As a member of the Joint Committee on Commercial State-Sponsored Bodies I welcome the extension of the terms of reference to common issues relating to a number of areas of concern to these bodies. The commercial State-sponsored bodies which are the subject of examination by the committee are owned by the State, controlled by the Government and, should they incur losses, the taxpayer carries the can. Therefore it is only right and proper that an Oireachtas Committee should examine these bodies to try to ensure that they are run efficiently and in the best interest of the State and, of course, the taxpayer. I would stress at this stage that our work is not a witch hunt. It is an objective assessment of these bodies in order to ensure that they do a better job where improvement is necessary.
Senator Dooge, on behalf of the Minister, made a comprehensive speech and covered a considerable amount of ground, including board responsibility. There was reference in his speech to the question of the objectives of these bodies. It is vital that the objectives of State-sponsored bodies be clarified and reviewed at regular intervals. In our report on Irish Shipping Ltd. we recommended that the objectives of State-sponsored bodies be reviewed every three years and that such reviews be included in the annual reports. It is of key importance obviously to clarify what business these bodies are in. In the case of Irish Shipping it was founded to meet the strategic tonnage required in war time conditions. But it drifted a long way from that. On the question of objectives, I would raise the question as to whether Irish Shipping should have been in long term charters at all. A State-owned body founded with the central objective of meeting the strategic tonnage required in war time conditions was latterly heavily engaged in transporting goods between foreign ports. The original objective we were told in evidence, was not reviewed for 21 years. Yet when Irish Shipping were liquidated the Irish taxpayer picked up the tab. The review of objectives is vital. We have recommended it in the Irish Shipping report for general application. I am pleased to see it in the Minister's opening speech.
I now want to refer to the question of the appointment of directors to the boards of these bodies. They are political appointments. In most instances the appointees have given sterling service. I want to make a plea to all political parties that only the best qualified people should be appointed to these boards in terms of their skills and their expertise. If we are going to attract the best people to these boards we have to do two things. We have to appeal to their sense of public service and we have to pay them. The Minister refers to the modest remuneration. Something should be done about that. Many are serving on these boards for a net sum of £300 a year. Obviously that is entirely inadequate and in no way matches the demands placed on them by these boards.
On the question of control of State-sponsored bodies, I worked for seven years in two of these bodies before I joined the staff of UCD. I would be the first to defend their right of control over day to day matters. But when substantial policy changes are made, or substantial capital expenditure is incurred, then there is an obvious obligation on these State-sponsored bodies to inform the relevant Departments.
There have been over-runs on capital expenditure which have been referred to in the Minister's speech. The joint committee have reported on OIE and Irish Shipping Ltd. In the case of OIE, there was a sixfold overrun in what turned out to be a disastrous investment decision — the hotel in Belfast. Six times the sum approved by the relevant Department was actually spent on that. Obviously there is a need for tightening up on capital expenditure. The board of OIE should have been on the alert and reported to the Department. But equally the Department should have been on the alert to ensure that they were getting relevant information quickly. There are then two sides to the control problem.
Again, in the case of Irish Shipping Ltd. there was a substantial increase in long term charters at the wrong time. The board did not inform the relevant Department of these particular decisions which proved disastrous — I use the term used by the Minister for Communications last year in connection with these charters.
I mentioned earlier the question of balance between, one the one hand, bureaucratic interference, which may stifle the operation of these bodies and, on the other hand, accountability to the shareholders and ultimately to the public and the taxpayer. This is a difficult balance to achieve. If the measures in the Minister's speech are implemented, then there should be progress in achieving that particular balance. Let me return to the question of expertise. The Minister has highlighted the importance of appointing people with appropriate expertise to State bodies. My concern is that if these well qualified boards put forward proposals to the relevant Department is the staffing and expertise present in the Civil Service to evaluate these proposals? Perhaps the Minister will pick up that question in reply.
It is all very well to appoint better qualified people to the boards of State-sponsored bodies who in turn are expected to report to the relevant Departments so that their proposals and performance can be evaluated. But it is absolutely essential that the relevant expertise be available in the Government Departments properly to appraise and evaluate the proposals and results put to them. Civil servants, for the most part, are highly competent people. Some of the proposals put forward by these State bodies are highly technical and highly complicated. Unless something is done either by training civil servants or employing consultants to evaluate the proposals, it is too much to expect, given the Civil Service pattern of experience that we have had in the past, to cope with——
