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MIONTUAIRISC NA FINNEACHTA(Minutes of Evidence)Déardaoin, 25adh Abrán, 1940.Thursday, 25th April, 1940.The Committee sat at 11 a.m.
Seóirse Mag Craith (Ard-Reachtaire Cunntas agus Ciste), Mr. C. S. Almond and Mr. F. J. Feeney (Roinn Airgeadais) called and examined.Deputy O’Rourke.—In the absence of the Chairman, I propose that Deputy McMenamin take the Chair. Deputy Hughes.—I second. Deputy McMenamin took the Chair. VOTE 39—PUBLIC RECORD OFFICE.Mr. J. F. Morrissey called and examined.410. Chairman.—There is no note in connection with this Vote, but I think that last year questions were asked about the report of the office. Have you made any advance with it?—A lot has been done but it has not been finally completed. It covers a number of years. The witness withdrew. VOTE 67—EXTERNAL AFFAIRS.Mr. J. P. Walshe called and examined.411. Chairman.—On sub-head A 5, I note that expenditure on official entertainment was considerably in excess of the Vote?—There were several items during that year for which we could not have made provision. We had three fairly large items in connection with the entertainment of new Ministers by reason of the sudden changing and departure of Ministers. 412. It was rather a severe year for them?—It was a hard year, yes. 413. How do you manage excess expenditure? Do you go to the Department of Finance?—We generally manage out of our savings on the rest of the Vote. It is only very rarely that the excess is anything like that. As a rule, we keep very well within the Estimate. 414. When you exceeded the £650 grant, what did you do?—We asked the Department of Finance for sanction. 415. And you got it?—Yes. 416. Deputy Hughes.—Does £650 represent the average amount spent?—Yes, that is the average figure over the preceding three years. 417. Has that amount been appreciating over a period of years?—I do not think so. The £650 is the average over a period of years. 418. Chairman.—With regard to sub-head A 7 in connection with the expenses of withdrawal of volunteers of Irish nationality from Spain, there was a Supplementary Vote for £400—Yes. 419. Subhead A 9 is a contribution towards the expenses of the International Commission for the Assistance of Child Refugees in Spain. How was that money contributed, or to whom was it contributed?—To the special International Committee set up at Geneva. 420. Was this a Committee set up by the various Governments?—Twenty Governments contributed to it. 421. Subhead A 10 is a Supplementary Vote of £150 for the promotion of cultural relations with other countries. What has that reference to?—That really relates to only one item—the visit of a professor of the National University to the United States where he gave a series of lectures, mainly on Irish folklore. 422. Deputy Hughes.—With regard to subhead B 5—Repatriation of Destitute Irish persons—how are these people repatriated? Who makes representations? —Generally, the individuals concerned apply to the nearest Irish representative on the Continent and he refers to us. It is generally the subject of correspondence for some time. We have to examine all the details of the case before we finally accept the position and then the person must be destitute. 423. Are we prepared to repatriate anyone who is destitute?—No, not everywhere. The general principle we adopt— it must be a rather loose principle in practice—is that where there is a large Irish colony and where there are institutions, committees or social organisations looking after destitute members of the colony, we do not repatriate them. It is generally a case of complete isolation. For instance, we occasionally have cases of Irish governesses who have become very old and have lost their jobs in France, Germany or Austria. 424. Deputy O’Loghlen.—Do you maintain contact with them subsequent to repatriation?—We try to. 425. Have you ever recovered any of the advances?—We sometimes recover part and sometimes none. 426. Deputy Hughes.—What usually happens when they are repatriated and arrive back? What becomes of them?— They pass out of our hands. 427. Into the hands of some local authority?—We would let the Local Government and Public Health Department know if it was a really bad case. Sometimes they are supported by relatives. Relatives who would be too poor to send them money to come home might keep them. We always follow them up for a little while. VOTE 68—LEAGUE OF NATIONS.Mr. J. P. Walshe further examined.428. Chairman.—With regard to sub-head A—Contribution towards the Expenses of the League of Nations—is this now coming to an end, Mr. Walshe? —I do not think so. 429. Does the League of Nations still exist?—It still exists. 430. I understand there is an International Labour Bureau attached to the League of Nations?—That is quite true. The witness withdrew. VOTE 22—STATIONERY AND PRINTING.Mr. J. B. Whelehan called and examined.431. Deputy Cole.—In connection with subhead F 1—Printing, Paper and Binding for the Oireachtas—have you any idea what it costs to print the postcards we get so frequently—the postcards that are always printed in Irish?—Straight off, I have not. It would all depend upon what the particular card was and the number of cards printed. 432. They are all more or less the same —so far as the majority of Deputies are concerned, they are all the same?—The printing cost of postcards, where very large numbers are printed, would be very small indeed. In the case of printed postcards, it is more economic to have what I might term omnibus printing done rather than to have various cards typed, unless the occasion demands otherwise. 433. Would it not be well to print them in English as well as in Irish?—That is a matter in regard to which, I am afraid, I should not express an opinion. 434. Chairman.—You are not responsible for policy—you have to go elsewhere for that? 435. Deputy O Briain.—And it is a matter of opinion in which probably there would be a preponderating weight of opinion in favour of the printing in Irish? —It would, doubtless, provide material for quite an interesting discussion. 436. The position has advanced so far with regard to Irish that there are very few people who would not be able to find out very easily the contents of the card, even if they were not able to read the Irish themselves?—Quite so. 437. Deputy O’Rourke.—Perhaps it is a good thing that some of them do not know what is on the cards? 438. Chairman.—On that subhead, F 1, I observe that you had a saving of £1,942 2s. 4d. That seems a considerable sum?—Yes, that was in 1939. In that year the Dáil was dissolved and consequently there was less expenditure. 439. There was a benefit to the Exchequer?—Not exactly, because you will find there was probably more expended subsequently under the Central Fund. But there was considerable saving on the Dáil Debates and printing generally for a period of three weeks. 440. Deputy O’Rourke.—It would be a good thing to repeat?—That, also, is a matter of opinion. The Committee will observe that the same applies to subhead F.2. 441. Chairman.—Does the same reason apply there?—We expected the Seanad would be established earlier than it was. It did not begin to function until September of that year. There was very little expenditure, possibly only half of what we anticipated. 442. Deputy Brasier.—On subhead F 4 —Editing, Printing, Paper and Binding for certain Irish Texts—what were those Irish texts?—These are rather advanced text books on which a committee, composed largely of University and literary people, are working. They are text books for advanced students of Irish. The printing and publication of these books are financed by the Government. In a great many cases the compilers or editors work without any remuneration whatsoever. In some cases gratuities or ex gratia payments are made to the editors. 443. Deputy O’Loghlen.—What are the special reasons why the full grant was not expended?—It all depends on the amount of work coming in. 444. Chairman.—It depends on the work you do?—Yes. You cannot always induce them to give you the work to date. Sometimes when they get proofs, the text is of such a nature that it requires considerable revision and it is held up perhaps for months. 445. With regard to subhead F 7— Publication of Irish Translation of the New Testament—have they got anywhere with that yet?—There again we are completely in the hands of the editor. We are not making any payment until the proofs are actually passed by the diocesan censor. 446. You mean the theological censor? —Yes. We want some kind of finality about the work. 447. Deputy Hughes.—What becomes of these amounts that are not expended— are they surrendered and asked for in the following year?—They are surrendered and, when we require the moneys again, they are asked for. 448. Chairman.—In the case of sub-head H—Printing—is that related to outside printing?—That represents the printing for the various Departments of State. 449. Printing that you do?—Printing that we get done outside. We have no printing press in the Stationery Office; all the work is done under contract. 450. You are responsible for the price and you see that you get value for your money in that Department?—Yes. 451. Have you a staff of expert printers to see that you get value for your money? It is just like every other thing; if you do not know how to price an article, advantage may be taken of that fact?—We have a technical staff, and the members of it look after that end of the business. The technical staff, I should say, more than pays for itself. 452. This is the type of business in which it is necessary to have expert advice?—Yes. We had extraordinary experiences in the first years of Saorstát Eireann. We got various accounts in. One figure that stuck in my mind was for £340 odd, and we subsequently paid the firm £73 when the account was gone over from a technical point of view. There are various operations connected with printing. Our printing schedules give detailed prices for each printing operation, and we check up against the price outlined in the schedule. 453. With regard to subhead L—Books and Maps—are these maps geographical or Ordnance Survey maps?—That refers to the various types of maps for the public service. 454. Do you do the Ordnance Survey maps?—Oh, no; the Ordnance Survey Department do those maps. We purchase from them, and we also act as sales agents. 455. The maps offered for sale are bought from the Ordnance Survey Department?—Yes. The witness withdrew. VOTE 43—DUNDRUM ASYLUM.Dr. G. W. Scroope called and examined.456. Deputy Hughes.—There is sub-head I for £320 for the garden and farm. Is that an annual item?—Yes. 457. Does it mean that you incur a loss on the garden and farm of that amount in the year?—No. Mr. McGrath.—You will note at the end of the page sub-head J—Appropriations in Aid. That £877 2s. 4d. has been realised from the farm and garden. 458. Deputy Hughes.—What is the extent of the farm and garden?—The garden is about 12 acres. The whole building including the farm and gardens will come to about 33 acres. 459. You provide your own labour?— Yes. 460. Do you have to pay for labour or do you provide it from the inmates?— From the inmates who are well enough to work. They work the farm. 461. How do you use the farm?—We grow vegetables, potatoes, cabbage, parsnips, cauliflowers and so on. 462. You produce your own vegetables? —Yes, we produce our own vegetables and we supply the patients and the staff with what we produce. We sell on the market any surplus vegetables we have. 463. I take it you set that down at the market price?—Yes. 464. You produce your own milk?—No, we have no cows; the only live stock we have on the farm are pigs. 465. Chairman.—How are the pigs paying you?—Fairly well. The witness withdrew. VOTE 40—CHARITABLE DONATIONS AND BEQUESTS.Mr. W Smyth, called and examined.466. Chairman.—What is subhead C for, that is Travelling and Incidental Expenses—do you send some officials to the country?—This £27 11s. 9d. was mainly expenses incurred on telephones, telegrams and other incidental expenses. These things are grouped. There is provision made for the travelling of officers to give evidence in respect of prosecutions against people who do not comply with the requirements of the Commisisoners. 467. Under subhead D—Appropriations in Aid, there is set down £47 14s. 8d. What is that for?—We have an Embezzlement Charity Fund which was started many years ago. That fund was started with the object of covering the cost of the Commissioners undertaking prosecutions against persons who withhold or misapply charitable funds or in any other way contravene any of the Acts governing the Commissioner’s duties. We surrender that. At the present time if we incur any expenses in connection with prosecutions and our solicitor has expenses that are not payable out of the Charity Fund we have to submit a claim to the Department of Finance for payment out of subhead B —Law Costs. 468. Do you ask the Attorney-General or the Department to institute these proceedings or do you do it at the instigation of your own solicitor?—These are prosecutions instigated by the order of the Commissioners. 469. And carried through by your own solicitor?—Yes. 470. With regard to item subhead B— Law Costs—has this item of £17 15s. 8d. arisen out of the realisation of £47 14s. 8d.?—Well, I think subhead B would be charges that would be passed by the Finance Department at the end of the year when a claim is made and taxed. These costs are always taxed. 471. You ask for a Vote for Law Costs and you get the grant voted?—Yes, a nominal sum, hoping it will not be exceeded. VOTE 63—POSTS AND TELEGRAPHS.Mr. P. S. O’Hegarty called and examined.472. Chairman.—There is a note by the Comptroller and Auditor-General which reads:— “Subhead C—Rent, Office Fittings, etc. “74. The charge to this subhead includes a sum of £500, being the ground rent of a site acquired for Post Office purposes. The site in question was leased to the Agricultural Credit Corporation by the local authority in 1932 and, following negotiations for the acquisition by the Department of Posts and Telegraphs of portion of the premises to be erected, arrangements were concluded by which the Department accepted a transfer of the Agricultural Credit Corporation’s interest. These arrangements provided for the reimbursement of the Corporation’s outgoings in respect of the costs of acquisition, rent, rates, etc., and for the erection of a building to accommodate both a new branch post office and the Corporation. The latter undertook, by letter dated 23rd March, 1936, to enter into a lease of part of the premises at an exclusive rent of £1,450 per annum, subject to the building being ready for occupation within two years. The Corporation subsequently withdrew from the arrangement on the ground that the building could not be completed by March, 1938. Payment of £5,200, which included £1,500 for three years’ ground rent to September, 1935, was made by the Department as consideration for the transfer of the Corporation’s interest and the assignment was executed in June, 1937, when it must have been reasonably clear that the premises could not be available by the date originally anticipated. Further, the assignment did not contain any provision for the completion of the building by a specified date. In these circumstances I inquired whether any claim was made against the Corporation for refund of any part of the consideration money, and I was informed that the position had been fully reported to the Minister for Finance, who had agreed to the unconditional release of the Corporation from their agreement. I was also informed that in view of the existing emergency, and the need for curtailment of expenditure, building operations are being deferred, and that the local authority has been approached for further extension of the period for rebuilding. The total expenditure, to the 31st March, 1939, in respect of the acquisition and occupation of the site was £5,956 11s. 11d., which included £1,086 1s. 6d. for Architects’ fees, etc. As the original plans were drawn to provide accommodation for the Agricultural Credit Corporation, their revision will be necessary.” Mr. McGrath.—In the third paragraph there I have to make a correction. That should read: “Payment of £5,200, which included £2,250 for four and a half years’ ground rent to March, 1937.” 473. Chairman.—Perhaps Mr. McGrath will give the Committee a statement explaining this matter? Mr. McGrath.—As will be seen by paragraph 74, the Agricultural Credit Corporation was the lessee, or principal, in the original lease dated 25th March, 1932. 474. Chairman.—From the local authority? Mr. McGrath.—Yes, from the Dublin Corporation. 475. Deputy Hughes.—Where is the site? Mr. McGrath.—In St. Andrew Street, Dublin. A covenant in the lease provided that the new building was to be erected by September, 1935. 476. Chairman.—Erected by the Agricultural Credit Corporation? Mr. McGrath.—Yes, and this covenant was not carried out. The covenant is in the original lease. In May, 1934, a proposal that the Department of Posts and Telegraphs should acquire the site and rent accommodation to the Agricultural Credit Corporation was made. 477. Chairman.—What kind of a proposal was it? Mr. McGrath.—There were varied proposals on the matter, being worked out by correspondence. Certain proposals were put up by the Department of Posts and Telegraphs. That was the state of affairs that prevailed up to the 15th June, 1935, when the Department of Finance approved of certain definite arrangements. Amongst these arrangements was one that the Department of Posts and Telegraphs should become the principal, and grant a lease for 21 years to the Agricultural Credit Corporation for portion of the building at £1,450 per annum, exclusive of rates and taxes. 478. Deputy Hughes.—You stated earlier, Mr. McGrath, that the Agricultural Credit Corporation agreed by letter dated 23rd March, 1936. to enter into this agreement provided the building was ready for occupation within two years, and further down you say that there was no mention of that condition in the assignment at all. Mr. McGrath.—I am merely stating the facts. On the 23rd March, 1936, the Agricultural Credit Corporation undertook to enter into a lease on the condition that I have already quoted, namely, that the Department of Posts and Telegraphs should grant a lease for 21 years to the Agricultural Credit Corporation for portion of the building at £1,450 per annum, exclusive of rates and taxes. On the 17th November, 1936, the Dublin Borough Council—I make a distinction between the Dublin Corporation and the Dublin Borough Council in order to avoid confusion with the name of the Agricultural Credit Corporation—approved of the transfer, and extended the rebuilding period to the 31st March, 1939. In May, 1937, the Department of Posts and Telegraphs refunded to the Agricultural Credit Corporation the amount expended by the latter to date. I ask the members of the Committee to remember that the Agricultural Credit Corporation was spending money on this site up to this period. They had actually spent £4,002 18s. 5d. and they handed over a bill for which they were liable for professional fees for £1,199 9s. 6d. which the Department of Posts and Telegraphs paid, which makes up the sum of £5,202 7s. 11d. The assignment was executed in July, 1937—that is the assignment from the Agricultural Credit Corporation to the Department of Posts and Telegraphs. On the 15th November, 1937, when the money had been paid over for six months, the Agricultural Credit Corporation withdrew from the arrangement as the building could not be ready by March, 1938. On the 27th May, 1938, the Department of Finance agreed to release the Agricultural Credit Corporation. My point is that the Department of Posts and Telegraphs entered into this matter in the beginning really as a subsidiary, the Agricultural Credit Corporation having entered into it as a principal. After a number of years the Agricultural Credit Corporation transferred their responsibility to the Department of Posts and Telegraphs on the condition that the Agricultural Credit Corporation would become a tenant of the Department of Posts and Telegraphs for the sum of £1,450 a year, which made a considerable difference as regards the future liability of the Department of Posts and Telegraphs, but as I have said, the Agricultural Credit Corporation eventually withdrew completely and got clean out without any payment whatever. 479. Deputy O’Rourke.—They made a nice escape all right? Mr. McGrath.—That is the reason why this matter is brought before the Public Accounts Committee. The Department of Finance seem to be satisfied to release the Agricultural Credit Corporation, but it is my business, when I come across a matter like this, to ask the reason why. The Department of Finance have seen fit to do that. That is their own business. But, at the same time, when I am told that the Department of Finance have agreed to release them, I think that I, as representing the Dáil, in examining this matter should be given a little more detail. 480. Deputy O’Rourke.—A question arises, of course, as to whether the Department of Finance obtained legal opinion about this? Deputy O Briain.—The contention of the Comptroller and Auditor-General appears to be that this was a good thing for the Agricultural Credit Corporation. Chairman.—He does not state that. Mr. O’Hegarty.—May I make a general statement on the matter? This thing goes back over a great number of years. It is very complicated and detailed and gave a great deal of trouble. It goes back to 1932. The origin of it may be described briefly in this way: that for a great many years the accommodation in the post office in College Green has not been fully adequate. There is no means of extending that building. There could be no question of rebuilding it, because the cost would be prohibitive. We had been on the lookout for suitable premises for a very long time. About the period I speak of we discovered that these premises in St. Andrew Street were on the market. We then found that the Agricultural Credit Corporation had got a lease of the site from the Dublin Corporation. We ascertained that the Agricultural Credit Corporation would not require the whole of any building to be erected on that site, and that they might be disposed to let us the ground floor of it for a post office. We opened up negotiations with the Agricultural Credit Corporation. At first they asked us to pay a rent of £2,250 a year. We refused to pay that rent, as we considered it too high. They were to erect the whole building and to lay out the ground floor according to our specification, but, as I have said, we thought that the rent they asked was too high. However, negotiations continued. A proposal was then made that we should pay an annual rent of £500 a year and be responsible for the cost of erecting the post office portion of the premises. Subsequent to that arrangement being agreed to, the Agricultural Credit Corporation withdrew from it. They cancelled the arrangement, and also cancelled their previous offer of £2,250 a year. Following that, there were further discussions in which the Agricultural Credit Corporation offered to transfer the whole site to us, to let us put up any building we liked, and in any way we liked, and to let them portion of it for their own business, and for the business of the Industrial Trust Company which was then in being. That was agreed to. 481. Chairman.—When was that? Mr. O’Hegarty.—In 1934. It was agreed that the Agricultural Credit Corporation should pay to us £1,450 a year— £850 to be paid by the Agricultural Credit Corporation and £600 by the Industrial Trust Company. Then the Industrial Trust Company withdrew from the arrangement, and as the Agricultural Credit Corporation were left on their own there had to be fresh negotiations. That brought matters down to the final arrangement which was agreed to. 482. Deputy O Briain.—The final arrangement was sanctioned by the Department of Finance?—Yes. Then there was this reference in their letter of March, 1936, to the provision of the building within two years. You see the assignment following on that was not completed until July, 1937, and there was no mention at all in the assignment of this condition. The Post Office never regarded this condition as capable of fulfilment. 483. Chairman.—What condition?— About building in two years, because, of course, the Board of Works had never put up a building of that magnitude in two years. It would not be possible to do it. When the assignment was agreed to by both parties without this condition, we regarded the condition as having no further application. They then withdrew finally in November, 1937, from the arrangement, because the building could not be ready. At that time we were anxious ourselves to get the whole building because we can use it easily for Post Office needs. We did not raise any strong objection to their withdrawing from the arrangement. The top floor of the building will be used for a trunk exchange, and the lower floor for a post office. 484. Deputy O Briain.—Has the building been constructed?—It has not, but the plans are in train. I might also say that, when the assignment was finally completed in July 1937, we would have proceeded at that time with the building, but the proceedings were held up by the building strike. By the time the strike was over, the Agricultural Credit Corporation had withdrawn, and the whole thing had to be recast again. 485. Deputy Hughes.—Were the plans drawn up before they withdrew?—I do not know. I do not think they were completed. They had them in hands. 486. Was there any provision in the plans for accommodation for the Agricultural Credit Corporation?—There was. 487. Chairman.—Mr. McGrath wishes to know would you not have to change the original plans?—Yes. 488. Chairman.—How much did the Agricultural Credit Corporation pay for the site?—£500 a year is the ground rent. 489. Had you that figure before you? —Yes. 490. When the Post Office took it over, did you submit that to a valuer to see whether it was worth £500 per year? —Of course the Board of Works always look after that. 491. Did they?—Yes. 492. Have you a record of that?—They always do it. I cannot specifically say that I have a record of it, but they always do it. 493. Assuming I gave £1,000 for a site to-day and I find to-morrow that I have been caught and I go to somebody else to get him to believe that it is value for the money when in fact it is not?—No scheme of this sort ever goes to the Department of Finance without a Board of Works’ valuation. 494. Mr. Cole.—Was not that £500 a year a fixed sum?—Yes, it was the ground rent. 495. Chairman.—Was there not a crux between the borough council and the Agricultural Credit Corporation as to the value?—I do not know how they fixed it. That was the rent. We did not come into it until after the ground rent was fixed. 496. You undertook to take it over at a yearly rent of £500?—Yes, finally. 497. Had you any advice from anybody as to whether the site was value for £500 a year—The Board of Works, of course, vetted the proposal before it went to the Department of Finance. 498. Have we that?—I cannot say specifically, but it is always done, and I am sure it was done in this case. The Department of Finance would not expend a penny without the Board of Works examining it. Mr. Feeney tells me that it was. 499. Chairman.—Was there an expert opinion got that the site was worth £500 a year. 500. Deputy Keyes.—Arising out of the report of the Comptroller and Auditor-General, I suggest that the point before the Committee is the reason which actuated the Department of Finance to give authority for the releasing of the Agricultural Credit Corporation from all liability. I think the Department to answer that is the Department of Finance. 501. Chairman.—Can we have that? Mr. Feeney.—The main point in the comment in the Comptroller and Auditor-General’s report is the releasing of the Agricultural Credit Corporation. But, before coming to that, certain preliminary observations are necessary, I think, in order that there may be a grip got of what undoubtedly was a complicated question. As stated by Mr. O’Hegarty, the Department of Posts and Telegraphs required central premises in the College Green area. If they had to extend and renovate the existing premises in College Green, it would be a very costly operation, much more costly than the operation which will ensure as the result of the acquisition by the State of the St. Andrew Street site. The Agricultural Credit Corporation is a concern in which the State owns the majority of the share capital. In view of the vital interests of the State in the Agricultural Credit Corporation, there was only a very slight distinction between the position of that corporation and a Government department in the matter. If a Government department had been concerned in the first instance, no question whatever would arise of seeking a refund of any portion of the money given as a consideration for the transfer of the site to the Department of Posts and Telegraphs. In this connection it has to be appreciated that the State paid the Agricultural Credit Corporation no more than the Corporation’s outgoings. If the State had acquired this site in the first instance, the State would have had to expend the same amount of money that was actually paid to the Agricultural Credit Corporation. The Agricultural Credit Corporation did not seek to make any profit whatever on the transaction. When the buildings are erected on the St. Andrew Street site, so far as it is possible for any human being to visualise at present the Post Office will require the whole of this building for Post Office purposes. If—and there is a very big “if” about it—there should be anything to spare over the Post Office requirements, there is no doubt, I think, that in that locality it can be let without very much difficulty. The Agricultural Credit Corporation is a semi-State institution in which the State has a vital interest, and a rental of £1,450 would be a very heavy charge on the Agricultural Credit Corporation. 502. Chairman.—That is the rent?— Yes. The Minister for Finance, having taken into very careful consideration all the circumstances of the case, and after all the necessary inquiries had been made and advice obtained from the experts in the Board of Works on the points that you mentioned, Mr. Chairman, as to whether the site was value for £500 a year rental or not, and being satisfied upon all the points, came to the conclusion that no charge should be made against the Agricultural Credit Corporation for release from the undertaking. Moreover, it should be observed that in the final result, if this were to be pressed between the State on the one hand and this semi-State institution on the other, the only way in which it could ultimately be resolved, if the Agricultural Credit Corporation held out, as they were perfectly entitled to do in the circumstances, would be by recourse to the courts. That might be a much more expensive operation; and certainly would involve either the State or the semi-State institution in costs, and the result might not by any means be as satisfactory as was obtained by the ordinary way of negotiation. 503. Deputy Cole.—The correspondence seems to have been going on since 1932? —Correspondence in matters of this kind is always prolonged, and must necessarily be prolonged, because so many people have to be consulted. As you may have observed from Mr. O’Hegarty’s statement, there were four parties really interested —the Industrial Trust Company, the Agricultural Credit Corporation, the Department of Posts and Telegraphs, and the Department of Finance—neither of the two Departments of State making any move without consultation with the Board of Works. 504. Are the premises empty, or how are they held since 1932?—It is a site on which a building is to be erected. 505. It is vacant since 1932?—The year in which the State came into possession of the site was, I think, 1937. 506. It is costing the State £500 a year since that?—It is, as it has worked out. The fact that the site is vacant so long, and that the building has not been proceeded with, has not been due to circumstances within the control of the State. As Mr. O’Hegarty pointed out, it has been due, first of all, to the building strike which occurred at the time when we were in a position to go on. Then the emergency arose and, for reasons which have been explained, the building is not being proceded with at the moment. 507. Chairman.—That was in 1937?— Yes. 508. How long did the strike last— three months?—I could not tell you; it was a prolonged strike. Deputy Keyes—Six months. 509. Deputy Hughes.—The Agricultural Credit Corporation was liable for a portion of the architect’s fees when there were special plans and specifications got out providing offices for them. Mr. O’Hegarty has stated that the plans and specifications had to be changed. Mr. Feeney.—They had, because of the necessary alterations. 510. Do you not think that the Agricultural Credit Corporation should be held liable for the fees involved in that? —One particular item in this could not have been taken out and considered by itself. The whole circumstances surrounding this were taken into consideration. 511. Was there a contract for the building entered into?—The contract was never placed. 512. Even yet?—So far as I know. The concluding part of the observations of the Comptroller and Auditor-General explains that. In the emergency it is not proposed to proceed at present. 513. Chairman.—Was there not a clause in the lease that the Agricultural Credit Corporation were to take a part of the building at a rent of £1,450 a year. Was there a penalty clause in the deed if they refused to carry out their contract under that clause?—I would say that there was not, from the observations of Mr. O’Hegarty. 514. Deputy O’Loghlen.—(To Mr. McGrath) Any obligation that would rest on the Agricultural Credit Corporation is entirely dependent on the interpretation to be placed on the letter of 23rd March, 1936. In the opinion of the Comptroller and Auditor-General, did the fulfilment or non-fulfilment of the condition set out in that letter release the Corporation from any obligation to become tenants subsequently, or did it not? Mr. McGrath.—I do not understand the question. 515. Deputy O’Loghlen.—The Corporation wrote in March, 1936, agreeing to take up the tenancy of portion of the premises at a rent of £1,450 per annum, subject to the condition that the premises were ready for occupation within two years afterwards, which meant 1938. Mr. McGrath.—My opinion is that the Agricultural Credit Corporation, when it made the condition, knew that it could not be carried out. 516. Deputy O’Loghlen.—Will your opinion override the documents in existence containing a certain condition? Mr. McGrath.—I am giving my opinion. 517. Deputy O’Loghlen.—It turns on that. 518. Deputy Hughes.—Would not the assignment override that? Mr. McGrath.—I must draw the Committee’s attention to the fact that the Department of Finance sanctioned this with certain conditions, one condition being that the Department was to grant a lease for 21 years to the Agricultural Credit Corporation of portion of the buildings at a rent of £1,450 per annum. That condition was not carried out. Mr. Feeney.—What was the date? Mr. McGrath.—When the Agricultural Credit Corporation undertook to enter into a lease they knew that the condition that was made could not be carried out. I can, I believe, prove that also from Mr. O’Hegarty’s file. Mr. Feeney.—It is true that a communication was issued from the Department of Finance, but it is of importance to note the date, 15th June, 1935, and it dealt with a position that was entirely different from that on which the decision of the Minister for Finance was ultimately taken. 519. Deputy O Briain.—If that agreement with the Agricultural Credit Corporation was not come to, the Post Office would have to be erected at some other site? Mr. Feeney.—Undoubtedly. In that particular quarter of the city it is extremely difficult to get any suitable site at all for a post office, and if you were to get an ideal site, which this is, in the neighbourhood of the existing office, you would have to pay considerably more than was paid for the site obtained. 520. Chairman.—What strikes me about it is that under the agreement you gave sanction to the key clause. The Corporation undertook to take part of the building at £1,450 per annum and got out of that undertaking without any penalty. The Comptroller and Auditor-General says that he can prove from the file that at the date the Agricultural Credit Corporation entered into the agreement they knew quite well that if the building was not erected in two years they were safe, and could ignore that clause. They knew the building could not be erected in that time. Mr. Feeney.—I think the observations of the Comptroller and Auditor-General show that it was by the letter—not by the agreement—of March 23rd, 1936, that the Agricultural Credit Corporation said they would do a certain thing. The agreement did not contain a clause binding them to that at all. The Comptroller and Auditor-General’s opinion—and I attach importance, to the word “opinion” in view of what was said earlier—would not serve in the courts. It is on the documents the matter would be determined. In the last resort the Corporation will only have to pay anything as a result of legal proceedings. 521. Chairman.—Why did you give your sanction by letter, because you were dealing with real property? Should there not have been an agreement signed by the Corporation that they would enter into this arrangement on certain conditions? There should have been a lease between the Corporation and the Department and that should be incorporated in a deed. Mr. Feeney.—What I am interested in is the attitude of the Department of Finance in releasing the Corporation from making any contribution towards release from the obligation that they entered into in the letter dated March 23rd. 522. Chairman.—The way I look upon it is that the Corporation was sitting on a safe thing all the time. They knew when they did that, that there was no legal document binding them to pay and by that they got away. This is a semi-state body. I think you will admit that it is a completely autonomous body. Mr. Feeney.—If I may say so with respect, it is not in the same position as a private individual or an institution. The State owns the majority of the share capital of the Corporation. There was a close relationship and only a shade of difference as between the Post Office and say the Department of Industry and Commerce in the transaction. 523. Chairman.—Assuming I was interested in some industry, and that the Government advanced money which would amount to a substantial part of my capital, would not the Department of Finance be as deeply involved as the Government is in this case? My point is that this is an autonomous body, and from the clause they felt they were sitting pretty safe, and not legally tied up in any way. It looks as if they got “a quick one.” 524. Deputy Keyes.—The transaction originated in 1932 with an undertaking by the Post Office to provide offices, and now in 1940 we have the matter before us with a continuing loss to the State. This Committee is inquiring from the Post Office and from the Department of Finance the reasons for the loss. It appears that an elephant was bought and that it was transferred without cost to the Corporation, notwithstanding the fact that it is a semi-State body. We should get a memorandum from the Department of Finance showing the reasons that actuated them in having this continuing loss? Mr. McGrath.—That is exactly the point at issue. Mr. Feeney has almost said that it did not matter which body paid the loss, the Agricultural Credit Corporation or the Post Office, but this Committee is concerned with a loss of £500 a year for eight years. A rent of £500 per year was paid for eight years for an empty site. Mr. Feeney.—I think that is an interpretation of my statement that I would not consider reasonable. I would be prepared to rely on the notes as to whether that is a reasonable interpretation or not. Mr. McGrath.—The interpretation of Mr. Feeney’s statement, as far as I am concerned, was that as the Agricultural Credit Corporation was a semi-State organisation, the question whether the Post Office or the Agricultural Credit Corporation was to pay for this transaction and for the loss incurred was a minor matter. Mr. Feeney.—I did not say that. Mr. McGrath.—That was the interpretation I put on it. Mr. Feeney.—I did not say that. I do not think it is a fair interpretation of what I said. 525. Deputy O Briain.—What I gathered from Mr. Feeney’s statement was that this post office was required by the Department of Posts and Telegraphs, and even if they got the site originally, that the expenditure would be necessary in any case to prepare it for the erection of the building, and that the Department of Finance took that view when they sanctioned the arrangement. Mr. Feeney.—That is a much fairer interpretation than the other one. 526. Deputy Keyes.—This Committee would be bound to inquire into the reasons that actuated the Department of Finance in this matter. Mr. Feeney.—The Agricultural Credit Corporation at the time might have taken the view that they would have to pay £500 per annum for this site, and that if another party wanted it badly, then they would have to be paid more before they parted with it. The Corporation made no profit whatever. It was a site we would have taken at first if we got the opportunity of taking it. 527. Deputy Hughes.—That does not defend the decision to leave it there derelict for eight years. Mr. Feeney.—This is a long-drawn-out business. We have had it only for two years and can only be held to blame, if there is any blame at all, for two years— certainly not for eight years. 528. Deputy Hughes.—Did they discharge their liabilities for the other six years? Mr. Feeney.—We did, but that would not enable us to antedate building operations before we got the site. 529. Deputy Brasier.—Did the Agricultural Credit Corporation pay £500 for five years? Mr. Feeney.—Yes, they had to pay the Dublin Corporation. In the sum paid to the Agricultural Credit Corporation there is money which the State would have had to pay, because it included payments made in respect of the actual cost of clearance of the site. 530. Deputy Cole.—The State was at a loss of £500 a year? Mr. Feeney.—I would not use the word “loss” in that sense at all. 531. Deputy Cole.—Nothing was done with it. Mr. Feeney.—Assuming that we got this site direct from the Dublin Corporation in 1937, when we got it from the Agricultural Credit Corporation, we would be in the same position now. 532. Deputy Cole.—If you were dealing with an individual who bought this place in 1932, what would happen? Mr. Feeney.—We did not get it in 1932. That is where there appears to be a misunderstanding. 533. Deputy Cole.—The Agricultural Credit Corporation did. Mr. Feeney.—We were not there to deal with it then. 534. Deputy Brasier.—Am I to understand that it was regarded as a retainer that the ordinary builder gets? Deputy Hughes.—In other words, it means that the site as far as the Department was concerned was worth the cost, plus the accumulated rent? Mr. Feeney.—From our point of view it was a valuable acquisition, having regard to the position. 535. Deputy Brasier.—And it was necessary to acquire it before anyone else did so? Mr. Feeney.—Quite so. If we did not take it, someone else would have done so, and we would then have to pay more for a suitable site for College Green Post Office. It is only a matter of a short time that the College Post Office can be operated in the present premises. Deputy O’Rourke.—What will be done with the present College Green Post Office when the other one is operating? Mr. Feeney.—It is held on a lease. 536. Deputy O’Rourke.—I take it that you regarded the site as being valuable when it was bought? Mr. Feeney.—Certainly. 537. Deputy Hughes.—(To Mr. O’Hegarty) Three years have elapsed and why was nothing done about erecting the building since? Mr. O’Hegarty.—The assignment was completed in July, 1937. We could not begin to deal with the site until we had the assignment. In November, 1937, the Agricultural Credit Corporation withdrew from the thing altogether. 538. Deputy Hughes.—And then you had to instruct your architect to change the plans. Mr. O’Hegarty.—We had to consider what we would do with the building. The plans had to be changed and we had to get authority from the Department of Finance for the withdrawal of the Corporation. We got that authority in May, 1938 and then we had to consider new plans and conditions. I may say that we were very glad to get the whole of the building. 539. Deputy Hughes.—That was two years ago. Mr. O’Hegarty.—That is all the information I have. We were not free to give the site under new conditions until May, 1938. 540. Chairman.—Were any steps taken to get tenders? Mr. O’Hegarty.—No. The plans will have to be revised to accommodate the post office on the ground floor and trunk telephones on the upper floor. The plans are dependent on the Board of Works. For the last couple of years the Board of Works has had more important buildings than this one on hands. It is always a slow matter to get out plans. 541. Chairman.—You will send a memorandum* to the Committee, Mr. Feeney? I understand the Committee would prefer a memorandum giving the reasons justifying the passing of this transaction. Mr. Feeney.—Certainly. 542. Chairman.—There is a note by the Comptroller and Auditor-General at paragraph 75. “Losses by Default, etc. “The losses borne on the Vote for the year ended 31st March, 1939, amounted to £1,230 9s. 2d., of which £1,228 19s. 9d. was charged to subhead H. 2. and £1 9s. 5d. to subhead O. 6. Classified schedules of these losses are set out at pages 210 and 214. At pages 212 and 214 particulars are given of 22 cases in which cash shortages or misappropriations amounting to £891 7s. 11d. were discovered; the sums in question were made good and no charge to public funds was necessary. In addition to the losses noted in the account, Official Arbitration Stamps, valued at £480, were found to be missing from the Department’s main stock and are believed to have been inadvertently destroyed. The value of the missing stamps has been written-off with the sanction of the Minister for Finance.” Chairman.—I presume you took some steps to see that these stamps could not get back? Mr. O’Hegarty.—Yes, the colour was changed and a watch was kept to see if any of them were used. None of them have been used. It is practically certain that they got into the wastepaper baskets and were burnt. 543. Chairman.—There is a note by the Comptroller and Auditor-General at paragraph 76. “Special subhead PP.—Annuities under the Telegraph Acts, 1892 to 1921. “Provision was made at subhead P to meet deficiences due to the withholding of sums by the British Government in connection with certain disputed claims, but consequent upon the Financial Agreement concluded with Great Britain in April, 1938, no such sums were withheld, and, accordingly, no charge fell on that subhead. It was agreed, however, prior to the Financial Agreement, that the British claim in respect of outstanding annuities under the Telegraphs Acts, 1892 to 1921, should be met, and payment of £4,950 14s. 3d., being the present value of the outstanding annuities, has been charged to this special subhead with the sanction of the Minister for Finance.” Chairman.—I take it that the meaning of that is that you entered into an arrangement prior to the Financial Agreement of 1938, to settle this matter apart from others that arose out of the economic war. Mr. O’Hegarty.—Yes. 544. Chairman.—The note by the Comptroller and Auditor-General at paragraph 77 is as follows:— “Special subhead Q. 4.—Acquisition of Sites, etc. “This special subhead was opened with the sanction of the Department of Finance to bring to account expenditure incurred in connection with the acquisition of certain lands for the erection of a wireless station for the Transatlantic Air Services. It appeared that although an area of about 17 acres was regarded as adequate to meet immediate requirements it was considered desirable to acquire an entire holding comprising 49 acres. I am informed that as schemes for additional radio communication facilities are under discussion the need for a considerable additional area may arise. It has, therefore, not yet been found possible to delimit the area required for State purposes, and the Irish Land Commissioners have consented to purchase the unrequired residue of the land, when this has been determined, at a price to be based on their valuation for their purposes under the Land Purchase Acts.” Chairman.—You found it convenient to get this land and to buy the whole farm? Mr. O’Hegarty.—Yes. 545. Chairman.—I suppose he would not sell it otherwise? Mr. O’Hegarty.—We could not get a portion of it. 546. Chairman.—There is a note by the Comptroller and Auditor-General at paragraph 78. “Erection of New Stores Depôt. “Under a scheme approved by the Department of Finance, land at Aldborough House, Dublin, which was held on lease by the Department of Posts and Telegraphs, was acquired by the Dublin Corporation for Housing purposes. The scheme provided for the transfer of the Department’s Stores Depôt to new premises to be erected, and for the payment by the Corporation of a sum of £7,950, based on the cost of the provision of alternative accommodation, estimated at £9,950, less a sum of £2,000, being a commuted allowance in respect of the rent of premises retained by the Department. Formal transfer of the site to the Corporation has been deferred pending the enactment of legislation enabling the Minister to dispose of his interest in the lease. Meanwhile no payment has been made by the Corporation, but I am informed that it is anticipated that a substantial portion of the sum due will be paid over at an early date. The amount expended to date on the provision of alternative premises was £10,110, approximately, of which £9,752 was borne on votes for Public Works and Buildings.” Chairman.—Apparently there was some snag in the title and legislation had to be passed? Mr. O’Hegarty.—Something about the State Lands Act. It was a legal question. 547. Chairman.—The State could only give a lease for 99 years? Mr. O’Hegarty.—I do not know the figure. Legislation is in contemplation with regard to State property and this question is held up until that is decided. 548. Chairman.—There is a note by the Comptroller and Auditor-General at paragraph 79:— “Stores. “A test examination of the store accounts was carried out with generally satisfactory results. Considerable deficiencies in the stocks of internal mail bags have been disclosed at each of the half-yearly stocktakings held for some years past. In view of the loss to public funds arising from these deficiencies. I inquired regarding the extent of the control exercised over these stores and as to the steps taken towards the prevention of further losses. I was informed that the position was the subject of special inquiry and that proposals were being considered which, it was hoped, would enable a closer record to be kept of the movements and cause of loss of mail bags. In addition to the engineering stores shown in Appendix II. as valued at £150,692 on the 31st March, 1939, engineering stores to the value of £509 were held on behalf of other Government Departments. Stores other than engineering stores held at that date were valued at £70,626. included in this amount being a sum of £22,874 in respect of stores held for other Government Departments.” Mr. O’Hegarty.—There is a flow of mail bags to and from England. 549. Chairman.—I suppose it is difficult to keep an eye on all the bags. Mr. O’Hegarty.—Yes. 550. Chairman.—How many have you? Mr. O’Hegarty.—About 60,000. We are having a special inquiry into this question at present, and I am hoping to get some arrangement about it. There is a good deal of wastage, but we are getting at it, and I hope to have some arrangement made to have proper control. 551. Chairman.—There is a note by the Comptroller and Auditor-General at paragraph 80. “Revenue. “A test examination of the accounts of the Postal, Telegraph and Telephone services was carried out with satisfactory results. Sums due for telephone services, amounting in all to £377 15s. 5d., were written off during the year as irrecoverable. This amount included a sum estimated at £59, which was written off with the sanction of the Minister for Finance in respect of the accidental destruction at a Telephone Exchange of certain charge tickets for trunk calls.” 552. Chairman.—The following note by the Comptroller and Auditor-General appears at paragraph 81. “Post Office Savings Bank Accounts. “The accounts of the Post Office Savings Bank for the year ended 31st December, 1938, were submitted to a test examination with satisfactory results.” 553. Chairman.—There is a note by the Comptroller and Auditor-General at paragraph 82. “Post Office Factory. “A test examination was applied to the accounts of the Post Office Factory with satisfactory results. The expenditure on manufacturing jobs, including work in progress on 31st March, 1939, amounted to £16,468; expenditure on repair works (other than repairs to mechanical transport) amounted to £18,341, and expenditure on mechanical transport repairs amounted to £2,099.” 554. Chairman.—If there be no question, we will now pass on to the subheads of this Vote. Subhead L 1—Maintenance by Railway Companies refers to work which the companies did for you?—Yes. 555. Deputy Hughes.—In regard to subhead PP—Annuities under the Telegraph Acts, 1892 to 1921—was there a Supplementary Vote for that expenditure because no grant is shown? Mr. McGrath.—Special authority was given by the Department of Finance for that expenditure in the circumstances. In a sense they had leave for the expenditure under subhead P, but it was not done as anticipated under P, so the Department opened a new subhead PP in order to show to the Dáil that things were slightly different from what had been provided for. 556. Deputy Hughes.—The same thing apparently applies to subhead Q 4? Mr. McGrath.—Yes; they opened a new subhead to show it distinctly. 557. Deputy Hughes.—Going back to subhead E 1—Conveyance of Mails by Rail —that is done by contract, Mr. O’Hegarty?—Yes. 558. How is it then that the expenditure exceeded the estimate by £243?— The railway companies were granted an increase on their general rates, but we gave the companies less than the Railway Tribunal allowed them to charge. We negotiated with the railway companies. They got an increase of 5 per cent. on their general rates, but we settled with them for a smaller increase. Their contracts have a clause that, in case of unusual circumstances arising, they can apply for a revision. Under that clause they applied for a revision and we made a bargain with them. VOTE 64—WIRELESS BROADCASTING.Mr. P. S. O’Hegarty further examined.559. Deputy Keyes.—In the explanation of the expenditure under subhead C of this Vote—Musical Instruments, Music, etc.—it is stated that the excess expenditure was due to the purchase of two new pianos not estimated for. They seem to have been fairly costly?—You have got to get the best pianos. 560. Chairman.—Are these grand pianos?—I am not sure, but certainly one of them would be. 561. They are bought by contract?— Yes. 562. The orders are sent through a contract organisation?—There is a Government Contracts Committee. 563. Was it through that Committee they were bought?—I am not sure whether that particular order went through it. I am reminded that that Committee only deals with contracts over £1,000. We issue tender forms to firms. 564. In regard to the expenditure under subhead G—International and Other Conferences and Conventions—of course you attend all these Conventions on wavelengths, with the rest of the staff?—Yes. 565 How are you getting on with your present wave-length?—The Lithuanian Station which was on our wave-length and used to interfere with us has gone off since January. Our wave-length is free at the present moment and we are getting very good reception. 566. I suppose you do not really know very much about the affairs of the station although you are Accounting Officer? Dr. Kiernan would know all about the details?—He would know all the details of the working but I have some general idea of it. 567. And of the operations of the staff?—Yes. 568. Deputy Keyes.—Was anything else, other than the two pianos, purchased which accounted for this excess expenditure under subhead C?—I cannot say off-hand, but I shall send a note* to the Committee if you wish. 569. Chairman.—Do you send anybody out from the Broadcasting Station to musical competitions or Feiseanna?—Do you mean to go around to Feiseanna to see who is there? 570. To look out for talent?—No. 571. Have you anybody on the lookout for talent?—We watch the programmes, we get local reports and so on. 572. You have not any “spotter” of your own?—No. The Committee adjourned at 1 p.m. until Thursday, May 16, at 11 a.m. |
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