SELECT COMMITTEE ON FINANCE AND THE PUBLIC SERVICE díospóireacht -
Wednesday, 30 Nov 2005

Estimates for Public Services 2005.

Vote 13 — Office of the Chief State Solicitor (Supplementary).

Chairman

The two items on the agenda are consideration of double taxation relief orders and the Supplementary Estimate for the Office of the Chief State Solicitor. With the committee's permission, I will change the sequence and deal, first, with the Supplementary Estimate for the Office of the Chief State Solicitor because the Government Chief Whip, Deputy Kitt, must return promptly to the Dáil. The Minister of State at the Department of Finance, Deputy Parlon, will attend the committee within half an hour approximately. If we complete our consideration of the first issue before then, we will take a five minute sos. If we have not finished, the Minister of State, Deputy Parlon, may wait for our consideration of the double taxation relief orders.

Yesterday, 29 November, the Dáil ordered that a Supplementary Estimate for Vote 13, the Office of the Chief State Solicitor, be referred to the committee for consideration. I thank the Minister of State at the Department of the Taoiseach, Deputy Kitt, for attending and for providing us with briefing material, which has been circulated. Before we proceed, I suggest that we have a short opening statement from the Minister of State. We shall then call on members, starting with the Fine Gael spokesman, Deputy Bruton, and continuing with the spokespersons for the Labour Party, the Technical Group and Fianna Fáil, to contribute.

Minister of State at the Department of the Taoiseach (Mr. Kitt)

I thank the committee for allowing me to present for its consideration a Supplementary Estimate for Vote 13 — Office of the Chief State Solicitor. The Office of the Chief State Solicitor seeks approval for a Supplementary Estimate for 2005 of €2 million. This relates to additional expenditure on payment of fees to counsel in subhead B, where overall additional funding of €6.95 million is required to meet unanticipated additional commitments. The CSSO has managed to absorb most of this additional cost, due to savings of €4.95 million elsewhere within the Vote. The requested Supplementary Estimate is to address the balance, which cannot be met from within the original allocation. This excess has arisen due to a high level of expenditure on payment of fees to counsel engaged in cases in which the State is involved. This can be attributed to the fact that in recent years there has been an increase in the State's litigation caseload and in the complexity and length of case. These factors impact significantly on the cost of counsel.

The State operates in a very litigious environment and sources or volume of new litigation can be difficult to predict. The State's law offices endeavour to maintain the capability to respond to major litigation taken against the State and to deal with it appropriately. For example, caseloads in some areas have increased rapidly in the past three years and there have been a number of high profile cases that have attracted fees that correspond to their complexity.

It is difficult for the Office of the Chief State Solicitor to predict the level of expenditure on this subhead, given that it is a demand-led service over which the office has limited control. However, the office makes every effort to monitor and keep expenditure down and to mark down fees submitted by counsel to appropriate rates. Procedures in use for the sanctioning of fees in any specific case include a process of seeking Department of Finance approval for those in excess of €9,500. The cost of the Supplementary Estimate will be financed through savings made elsewhere in the same Vote.

I commend the Supplementary Estimate to the committee. The amount of money involved, €2 million, is relatively small, so I hope we can deal with this matter as quickly as possible.

Mr. Bruton

The statement by the Minister of State is very brief in explaining why this overrun has occurred. He has not mentioned any particular case, the complexity of which has contributed to the overrun.

Generally speaking, our attitude to spending on legal costs is one of accepting them as a fact of life. I am not satisfied that the degree of scrutiny by the State of the necessity and level of legal costs is sufficient. The Government increased tribunal counsel fees by approximately 75% at a time when the dogs in the streets knew we were creating tribunal millionaires. That did not smack of a value for money approach being adopted by those involved, either in the Office of the Attorney General or, ultimately, in the Department of Finance, which sanctioned the increases. The Department belatedly stated that there would be an entirely new regime for tribunals. However, we are informed that this will not be in place until after most of the current tribunals have completed their work. It seems to be a case of "Make me virtuous, Lord, but not yet".

Will the Minister of State indicate what has been the increase in the overall legal bill to the State during the past five years? What principles of value for money are applied? What tests of performance does the Minister of State demand to see that, as taxpayers, we will not be ripped off by excessive legal costs or excessive challenging of litigation? We discovered from the Personal Injuries Assessment Board that it is possible to successfully cut out a raft of legal costs from insurance. The State Claims Agency is beginning to take a more aggressive approach to claims but we need to take a hard-nosed look at these legal costs, which continue to arise, and to try to be more frugal with the taxpayer's euro in respect of them. I will await the Minister of State's reply but I suspect that if everything is totted up, including the legal services of the DPP, the Attorney General and the Office of the Chief State Solicitor, along with the charges imposed people who work for them on contract, it will become apparent that legal costs to the State have mushroomed out of all recognition during the past three or four years.

There must come a time, though probably not today, to put some sort of framework of evaluation into this area of burgeoning cost to see if we can introduce more sensible approaches to the commissioning of legal advice, to the way cases are handled, towards less legalistic ways of resolving issues of dispute and towards inserting into contracts clauses that would prevent litigation emerging from them. We need to be much more conscious in this area. I would be interested to hear what initiatives the Government plans.

Caoimhghín Ó Caoláin

I welcome the Minister of State and the officials from the Office of the Chief State Solicitor.

The Minister of State referred to unanticipated additional commitments. He attributed these commitments to the fact that in recent years there has been has been an increase in the State's litigation caseload and in the complexity and length of case. If that has been the case for a number of years, which is apparent, why could we not have anticipated a more realistic reflection of what was necessary in order to cover fees to counsel?

The Minister of State said that a figure of only €2 million is involved and, thereby, sought to dull the impact of the request. In reality, we are talking about an underestimate of 84% for the current year with regard to fees to counsel. Instead of a provision for €8.25 million, there will be an anticipated expenditure of €15.2 million over the 12-month period. That is a colossal increase and we need to place it in focus. It is commendable that €4.95 million has been clawed back from a raft of different subheads in the Estimate for the Office of the Chief State Solicitor. However, in this area, which is one of great public concern, there has been an underestimate of 84% in fees paid to counsel. This requires a more detailed explanation than that presented by the Minister of State. What examples, as Deputy Bruton asked, can the Minister of State give to substantiate the claim being made? What has given rise to such a colossal increase in anticipated fees to counsel in the current year? What is the anticipation now for 2006? Is it reflected in the Book of Estimates?

The point has already been made regarding the extension of time for the higher fees to be paid to legal representatives involved in tribunals. We had anticipated the lower rate being introduced next January. That has been deferred until June by the Taoiseach's recent pronouncements. There has been a very unsatisfactory response from the Taoiseach to questioning from Opposition Deputies on the matter. It is not, however, only Opposition voices which have expressed concern. Voices are representative and reflective of public concern at the wheeling out of barrows of public moneys to legal representatives who seem to be able to put their hands in the clouds and draw down whatever figures suits their whims at a given time.

I find this an incredible request. It warrants, with all due respect to the Minister of State, a much more detailed accounting to the committee and to wider public. I do not accept the notion of unanticipated additional commitments when it is stated almost in the same breath that in recent years there has been an increase in the State's litigation caseload, complexity and length of case. There has been an incredible increase which this year has reached unprecedented proportions. I ask the Minister of State to explain properly what is at issue and to offer the detail of the cases in question. To whom are these moneys to be directed? Who are the benefiting counsel for whom we have made so great an underestimate in the current year? Is it expected this is the sort of figure we will face in future years? We need the detail. The importance of the matter requires the Minister of State to be much more fulsome in his approach to the committee this morning.

Ms C. Murphy

To what extent does the Office of the Chief State Solicitor advise against taking cases where there is a question mark over whether political responsibility has been taken for services? Year after year there is case after case involving parents who seek to secure appropriate educational provision for their children. I received a reply to a parliamentary question relating to 2003 and 2004 which told me that on one side it cost approximately €10 million to defend 24 cases, the minor element of which involved settlements. All parents were seeking in those cases was speech or language therapy or appropriate educational provision for their children. Despite its political responsibility to deliver on those services, the Government defends itself in the courts to avoid establishing precedents of an entitlement to provision.

The €10 million the Government spent over two years represented significantly more than is spent in the entire eastern region on children in the autistic spectrum. I am aware of cases before the courts currently, such as the high-profile one earlier this year involving Lewis O'Carolan and in which the State, rightly, picked up the legal fees. Given the National Council for Special Education has a lead-in time of six years to provide services, I put down a marker that there will be a great many more cases taken unless there is an acceleration of provision. Quite a number of children who achieved primary school places will be soon queuing at secondary school for the same level of services provision, but there will be no political requirement to meet their needs for six years. Inevitably, cases will end up in the courts. Parents will no longer stand back in an economy we are told is the envy of the world and allow their children to go without appropriate education. In consequence of the putting aside of political responsibility, litigation has been brought. The Chief State Solicitor should advise the Government that it has a political responsibility to which it must live up. We will pay the price for it one way or the other. I would prefer to see the €2 million being invested in services rather than going into the pockets of senior counsel. I have focused on this issue because I have a clear understanding of it and know that responsibility for it has been shirked. The money should be spent on services, not legal fees.

Mr. N. O’Keeffe

I welcome the Minister of State, Deputy Kitt, and his officials. Having listened to the Opposition crying and screaming, one would think the country was bankrupt. We are living in a period when the economy is expanding, which places more and more demands on the legal system in terms of conveyancing and general services. This is very expensive work and the legal profession has done a good job. By and large, there is an overrun in any business. For example, one can have an overrun in the household budget. For the Opposition parties to lecture us on overruns is too much when one considers there were numerous overruns when they were in office. The Office of the Chief State Solicitor is working efficiently and a shortfall of a mere €2 million is very little when one considers the demands on the office, with tribunals, decentralisation and bringing cases to finality. I congratulate the Minister of State on a job well done and for bringing forward the Supplementary Estimate.

Mr. Kitt

I thank Deputy O'Keeffe for his encouraging remarks. I do not want to minimise the figure of €2 million which is a substantial sum of money. However, the point I was making was in the context of savings of €4.95 million as a result of good management by the Office of the Chief State Solicitor. I agree with Deputy O'Keeffe that the office has managed its finances well.

I will respond to the points raised by Deputies Bruton and Ó Caoláin. The fees are below market level. Society is now more complex, with a growing economy and population. We cannot always anticipate what cases will come up. Some involved emergency application to the court. One does not know the number of cases that will come up down the line. I cannot comment on individual cases but the number of judicial reviews has increased. There has been a 100% increase in asylum cases in the past three years. All of these issues are very relevant to what we are discussing today.

I cannot go into the specifics of the education case but I give Deputy Murphy a commitment to convey the points she made to the Minister for Education and Science.

I thank members for raising these issues. As I mentioned, procedures are in place for sanctioning fees in specific cases. Staff must seek approval from the Department of Finance for fees in excess of €9,500. The Office of the Chief State Solicitor is well run. However, one cannot always predict what is coming down the line. Therefore, approval is being sought for an additional €2 million.

Mr. Bruton

The Minister of State ought to provide members with more detailed information, rather than the casual reference to the number of asylum cases being up 100%. It makes little of the work of the select committee if proper briefing material that compares the anticipated flow of work with the actual flow of work is not provided. We would expect something more than what we are getting from the Minister of State, which is just a casual reference.

Mr. Kitt

I would be more than happy to do that. I may be rushing to some extent, since I am conscious I must move on to other work. I apologise for that.

Mr. Bruton

It should be documented.

Mr. Kitt

I am more than happy to provide the Deputy with figures I have here regarding the specific asylum section, judicial reviews, the number of habeas corpus cases and the number of non-asylum judicial review cases. I am happy to share any of those figures with members and expand on what I have said.

Caoimhghín Ó Caoláin

I appreciate the Minister of State is willing to furnish the Deputy with those details as soon as possible. That is the very least we should expect.

I am, however, disappointed at the tone of the Minister of State's replies to Deputies Bruton, Catherine Murphy and, in particular, me. With all due respect, it seemed very patronising. The Minister of State did not reply in any substantive fashion to the questions we posed and the concerns we highlighted. He rounded off by thanking us for taking the time. He is in a hurry to move on, as we all are.

This issue is very important, and the Minister of State has not given us a substantive response to the questions we raised seeking justification for the approval of an 84% increase in fees to counsel in the current year. He has not given us an account of how the serious underestimate occurred, particularly given that he has mentioned the pattern of recent years. That pattern should clearly inform decisions, but the Minister of State has not stated the provision for 2006. Will we see a perpetuation of levels such as €15.2 million compared with €8.25 million anticipated in the current year? None of those questions has been answered, and the very cursory way in which the Minister of State has addressed the matter is unsatisfactory. I do not appreciate it at all.

This committee and its role as scrutineer must be respected and met. Ultimately, it is a very shoddy way to do business and does not meet the standard the general public should expect of a Select Committee on Finance and the Public Service regarding such a massive increase in this area, which I regard as very sensitive. Much public disquiet has been already clearly expressed regarding fees to counsel — legal representative fees. It is not something we can rubber-stamp at the pleasure of the Chief State Solicitor's Office or the Ministers. We would be failing in our responsibility if we did not highlight those concerns and question properly. The questions I and others posed have not been answered, and I voice my strong disappointment in that regard. Before us we do not have enough information to justify a mere nod of the head to this proposition, and I will not accredit it.

Ms Burton

I apologise for my late arrival, but I was caught up in a very bad traffic jam on my way.

Regarding the volume of litigation mentioned in the note and the fact that Irish society is now very litigious, one thing that has always intrigued me, including during my experience as a Minister of State, is that there seems to be absolutely no inherent controls on senior members of the public service such as Secretaries General when they decide to take a course of action that at some point may involve such litigation. Other parts of Departments' Estimates and budgets are capped regarding expenditure. In this year's Book of Estimates there is provision for anywhere from 5% to 7% under spending headings. However, the legal fees area is a little like the holy mysteries. Nobody is allowed to know whether a Department's budget in regard to legal fees is set in the same manner as other budgets. Can a Secretary General embark on a course of action in the belief that some administrative act that is being contested will eventually be all right because the Department has the State's power on its side? In the end, however, matters often do not work out as planned and there are horrendous costs.

What, if any, structures exist in regard to the oversight of legal fees? Does the State allow Secretaries General to enter into legal actions in respect of which there is effectively no upper limit in terms of the ultimate cost? In many cases, it might be as wise to settle or change the administrative course or decision in order to avoid a legal contest. However, many Secretaries General act like the proverbial hard men and decide that the legal route is fine because the State is there to fund the legal case as required.

I wish to pose a question in regard to the various elements of litigation and so on arising from inquiries such as those conducted by the redress board and the investigation into the incidence of clerical child abuse in Ferns and those forthcoming in Dublin and other dioceses. What, if any, is the relationship of the Office of the Chief State Solicitor with litigation of this sort? Are there ancillary or preliminary actions, cases or legal advices which arise? Is there any oversight of the likely costs? The Ferns inquiry has so far cost some €2.4 million. A large proportion of that figure came about as a result of the legal fees imposed.

In terms of the Office of the Chief State Solicitor, is there any attempt to seek value for money in regard to legal advice? The Minister, Deputy McDowell, set a high level in respect of fees for barristers. It is often the case that a significant number of counsel must be taken on for inquiries such as those I mentioned. Is there any value for money guideline adopted in respect of how the State purchases legal services? Is there any form of competition in regard to price and is any search done in respect of seeking value for money?

Mr. Kitt

A number of questions were asked. The first point made by Deputy Burton related to Secretaries General. It is the Minister who takes legal action. There are guidelines——

Ms Burton

It is not my experience that it is the Minister who takes legal action. Very few Ministers initiate such action; it is almost always initiated on the advice of the most senior civil servants. I do not believe that a Minister wakes up in the morning and decides to go after a particular nasty piece of work. It is the Secretary General and the senior civil servants who advise the Minister and who often drive him or her to take legal advice, particularly when the political view might well be that a matter should be settled without recourse to the courts.

Mr. Kitt

The Minister would be attached to the initiation of legal action by his or her Department. There are guidelines in place in such situations which are overseen by the Attorney General and the Minister for Finance.

Ms Burton

Is a monetary cap imposed on each Department in regard to the level of legal services that can be purchased in one year and how much can be spent on litigation?

Mr. Kitt

Although I do not have the exact figures with me, the vast majority of cases under consideration involve litigation taken against the State. The Department of Finance monitors the situation closely.

I stated earlier that the Department of Finance is obliged to approve fees in excess of €9,500. With regard to the Ferns inquiry and that proposed for the Dublin diocese, the Office of the Chief State Solicitor is not involved, although it would be involved in ordinary litigation against the State. I understand that the Department of Justice, Equality and Law Reform is involved with the Ferns inquiry.

There is an ongoing review with regard to value for money in terms of whether the Office of the Chief State Solicitor is getting good advice.

Ms Burton

Is there a table of cases won and lost and the costs involved? Every other area of activity in the public service has benchmarks, guidelines and some indication of a sense of value for money.

Mr. Kitt

I understand that the Office of the Chief State Solicitor is developing a benchmarking process.

Ms Burton

What sort of process?

Mr. Kitt

With regard to any questions raised, I will forward details on precisely how some of these processes are working.

Ms Burton

May I ask one constituency-related question?

Chairman

That is not relevant.

Ms Burton

This applies to the constituencies of many Deputies. In my constituency, Dublin West, we have a rapidly developing situation in that we do not have school sites, which are reserved by the country council. These sites must be purchased from developers, who will have had the areas involved rezoned. The Chairman is probably familiar with this issue.

A site for the proposed second level school in the Castaheany-Littlepace-Ongar area of Dublin 15, has not been acquired by the Department of Education and Science in two and a half years since final discussions on this matter were apparently entered into. The houses in the area were built approximately seven or eight years ago, so the school has been promised for much longer. The situation in which we have become embroiled is similar to that involving Jarndyce and Jarndyce in Bleak House and a site for the school has still not been chosen. The absence of a second level school has serious implications for the people involved, while the Minister of State apparently goes about giving the names of the committee members as the people who have the paperwork. Is it that recalcitrant developers will not provide title or that they make it difficult for the Minister of State to examine and confirm title? I accept that the passage of property is very complicated and that the Department of Justice, Equality and Law Reform must do a proper job. However, there is no secondary school in the area in question and the Minister of State’s office is being blamed for that locally.

Mr. Kitt

I assure the Deputy that I will have a reply on this issue. I appreciate that there may be implications for the local authority but I do not know the specific details.

Ms Burton

This is a common issue. Surely the Office of the Chief State Solicitor is aware of this problem in various areas throughout the country?

Mr. Kitt

The Chief State Solicitor is with me and I will ask him to revert to the Deputy on this matter.

Chairman

He may revert to the Deputy through the committee. We indicated that we were going to proceed to another topic.

Mr. N. O’Keeffe

The first paragraph of the Minister of State's briefing note states clearly that CSSO staff are involved in the provision of conveyancing, property law and general services. Everyone knows that conveyancing takes time, that titles involve technical matters and that this country inherited a certain system and must work through a variety of landlord systems, etc. I come from a small town in east Cork where in the past there were landlords whose estates went elsewhere and were willed to different organisations. Long conveyancing delays have resulted. I have seen issues of conveyancing and title taking two years to be resolved. I am somewhat surprised, therefore, that Deputy Burton would have a difficulty in this area, which, as a Member of the Houses, she should understand.

Chairman

I am concluding the discussion on this topic. The information and details requested by members will be circulated through the committee and immediately forwarded to them. May we publish the Minister of State's opening statement?

Mr. Kitt

Yes.

Chairman

As we have now completed our consideration of the Supplementary Estimate, the Clerk will send a message to that effect to the Clerk of the Dáil, in accordance with Standing Order No. 85. Under Standing Order No. 84(2), that message will be deemed to be reported to the committee. We will now suspend the sitting until the Minister of State, Deputy Parlon, arrives.

Caoimghín Ó Caoláin

I do not know whether this amounts to a motion, but I record my dissent. I do not dissent on the basis that I wish to see the Office of the Chief State Solicitor tripped up in its work, but in protest at the fact that the committee has not been given the full information necessary to make an informed decision. This state of affairs is discourteous to the committee. The issue is far too important, while the sum of money involved is considerable.

Ms C. Murphy

I attach my name to the list of whose who dissent.

Chairman

I am governed by Standing Orders. Members should note that we are not here to make a decision. While we are discussing the issue, the decision will be made in the Dáil when the matter reverts to the Chamber. It will then be a matter for Deputies to agree or disagree on the Estimate.

Mr. Bruton

As Chairman, you should demand that those who come here to discuss Estimates or Supplementary Estimates provide briefing material which meets the standard we have a right to expect. I have no doubt that the information is available and that this meeting was seen as a casual affair. The truth is that proper Estimates are also seen as a casual affair when we come to discuss them in June. This is ground we have been over umpteen times. The Chairman should make it clear to anyone attending the committee to discuss Estimates that we expect proper information which will allow us to make proper decisions.

Chairman

We agree. I understand the Minister will refer specifically to that issue in the Budget Statement, as has been indicated. The Committee of Public Accounts recently issued a report on the way in which committees should properly consider Estimates. Everybody here agrees the process is completely lacking. We will await the Minister's response on budget day and in advance of any discussion on the Estimates next year discuss the type of information we need. We are all aware of the shortcomings of the process.

After the suspension, we will discuss the double taxation agreements with the Minister of State, Deputy Parlon.