Charles Flanagan
Ceist:46 Deputy Charles Flanagan asked the Minister for Finance if he is satisfied with the performance of his Department; and if he plans any restructuring of the Department. [11605/10]
Amharc ar fhreagraWednesday, 10 March 2010
Ceisteanna (10)
Freagraí ó Béal (36 píosaí cainte)
My Department has already changed its organisational structure and its deployment of staff in response to recent events in the economy and the financial system. It has demonstrated considerable flexibility in dealing with these issues. I am satisfied with the performance of my Department, especially in light of the extraordinary demands placed on it in the period since I came to office. The Department has helped me to address some tremendous challenges during this period, as we sought to stabilise the country's finances, restore confidence in its banking system and ensure that the country can re-establish its competitiveness. There is a good deal more work to be done and I expect to be able to call on the resources of the Department and the resourcefulness and dedication of its staff in dealing with the rapidly changing environment. Organisational change and development should be a continuing process and I expect further changes in the organisation of the Department of Finance to take place as the need arises.
I read the high level statement of the Department, which sets its targets. These include a high performing public service, value for money, a regulatory structure that secures public confidence, an effectively functioning banking system and budgetary stability. If anyone sought a comprehensive statement of everything that has gone wrong in the past three or four years, it is available in that list. However, the annual output statement of the Department declares "delivered" beside each of these targets; that is to say, the Department has delivered a reformed public service, a regulatory structure with public confidence, budgetary stability and an effectively functioning banking system. Who is it fooling? These things have not been delivered. We must have a more realistic approach.
It has been widely speculated that a Department of public service reform will be established. Does the Minister support the establishment of such a body in view of the ineffectiveness in his Department in delivering public service reform?
As the Deputy is aware, that is a matter for which the Taoiseach is responsible to the House.
I wish to hear the Minister's view. We have a serious void in respect of public service reform and a serious economic strategy.
Several Deputies are offering to contribute.
I do not accept the existence of the void to which the Deputy referred. The public service reform agenda is central to the work of my Department. The way in which it will be managed in the future has been discussed between the Taoiseach and me, but it is a matter for the Taoiseach, as leader of the Government, to make final decisions on this matter and I will not pre-empt those. I should say though that the current position is public service change management is shared between the Department of the Taoiseach and the Department of Finance.
On economic strategy——
Is it working?
——I entirely rebut the suggestion that there is no economic strategy in my Department. The consensus of international commentary in recent months demonstrates clearly that there is in operation a very definite strategy that has commanded considerable confidence and support outside this country. What we must do is translate that confidence and support in Ireland that is manifesting itself so strongly outside the country in recent weeks into confidence and faith in ourselves.
How many economists and persons with technical professional qualifications in banking and in accountancy work in the Department? Why has such a large chunk of his Department's responsibilities been effectively outsourced to the NTMA? The NTMA, which has a good record, cannot take responsibility for the entire running of the country.
People feel the performance of the Department of Finance has been underwhelming in the context of the crisis. Is this to do with the type of personnel? How many qualified economists and qualified accountants are there in the Department?
I indicated in my written reply of 19 January last that of the 560.78 whole-time equivalent staff at my Department at the end of 2009, there were 57 officers who held degrees in economics and related disciplines, 44 who hold a master's-graduate qualification in economics and related disciplines, and two who hold a PhD.
Specifically in the banking area, the Department retained two banking experts — one through direct employment and one through an existing private sector exchange arrangement — to supplement on an in-house basis the external expert advisory services retained on my behalf. The Department also has an in-house legal expert on loan from the Office of the Attorney General. These arrangements are important and are kept under review.
I call Deputy O'Donnell.
I do not accept a suggestion that the performance of my Department is underwhelming. I want to put on the record of the House my acknowledgement of the long hours spent by many senior officers of my Department in tackling the problems. Deputy Burton has been given many opportunities to brief herself by my officials on various aspects of our economic problems. As she will be aware, I am not permitted to know the content of any such discussions. Certainly, there have been many official briefings of the Opposition parties on matters which arose.
I call Deputy O'Donnell.
This is a charge against civil servants in the House and I am entitled to deal with it.
The Minister dealt with it rather well. I call Deputy O'Donnell.
The Minister——
I called Deputy O'Donnell.
——did not state whether there was a senior professional accountant in his Department.
On the same matter——
Is there?
I can get that data for Deputy Burton.
I call Deputy O'Donnell.
There does not seem to be.
Deputies will wait until they are called.
It is fair comment, if one looks back over the past number of years, that the Department's figures have been way off target. If that occurred in the normal business world questions would be asked.
On the same theme, how many new staff with specific master's degrees in economics, accountancy or tax specialties has the Minister, Deputy Brian Lenihan, taken on since he came into office? Does the Department have the requisite skills within it to deal with the current financial crisis? It is fair comment that last year we received no tax revenue targets until April. This year we are running significantly behind.
Deputy O'Donnell is imparting information rather than seeking it.
First, I must get the information sought by the Deputies. Qualification is an ongoing process in any Department, although I would have doubts about the capacity of the senior persons in the Department of Finance to undergo further qualification and study at present given the volume of business that they must transact. There is ongoing education and training in any Department, and especially in the Department of Finance.
Regarding the NTMA, I wanted to reply to Deputy Burton. I am sure the Leas-Cheann Comhairle will not object to me dealing with it because it is an important question. The deputy secretary general who had charge of the banking crisis became the Secretary General of the Department, as Deputies will be aware, and at that stage I deemed it appropriate that the assistance of the NTMA should be available to the Department in direct negotiations with the financial institutions. I felt it important that this should be done. In fact, the relevant legal documentation has not yet been executed, but in practice there is a protocol and the negotiations with the different guaranteed institutions are conducted by the NTMA with my Department.
May I ask a final supplementary question?
Briefly.
The Minister states that the economic strategy is perfect. Is he stating that the regulatory failures have nothing to do with the Department? Is he stating that the collapse of competitiveness in this economy has nothing to do with the Department? Has the zero progress on public service reform nothing to do with the Department? These matters are core to an effective economic strategy. Against that background, how can the Minister pretend that there is an adequate economic strategy?
A brief final reply.
There has been a great deal of public service reform in the past year and a half, and very difficult decisions had to be taken by the Government on the core issue of remuneration in the public service.
That is the only change, which was a command and control change. It was not reform.
The Government looked after the higher paid.
Let Deputies not anticipate the next question.
It was a fundamental and difficult change. Indeed, it is the change that has excited international approval because it is seen as a Government clearly in command. That is the most important message that Ireland must send out at present.
We are holding an inquiry into banking, and no doubt we will have an inquiry into other matters. The scope of that inquiry will give ample time to look back and see where there were failings in the system. I am not standing up here denying that there were failures in the past, but if there were failures, they were failures of a similar type to those which took place in many other countries as well. What I can speak of is the response that was required by the Department to those failures. The response was swift and the quality of advice I received on an appropriate response to the crisis that emerged was sound.