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MIONTUAIRISC NA FINNEACHTA(Minutes of Evidence)Dé Céadaoin, 10 Deireadh Fómhair, 1956.Wednesday, 10th October, 1956.The Committee sat at 3 p.m.
DEPUTY CARTER in the chair. Mr. C. O’Neill (Secretary and Director of Audit), Mr. M. Breathnach, Mr. S. Ó Buachalla and Mr. C. J. Byrnes (An Roinn Airgeadais) called and examined.VOTE 38—LOCAL GOVERNMENT.Mr. J. Garvin called and examined.265. Chairman. — We shall take paragraph 50 of the Report of the Comptroller and Auditor General. It reads:— “50. The contributions towards loan charges under the Housing (Financial and Miscellaneous Provisions) Acts, 1932 to 1952 amounted to £1,417,780. Non-statutory contributions in recoupment of the additional charges incurred on certain loans advanced from the Local Loans Fund for subsidy housing schemes by reason of increases in the rates of interest payable on such loans amounted to £177,219.” Have you anything to add to that? Mr. O’Neill. — That paragraph breaks down the expenditure on these contributions into its statutory and non-statutory elements. In the next paragraph we go on to deal more specifically with the latter. 266. Chairman. — We can then take paragraphs 50 and 51 together. Paragraph 51, dealing with subhead I.1, relates to contributions towards housing loans charges by local authorities, it reads:— “51. The total amount paid by way of non-statutory contributions to loan charges in the years 1949-50 to 1954-55 inclusive was £603,096. As it seemed to me undesirable, in principle, that continuing payments of significant amount should be made without specific legislative authority, and in particular having regard to the parallel provisions for loan charge payments contained in the Housing (Financial and Miscellaneous Provisions) Acts, I inquired whether consideration had been given to the question of securing such authority. I was informed that as authority for the expenditure was contained in the annual Appropriation Acts it was not proposed to seek further legislative sanction for the payments which were made only in respect of a limited number of schemes which had already been undertaken.” Mr. O’Neill. — We take the view that, as a general principle, it is desirable that recurring payments of this kind should be covered by specific statutory authority. This principle seems to hold more particularly when, as in the present case, the legislature has defined the limits within which contributions may be made. The limits, as so laid down, are in effect being exceeded. 267. Chairman. — Could you say, Mr. Garvin, how much of the loan charges are subsidised under the statute?—The loan subsidies are 66⅔ per cent. in respect of special housing and 33⅓ per cent. in respect of what is called normal housing. A flat subsidy of 60 per cent. is paid in respect of labourers’ cottages. 268. Could you say what proportion is covered by the special interest subsidy or non-statutory subsidy?—The sub-division of the allocation is mentioned in paragraph 50 where the contributions are given as £1,417,780 statutory and £177,219 non-statutory contributions. I take it the latter figure is not included in the former amount. It represents less than one-ninth of the total amount. As the special subsidy is referable only to a limited number of loans and to a limited period of time, and as the total subsidy will tend to increase, the fraction of the total subsidy represented by the special subsidy will tend to decrease. 269. Mr. O’Neill.—The total for the five years is £600,000 so that it averages roughly £120,000 per year. 270. Deputy Sheldon. — I wonder if I could get this point clear: am I to take it that Mr. Garvin’s point is that this is not really a continuing charge in the sense that there is no finality to it—that it was to meet particular circumstances which might continue over a number of years but which would have an ending?— That is so, and also our consideration of the fact that the Housing (Financial and Miscellaneous Provisions) Acts laid down general terms under which various rates of subsidy are payable influenced us rather to the contrary opinion to that suggested by the Comptroller and Auditor General. We felt that these Acts provided for the general conditions under which the subsidies are paid, whereas the special subsidy is merely a supplementary to the general subsidies. 271. Deputy Bartley.—Do I take it the expression “non-statutory” means what it has been suggested it means by the Comptroller and Auditor General—a payment in excess of the amount provided for by the statute? Chairman.—Yes. Mr. O’Neill.—The statute provides for 66⅔ per cent. of the loan charges. In fact more than that is being paid. 272. Deputy Bartley.—The term “non-statutory” is not used in any other sense? Chairman.—It could be called a special interest subsidy? Mr. Garvin.—It is additional to the permanent statutory provision, but of course it is validated annually and is not paid until it is validated. 273. Deputy Sheldon.—Was it agreed to by the Dáil through presentation in the Estimate? — Yes. It is agreed to annually. It originated in a Government decision to meet a rise in the rate of interest so that this rise would not reflect itself in a corresponding rise in the charges on certain loans from the Local Loans Fund. The reason was that the post-war housing campaign was only starting in 1948, the year in which this rise in the rate of interest took place. There have been various rises since but not accompanied by any corresponding Government decision. 274. Chairman.—Have you anything to add, Mr. O’Neill, to paragraph 52 which reads as follows?:— “52. Section 16 of the Housing (Amendment) Act, 1948, as amended, empowers the Minister for Local Government, with the consent of the Minister for Finance, to make to any person erecting or reconstructing a house a grant not exceeding certain limits laid down in the Act. A sum of £195 paid to an applicant represented the maximum grant of £225 for the erection of a five-roomed unserviced house, less a deduction of £30 owing to the incorporation of portion of the original structure. The applicant had submitted proposals for the reconstruction of the house and these proposals had been approved for the purposes of a reconstruction grant, the maximum grant payable for this purpose being £120. As it appeared that the work carried out was entirely in accordance with these proposals I inquired as to the reason for the payment of a grant appropriate to the erection of a house.” Mr. O’Neill.—In the first instance, the work proposed here was approved for the purpose of a reconstruction grant and in the result it was found that something more than the maximum reconstruction grant was paid. The grant paid was that proper to the erection of a house less certain reductions. We put the point of view to the Accounting Officer that the work seemed to be one of reconstruction and asked why an erection grant was paid. I shall read his reply to our query which is as follows:— “When, as in this case, an applicant for a reconstruction grant carries out so extensive a reconstruction as to have, in effect, provided a new house, incorporating only a small portion of the original, the initiative in the question of having the house treated as a newly-erected house for grant purposes, may be taken by either the inspector or the applicant, at any stage of the case. In this instance it was the applicant who did so, at a stage when the work on the house had advanced sufficiently for him to be able to assess the position adequately. The question might equally well have been raised by the inspector at the outset, when the same considerations, which governed the decision actually taken, would have applied.” In that particular case it transpired that what was originally a one-storey, three-roomed house was converted into a two-storey six-roomed house. I do not know whether it is possible to draw a line defining what is reconstruction and what is erection. 275. Deputy Mrs. O’Carroll.—I suppose it depends on the extent to which the old house was altered in the course of its reconstruction? 276. Chairman.—Is there not a regulation governing that point? Mr. Garvin.—Yes. May I point out that my full reply has not been read out. What was read was my reply to a supplementary query. My original reply, dated January 7th, 1956, gives the full facts. Mr. O’Neill.—I will, of course, read the full reply if that is desired. The reason why I read only the supplementary reply is that it is the reply to the question to which reference is made in the relevant paragraph of the Report. The relevant portion of paragraph 52 is:— “As it appeared that the work carried out was entirely in accordance with these proposals I inquired as to the reason for the payment of a grant appropriate to the erection of a house.” That was a supplementary question and I read the supplementary reply. Mr. Garvin.—I think my original reply might very well have been incorporated in the Report or read to the Committee. 277. Chairman.—Perhaps Mr. O’Neill would read it now? Mr. O’Neill.—The original question was as follows:— “It is observed that a grant of £195 was paid to an applicant from County Cavan, in respect of the construction of a house, a penalty of £30 having been imposed on account of the percentage (60 per cent.) of old walling in the structure. As it would appear that the house in this case was not newly erected but reconstructed, the observations of the Accounting Officer are requested.” The reply to that question was:— “A grant of £195 was allocated and paid to this applicant under Section 16 of the 1948 Act representing the maximum grant for the erection of a five-roomed unserviced house less £30 because old walling was incorporated in the structure. The decision was in accordance with a direction on the case given by the then Minister. The policy with regard to permitting the inclusion of old work in newly-erected houses, for grant purposes, which is derived from the powers reserved to the Minister under the relevant Statutory Regulations, is to examine each case carefully, on its merits. It often happens that applicants who start on simple reconstruction work find it necessary to engage on major works when, for instance, the roof is stripped, or alternatively, feel disposed to alter their intentions at this stage. The practice followed in these cases is to have regard to the nature of the extra works undertaken with particular reference to the ultimate cost to the applicant. In the present case the cost of the work was estimated at £657. The applicant raised the house by 6 feet 6 inches (from 9 feet 6 inches to 16 feet) and had thus converted the original structure from a one-storey to a two-storey building dwelling comprising six rooms (three rooms originally). The floor area of the premises had been increased from 504 square feet to 1,008 square feet.” 278. Deputy Sheldon.—I take it that at some stage subsequent to the original application the applicant put in an application for a grant for erection under the relevant section. Chairman.—I dare say he amended his application? Mr. Garvin.—That is the position. He corresponded with the Department or the Minister. The Minister is empowered to dispense with any of the conditions, including conditions as to construction, in any case in which he is satisfied that circumstances have rendered adherence to the regulations undesirable. In any such case the Minister may reduce the grant to such an amount as he thinks fit. In this case the amount of reconstruction done was practically equivalent to the construction of a new house and the application was treated as one in respect of a new house. A grant on the basis of a new house was given, subject to a reduction of £30 in the amount. 279. Deputy Sheldon.—I still want a point made clear. Was there a subsequent application, following the original one, for the erection of a house? From the paragraph one would fairly get the impression that there was but one application for reconstruction and that the Department had treated that as if it were an application for the erection of a house. It is not made very clear in the paragraph. Deputy Mrs. O’Carroll.—It seems to be clear that the applicant changed his original application?—I am certain that the applicant was in touch with the Department in one way or another and altered the form of his application for a grant. 280. Deputy Sheldon.—All I would like to discover is whether, when the applicant applies for a grant, he must do it on a prescribed form. What I should like to find out is if the applicant could get a grant under Section 16 of the Act for the erection of a house? — Well, the details of this proposal were put in on a reconstruction form in the first instance. The prescribed form of application for a new house grant may or may not have been included in the subsequent correspondence from which it transpired that he had built a new house. I could let the Committee know later. Chairman.—You will let us know later? —Yes.* 281. Chairman.—Paragraph 53 of the Report of the Comptroller and Auditor General reads:— “Subhead Q. — Grants to Local Authorities for Improvement of certain Roads in the Gaeltacht and Congested Areas. 53. A provision of £400,000 was made under this subhead for the payment of grants to local authorities for the improvement of certain roads conducive to the development of the tourist industry in the Gaeltacht and congested areas. As noted in the account, it was decided subsequent to the framing of the estimate that the State expenditure on this service should be borne on the Road Fund which was supplemented for the purpose by grants from the National Development Fund.” One question that I want to put is why was it decided to change the method of dealing with the service?—At the time of the introduction of the 1954 Budget the Minister for Finance announced in his speech that this £400,000 would be met from the Road Fund and not from voted moneys. 282. Deputy Bartley.—I would like to get some information on another point. Oifig na Gaeltachta agus na gCeantar gCung had a function to perform in relation to the expenditure of this money when the original decision was made. The moneys were subsequently incorporated in the Road Fund even though their origin was still the National Development Fund. Does this change put an end to the function of Oifig na Gaeltachta agus na gCeantar gCung in relation to its expenditure? — Oifig na Gaeltachta agus na gCeantar gCung was certainly consulted in the first instance in regard to the roads which would be affected by the whole programme and they are still consulted annually in regard to them, although I think they were fairly well aware of the total programme. Since then they have had an allocation of £65,051 for roads in the Fíor-Ghaeltacht which is a distinct allocation from the Gaeltacht and tourists grants. They make definite recommendations to the Department in respect of that money. 283. With regard to the main provisions they did make recommendations originally?—Yes, the contact with Oifig na Gaeltachta agus na gCeantar gCung such as was contemplated in the first instance continues and in fact the Minister for Local Government is the person who exercises the functions in relation to Oifig na Gaeltachta agus na gCeantar gCung. 284. I take it that the assignment of this office to the Minister for Local Government was not influenced by the fact that he was Minister for Local Government?—No. 285. It was just that he was regarded as the most suitable person for the office? —Yes. 286. Was it because of that that it was decided to incorporate the money in the Road Fund? However, that is hardly a question for the Secretary? — The present Minister was not in office when that was decided. 287. There has been considerable dissatisfaction in those counties, and in those areas, entitled to these special grants because it is believed — whether there is basis for the belief or not—that the ordinary grants were reduced. I sought information from the Department of Local Government and also from the County Council and I could not get a reply?—The Deputy asked me last year whether there was such a reduction and I said there was no reduction. 288. It is strange that when I put that question in the Dáil I was referred to the County Council. 289. Chairman.—The only thing for you to do is to raise it again on the Estimate. 290. Deputy Lynch. — Deputy Bartley mentioned areas entitled to grants under this. This seems to be a very stupid question, for what is a Gaeltacht area? Deputy Bartley.—That is introducing something new. Deputy Lynch.—I asked the Minister that in the Dáil and was not answered. Deputy Bartley.—It has been answered fully recently. The Minister has defined them within the past month. 291. Deputy Lynch.—I asked the Minister for Local Government in the House and he said we had not got a Gaeltacht area in Waterford. There is an enormous number of people speaking Irish around Helvick and Ring and I discovered we got no money. Mr. Garvin.—There was an allocation over and above the county allocation for Ring under this heading. 292. Deputy Lynch.—When did we get it?—You got it anyway. 293. Chairman.—Paragraph 54 of the Report of the Comptroller and Auditor General reads:— “Subhead T.—Alleviation of Distress caused by Flooding (Grant-in-Aid). 54. As stated in paragraph 42, provision was made by supplementary estimate for a grant-in-aid for the alleviation of distress caused by flooding in the city of Dublin in December 1954. Issues from the grant-in-aid, amounting to £99,730, included £71,581 to a committee specially appointed by the Minister for Local Government, £17,666 to the Irish Red Cross Society and £10,483 to Dublin Corporation.” 294. Deputy Mrs. O’Carroll.—Are all the claims of people, who suffered distress from flooding in 1954, paid?—They have all been met and the account is closed. 295. Were all the people satisfied?— They were substantially satisfied and pleasantly surprised. 296. Chairman.—I take it there will be an element of compensation included in the grants?—We were advised in regard to the amount of the grants by an assessor and I think his recommendations were generous. 297. Chairman.—Paragraph 55 of the Report of the Comptroller and Auditor General reads:— “Motor Tax Account. 55. A test examination was applied to the Motor Tax Account with satisfactory results. The certificates and reports of the Local Government auditors who examine the motor tax transactions of local authorities were scrutinised, in so far as they were available, but in three cases this audit had not been completed at the date of my test examination. The gross proceeds of motor vehicle, etc., duties in 1954-55 amounted to £4,788,396 compared with £4,422,571 in the previous year. They include £34,522 attributable to fines collected by the Department of Justice, £5,675 in respect of fees received under the Road Traffic Act (Parts VI and VII) (Fees) Regulations, 1937 (S.R. & O., No. 92 of 1937), and £70,827 received from government departments in respect of State-owned vehicles. A statement of the gross and net receipts of the Motor Tax Account, and of the payments thereout to the Exchequer, appears on pages 6 and 7 of the Finance Accounts, 1954-55.” 298. Deputy Brennan.—I would like to ask if the amount which went into the Road Fund, accruing from fines under the Road Traffic Act, showed any increase this year? Chairman.—There was a big increase. Mr. Garvin.—I will arrange to have the amount forwarded to the Committee, with the corresponding amount for the previous year. * 299. Chairman.—We can now turn to the Account itself. On subhead I.5, Mr. Garvin—Grants to Local Authorities under the Housing (Amendment) Acts, 1948, 1949 and 1950—would you say why less houses were provided for newly married people?—The reason for this is that this scheme had by that time been in operation for a number of years. According as the familes of these people increase, and certainly within five years at any rate, they are obliged to vacate their houses. They then get absolute priority in new local authority houses. Numbers of people availed themselves of that and the houses originally given to them were available for new applicants. Possibly also some applicants were not satisfied with the location of these houses and may have had some objection to going too far out to a new housing scheme and so did not avail themselves of the allocations. 300. Deputy Mrs. O’Carroll.—How can you account for the fact that newly weds who drew houses in 1954 have not been housed yet? I have two cases in mind. Chairman. — The Housing Officer of Dublin Corporation, I suppose, would be able to answer that. Deputy Mrs. O’Carroll. — They were told they would not get them for ten or 12 months. Mr. Garvin.—The reason for the saving is that the Corporation were not in a position to draw on the allocation. 301. Deputy Mrs. O’Carroll.—Can we have some information about the saving of £70,000, under subhead I.6—Grants to Local Authorities towards cost of Housing Schemes? Chairman. — It is in the explanatory note. 302. Deputy Mrs. O’Carroll. — Is it possible to ascertain how much was unexpended in the Dublin area?—I could not give a definite estimate of the saving in Dublin. It can hardly be described as a saving in respect of any area as it represents merely a change in the nature of the subsidy. An arbitrary date had to be taken in making the change. I think the date was April, 1953. 303. Chairman.—Subhead M. — Contributions towards Loan Charges of Local Authorities in respect of Sanitary Services Works. Deputy Sheldon.—I do not know if the Department has any control over Dublin Corporation in seeing that they carry out statutory obligations. Is there a statutory limit to the water rate charged by the Dublin Corporation?—I do not think there is any limit. The rate levied as part of the municipal rate is governed by the cost of production. I understood there was an Act which fixed an upper limit?—There may have been an upper limit but there has been more recent legislation in connection with the Liffey water supply and I think that any limits are now out of date in the city. The witness withdrew. VOTE 50—INDUSTRY AND COMMERCEMr. J. C. B. MacCarthy called and examined.304. Chairman. — With the permission of the Committee I should like to take paragraphs 70 to 72 of the Report of the Comptroller and Auditor General, and they read as follows:— “Subhead J.1.—Food Subsidies. 70. The expenditure charged to this subhead is made up as follows:—
71. The flour subsidy, paid to Grain Importers (Éire), Limited, was the amount required to control the price of flour, and to regulate the earnings of the milling industry. It was calculated on the basis of ensuring that, over the industry as a whole, millers would earn remuneration equivalent to 4s. 6d. per sack of flour produced after charging all admissable expenses. The payments include £7,506,523 representing the difference between the average cost of production of flour, together with the permitted profit of 4s. 6d. per sack, and the controlled selling prices in force during the year ended 26 February, 1955. This amount is subject to adjustment following examination by the Department of the millers’ accounts. £363,617 was paid in respect of provisional adjustment of subsidy for the cereal years 1950-51, 1951-52 and 1952-53. 72. The subsidy on wheaten meal for the cereal year 1953-54 was paid to millers at varying rates representing the difference between the average cost of production together with a profit of 2s. 6d. per sack and the controlled selling price. In addition to normal subsidy, payments totalling £1,925 were made to three wheaten meal millers who, not being able to obtain their full requirements in the market, were compelled to purchase at enhanced prices from other millers.” I will ask Mr. O’Neill if he has any comment to make on these paragraphs. Mr. O’Neill.—The paragraphs analyse the payments of flour and wheaten meal subsidies. In paragraph 72 there is reference to special payments made to three millers of wheaten meal who were unable to secure supplies of wheat locally and had to purchase it at enhanced prices from flour millers. 305. Deputy Mrs. O’Carroll.—Is there any reason for the enhanced prices—I take it we have to subsidise this additional cost? Mr. MacCarthy. — Normally, I think these people got their supplies locally from local suppliers. In this case they could not get sufficient and had to go to flour millers whose prices were higher and they got a sort of subsidy to recoup that. 306. But were not those millers who were charging the higher prices getting a subsidy?—They would only get a subsidy on the actual production of flour. If they had not made the flour they would not get the subsidy. 307. I am still not clear—as I see it there is a double subsidy payable? Chairman—The accounting officer says that it is only on flour produced that the subsidy is paid. Mr. MacCarthy.—The subsidy is paid to the miller on sacks of flour actually produced and if he did not put the wheat into production he would not get the subsidy. 308. Deputy Mrs. O’Carroll.—What is the explanation for the enhanced differential?—If these wheat millers had been buying directly they would buy locally. In this case they had to go to flour millers and pay the extra cost. One obvious thing to inflate the cost would be transport charges. Secondly, they would literally have to pay—for the quality of the wheat they wanted—whatever prices these flour millers wanted to charge for, so to speak, obliging them. 309. Deputy Sheldon.—Could we have some idea of the quantity of wheat?—I think I could give you that. It was 3,450 barrels. That was the amount purchased. To make that intelligible, I should say that the total requirement was 50,000 barrels so that the quantity involved represented 3,450 out of 50,000 barrels. 310. Was this paid only to the three millers concerned?—It was paid only to them. The way the wheatmeal subsidy works is that there is a notional fair price arrived at. Then there is the actual controlled price. The miller is allowed the fair price plus a profit of 2/6 per sack. 311. Deputy Mrs. O’Carroll.—It is a notional fair price?—Yes, plus 2/6. You subtract the controlled price from this and the difference is the subsidy. 312. I see. Does the Department calculate the notional fair price or do the millers do it?—No, we do it. 313. In consultation with the millers, I take it?—The consultation with the millers would be mainly on the amount of profit and they would complain, of course, that we were not giving them enough but they have nothing really to say to the calculation of the basic fair price. 314. And the difference between the notional price and the 2/6 profit and this actual price is the subsidy? Does that vary much?—It has varied a little in recent years because we used to allow 2/- a sack and we have increased that to 2/6. I can tell you what the fair price has been over a period. In 1945-46 the fair price was 73/5 a sack; in 1953-54 and indeed in the current year, the year of account here, the fair price ranged from 103/11 to 104/7 according as the delivery was on the basis of free-on-rail or ex-mill. In between, in 1949-50 it was 85/-, and in 1951-52 it was 92/11. In 1952-53 it was 105/5 so that it was reduced—the fair price was reduced slightly, as compared with 1952-53. Now, the price to the consumer of course remained much the same. It went from 60/- to 62/- in 1945-46 and from 62/9 to 64/9 from the 24th April, 1954. The subsidy on the other hand had increased very much from 13/5 in 1945 to 41/2 in 1954. 315. Chairman. — You anticipate that such payments will be likely to recur?— Well, I think they will continue certainly, Sir, so long as the present price to the consumer is kept under control. They will continue, in other words, so long as the principle of subsidy is maintained. 316. Chairman.—No, I am referring to the three millers? Deputy Mrs. O’Carroll. — The special payments?—Oh, that should not recur. That was purely exceptional. What had happened in that case was that there was a rather bad harvest, or a bad harvest in that particular area, and the native wheat available was of such poor quality that they could not use it for wheat milling. 317. Deputy Sheldon.—If I may revert to the figure, it works out at something about 11/- or 12/- a barrel. That is a fairly substantial difference. I doubt if a great deal of that could be accounted for by transport. It looks as if the difference is accounted for by the fact that those wheat millers who would in the ordinary way be buying green wheat locally bought instead this conditioned wheat? — Well, the difference you have given is more than the actual difference. At that time the price fixed by the Minister for Agriculture and the actual price charged in that case varied between the three people. In one case it was 96/- and in another case it was 104/-. The difference was only 4/6 a barrel in one case and it was as high as 12/- in the other case. 318. I was taking it that there were 3,400 barrels roughly and relating it to a figure of something over 10/-. What I am getting at is that if account was taken of the fact that this was conditioned wheat it might cost more, but it should give higher production of flour?—I have no doubt of that and coming from the millers it is also dry wheat and was to that extent, I suppose, improved in its quality. 319. If they had purchased the green wheat locally they would have had to dry it in their own buildings so that out of this wheat they would get higher production of wheaten meal?—Yes. 320. I would have thought one thing would have balanced the other?—It was gone into certainly on an arithmetical basis at that time and they only got such differentials as would in fact affect this computation on the basis of fair price. The fair price was taken to be for green wheat plus the excess cost of the wheat. There might have been savings in regard to condition and in other directions. I do not know. 321. Deputy Mrs. O’Carroll.—Can you explain the differential allowed amongst the three, where one was 12/6? Surely that was not all transport?—No, I do not think it would be. It would be a matter of a willing buyer and a willing seller. It had to do with the best bargain that could be made. 322. Chairman. — We will pass on to paragraph 73 which reads:— “Subhead K.—Fuel Subsidy. 73. The sum of £250,000 was paid to Fuel Importers (Éire), Limited, on account of the balance of losses outstanding at 31 December, 1954, which amounted to £383,567. The total amount paid to the company up to 31 March, 1955, was £10,296,373.” Have you anything to say on the fuel subsidy, Mr. O’Neill? Mr. O’Neill.—No, it is just a factual statement. 323. Deputy Mrs. O’Carroll.—To what are the losses attributed? Mr. MacCarthy.—They are attributed primarily to the fact that coal was bought at higher prices than it was possible to get for it on sale. Also, there will be certain losses as some coal turns into slack in storage. 324. Chairman.—In view of the high current price of coal, would it not be possible to dispose of some of the stocks at an economic price?—I propose to give you a figure now, Sir, but I do it with all reserve because the situation may be different when we actually come to sell. The coal now in stock has been valued and the value placed on it is £7 10s. per ton. That coal actually cost us £8 6s. 7d. So that there is a loss even now. It may be that coal will become still dearer and that we might get more than £7 10s. 325. Deputy Mrs. O’Carroll.—Was that a recent valuation?—A very recent one, yes. It was done about the middle of the present year. The coal has to be collected from the Park, drawn out of the dumps and you have ordinary distribution expenses. The Park value really almost corresponds with the position of stuff arriving on the quays. 326. Chairman.—Paragraph 74 of the Report of the Comptroller and Auditor General reads:— “Minerals Development. Subhead L.1.—Payments to Mianraí, Teoranta, for Prospecting. 74. Section 5 (2) of the Minerals Company Act, 1947, as amended by section 3 of the Minerals Company (Amendment) Act, 1950, authorised the Minister for Industry and Commerce, with the consent of the Minister for Finance, to pay to Mianraí, Teoranta, in each of the financial years from 1947-48 to 1953-54, inclusive, a sum not exceeding £85,000 for prospecting and for the purchase of land and mineral rights. In introducing the Estimate for the year 1953-54 on 28 October, 1953, the Minister for Industry and Commerce stated that although the statutory provision for payments of this nature would be exhausted on 31 March, 1954, he did not propose to introduce amending legislation to provide the additional amount required to complete the scheme, which would involve only a matter of some months. He would ask An Dáil to vote sufficient funds to enable the work to be done without any special legislative authority other than that contained in the Appropriation Act. The sum of £89,000 was accordingly provided in the Estimates for 1954-55 and payments totalling £88,700 were made to Mianraí, Teoranta.” Have you anything to say, Mr. O’Neill? Mr. O’Neill.—The position is as set out in the paragraph. The statutory provision was exhausted at the end of the financial year 1953-54 but the Minister made it clear in the Dáil that he was going to make further issues without any special statutory authority other than the Appropriation Act. I think there was also a payment to them in the year 1955-56. That is not before us yet, of course. 327. Chairman.—Having regard to the specific statutory provision for payment to Mianraí, Teoranta, Mr. MacCarthy, for prospecting, we can regard that sum of £88,000 odd as the statutory payment? —Well, the view taken at the time, as the Minister put it to the Dáil, was that he would get the statutory authority in the Appropriation Act. If there were any likelihood of a continuing requirement he would have gone for an amendment of the original Act but at that time it was pretty clear that we were at the end of operations of Mianraí, Teoranta, at Avoca and it was thought unnecessary to get any other statutory authority than that given by the Appropriation Act. 328. Is it correct to say that the payments related entirely to work at Avoca?—That would be so, Sir. 329. Would you have firm figures there for capital invested?—Certainly, I can give you that because we had to do that in connection with the lease to the Canadians who contracted to repay all of this. The actual expenditure was £543,000. 330. What happened to the machinery and stocks?—That £543,000 includes the cost of purchasing machinery. Now the Canadians bought the thing over from us, as it were, on a sort of instalment arrangement. They will pay off £543,000 by way of 25 per cent. of net profits, but we could not very well agree to let them have actual possession of the machinery which they might sell before they had ever completed repayment of the £543,000. So, we leased the machinery to them. As soon as they have paid off the £543,000, then the machinery will go into their possession. There are other consumable stores which Mianraí, Teoranta, had purchased out of this last grant of £89,000. These were paid for in cash by the Canadians when they took them over, and that cash payment is over and above the £543,000 for which they are liable. 331. Chairman.—We will pass on to paragraph 75 of the Report of the Comptroller and Auditor General, which reads:— “Advances to Mianraí, Teoranta. 75. Reference was made in previous reports to the liability of Mianraí, Teoranta, for advances and for interest thereon. The total liability of the company amounted at 31 March, 1955, to £213,070. In exercise of the powers confferred by sections 11 (2) and 12 (3) of the Minerals Exploration and Development Company Act, 1941, and Section 8 (2) of the Minerals Company Act, 1945, the Minister for Industry and Commerce, with the consent of the Minister for Finance, agreed to postpone to 1 April, 1956, payment by the company of interest on advances and of instalments of advances which fell due on 1 October, 1954, 1 April, 1955, and 1 October, 1955.” Have you anything to add. Mr. O’Neill? Mr. O’Neill.—No. 332. Chairman.—We will take paragraphs 76 and 77 of the Report of the Comptroller and Auditor General together. They state:— Operations of Bord na Móna. “Subheads M.1 and M.2. 76. The issues from the Grants-in-Aid during the year comprised £10,000 for experiment and research (subhead M.1) and £50,160 for grants for housing (subhead M.2). 77. Section 52 of the Turf Development Act, 1946, as amended by section 2 of the Turf Development Act, 1950, provides for the payment out of voted moneys of grants towards the expenses incurred by Bord na Móna on experimental and research work, subject to a limitation of £250,000. The issues under this head amounted at 31 March, 1955, to £209,800.” Have you anything to add, Mr. O’Neill? Mr. O’Neill.—No. This is a further postponement by the Minister of the date for the repayment of advances and interest. 333. These are paragraphs 76 and 77, Mr. O’Neill?—I beg your pardon. I was taking Bord na Móna as a whole. There is a reference to the disposal of equipment. I think that matter of the disposal of equipment was discussed last year. I do not think I have anything to add. 334. Deputy Mrs. O’Carroll.—Was there much loss incurred in the disposal of the equipment? Mr. MacCarthy.—A very considerable loss, I am afraid. 335. Is there any explanation for it?— Well, there was no market for it. We could not get a buyer. 336. Was not some of it new and unused?—That is right. 337. Why was it not used? Who was responsible for buying equipment that was never even used?—I did explain that last year. They were almost exclusively semi-automatic machines. They had been acquired for the county council turf production scheme. The county council turf production scheme was abandoned in favour of a fully mechanised production scheme and, when Bord na Móna went over to the fully mechanised scheme, they had no use for the semi-automatics. Some of them were absolutely new. They tried to get the manufacturers to take these back and the manufacturers would not do so. In the end, they had to keep them and sell them for what they could get for them, which was very little. 338. Deputy Sheldon.—Could you give us a figure for the total loss? — The answer given in a parliamentary question was £54,461 6s. 6d. That refers, of course, to the new machines which were sold. In addition, they had to sell a lot of used ones. The total cost of used and unused machinery and a small amount of stores was £283,243. The amount received was £33,110, so that the total loss was £250,000. Deputy Mrs. O’Carroll.—A quarter of a million pounds?—That, of course, is not a loss. It is the difference between cost and selling price. They did, in fact, use the vast bulk of these machines. This may help the Committee. Two hundred and two of one type of machine cost them £93,000. All of these had been used. Forty other machines were bought and, out of the 40 bought, 31 were new at the time of sale and nine had been used. Again, in the case of other machines, 195 were bought, 178 had been used and there were only 17 new ones. All the tractors, trucks, etc., had been used. I cannot divide the machinery parts, tools and general stores as between used and unused, but the total initial cost was £32,000 and the amount received £9,000. 339. Deputy Sheldon.—I take it, from what you have said, that you have a figure for depreciation then?—In respect of used machinery? You were saying that the quarter of a million pounds is not a loss. I take it you mean that some is written off every year? Have you a figure?—I am sure I could get a figure for that. I have not a figure with me at the moment. We can send you a note about that. What you want to know is what figure was included in the balance in respect of depreciation of the used machines.* 340. Deputy O’Hara.—When machinery is offered for sale, is it disposed of on the spot, on the particular site, or is it customary to take it to Dublin?—In this case they invited tenders. I do not know what would be done customarily. It would probably be sold on the actual site but it would not follow that the buyer would not come from far away. 341. Deputy Brennan.—Was this machinery the property of Bord na Móna?— Yes—as agents for the Minister. 342. Had it been on loan to the county councils?—The term “county council scheme” was merely used. It came up during the emergency period. We had the hand-won turf scheme and the regular Bord na Móna machine-won turf scheme. Bord na Móna went off semi-automatic production which is what the county council scheme was and went on to the fully mechanised scheme. Deputy Brennan.—It stopped the hand-won turf scheme in fact. 343. Deputy O’Hara. — When tenders were invited were they only invited in our own national daily papers?—I cannot tell you that, but I am sure I can find it out without the slightest difficulty. It occurs to me that such machinery could be sold outside this country?— I had some notes last year. I think they advertised in technical papers in England. I recall now. When they had gone back to the manufacturers and asked them to take the machinery, I think there was also an advertising campaign in England and elsewhere. 344. Chairman.—With regard to subhead M.1 — Experiment and Research (Grant-in-Aid)—I presume that Bord na Móna work in liaison with the Institute for Industrial Research and Standards?— They do, indeed. 345. Have they achieved anything in that direction of late? — I will tell you what was done out of the grants paid up to and including this year. They concentrated upon the mechanisation of drainage. They developed machinery of their own for which they got patents, I understand. They also devoted a lot of consideration to the production of domestic turf burning appliances. They got some patents and interested Irish manufacturers. They devised special burners for burning turf for industrial installations. They also went into experiments in the production of turf by hydro-peat and also experiments in the extraction of wax from peat. All these experiments have been brought to a successful conclusion. Indeed, preparations have been initiated for full-scale hydro-peat production on one of the Board’s bogs. Deputy O’Hara. — They are up and doing. 346. Deputy Sheldon. — Surely the experiments on the production of Móna wax took place before Bord na Móna was set up?—I am not a technician and I do not know what exactly they had to do but they certainly spent money out of this on peat wax research. How this differed from the earlier one I do not know. 347. When you say the experiments were successful, could you say if there is any likelihood of any industrial development from the peat wax?—I cannot say that with any certainty, but I can say that I know they are actively negotiating about it. 348. Chairman.—Grants paid up to the 31st March, 1955, in respect of the building of houses amount to £314,000 odd or £570 per house. This would mean development for roughly 552 houses. Is the Board still building?—No. They have rather eased off that. 349. Can you say if all the houses are occupied?—I cannot answer that. In this matter I might have knowledge, but it would not be in my capacity as Accounting Officer. The Board is completely autonomous in this matter. Once we pay the grant we have no right to query them on it. 350. Deputy Brennan.—Might I ask if the price of the fuel is based on actual production costs without any margin left for calling upon the Exchequer?—Do you mean the price Bord na Móna themselves charge? Is the price based on actual production costs?—Yes, I think so. They have, in fact, made a repayment of some of the advances. 351. Chairman.—In addition to these grants, repayable advances towards the expenses of housing schemes may be issued from the Central Fund. Have such advances been made from the Central Fund? Mr. MacCarthy. — I was asked about housing grants. Chairman.—I am sorry. Mr. MacCarthy.—You mean advances to Bord na Móna for carrying on housing activities?—Yes. Mr. O’Neill. — There have been advances. There is a limit of £680,000. Up to the end of March, 1955, £479,000 was issued. 352. Deputy Mrs. Crowley.—Are houses built only for the engineers?—It is for the work people they are built. 353. Chairman. — Paragraphs 79 and 80 of the Comptroller and Auditor General’s Report read:— “79. Receipts from the Board, as shown in the account, were as follows:—
80. As indicated in paragraph 73 of the previous report the local schemes for the production of machine-won turf, which were taken over from County Councils in January, 1948, were discontinued and steps taken to dispose of the equipment and stores. Including £16,648 received from the Board in 1953-54, the proceeds of sales up to 31 March, 1955, amounted to £33,045.” 354. Mr. O’Neill.—We have discussed these paragraphs in so far as they related to equipment. Another item is the repayment of advances made to the Turf Development Board. I think those advances have been completely repaid since. Mr. MacCarthy.—That is so. 355. Chairman.—Paragraph 81 of the Comptroller and Auditor General’s Report reads as follows:— “Subhead P.—Repayment of Advances for Rural Electrification. 81. Reference was made in previous reports to the varying methods by which provision was made, pursuant to section 41 (3) of the Electricity (Supply) (Amendment) Act, 1945, for the repayment out of voted moneys of a moiety of each advance made out of the Central Fund in the years 1947 to 1952, inclusive. In the year 1953-54 the Minister for Finance directed that the outstanding liability in respect of subsidy moieties of advances for rural electrification should be discharged by the payment over a period of 25 years of instalments which would not contain any element of interest. The liability of the Board at 1 April, 1954, was £2,110,213 and the sum of £84,613 charged to this subhead is the first instalment so repaid. Section 4 (2) of the Electricity (Supply) (Amendment) Act, 1955, provides that the total amount remaining due to the Central Fund at the passing of the Act, 29 July, 1955, in respect of advances already made for the electrification of rural areas, together with any future advances, shall be repaid by the Electricity Supply Board.” Mr. O’Neill.—From time to time there have been different methods of repaying the Central Fund the moiety advances, but the statute which provides for these repayments has been repealed by the 1955 Act. As stated in the Report advances already made together with all future advances will be repaid by the E.S.B. 356. Chairman.—Is the Board liable?— On the outstanding balance. 357. Chairman.—Paragraph 82 of the Comptroller and Auditor General’s Report reads as follows:— “Subhead X.—Grant to Min Fhéir, Teoranta, for Capital Purposes. 82. Paragraph 76 of the previous report referred to the incorporation, under the Grass Meal (Production) Act, 1953, of Min Fhéir, Teoranta, and to the limit of £165,000 imposed by section 14 of the Act on grants to be made to the company for capital purposes in connection with the acquisition, drainage and cultivation of bog-land in the Bangor Erris area, the processing of grass and other plants and the carrying on of kindred and incidental activities. As indicated in the account, the major part of the work on the scheme was suspended as from November, 1954, and grants amounting only to £12,750 were issued out of the provision of £70,000. Including £12,000 issued in the year 1953-54, the grants made to the company for capital purposes totalled £24,750 at 31 March, 1955.” Mr. O’Neill. — There were grants for capital purposes—£24,000 odd, up to the 31st March. I think there was a further issue in the year 1955-56. There was an issue of £8,000 from the Central Fund in respect of shares which the Minister took up. The company has now been wound up and I think the liquidators’ account is available. 358. Chairman.—Have they tangible assets? Mr. MacCarthy.—Yes. They were transferred to Government Departments. They had tangible assets—drainage machinery and that sort of thing. Deputy O’Hara. — They realised £11,000 odd. 359. Chairman.—With regard to subhead L.2 — Compensation for Mineral Rights Acquired — I see that due to legal difficulties no compensation was paid. What was the nature of these legal difficulties? — I am afraid there were interminable legal delays. In this particular instance, minerals were acquired compulsorily, mainly in the Slieveardagh area. Title was most obscure. We must concede that. The biggest immediate holder of title at the time was the Munster and Leinster Bank. The ultimate title went back into the dim and distant past. Up to that time and, indeed, so far as most of it is concerned, not even yet have they been able to establish the clear title required in order that royalties would be paid. It has not hurt people an awful lot. A royalty is not payable until coal is produced. In some cases if such title had been established the people would not get a royalty even yet. 360. Chairman.—With regard to subhead Q.2—Salaries, Wages and Allowances—there is an excess which is explained as being due to an increase in the activities of the authority?—We had to put a new section in that staff when we undertook these tariff reviews at the request of the British side under the Trade Agreement. We had to give them a special staff. 361. Deputy Mrs. O’Carroll.—On subhead T.1—Grant to An Foras Tionscal— have you any more information about the saving of the £60,000 on the erection of factories, etc., for the undeveloped areas? —It is not really a saving in the sense that the money will have to be paid. The claims have not actually come in. They enter into commitments to provide a grant for a factory but the payments only mature at certain times and in compliance with certain conditions. At the end of 1954-55 they had issued only £65,000, but in that very year had undertaken to make grants up to £233,000 and, going back to the first day of 1952-53, the total amount of the grants which were committed up to the end of March, 1955, was about £500,000. However, only £130,000 had actually been paid out. That is entirely due to slowness on the part of the promoters concerned. Of course the money will have to be paid. It is committed. 362. Deputy Sheldon.—On subhead W. —Technical Assistance — I wonder how much was spent on examination of the production of nitrogenous fertilisers?— £10,888. That is the total amount?—Yes. There was no expenditure in any previous year. The bulk of that figure—£10,000—was a fee paid to the company which actually did the research work. The £888 is made up of travelling expenses of their people coming in here. 363. Have you any concrete results to report?—That, I am afraid, I could not tell you. The matter is in the hands of Ceimicí Teoranta, an independent company for whom I cannot answer. 364. Chairman. — Regarding the item in the note to the subhead dealing with fishmeal production could we have any information?—That figure represents the cost of a survey carried out by a Norwegian firm into the possibility of utilising shark carcases for the production of fishmeal. The total cost was £1,266. Deputy Mrs. O’Carroll.—Have we had any result from that?—Not so far as I know. The Department of Agriculture would be answerable for that one. VOTE 51—TRANSPORT AND MARINE SERVICES.Mr. J. C. B. MacCarthy further examined.365. Chairman.—Paragraphs 83 and 84 of the Report of the Comptroller and Auditor General reads:— “83. The charge to this subhead represents the sum repaid to the Central Fund in recoupment of the amount advanced to Córas Iompair Éireann in the year ended 31 March, 1954, in accordance with section 30 of the Transport Act, 1950, to meet payments of interest on transport stock. The provision for a grant towards the operating losses and revenue charges was not required. 84. In paragraph 78 of the previous report reference was made to a claim which was presented to the company for refund of subsidy overpaid in the years 1952-53 and 1953-54. As indicated in a note to the account a re-allocation from revenue to capital of certain items of expenditure included in the company’s accounts for these years resulted in a refund by Córas Iompair Éireann of £829,000, which is included in the extra receipts payable to the Exchequer.” Mr. O’Neill.—Paragraph 83 reports the repayment to the Central Fund of advances for interest on transport stock. There was no charge for operating losses in that year. The following paragraph deals with a refund which the company made on a re-examination of their accounts. A re-allocation from revenue to capital of certain items of expenditure in the company’s accounts resulted in a refund by Córas Iompair Éireann of £829,000. 366. Chairman.—I take it the company pays interest on their outstanding advances?—They do not pay it but they are liable. This payment is made because under the Act there is an obligation to do it out of the Central Fund. However, that does not exempt the organisation from liability to recoup this expenditure. 367. Paragraph 85 of the Report of the Comptroller and Auditor General reads:— “85. The agreement scheduled to the Great Northern Railway Act, 1953, provides for the apportionment between the Minister for Industry and Commerce and the Minister of Commerce, Northern Ireland, of the profits and losses, and the capital requirements, of the Great Northern Railway Board. Section 30 of the Act authorises the Minister for Industry and Commerce to pay to the Board the amount of any loss for which he is liable and to make advances towards making good any anticipated loss for which he would be liable, and section 33 authorises him to make payments to the Board to meet any capital expenses to be provided by him under the agreement. A payment of £430,627 was made to the Board in the year under review pursuant to these sections, as follows:— Period 1 September 1953 to 30 September 1954.
On that paragraph could you say what the gross loss of the company was for the period in question?—I wonder if you would accept from me that part of the loss for which we are responsible, because I do not like giving those for which the Six-County area are responsible? The total revenue loss from the 1st September, 1953, to the 31st March, 1955, was estimated at £283,000. It is not possible to be quite definite about it until we have the accounts absolutely cleared. We had to put in £350,000 in 1955-56 and then we had a Supplementary Estimate for £396,000 in March of 1956. In 1955-56 their operating losses had come up to £647,000, that is our share of the operating costs. 368. Has the Board a free hand in the matter of capital expenditure or must it submit a capital programme?—It must submit a capital programme. 369. I presume that payments both towards losses and towards capital purposes would be all repayable?—They would be, I suppose, repayable technically. At least we hope they will be repaid in due course. 370. Deputy Brennan. — The Act provides for payment of anticipated losses. By what means of calculation are they arrived at?—We know the possible losses and we pay on that. In the year ended March 31st, 1955, the year of account, we paid £88,000 in respect of ascertained losses for the accounting period ended September, 1954 — that was only half through the financial year. We must cover them for the other half and in that case we can only anticipate because we shall not have their financial accounts until September, 1955. When we get their accounts, if we find we have paid them too much we will recover, and if we have not paid them enough they will claim the balance. 371. The balance is recoverable?—It is adjustable. 372. One would think that is not a very sound system. Paying estimated losses in advance would seem to be an inducement to the company to spend?—There may not necessarily be a payment. It all depends on the stage at which the company send in their accounts. In this particular year we paid them £88,000 which was ascertained. There was nothing the company could do about that. We also paid them in respect of the financial year, in anticipation of their losses, £95,000. Your point is that having been provided against losses they might be negligent about measures of economy. There is certainly that possibility, but you have that element in all these subsidy matters. You must keep them going, anyway; they must be enabled to pay their wages. Deputy Brennan.—I would imagine the same incentive for economies is not there. 373. Chairman. — You have that element in all subsidies. Mr. MacCarthy.—I should like to make one point before we leave the paragraph. If we had not paid the company anticipated losses they could still be as extravagant as they liked because ultimately we have got to make good their losses. They could get a bank to finance them, pro tem. I think that our payments in respect of anticipated losses do not affect the issue. 374. Chairman. — On subhead B.— Grants for Harbours—I see there was a saving of £82,000 on grants made towards harbour works? — The explanation for that is at page 161 of the Appropriation Accounts. We have a provision for harbours, but we might, for instance, be doing one particular type of thing at one harbour when an entirely new scheme comes in for the same harbour which would be proper to the National Development Fund even though we have provision for that particular harbour in the year concerned. 375. On subhead N.5.—Rocket Equipment—is this rocket equipment essential or would its absence lessen the efficiency of the Life-Saving Service?—If we had not got rocket equipment it would lessen its efficiency. The provision in this case is really for renewal of existing supplies. I am sure that in no station would they let stocks be depleted because they could always borrow some rockets from the British side. VOTE 52—AVIATION AND METEOROLOGICAL SERVICES.Mr. J. C. B. MacCarthy further examined.376. Chairman.—Paragraphs 86 and 87 of the Report of the Comptroller and Auditor General reads:— “86. Expenditure during the year on constructional works, including furnishing of buildings, at Dublin and Shannon (Rineanna) Airports amounted to £41,122 and £54,063, respectively, bringing the total expenditure as at 31 March, 1955, to £1,295,678 for Dublin Airport and £1,998,640 for Shannon (Rineanna) Airport, exclusive of expenditure on the acquisition of land. Expenditure out of subhead I on the proposed airport at Cork amounted to £262 and comprised payments in connection with a site survey and the preparation of preliminary plans. Operation of Dublin and Shannon (Rineanna) Airports. 87. I have been furnished with statements giving particulars of the cost of operating Dublin and Shannon Airports. Dublin Airport is managed by Aer Rianta, Teoranta, on behalf of the Department and Shannon Airport is managed directly by the Department. The expenditure and receipts under their main heads are as follows:—
377. Deputy Mrs. Crowley.—Paragraph 87 says that in the Dublin Airport Restaurant the profits on the catering were £7,890. The item dealing with Shannon Airport in the same paragraph says that receipts from catering amounted to £57,373. Does that figure represent profits, does it represent receipts from passengers and was there a profit? — It means the actual profit. In the case of Dublin Airport we do not run it directly from the Department. Aer Rianta do the catering. We merely get the profits on the transactions. In the case of Shannon Airport we run it. We have Mr. O’Regan there and we provide him with all the necessary things and he provides the services. We pay him a salary and commission on profits. The receipts are excess of income over expenditure. Deputy Mrs. Crowley. — That is satisfactory. Mr. O’Neill.—There are two items contained in this. There is £52,600 on the catering and £4,700 from the passenger hostels. Mr. MacCarthy.—This is a constructional account. 378. Deputy Sheldon. — Have you figures for the gross turnover on duty-free and other goods?—We only give figures for the catering service as such, but not particular sections. I would have no objection to giving you turnover figures if I had them with me but I have not got a break-down of the figures with me. It seems odd that there would not be figures for turnover in duty-free and other goods which are quite distinct from catering?—The department is taken as a whole and the out-turn for the year is related to the activities of the catering controller and we have always resisted any attempt to break it down. He is remunerated on a certain sliding scale and we have always maintained that he is doing the same job, whether he is selling goods or catering. 379. Deputy Brennan. — Surely there are figures for the duty-free goods which are mainly exports?—Yes, there are. I have them on a file in my office and I will let you have them.* 380. Chairman.—On paragraph 86, Mr. MacCarthy, the combined expenditure on works of a constructional character at the two airports amounted to £100,000. Can you give us any idea of the type of work involved? Deputy Brennan.—I take it that it was additional work rather than maintenance work? Mr. MacCarthy.—I think I can let you have those details. There is a separate subhead for maintenance. Most of it in fact is given in the notes on page 166, under subhead G, and also under subhead H. I could in fact give you an itemised account of the actual expense. It refers to runways, taxiways, buildings and the launch. We have a new launch and it is covered by the expenditure. 381. Chairman.—You have very little expenditure on land acquisition?—That is again a case of legal difficulties. The expenditure of £31 is on law costs. There was no expenditure on actual acquisition. That arises from delays in arbitration. In the case of Dublin, the Minister announced his intention of acquiring 281 acres on the south-west side of the Airport. That was in 1951. The matter was referred to arbitration subsequently because there were eleven holdings involved. One of the holders was willing to accept an agreed figure but the others were not. The arbitration did not start until January, 1956, which was after the end of the financial year. In the meantime we have had the arbitrator’s award. In the case of Shannon we are still negotiating with Clare County Council over a small holding. Again, in the case of Dublin, there is this re-conveyancing. 382. On paragraph 87 — Operation of Dublin and Shannon (Rineanna) Airports —I presume the figures give a complete picture on the cost of operation?—That was the idea, to make it as realistic as possible. 383. The losses are fairly substantial, over £500,000?—Very substantial. 384. Are they declining or increasing? —In the case of Shannon the trend is towards a lessening of the loss. In the case of Dublin the deficit is moving slightly in the other way. 385. In the case of landing fees, I suppose that you could not step them up?— That question is very much alive at the moment. We are going to a conference in Montreal next month which is on that subject. 386. Chairman.—Paragraph 88 of the Report of the Comptroller and Auditor General reads:— “Extra Receipts payable to Exchequer. 88. In paragraph 67 of the report for the year 1950-51 reference was made to the sale of the hostel at Foynes to a local authority for use as a hospital. The payment of the agreed price of £5,000 was withheld pending completion of the necessary legal documents but the purchaser was allowed to enter into occupation of the premises in June, 1949. The legal transfer of the property was effected during the year under review and the purchase price, together with accrued interest thereon amounting to £1,031, was received and is included in this account.” There appears to have been some delay in completing the sale. Was there any particular reason for that?—It was really the Land Registry that caused the trouble. There was delay in registering the Minister’s title. 387. Chairman.—Paragraph 89 of the Report of the Comptroller and Auditor General reads:— “89. Property which had been acquired at a cost of £4,070 to provide accommodation at the seaplane base at Foynes included a hotel on which £5,500, approximately, was expended on adaptations. Following the abandonment of Foynes as a flying boat base it was decided to dispose of the hotel premises. As they were not required by other Government Departments they were advertised for sale early in 1954 but no offers were received. In October, 1954, an offer of £800 by a local body was accepted and a deposit of £200 was received and brought to account.” £800 seems to be a low price for premises on which £5,500 was spent. What was the condition of the hotel at the time of the sale? — The condition was not terribly good when they took it over. They paid £4,000 for it and spent £5,500 on it. It was then turned into an airport building. It is just a sort of casualty of the times. The seaplane base faded out. We advertised it all over the place—in England, in the Six Counties, in various tourist magazines — but we found no interest in it. 388. On subhead C.—Telegrams, Telephones and Teleprinters—of the Vote itself a saving of £1,700 odd, due to the non-utilisation of the provision of a private wire, seems to be a substantial sum?—It had been the intention to have this arrangement but instead the Meteorological Service kept on with the ordinary telegram and telephone arrangements. 389. Deputy Brennan. — £15,545 is a huge amount under that heading to be expended in comparison with other corporations?—I think it would be hard to find any corporation that would have the degree of teleprinting and telephone activity that Shannon would have, and even Dublin is pretty busy. I do not think there would be anything comparable. I think it is a colossal figure? — The costs are enormous, but it is a profit earning expenditure and the receipts are £50,000. 390. Chairman.—This then is a service given to the public for which they pay? —It covers the telegrams, telephones and teleprinting done on the State service and also the work done for aircraft companies en route here, for which they pay. It also covers messages sent from here to Paris, or anywhere else, on behalf of airline companies for which they pay and on receipt of which we keep 50 per cent. and the Department of Posts and Telegraphs keep the other 50 per cent. You can arrive at Shannon and you may want to send a message to India. It could be to a place quite a long way away. You can send it from Shannon and you pay for it. All this is stimulated by this expenditure under subhead C. Chairman.—That is a fairly satisfactory explanation. 391. On subhead D. — Incidental Expenses—does the sum of £10,500 mentioned in the note cover the full cost of the inquiry?—Yes. It will not include the time of various officials who attended, secretaries and so on. It is made up of the legal expenses for counsel appearing on behalf of the Minister and the staff —£6,696; the cost of verbatim reporters and interpreters, £2,161; transport, £403; travelling expenses, £846, and odds and ends, £460. In the following year we incurred expenditure again on delayed legal fees and also on salvaging the wreck. 392. On subhead F.—Rent and Rates on Land, etc.—do the rates on land form a considerable proportion of this expenditure?—I think it would be a very substantial proportion, but I am afraid I cannot divide it. I could send you a note on it.* Deputy Brennan.—Have we the total valuation on all properties at Shannon Airport, that is, the rateable valuation? —I would have to send you a note about that.* 393. Chairman. — I wonder why they would not be met from Vote 17—Rates on Government Property. Mr. MacCarthy. — That is bounty in lieu of rates. I gather that that was considered some years ago and that a positive decision was taken that, because of the commercial character of the airports, it would not be proper to provide for this out of bounty in lieu of rates. 394. Deputy Brennan. — Before you pass from subhead G. in regard to the furnishing of buildings, do replacements of furnishings take place fairly regularly?—Yes, they do. It is found that at airports furnishings have pretty well a natural lifetime. Carpets become worn out and seats of chairs have to be replaced and other things, including the more perishable items like glasses and so forth. 395. Chairman. — On subhead J. — Maintenance Works—I see that certain works were not carried out. Is there any danger that deterioration would set in in the buildings?—I do not think so, Sir. That is watched most carefully. 396. On subhead Q.—Telegrams, Telephone and Teleprinters—only one of the four proposed meteorological stations provided for was completed? — That is so, Sir. We had great delay in getting equipment. In this case you might perhaps remember in the previous year’s account there was a very substantial saving shown, and that it was because there was enormous delay in getting the necessary equipment. But we have got all the stations ready now. 397. There is a saving on subhead R.— Equipment? — That is part of the same thing. Knowing that they could not get certain essential things, they did not bother rushing with other parts of it. What were the items? — When they could not get key items, so to speak. VOTE 53—INDUSTRIAL AND COMMERCIAL PROPERTY REGISTRATION OFFICE.Mr. J. C. B. MacCarthy called.No questions. VOTE 66—TOURISM.Mr. J. C. B. MacCarthy further examined.398. Chairman.—Subhead A deals with the grant to An Bord Fáilte. Deputy Sheldon.—On the note to subhead A could Mr. O’Neill expand the phrase “due to circumstances outside the control of the Board”? Mr. MacCarthy.—I think I could, but it is a matter that we really do not go into because it is an autonomous board. We know, for instance, in the case of the road signs that they decided on a new type of sign and that these are now up. They had delay in getting delivery of these for which they were not responsible. Similarly in the case of ancient monuments where they had provision made for putting up little plaques stating what these monuments were all about, they had a great amount of trouble getting agreement with owners of land to let them in and so on. I gather those are the reasons but we cannot demand explanations from them. VOTE 67—REPAYMENT OF TRADE LOANS ADVANCES.Mr. J. C. B. MacCarthy further examined.399. Chairman.—Paragraph 114 of the Report of the Comptroller and Auditor General states:— “114. In July 1951 the Minister for Industry and Commerce guaranteed a loan of £15,000 under the Trade Loans (Guarantee) Acts to Messrs. Parlanti Castings (Ireland) Limited. The company went into voluntary liquidation in December 1951 and a sum of £8,970 was advanced from the Central Fund on foot of the guarantee. Sums amounting to £2,250 realised on the sale of the assets were credited to the Exchequer in 1952-53. The charge to this vote represents the payment of the balance to the Central Fund pursuant to section 10 (3) of the Trade Loans (Guarantee) Act, 1939. A further sum of £416, being the balance of the proceeds of the assets, was paid into the Exchequer in 1955-56.” Have you anything to add, Mr. O’Neill? 400. Mr. O’Neill.—I think not. The amount advanced from the Central Fund on foot of the guarantee was not repaid within two years and is repayable from voted moneys. 401. This company did not last long? Did it ever reach the stage of production? Mr. MacCarthy.—Yes; it was in production. 402. It appeared to have gone through roughly £9,000 of the loan during that period. Does the Department exercise any function in that connection?—No, once the loan is given. Moneys must, of course, be deposited to a special account which must be kept separate and distinct from the ordinary accounts and they are not allowed to draw from that account except on a certificate from the Auditor of the actual purpose for which the moneys are required. That gives some protection in the sense that you know what the money is used for and that it is not used for any irregular purpose but it does not assist you in reaching economic working. 403. Deputy Brennan.—Would all the tangible assets be realised? — Yes, the liquidator was responsible for that. That was done in this case and there was a small receipt actually after the Vote was made out. I think a sum of some £400 was received. 404. Chairman.—Could you say what the actual loss to the Exchequer was?— Yes, certainly. The actual loss was £6,720 and the subsequent assets of £416 were realised reducing the actual loss to £6,304. The witness withdrew. The Committee adjourned. * Note by Witness.—The receipts under this heading in 1954-55 were £34,522 and in 1953-54, £35,666. |
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