpayers' point of view? To the layman they seem to be totally unequal. To transfer to the State gives the Department 100% ownership but to transfer to a registered charity with 25 years' limitation on its right to sale seems to be an entirely different deal. I know the Department of Finance did not make the agreement as such; it probably came from elsewhere. However, did the Department attempt to put a valuation on the equivalency of these two options? Was a due diligence procedure put in place as part of working through this so that any assets and their values would have been properly assessed by the Department from the point of view of the taxpayer to check that it was getting something like an equivalency to the headline agreement?

Legal advice on liability was obtained. As far as I understand, it was sought by the Department of Education and Science, but it was made available to all the people involved. It was found that the State would have a liability. There is actually no case law in Ireland to indicate how that should be apportioned between the State and the religious congregations. Similar issues in Canada were considered; different proportions were used by different people in apportioning liability. The fifty-fifty divide was very much a rule of thumb; it would not be fair to those who gave us legal advice to say that they specifically said fifty-fifty. However, we were convinced that there would a significant liability to the State. In addition, as I said in my opening statement, there was the question of an overall policy-based desire to help to bring closure to the victims. We did not want to require that every case be fought in the courts or that the proportioning of liability be questioned for every case. The courts would not necessarily find an identical liability split among any of the cases. Within that context, the fifty-fifty rule of thumb was used.

On the £100 million cap, the Government had already decided at that point that it would set up a redress board and that it would not question its own liability in every case. This decision was made for broad policy issues. The question of ascertaining the limit to the liability of the religious was obviously difficult, since at that point they were to an extent volunteering to come into our redress scheme, which we were setting up in any case. The first estimate was for £200 million and the cap of £100 million arose from that. At a later stage it was felt there would be further cases and the cap would be at the lower end of the range of possibilities but we secured agreement of that figure from the Government for the discussions with the religious congregations with that being the lower limit.

A question was asked about the period during which we were out of the loop and what we found acceptable. The final agreement by the Minister for Education and Science was the minimum acceptable. We would have accepted it had it been on offer the previous October - a cap of £100 million for the indemnity. Had we been in the loop, the same agreement would have been reached. It was a bottom line that had been agreed by our Minister at that point.

As regards properties going to registered charities, there are two classes of property covered in the agreement - those that had not been transferred to anyone at the point of agreement and those that were transferred between the date of the Taoiseach's apology in 1999 and the date of the signing of the indemnity last year. Those two classes of property were treated differently in the indemnity. Those that were yet to be transferred have to be transferred to the State and cannot be transferred to charitable organisations. Those that had already been transferred include those transferred to charitable organisations but they must be of social value to the State and there is a requirement that they be acceptable to the State. Ongoing discussions are under way on the valuation of those properties for the State, a separate idea from the monetary value of the properties with the Department of Education and Science. Agreement has not been reached on that aspect.

Due diligence on the properties is a matter for the Department of Education and Science. The Department of Finance does not play a role, other than broad policy agreement on what we want from this agreement. We want clean title and agreed valuations between ourselves and the religious congregations and there is a process for settling disputes if evaluations are not agreed. We are not, however, examining the properties; the Department of Education and Science does that in conjunction with other Departments where appropriate, such as the Department of Health and Children in some cases.

Does the Department of Education and Science decide if these matters are acceptable?

Yes, inasmuch as they offer educational purposes, that would be a matter for the Department of Education and Science. If they are for health purposes, the Department would take advice from the Department of Health and Children; if they are for local authority purposes, it takes advice from the local authority.

If the Department was buying these properties it would demand a much greater degree of scrutiny?

No. The Department of Education and Science has its own properties and we do not get involved in scrutinising the properties it buys; it has a property unit to do that. We are only involved in allocating capital budgets. In terms of ensuring value for money on each purchase made, the Department of Education and Science decides that itself and reports it to us. We would not get involved in each property.

I thank the officials for attending. In the presentation, Ms Nolan mentioned the group of officials, chaired by the Department of Education and Science, who met representatives of the religious congregations who were advised by a senior counsel on a number of occasions. If they were accompanied by high level legal advice, were representatives of the Attorney General or other legal advisers to the Department present at those meetings? It is obvious from the context of the memorandum that the religious congregations had the benefit of high level legal advice at all meetings with the State. Were legal advisers to the State present at the meetings in a way similar to the religious congregations?

At each stage following the meetings, did the Department of Finance and the other Departments consult legal advisers? The religious orders were following such a strategy and in business that would be the norm when negotiating with people who have high level advice.

There is a reference in the document that in April 2001 the group of officials sought clearance from their respective Ministers for the parameters which would amount to a reasonable contribution by the religious congregations. This was in order to be in a position to react to any offer being made by the religious congregations, which did not happen until three months later, on 26 June 2001. The fifty-fifty deal was then decided. That must have been based at that stage on having some idea of the total cost. Are legal costs included? As we know from tribunals, those costs can be an exceptionally significant part of such processes. If the religious congregations had so much legal advice at all stages in their discussions with the Department, would it not be reasonable to include estimates of legal costs in the fifty-fifty deal?

In the note that the Department of Finance sent to this committee in January, which this session is following up, an estimated number of claimants and average amounts were given but it was never clear that those were inclusive of legal costs. How did the Department calculate this? From this document, it seems that the calculation of the total cost was a maximum of £200 million in the sense of the £100 being acceptable for the fifty-fifty figure. Did that include legal costs? If not, were the legal costs calculated separately then or at any time since? Is there an estimate of those costs that the committee could inspect?

The document goes on to deal with the negotiations carried on by the former Minister for Education and Science, Deputy Michael Woods. It states that the Department of Finance, as we know from answers to questions asked of the Minister for Finance and the Minister for State at the Department, had no contact with the negotiations from 16 October 2001 to 30 January 2002, when the Minister for Education and Science was doing his thing. Was there any further evaluation, then or subsequently, by officials of the costs of the agreement or was that the end of the evaluation role of the officials of the likely final costs of the agreement and how much of a burden the taxpayer would bear?

It was also stated that the Attorney General's office was not present and representatives of the religious congregations with Arthur Cox, solicitor, attended the meeting on 30 January. It seems that Arthur Cox and the esteemed legal counsel for the religious orders drew up this document. There was a hiatus for three months, from 16 October to 30 January, when the Department dropped out of the picture because the Minister was involved in separate negotiations. The meeting took place at the office of Arthur Cox, solicitor. Did Arthur Cox draft the heads of the agreement and the civil servants fill in the bits? This would explain why in many ways this deal may turn out to be poor value for the taxpayer with regard to the appropriate sharing of responsibilities. Was it the solicitors or their legal team who drew up the outline agreement?

The property transfers were discussed as part of the meetings on 7 May 2000 and 16 May 2002. Was there a way in which the value for money of the property transfers was assessed? The Department told us in earlier responses, and in responses to parliamentary questions, that the transfers of real property were valued at €40 million and they were real transfers which took place since May 1999, the date of the Taoiseach's apologies. Does the Department, which is in charge of the Vote on education, have a list of those properties and their values? While I am grateful for this report and presentation they are incomplete until this committee receives a list of such properties, a brief description of them and their valuation, and how that tots up to the €40.32 million. This committee would appreciate such a list to see what value attaches to the properties.

The second part of the €80 million property transfer comprises transfers to be made to the State as soon as practicable and that amounts to €36.4 million. Will the Department indicate what properties are involved and from what congregations? Have any transfers been made? The Taoiseach's responses in the Dáil about two weeks ago suggested that no transfers have yet occurred under this heading. Why not? What is the problem? Is it that these properties do not represent value for money to the State? Is it that these, or the earlier properties, are tied in to the variation on property transfers to registered charities? The description in the memorandum of charities is unsatisfactory in that the Revenue Commissioners have a book of registered charities for tax purposes and we have no charity law other than the registration of charities. How are such charities identified? What are the charitable purposes for which they are identified? Can that be put into the public domain and responded to in this committee?

The founding articles or memoranda of many of the religious orders mean that several of them are trusts. The law on trusts for charitable organisations and the disposal or transfer of properties is complicated and usually requires solicitors such as Arthur Cox. How will the State acquire these types of property in a way that will be of real and meaningful value and use to it? At the end of the 25 year period could the properties be freely transferred so that the State would have the use of them for only 25 years? This calls to mindCarysfort college, the old St. Vincent's Hospitals and numerous similar issues in the State. For example, in Deputy McGuinness's constituency there was a dispute recently about a school which has been closed because of size but which nonetheless is valuable to people in Goresbridge. This is a technical question. Can I have some observations on this or some further information please?

As the Office of Public Works is the usual adviser to Government Departments that do not usually hold property,what is its role in assessing properties and their usefulness to the State? It is responsible ultimately to the Minister for Finance under a separate Minister of State. What is the value of the services part of the deal, the counselling and other support services for former residents which were valued in initial notes ranging from €10 million up to around €23 million because past services provided by religious orders were included in that? How is that being valued? I understand from people who are dealing with the Commission to Inquire into Child Abuse, and other organisations, that there is disquiet about how these counselling and other services, which are valued at many millions of euro in the agreements, are being rendered?

I agree with the Department that there is a desire to provide compensation and recompense to the victims. I doubt that there ever would be closure for them but some level of compensation and recompense would be in order. The amount allocated for counselling, educational services and so on is a large sum yet several people do not seem to be happy with what is on offer. It is a question of value for money in that the religious orders are arranging for this to be given but how is the Department of Finance assessing whether the victims involved are getting valuable services for this sum of money?

Yes, the Attorney General's office was fully involved in all but one of the meetings, the one from which I mentioned it was absent. This was the first meeting after the agreement was reached. We did not discuss legal matters at that and a separate meeting was arranged between Arthur Cox and the Attorney General's office to get a first draft of the indemnity agreement.

Arthur Cox seems to have played an exceptionally important role in designing the agreement. Was that meeting at which the Attorney General's office was not present for the purposes of concluding the shape of the agreement, given that the Minister had been doing his own negotiating?

No, it was looking at the procedures. The Minister had an agreement and several documents had been exchanged between the Department and the religious orders. As I understand it this meeting was discussing what to do about each heading, property, the indemnity agreement, and with whom it should be discussed. At no point did it discuss the details of what would be in a legal agreement. It considered the modalities of how we would proceed to bring what was an agreement in principle to a written agreement. The details of what would be in a legal agreement did not come up. It was merely procedural, looking at the modalities of how we would proceed in order to bring an agreement in principle to an actual written agreement.

When Ms Nolan says, "what will they do about property", was that asking what properties are being talked about, when will they be identified as opposed to the legal transfer?

No, it was not even doing either of those things. It was saying, when will we discuss them, who will produce the list of what properties are or are not covered. That meeting was much more general and was not a legal, technical meeting. There was one other meeting that the Attorney General's office were not at but the Chief State Solicitor's office did attend. That was to do with property transfer because they had the expertise in that area. At all times, we received legal advice with legal advisers present. There were pre-meetings from the official side, including our legal advisers. Our legal advisers had an important job in drawing up the amendment. I would not agree that the amendment was drawn up by Arthur Cox. There were various versions prepared by different people, but the final agreement covered the kind of issues we felt needed to be covered.

Would Arthur Cox have produced some of the versions or contributed significantly to some of the versions?

Yes, they would have. As one would expect in any agreement between two parties, both sides contributed to the versions. I do not suppose they would have seen their role as doing that.

On legal costs, all the estimates the committee has received from the Department are inclusive of legal costs. We have not prepared a separate estimate for damages plus costs. With regard to the value for money for property, there are two different sets - €40 million worth of property already transferred and €36 million to be transferred. There was an initial list of properties. This will not be completed until the committee receives the final list. At present, the list is not ready. I am aware the Minister for Education and Science, Deputy Noel Dempsey, answered parliamentary questions recently on the subject. A number of properties have been accepted by the State but have not yet been transferred. There will be further discussions on a number of other properties about their valuation, suitability and other issues that have arisen. They are still under discussion. In the event that a property is not acceptable to the State, it is within the agreement that the congregation will substitute it with an alternative property or with money. It beholds us to continue the discussions until we have a set of acceptable properties to the value agreed or until we have reached a point where it is clear we are not going to get such value.

At this stage in terms of the work of this committee, can we get a more detailed indication of what has happened on this front? Have any properties been formally handed over either on the initial €40 million settlement or the second €36 million? Ms Nolan indicated that some properties have been rejected as unsuitable to the State and that the religious congregations may have substituted alternatives. On how many occasions has this happened? How much money, in terms of the values indicated in the overall €80 million, is it a half or a tenth of this figure? Is there a significant minor problem with the total deal?

Ms Nolan indicated in the January note that we would be getting this information in May or June, at the time of the anniversary of the deal. I am referring to the note to the Clerk to the committee, Ms Hogan, that was passed on to members of the committee. I understand that when the State rejected property, the arrangement in the deal was that the nine months commences again for the property substituted. Can we have a financial evaluation of where we stand on the deal? Have half of the properties been rejected? Are we therefore looking at another nine months of negotiation or are there six months left? I understand the religious orders did make offers to the value of the amounta indicated before the March deadline.

Yes, they did. I do not have the details of the properties because they are with the Department of Education and Science and they are playing the lead role in checking whether they are acceptable.

On the note in January, it was a note of a conversation with Ms Hogan. We realised the minute she had written it that it was inaccurate in that it was not possible, given the nature of the agreement, to be sure that anything would be finished by the end of this year. We got back to Ms Hogan and an alternative version was agreed. I am sorry that the earlier version had already gone out to the committee by the time we had got back to Ms Hogan. I can give the committee a copy of our agreed version.

In fairness to the Clerk, the alternative version is completely borne out by the various answers to parliamentary questions, statements by the Taoiseach and so on. It was stated that Ms Nolan expected that by May or June 2003 it would be dealt with. That was based on the nine month March deadline and allowing for three months. It was a perfectly reasonable comment to make. It is one of the reasons why Ms Nolan was asked before the committee as we are interested in following up on the deal.

I do not believe there is a general problem on the deal. My understanding, from discussions with my colleagues in the Department of Education and Science, is that this process is taking longer than anyone expected. This is partly due, as Deputy Burton mentioned earlier, to the way religious orders hold property in trusts. There are issues in ensuring clear title and many technicalities that are slowing the process more than we originally expected.

There is not one big thing causing problems, but more many little issues. Having spoken to our colleagues, I am convinced they are as determined as we are that we will have agreed property valuations that we can stand over as value to the State. We do not feel it is useful to start giving a list stating this property is and this is not. It is commercially sensitive information and we do not want various lists floating around at different times. We want to get a complete set of what is being transferred under the various headings before we issue any list.

As the finance and public service committee, I do not find that answer helpful. We raised this issue, as did many Members of the Dáil and Seanad, on a number of occasions. This whole deal is ultimately going to be of significant cost to the taxpayer. It is of huge personal importance to the victims of residential institutional abuse. From a public information viewpoint, we are entitled to know where this deal stands at present, so that we can get a sense that there is some command of this issue.

I will repeat my earlier questions. Can we get details of the properties involved? How many are involved? What proportion of the properties that were offered were found to be unsatisfactory? Can we get an outline of the legal problems on the charitable status of the congregations? Can we get an outline of the legal problems on the charitable status of the registered charities to which some of the properties may be transferred for a 25-year period? These are important questions in the public interest.

Most members of this committee can recall when the Department of Finance said no to a request for €500,000 to build an extension to a school in their constituencies. I do not see why the Department of Finance should not take an interest in this element of the deal and be prepared to comment on it. I reiterate my query as to the extent of the Office of Public Works' involvement in the deal. Normally, they have an outstanding expertise on property valuation and acquisition for the State.

I should like to add to what Deputy Burton said. Ms Nolan might not be able to identify particular properties, or say that one in a certain location is among them but, perhaps, she could give some generalities. For example, are any buildings among the properties to be transferred presently in use as schools? If so, were those school properties second level and run by religious institutions, or were they voluntary secondaries owned by the board of management. If the State takes them over as part of this deal, does that mean that the State rather than the board of management owns them? Will they change their status as schools? If they are owned by the State, they are no longer voluntary secondary schools and fall into a totally different category. If it is a school, it will never realise a monetary value for the State, for it will continue to be a school during our lifetimes. When does the 25-year rule to which Deputy Burton referred kick in?

We need clarification on where we are going. If the officials, who have been very helpful, do not have that information, I suggest that they tell us that and agree to come back to talk to us within a reasonable period, perhaps ten days or two weeks, with the specific information that we seek. This is a matter for the committee and the public interest, and everyone should be up-front about it.

Reference was made to a conversation with an unnamed official in the Department of Finance, and the Clerk to the committee sent a letter regarding a memo last January. My understanding is that this committee had requested a memo that was not forthcoming. The memo was prepared by the Clerk to the committee on the basis of a phone call and subsequently sent back to the official in the Department of Finance, who added to the memo. Both versions were circulated to members of the committee last January. I wish to make it very clear that the Department of Finance did not in any way contradict the original memo produced by the Clerk to the committee. It added to it.

Perhaps I might make a further point on this specific element. Earlier this year the Department of Education and Science refused to release 140 documents specific to this deal that should have included the detail of the religious orders' properties. From the answers we are receiving today, it appears that that situation is being maintained by the Department of Finance. That is completely and absolutely unacceptable. The stance of the Department of Education and Science was totally unacceptable and highly objectionable. As the Oireachtas Committee on Finance and the Public Service, we require the release of all the relevant documentation withheld so far by the Department of Education and Science and whatever documentation is currently available from the Department of Finance. It should be released to this committee so that we can carry out an informed assessment of the situation regarding this deal at present. It is absolutely unacceptable that we are dealing in vague responses that do not answer the questions posed.

Looking at the overall questions asked and the deal struck, it seems unusual that the Department of Finance or the Office of Public Works would not have examined the properties, as they require Departments to do when implementing projects or policy on behalf of the Government, including what properties would be required in different counties. One would have thought that they would have looked at an overall list and identified them in the context of value for money, suitability or the uses that they had in mind for specific properties in different counties. That exercise did not take place. The Department of Finance must at least be unhappy about the fact that it was not fully involved at every meeting to bring into play that overall review of what properties were required, particularly given the role of the Office of Public Works.

Why did that not happen? Is the Department of Finance unhappy about its involvement or lack thereof in all the meetings? Is there a certain effort being made to distance the Department or the Minister from the deal struck? It lacks an overall plan and seems to rely on the religious orders to come forward with the properties and for the Department either to accept or reject them based on the social value that can be achieved at local level or the overall value of the property itself. There are many questions, even after what has been asked and the answers given, that remain unanswered. There seems to be a lack of a plan from the Department of Education and Science and the Department of Finance.

Many of the questions asked essentially concern information that I simply do not have. That information is held by the Department of Education and Science. We have not been involved on a case-by-case review of individual properties, nor do we intend to be so. That is a matter for the Minister for Education and Science. His Department has a large building unit, which is looking at them. In conjunction with that, it has taken a great deal of advice from the Valuation Office, which has been conducting valuations on several properties for it, along with whatever other professional advice it needs. We do not have the documents to which the Deputy referred and therefore cannot give the information for which he has asked. Our role merely concerns the overall value to ensure that the process is kept moving along and that the overall value of any property accepted meets the value laid down in the agreement with the religious orders.

Surely, by ceding that to the Department of Education and Science, the Department of Finance has already lost that argument. If the Department of Finance was genuinely trying to get €100 million in transfers of property, it would be looking at development land and, as Deputy McGuinness has said, assets in different counties which it wished to put to use. If Ms Nolan says that only the Department of Education and Science, which has no interest other than school buildings - which are already effectively, as Deputy McGrath says, frozen in their use - is concerned, she has already conceded that she is not looking for assets to the value of €100 million in the way that a taxpayer would talk about value. Ms Nolan is saying that she is simply going to rub out the name of the relevant religious order at the bottom of a document and write in the name of the Minister for Finance. However, no value will have been transferred to the State in any sense other than that the Department of Finance will be a long-term caretaker of continuing education activities. By saying that the Department of Finance signed off on this and allowed the Department of Education and Science to go off about its business, the Department of Finance has ensured that the taxpayer will never see that value. That is the frustration on this side of the room, shared by Opposition and Government.

I simply do not accept that. First, not all properties being discussed are educational. Quite a number of them are under the Department of Health and Children or local authorities and to do with various areas. The Department of Education and Science is taking a lead role but examining it in a much broader manner than simply considering the value to the education system. We have had several discussions with it, and it has had further discussions with the Department of Health and Children, health boards and local authorities, as well as with the Office of Public Works in some cases, where that is the appropriate body to look at those properties.

Perhaps I might amplify this. Let us suppose a school or part of a convent or religious institution is no longer used as such but has been paid for, maintained and renovated over the decades to a significant degree out of public funds by the Department of Health and Children for, say, accommodation for the homeless, which is one area I have heard about, perhaps under a charitable organisation like the Society of St. Vincent de Paul. If this is an arm's length deal and not a sweetheart deal between the State and the religious institutions on behalf of the victims, some appropriate mechanism for the Department of Finance must be put in place to ensure there is genuine value for money and transfer of real value to the State if it involves an asset which is already in public use and funded by the State, like health, education or elements of social services. Page 6 of the document refers to the registered charities. Ms Nolan has agreed that the Department of Finance will ensure the State receives optimum value for money from such property transfers. Will she now convince us that this is not a sweetheart deal between the religious orders and the State on foot of a deal knocked up in Arthur Cox's office and agreed to by the former Minister, Deputy Michael Woods? We want to see some evidence of value for money for the State.

Also, will Ms Nolan explain the role of the Office of Public Works in this matter which I would have thought, as an expert on property acquisition and disposal by the State, would be rather important? I will ask her later about the non-property element of the deal on services, which also involves very significant sums of money. As a former Minister of State, I can recall the Department of Finance correctly querying every £0.25 million or £0.50 million of expenditure. I am sure Deputy Bruton and others have had the same experience. That is the Department's job on the expenditure side where it is following the Votes. Is this deal being monitored by the Department to ensure that the religious orders contribute not only to the letter but to the spirit of the deal?

A number of issues arise. First, in all the cases where the State has already invested in some of these properties, the valuation of the property is net of any State grant, as is the normal process when property is being transferred to the State. If the State has built something on land which is owned by, say, a religious institution, only the underlying value of the land will be counted as part of the €36 million or the €40 million, depending on the heading it comes in under.

Net of the grant?

Net of the grant.

The grant that might have been made in the 1940s.

It will be indexed up, so it will be net of whatever contribution the State has put in. It is unusual that the entire building would be paid for by the State. It is normally a grant, which would be put with other money.

It could be up to 90%?

It could be up to 90%, yes.

Ninety per cent is the usual figure.

For schools, yes. In those cases it will be net of whatever grant has been paid, brought up to date.

I reject again the suggestion that the indemnity agreement was written in Arthur Cox's offices.

I am glad to hear that.

On the question Deputy Bruton put to me several times about the issue and the educational services, which are two other aspects of the deal we have not yet dealt with, the money for the educational services is in a fund which the NTMA is currently holding, separate from other funds, in a dedicated account.

Is that the £10 million or the earlier money?

It is €12.7 million. It was £10 million originally.

That is on deposit.

That is on deposit, and my understanding is that the Department of Education and Science and the umbrella group for the victims have had a number of discussions. They have anad-hoc committee examining how this could be applied for education of victims.

Is Ms Nolan aware that an amount of dissatisfaction has been expressed about that because the religious orders were party to this agreement and their members were party to some of the abuses which took place? That may not be the best form of counselling and education provision. The religious orders are contesting that they were not party to any kind of abuse but members or former members of theirs may have been. They are the people who are party to deciding how this money is to be spent.

There are two different issues here. I am talking about the €12 million educational issue. As far as I know, the religious orders do not have any say in how that money is being spent. The City of Dublin VEC, the further education division of the Department of Education and Science and NOVA, the umbrella group for victims, are involved. There have been a number of advertisements and they expect to be in a position in the autumn to start issuing grants to individuals. As far as I know, that aspect has no connection to the religious orders.

Would Ms Nolan be able to give this committee, in terms of her overseeing function in the Department of Finance, a broad indication of the expenditure proposals in respect of that money?

A scheme will be available to victims who will have to apply for it. The scheme is not yet up and running. A €12.7 million fund is available. I assume it would last over a number of years. I would be surprised if there were a sufficient number of eligible applications for September to use it all up but it is being advertised and we expect to have the first round for this September. I would imagine that once the first round is up and running, the scheme will need to be re-examined to determine if it is working both for the individuals and in terms of the way it is administered. There may be further changes made next September.

Does that scheme involve administrative costs in relation to any organisations, such as NOVA, being involved in the administration of the scheme or the acquisition of properties by them to administer the scheme?

My understanding is that they will have a cost but that it is grant-aided by the Department of Education and Science.

NOVA is grant-aided by the Department of Education and Science.


Separately from this.

Is there any acquisition of property involved?

No, not that I am aware.

I hope you noted our patience, Chairman. Mr. Justice Flood was the sole member of the tribunal for a number of years and I thought for a while that Deputy Burton was the sole member of the committee. However, I say that with no edge attached.

In her final commentary, Deputy Burton talked about the letter and the spirit. I would hope that latter point would not be the case because a more mean-spirited agreement I have never come across in my life. I hope there will be no dependency on the spirit in it because I find it highly objectionable, given the gravity of the cases concerned and the abuses recorded. Every time I am exposed to the detail and the absence of detail, as is the case here today, I find it ever more grossly distasteful.

I want to ask about the final meeting of the official group, which constituted officials of the Department of Finance - perhaps one of the representatives opposite - the Department of Education and Science and representatives of the Office of the Attorney General. At the meeting on 16 October 2001, it was indicated to the representatives of the religious congregations that the official group would be prepared to recommend a fifty-fifty contribution and also that the contribution would be capped at a figure of £100 million, as would have applied at the time. I wish to go back to the genesis of so much of what is deficient in all of this. Where did the notion of capping come from in the first place? On what basis was the capping figure evaluated? At that time, I do not believe there was any notion of the extent of the abuse or of the claims that would arise as a result of opening up the process to the Residential Institutions Redress Bill.

Deputy McGuinness is not far off the mark, with all respect to the two Department of Finance representatives present. I think they would be quite happy, looking at the way things have moved on, to leave some gap in terms of responsibility. When was it agreed, and by whom, that the Minister for Education and Science could go off on his own devices over a period of three months, or whatever time it took, to address this matter? Who suspended the work of the official group and had it exhausted all of its efforts?

I find most disturbing the position of the Department of Finance in relation to the earlier series of questions concerning the value of the properties to be handed over by the religious congregations as a part contribution. The Department of Finance has only recently written itself in ahead of the Department of Health and Children's representatives in terms of the hospital services executive board and the national hospitals office. The Department of Finance is watching things like hawks within all the Departments but most particularly the Department of Health and Children. The idea that the Department of Finance has not even a cursory interest in, let alone knowledge of, the factual value of the property element of this deal does not stand up. I cannot accept it because I do not think it holds water, and I do not believe the public will accept it either. If the departmental representatives do not have the information now, the only further logical question I can pose is will they now secure it and come back to the committee with the relevant information that each of the Deputies has requested this afternoon?

A number of questions have been raised. The Deputy asked about the meeting on 16 October 2001, which was the final meeting of the officials' group. There was a feeling at that meeting that, at official level, no further progress could be made and that it would have to go to ministerial level before it was likely that any further progress could be made on the issue.

As regards who mandated the Minister, Deputy Woods; obviously the Government mandated him. His was the lead Department and he had responsibility for the discussions with the religious orders on this issue.

But he reported directly to the Taoiseach, presumably?

To the Government, I presume. The cap was agreed by our Minister, the previous April, as being what could be described as a meaningful contribution from the religious orders to this process. It has to be seen in the context whereby the State had already decided it needed to provide for a redress scheme. Obviously, from a purely financial point of view, one might say it would be better to wait until some cases had gone to court to see what way the court had divided it up. However, the State had realised it had a responsibility. Many of the victims had spent an awfully long time seeking redress since the abuse had taken place, and it did not seem reasonable to say that we should wait. There was a Government decision that we should go ahead with the redress scheme anyway. So, in a sense, at that point, it was a question of ensuring that the religious congregations did make a meaningful contribution, and that was the figure that was picked.

The term "a meaningful contribution" seems almost contradictory. The official group was prepared to recommend an approach based on a fifty-fifty contribution, yet it was also prepared to recommend a contribution capped at a figure of £100 million. How can Ms Nolan say that that would be a fifty-fifty contribution? Those are the two elements in the paragraph in the group's report, yet it would appear that it was just "a hand up into the clouds, and we will draw down a figure here which sounds nice and comfortable". They chose a figure of £200 million without any sense, notion or idea of what would transpire as a result of the cases to be taken. I am disturbed that the Department of Finance, let alone any other Department, would go about its business in this way. These are ball-park figures drawn down, literally, out of the clouds. The recommendation is wholly contradictory because there was clearly no approach based on 50:50. The £100 million that the Department was prepared to cap it at, ended up at €128 million in equivalent terms. How does all that stand up?

Ms Nolan has acknowledged that perhaps people should have waited to see exactly how the compensation process might unfold, and what levels of compensation individual claimants might secure. If that had been multiplied by the number of claimants in relation to the differing degrees of abuse suffered, it might have provided some idea of what lay ahead, but the group had no such information then. The experience since would indicate that we are looking at figures greatly in excess of this, which means that the religious institutions have done extremely well from their point of view in terms of their responsibility. Of course, the State is responsible because, by and large, it was responsible for placing the children in these institutions in the first place. Nobody is trying to erase the State's role and responsibility but when was it decided that the State would take the lion's share of responsibility and that the public purse, ultimately, would be the one most deeply affected?

First, I do not accept that it is necessarily the case that the ultimate cost will be enormously greater than the range of costs already stated, although we do not know what the ultimate cost will be and I accept that we are taking the risk. As regards the point when it was decided, effectively, once the State had decided to establish the redress board one could not let it operate for a while and then force the religious orders to pay over any proportion of the awards money. One was left with a choice between——

Could Ms Nolan explain that in more detail?

One cannot set up a redress board that is making redress but which has a right to take property belonging to private organisations as redress. The courts could do that but I do not see that we could legally have set up a redress board which would have the right to issue orders or make decisions against the religious organisations. It certainly would be unprecedented.

Could I ask Ms Nolan a question in that context? In this case, the religious orders were given an extremely valuable indemnity to cap their contribution. Was Ms Nolan surprised, in terms of being on the expenditure side of Finance, at the robust legal approach the religious orders have taken to the Laffoy Commission hearings, which are under way and which have been reported in the press? Constitutionally, the religious orders have an absolute legal right to vindicate the good names of their members or former members, whether living or deceased. Reference was made to how the South African truth and reconciliation commission somehow informed the redress board. As Department of Finance officials, are you not surprised at how robust is the legal approach to the hearings of the inquiry? The institutions secured a valuable indemnity and the State rightly sought closure to ensure that those who suffered so much could have some recompense. Yet, it now appears that the hearings may last for years. I have heard from a number of people who have been before various hearings and who have been questioned in an incredibly robust way. The institutions secured an indemnity, but what are they giving in return in terms of trying to assist the victims?

Ms Nolan referred to the Canadian experience. I understand that in Canada there was no indemnity for the religious orders. The state met the costs and the state governments were then free to sue the religious orders. We now seem to be potentially getting the worst of both worlds. We have provided an indemnity to the religious orders while their robust legal approach to the various mechanisms established means that, particularly where accusations related to the deceased people, the orders are free to pursue the full legal avenues, something they are constitutionally entitled to do but which is not covered by the indemnity. It now appears that the Laffoy commission may sit longer than the Flood tribunal, which will not be good for the victims. What are Ms Nolan's views on the worth of the procedure that was undertaken?

Will the Department of Finance officials provide access to the material that the Department of Education and Science has refused to release into the public domain? Do they have any other material that should be presented to the committee?

Two points have arisen on a recurrent basis. The first is that the information has not been made available regarding individual properties. Every member of the committee understands that the lead Department is the Department of Education and Science and any requests for information must be submitted to it. The Department of Finance has a subsidiary role. Negotiations are ongoing and given that property valuations are under consideration, the early release of information may compromise a successful conclusion to property transactions. I understand it has been made clear that at the conclusion of the negotiations, a full list of assets will be disclosed by the Department of Education and Science. We understood our role in this regard would be limited because we do not deal with the Department directly involved.

Second, according to exchanges on a priority question taken in the Dáil on 25 February 2003, the Minister for Finance advised Deputy Burton that the Government decided to proceed with the compensation scheme even if it had to meet 100% of the costs of the awards. The Department officials cannot be held accountable for a political decision made by the Government. The Minister for Finance indicated in the Dáil that the Government considered that these people in State care had been wronged and that if their cases went to court it is possible that the State would be found to be 100% liable. Rather than asking the victims to wait for court hearings and decisions on the allocation of awards, the Government decided to proceed with a compensation scheme even if no funds were to be provided by the religious institutions. It can be argued that the agreement to secure €128 million, subject to final clarification on the list of properties, is a potentially better arrangement than the Government having to fund all settlements and then possibly suing the religious institutions in the courts over many years with the possibility that no recovery would be made.

The point in dispute is not whether the Government was entitled to secure an agreement with the institutions or establish a redress board with full compensation. Everybody accepts it was entitled to reach such agreements, although it may be questioned if they were good ones. Having agreed a sum of €128 million, the question remains if assets will be realised to meet it.

There are other factors to be considered, including, for example, the question of the State being compensated for the historic cost in terms of building these schools. It is suggested that the properties in question constitute land available for use, when, in fact, they are encumbered with tenants who cannot be removed, such as schools, boards of management, trusts, hospital beds and such like. They are encumbered properties and no independent valuer would say they would yield taxpayers the kind of money envisaged.

The Government is entitled to make whatever deal it likes, although it may be criticised for doing so. However, there is a question of financial accountability in terms of demonstrating to taxpayers that they will get the money provided for under the agreement.

The Deputy chose not to highlight a most important aspect. If the State does not reach agreement on the property aspect there is a cash alternative. The institutions have already handed over €41 million, plus the other money managed by the NTMA. If there is no agreement on the valuation of properties, the State has the right to take cash. In view of this, the State is ultimately guaranteed the value of the agreement by way of a cash payment if the properties are not deemed to be suitable.

The agreement was signed on 5 June 2002. I am disappointed that in the intervening nine month period, the Department of Education and Science did not reach an agreement on the valuation of the properties in question. The officials dealing with it have been dilatory in their duty. They sought a two month extension last March, which was granted. The religious institutions have provided an alternative list of properties and the officials now have a further nine months to consider it. They are not acting with a proper sense of urgency. This matter could have been concluded within nine months, yet it will now possibly take one year and nine months. In the meantime property values are increasing. What valuation applies? Is it the value of the properties on the date of the agreement on 5 June 2002, or when ownership is ultimately transferred to the State?

The valuation date for all future transfers, in other words, the property that is to be transferred in the future, is 5 June 2002. For property that was previously transferred, that is, between the date of the Taoiseach's apology and 5 June, the valuation date is the date of transfer, which is the earlier date, rather than 5 June. If the property was transferred in 2000, for example, then the valuation date is the actual date of transfer.

I appreciate that. My point is I am critical of the officials who have taken so long. I recognise there are complications. It would not take this long to tie up a property deal in the private sector and agree on valuations. I would want the message from this committee to be that we are not satisfied that the State's investment has been properly protected by the long time taken on this relatively simple commercial transaction and I hope this matter will be brought to a conclusion promptly.

I am a member of a delegation meeting with the Minister for Health and Children at 4.30 p.m. and I apologise that I must leave the meeting.

Ms Nolan's opening remarks were quite correct but the effort of this committee to obtain information about how the deal is being implemented is also correct. That is our responsibility. This is a matter of public interest and we should continue to explore it.

To return to the questions I already asked on the lack of involvement of the Department of Finance in all of these meetings, the Department must be unhappy about it, particularly given that the Office of Public Works is part of that Department. It is beyond comprehension that the Office of Public Works did not have a major role in the properties concerned given that it would have purchased property in various places from religious orders for schools. Has that been explored? What properties were in the course of being purchased by the Department but are being put on hold because of the cost of land or the cost of the site? Has the Department of Finance numbered those? Are they a part of the properties currently being discussed? That is what I meant earlier by having an overall plan, understanding what is required in each county, trying to fulfil projects and trying to deal with different issues raised by communities and so forth. Has every county been examined and are we able to discuss with the religious orders satisfying the projects which local authorities or other Departments are trying to bring to fruition?

On the striking of figures or the presentation of figures, Ms Nolan stated that the final cost could be in the region of €250 million to €500 million. How was that figure arrived at by the Department of Education and Science? I would have thought that in arriving at figures or presenting figures, the Department of Finance would have been present providing an input and arriving at the final figure because the issue is now back with that Department.

A range of between €250 million and €500 million gives the Department plenty of scope and €500 million may not be the other end of it either. I cannot understand how the Department of Education and Science, without the involvement of the Department of Finance, was allowed to present that case and arrive at those figures. There is some basis for reaching one of the figures, but I do not understand how it arrived at those figures and then allowed that gap of €250 million to €500 million. I would have expected more detail and a greater explanation. From the comments in the paragraphs in Ms Nolan's opening statement, one would be forgiven for reaching the conclusion that the Department of Finance was stepping back ever so slightly from where the Department of Education and Science was about to take us.

The schools building unit is 100% involved in this. It is consulted on any property which has an educational value or all property owned by religious orders which the schools building unit wants - it works both ways. There has been a strong involvement of the schools building unit, which does these jobs for all buildings that the Department is acquiring, throughout the document.

As regards Department of Finance officials' involvement in the figures for the memorandum for Government, it would be normal practice for the outside Department to produce the figures for a memorandum for Government. That is what is done. If we disagreed with them or had any reason to think that they were inaccurate, we would of course comment on that and provide alternative figures to Government, as indeed has happened on a number of occasions.

In this case, I am very conscious that the range, €250 million to €500 million, is very broad and that, as Deputy McGuinness stated, there is no guarantee that it will be capped at €500 million. We have no way of knowing what the figure will be. We can make estimates but these are "broad stroke" estimates.

There are different types of estimates. Some estimates are based on very detailed figures, which one can be sure are in the ball park, and one can be sure that such estimates will not be far out. This is not such an estimate. It is quite clear, by putting such a broad range, that whoever is writing it does not have any real reason to know that it will fall inside, not outside, this area.

We in the Department of Finance would not second guess the Department of Education and Science on this one because we do not have any further information on which to base an estimate. I can do a technical calculation for the committee, but it will not give any more accurate information than that found in the current estimate because we do not know the number of claimants. Neither do we know the relative severity. There are some absolutely horrendous cases. Such an issue is awful because it is hard to say that any of the cases are less horrendous than others. However, there are less severe cases and the pay outs would be less in those cases. We have set up a redress board which has the expertise to assess that and there is no point in us trying to second guess that assessment. In effect, we have said whatever the redress board says needs to be paid, will be paid.

That makes the emphasis on the value of the properties and their after use value even more important because Ms Nolan has taken the lower figures in terms of the cap. I am not convinced that such an exercise is going on because we do not know the properties concerned. We do not know whether we will be lumbered with properties which will ultimately be of no value because of title, usage or whatever, and neither do we know whether we will get properties to which we will be able to add value in terms of social use. We literally do not know on either score, that is, the score of the figures on the value of the properties and their usage or, on the other end of it, the score of calculating exactly what will be paid out. Effectively this is open-ended on both counts. I am not convinced on either one side or the other.

I am sorry I cannot convince the Deputy, but I can assure him that every effort is being put into ensuring that we do get the full £100 million value from the property and that the committee will get a list, whenever the agreement is concluded, of all the properties and their valuations.

As the Chairman said, there is provision in the agreement for a cash alternative. I appreciate it would be great to finish it off quickly, but it is far more important that we get the value for the money or, if the properties are not acceptable, that we get the cash instead.

At previous meetings I have given my clear position on the arrangement that was agreed. I come from a different position to that of Deputies Bruton and Burton. I believe that society, through the mechanism of democratic government, has a moral obligation to provide for the sick, for the hungry and for the underprivileged in society, and I put into this category these human beings who have been abused by institutions employed by the State. As a Member of the Irish Parliament, I have a moral obligation to support what the Government did on this occasion.

Phrases like "poor value for the taxpayer", "value for money" and "cost to the taxpayer" were used here. We are not talking here about normal business. We are talking about human beings who have been traumatised for a long time. One cannot put it in business terms.

There is a misunderstanding.

May I finish?

The Senator should be allowed to finish.

I would like to clarify the matter because there is a misunderstanding of the context in which this issue is being debated.

I understand that the Deputy has every right to ask these questions. However, I believe the issue is being used as a political football. I do not apply normal business arrangements and language to this issue. The essential point about the deal reached with the religious orders is that the Government wanted to find a way to fast track this matter and not put these human beings through more trauma. The Government did not want to add to their suffering and felt it was right that they should be compensated for the trauma and delay without having to go to court.

The issue should not be a political football. I do not mean anything personal in saying that. I said it to Deputy Burton on the first occasion the committee discussed this issue. It is being used as a political football to attack the Government. It is only right that the Government, unlike its predecessors, recognises the widescale abuse that occurred in residential institutions which were under the supervision of the State. It is for this reason the Government and I stand over the agreement reached with the religious orders. The compensation scheme will help close a long and shameful chapter in this country's history by ensuring just and adequate compensation for those whom society clearly failed.

Some have tried to make an issue out of why the financial burden was not split evenly between the congregations and the State. The reason is that it was impossible to determine exactly the percentage breakdown of culpability, but in similar circumstances in Canada, the courts said that the state was 75% liable and the congregations 25%. Representatives of the Canadian Government came to Ireland to study our scheme and considered it fair. The view of the arrangement with the Conference of Religious in Ireland was that the contribution had to be meaningful but should not be so high as to destabilise the congregations and the schools through which they still make a huge contribution. From my information, a contribution of €128 million is meaningful, and it is worth noting that 18 congregations contributed to the scheme, even though many of them had no case to answer.

I do not feel any need to defend the Church, but the negotiations had to have regard to the enormous contribution made and which continues to be made by many religious congregations to the education system and the social services. This appears to have been lost in the debate on the disgraceful behaviour of a minority of their members.

That is all I have to say on the issue. I feel strongly that the State must take responsibility. I do not dispute that both Deputies have a right to ask questions, but they have gone overboard in using business terms in this issue which concerns human trauma. That is how I see it. I am present as a parliamentarian to assist those who are weak or vulnerable in society. The hospitals would not be in such a bad state were they still run by the nuns who, over the years, had very efficient systems and hospitals. They made a major contribution. I do not see myself as a defender of the Church, but I wanted to make a point. I object to the use by both Deputies of business terms for such serious trauma from which neither the sufferers nor their families will ever recover. Business terms cannot be applied to this.

The notion that some members have a higher moral view of the role of the committee or the State is highly objectionable in a committee that is trying to conduct its work in a fair way. To refer to Deputies speaking in heartless business terms about this issue is to try to introduce an element of dispute and political cheap-shot into a debate that we should hold at a different level.

The concerns I expressed and the questions I asked, as I made clear to the Senator when she made her intervention, did not relate to the Government's right to strike a deal. It has a right to do so and I know it took a great many issues into account. Neither did I dispute the legal advice. What members of this committee have a right to do is to ensure that, if someone enters into an agreement with the State to transfer moneys to the tune of €128 million, the value to that degree is obtained.

This is a contentious area and there is an expectation on the part of those who were hurt to have Deputies not only see that a redress board is in place but, if a deal is done, that those party to it make their contribution. The questions I ask do not come from a business background but from my dealings with individuals who have been hurt in this process and who want these questions asked.

The Deputy used that language.

That is my appreciation of what the victims want. They want these questions asked. They do not want the matter swept under the carpet and for us to say that these were great institutions. They were, the religious did tremendous work in this country and I do not denigrate it. That said, great harm was done to individuals and we have an obligation to pursue the way in which the State has struck this deal.

I resent the way in which the Senator has sought to undermine the basis on which questions are being asked by other members of the committee. It does not do its work any good. Committee members should refrain from such comment about each other. I do not seek to make such comments about others when they ask questions, as is their legitimate right. I wish to put that on record in response to what the Senator said.

I am entitled to my opinion.

I was responding to the Senator.

I did not say the Deputy was not entitled to his, but I believe we are here to represent those who are most vulnerable in society.

That is why I am——

In this case, I do not see value for money.

I am doing the very same. The Senator may take whatever view she likes about the way we conduct our business, but if she expresses it continually in the committee in such a manner, she will undermine the coherence of the committee and its ability to do its work.

There are many other issues to which the Deputy could put his slide rule.

I inform Senator White that, in my opinion, the deal is a bad one. It is a sweetheart deal entered into by the then Minister for Education and Science, Deputy Woods, on behalf of his friend, the Taoiseach, to get the religious off the hook. I have detailed knowledge of a number of the issues and institutions involved and do not share Senator White's rose-tinted view of what the religious orders and congregations did in Ireland's industrial schools and orphanages.

I never said that.

I know many members of the religious orders who properly deeply regret what happened in the Ireland of the time.

I agree with Senator White on one point. Our concern must be to allow those who spent some or large parts of their childhood in institutions and industrial schools some measure of recompense and make up through this deal for some of the education they missed. By and large they were starved, beaten and sent out snagging turnips and potatoes for the religious and were not in school. That is the reality. RTE will shortly repeat the series on the industrial schools. I am sure Senator White has probably seen it already, but she might take an opportunity to look at it again.

If I thought this deal was a good one for those who lived in those institutions, I would be happy to commend it. I am on record as saying that from the information I have regarding the processes from the Laffoy Commission to the redress board and from the reports I have from individuals who are attending those bodies, they are not psychologically enabling for people who have lived in institutions and industrial schools. I record again my deep disappointment that many of the religious orders have chosen a legal strategy in relation to the procedures which are under way. That is part of the problem, though it was their absolute right to do so.

To come back to today's issue, as Finance spokesperson for the Labour Party I am perfectly entitled to ask about the financial aspects of this deal and whether it represents a good deal for the State and, particularly, for those who lived in the institutions. I reiterate that right. Is the deal signed by Dr. Woods and subsequently the Government being delivered on in reality? It was a €127 million deal, with approximately €40 million in cash, which has been delivered, and the rest in property and services. Our questions today are whether or not those services and property are being delivered on.

I quote the Taoiseach from two weeks ago:

The church authorities will have to deliver on the deal. The amount of money involved was stipulated and the Minister for Education and Science has indicated the land he requires. The fact that he has not agreed to accept those offered to date is an indication that there are others which he prioritises and wants to get.

Even in terms of Drumcondra-speak I understand that to mean the church authorities have offered properties and for various reasons those properties are unacceptable. We are asking the civil servants from the Department of Finance, which has an overseeing role in relation to the Department of Education and Science in this regard, to elaborate on the Taoiseach's comments to the House on 17 June. The Taoiseach went on to say that the Minister for Education and Science had a register of church lands in which he was interested and that he had identified the church lands he and the Department wanted, while the State's position was that those sites must be delivered.

Deputy Richard Bruton and I are perfectly in order in carrying out our responsibilities on behalf of the Opposition and those who elected us in asking how this deal is being delivered. It is going to be important in the future. We do not want the State to get poor value because if it does, so will the people involved. Members will know that the expenditure lists of most Departments are being shredded by the expenditure unit of the Department of Finance, so bad value on this will carry on, not only to those who lived in these institutions, but through to other areas like health and education. If Senator White feels our language has been robust or technical, so be it. It is a technical issue and a tough one.

I have to leave so I am asking——

I want to put on record, in case there is any misunderstanding, that I do not see myself in any manner defending the Catholic church.

Deputy Bruton

That is not the issue.

I am letting the Deputy know. What I objected to was the cold-blooded business language on the arrangement when we are talking about human beings who have been traumatised. I told Deputy Burton three months ago that she was entitled to her opinion on this deal but so am I.

Can I get agreement that Deputy Nolan will chair the meeting? I must leave at this point.

Deputy M. J. Nolan took the Chair.

May I ask a final question? We have probably gone as far as we can today and I reiterate to the officials that I am disappointed we did not see a list of properties. Can the officials give us a timeframe in which they expect to have details of the properties? On 17 June the Taoiseach was explicit about many properties being involved. Going back to the questions we asked at the start, we have no idea of how many properties are involved or where they are. We have no idea beyond the comments today on how the properties will be evaluated. Perhaps we can arrange for the officials to come back in the autumn with a more detailed response. I would also appreciate an answer to my earlier question about how the contribution in services - educational and other services - is being delivered on. I know many people who had their education interrupted by living in institutions and industrial schools.

For the information of some of those present, I do not see these people as being victimised; many of them have lead very successful lives. What they want is some element of recompense. This deal will not change what happened in their lives but it may give them some recompense. If they have educational needs it may enable them to pursue what was interrupted when they were children many years ago in the tender care of the religious authorities.

Is it possible to get the information Deputy Burton wants?

I spoke earlier about the educational fund, which is €12.7 million and has been put aside. The Department of Education and Science expects to have that up and running by the autumn. It has an ad hoc committee at present and once this gets started it expects further adaptations to meet the needs of those with educational requirements. The second part is counselling, which is another €10 million, and is to be provided directly by the religious institutions——

On that point, that is a valuable amount for counselling. My understanding is that these people have been through difficult events, particularly those subjected to horrific abuse. Was there any consultation as to whether it was appropriate for the religious orders, whose members may have been those who committed the abuse, to be in such critical roles in providing this counselling?

My understanding is that the counselling is being provided entirely by lay people and not by the religious. The Comptroller and Auditor General is looking into the value of the counselling and how that can be evaluated as part of the legal agreement. Until he has completed his work I am not in a position——

Is there a date for completion of his work?

I do not have a date but I would not expect it to take a great length of time. It would not be normal for him to take very long.

Is the Comptroller and Auditor General's endorsement of the value central to the deal? Is it acknowledged in the deal that the Comptroller and Auditor General will have to be satisfied that value has been obtained for the various elements?

No, the Comptroller and Auditor General is not mentioned in the deal butnonetheless his comments on the deal will be important in terms——

Will he be looking over the property elements——

——and he will vet everything?

We would expect him to vet everything.

And make his views known in a timely fashion so that the Government can act?

Absolutely. The valuations on the property aspect are strictly laid down. The religious order can put up a valuation and the State can do so; I understand the Valuation Office is giving valuations of various properties. There is a provision in the agreement for it to go to binding arbitration if the two valuations are not identical. The binding arbitration mechanism has not yet been invoked, as far as I know. A valuation has been agreed in relation to all properties so far.

I thank Ms Ann Nolan and Mr. John Conlon for their attendance at this meeting. I also thank the members of the committee for their attendance. The consumer director of the IFSRA will be in attendance at the next meeting of the committee, on 9 July 2003.

The joint committee adjourned at 4.50 p.m. until 2 p.m. on Wednesday, 9 July 2003.