Committee Reports > List of Committees > Dáil > 1958 > Committee of Public Accounts > Report - Appropriation Accounts 1955 - 1956

REPORT

PART I—GENERAL OBSERVATIONS. MINUTE OF THE MINISTER FOR FINANCE DATED 30th OCTOBER, 1957.

Social Assistance.

1. The Committee notes with satisfaction that statutory authority has been obtained to validate expenditure out of local funds and the Exchequer contributions towards the cost of preparing school meals. It also notes the steps taken to narrow the disparity in the cost of providing the meals in the various areas.

Army Pensions.

2. The Committee is glad to learn that revised arrangements for verification of claims for the award of medals have been put into operation. And it trusts that there will be no further grounds for complaint regarding the issue of irregular allowances.

Garda Síochána.

3. The Committee notes that a system of cost control of the transport maintenance service recommended by a firm of management consultants has been put in operation on an experimental basis, and it will be glad to be informed of the results in due course.

Wireless Broadcasting.

4. The Committee is pleased to note that alternative use has been found for the bulk of the stores declared surplus to requirements. It will be glad to be informed of the result of the efforts to dispose of the short-wave transmitter and associated stores.

Local Government.

5. The Committee is pleased to note that the Minister agrees with its conclusions that statutory authority should be sought for the recoupment to local authorities of a greater proportion of housing loan charges than is envisaged in current legislation, and that the Minister for Local Government has been advised accordingly.

Public Works and Buildings.

6. The Minister’s agreement with the Committee’s view that ‘time and material’ contracts should be used only in very exceptional circumstances is noted. In the special case of Shelton Abbey the Committee accepts the Minister’s explanation that the nature of the work did not admit of normal procedure being followed. But it is not satisfied that supervision over the work was adequate having regard to the number of errors in the contractor’s accounts which were allowed to pass unnoticed until attention was drawn to them by the Comptroller and Auditor General. It would be glad to be informed of the nature of the supervision exercised over this type of contract and of the method of ensuring the accuracy of claims.

7. The Committee is glad to note that it has been decided to sell the majority of the lighting sets which are surplus to requirements and desires to be informed of the outcome.

Lands.

8. The Committee agrees with the principle of central purchasing as the best method of securing supplies at the lowest cost to the Exchequer, but it would be glad if a copy of the current instructions was submitted for its information.

9. It is noted that the question whether the Land Commission continues to be responsible for the cleaning of drains although no longer in possession of the lands is not free from doubt, and that some aspects of it may require clarification by legislation. The Committee wishes to be informed in due course when a final decision has been reached.

PART II—PARTICULAR ACCOUNTS.

Office of the Revenue Commissioners.

10. Departmental regulations in the Estate Duty Branch provided for a review every three months of all open cases, e.g., cases in which additional duties assessed had not been paid or where accounts relating to the distribution of property passing at death had not been furnished. A large number of such cases opened between 1952 and 1954 had not been reviewed. The Committee was informed that it was hoped to organise the Branch so that, without additional staff, the arrears of work will be cleared. It would like to learn of the progress made in due course.

Social Insurance.

11. The attention of the Committee was drawn to the delay in furnishing for audit accounts of the Social Insurance Fund established on 5th January, 1953. It was informed that difficulties experienced in connection with the clearance of final accounts of the several funds wound up on the establishment of the Social Insurance Fund had been overcome and that accounts for the initial period to 31 March, 1953 and for the year ended 31 March, 1954 had now been furnished. As the Exchequer contribution for any year cannot be finally determined until the accounts for that year have been completed the Committee is glad to be assured that accounts will, in future, be submitted within nine months of the end of the relevant accounting period.

Qns. 66-69.

12. Section 21 of the Social Welfare Act, 1950, as amended, authorised the investment of moneys standing to the credit of the Social Insurance Fund on the construction and equipment, etc., of premises, and provided for payment to the Fund out of voted moneys of an investment return in respect of sums so expended. Áras Mhic Dhiarmada was the principal investment of this nature and part of these premises was occupied by Córas Iompair Éireann as a bus terminus from 1 October, 1953 but the rent payable by the company has not been agreed. The Committee is informed that payments on account of rent were received from Córas Iompair Éireann in 1954-55 but that a cheque received from the company in 1955-56 for a sum based on the company’s own assessment of the rent payable was returned on legal advice. The Committee notes that negotiations are proceeding and trusts that the matter will be brought to an early conclusion.

Social Assistance.

13. The Committee had under consideration the payment of grants to local authorities towards the cost of fuel supplied to necessitous families. It was informed that these grants are paid in accordance with a scheme initiated in 1942 by the late Department of Local Government and Public Health during a period of fuel shortage to enable supplies of fuel to be made available to necessitous families in non-turf areas. The scheme, which is operated in sixteen cities and towns, has no specific statutory authority. If it is the policy of the Government to continue these schemes indefinitely, the Committee considers that legislative authority should be sought.

Stationery Office.

14. The Stationery Office procedure regarding the maintenance of stocks of paper provides that when the stocks held fall below prescribed minima replenishment orders are issued. Arising out of an error in the records a replenishment order for 88 reams at a cost of £283 was placed although the actual stock held was sufficient to meet requirements. The Accounting Officer informed the Committee that there would be no waste as a result of this purchase, that the error was an isolated incident, and that it would be difficult to avoid occasional errors of this kind. The Committee in the circumstances accepts the Accounting Officer’s explanation.

The stock of paper at 31 March, 1956 was valued at £117,000, and the Accounting Officer explained that stocktaking is carried out every year as at 31 March. The figures of actual stocks are compared with the records and discrepancies investigated. Errors and omissions are adjusted in due course and if the resultant net discrepancy is small the matter is considered closed. Having regard to the large quantity of paper in store the Committee desires to emphasise the importance of stocktaking whether continuous or at regular intervals and the prompt investigation of discrepancies brought to light.

Industry and Commerce.

15. Payments in respect of flour subsidy made to flour millers are subject to adjustment following the examination of the millers’ accounts by officers of the Department. The Committee was informed that the examination of all accounts up to and including the year 1951-52 had been completed. The Accounting Officer stated that having regard to the cessation of these subsidies in May, 1957 he was taking steps to have the accounts for the balance of the subsidy period examined without undue delay. The Committee would be glad to learn in due course of progress made.

Agriculture.

16. Advances amounting to £922,717 were made to Comhlucht Siúicre Éireann Teoranta in 1952-53 from the Vote for Agriculture to finance a scheme for the importation and distribution of superphosphate by the Company. The advances were repayable by periodical remission to the Department of the proceeds of sales, less expenses. The amount repaid up to 31 March, 1956 was £451,135. The Committee is informed that all stocks have now been disposed of and the scheme terminated. The total expenditure incurred by the Company was £1,444,000 and receipts from sales, etc., realised £973,000. The net loss of £471,000 has been attributed mainly to a fall in world prices of superphosphate. The Committee assumes that it will be necessary to seek the authority of the Dáil for the write-off of this loss, and it trusts that this will be done without delay.

Fisheries.

17. The Committee has again had under consideration the question of the arrears of annuities set up to repay advances which had been made to the former Sea Fisheries Association in the period 1931 to 1952 for the purpose of financing the supply of boats and gear to fishermen on hire-purchase terms. These arrears have increased from £3,907 to £92,745 in the ten years ended 31 March, 1956. It understands that there is no direct relationship between these arrears due by Bord Iascaigh Mhara to the Exchequer in respect of the activities of the late Sea Fisheries Association, and current liabilities of fishermen for boat purchase contracts and the Committee is glad to learn that instalments on current contracts are mainly up to date. The Committee, when dealing with the accounts for the year 1952-53, commented on these arrears, which then amounted to £48,200, and were informed that the question of writing off the irrecoverable arrears was under discussion between the Department of Finance and An Bord Iascaigh Mhara. It trusts that a decision on this matter will not be unduly delayed.

Science and Art.

18. The attention of the Committee was again drawn to the question of the disposal of stocks of unsold books published in Irish by the Department of Education. It was informed that 97,000 copies of 68 books had been sold as waste paper and 16,000 copies retained to meet any possible future demand. The Accounting Officer undertook to examine the position with regard to all the books published in Irish, totalling 1,126 titles, and to furnish details of stocks for which there is little or no demand. The Committee reserves comment until this information is made available.

Public Works and Buildings.

19. A well equipped workshop is maintained for the servicing of plant and machinery used on the arterial drainage schemes. Occasionally the manufacture of spare parts is undertaken if the estimated cost of production compares favourably with commercial prices. The question whether it was more economical to manufacture parts within the capacity of the workshop was discussed before the Committee and also the basis on which costs should be compared. The point was made that for the purpose of comparison factory production costs should not be loaded with overheads as they are constant, and that the fullest use of the workshop facilities would be in the interests of economy. The Committee is inclined to accept this point of view, but would like to be further informed when the matter is fully considered.

20. The Committee learned that two independent sets of store records were maintained at the central engineering workshops, one by the Engineering Branch and the other by the Accountant’s Branch. The Comptroller and Auditor General stated he had been informed that the two systems were necessary because they served different purposes but he could not appreciate the difficulty of merging them as the more elaborate one contained all the information recorded in the other. He was however reluctant to suggest the abandonment of either set of records until the question was fully investigated and the Accounting Officer agreed to this course. The Committee would like to learn the result of this investigation.

National Gallery.

21. The Committee noted that the receipts from sales of reproductions were somewhat disappointing amounting to only £206 in the three years to 31 March, 1956. It was informed that the lack of proper facilities for display and sale had adversely affected these receipts, but it feels that this aspect of the matter should have been dealt with before the reproductions were purchased. The system of accounting for cash received at the Gallery appears to be inadequate and should be reviewed.

22. The question of inventories of the pictures in the Gallery was reviewed by the Committee and it understands that a complete inventory does not exist.

The Accounting Officer is satisfied that he has records adequate for the compilation of such an inventory if he had the staff and facilities available. The Committee trusts that this important work will not be further delayed and it desires to be kept informed of the position.

Gaeltacht Services.

Qns. 450-7; 473-491.

23. The Committee had under consideration the question of the safe custody and accounting for stocks of finished goods, including tweed and knitwear, at the Dublin depot of the Gaeltacht industries. The Committee was informed that the value of finished goods held at the various centres had increased from £14,000 in 1940 to £213,000 in 1956; that book records of the stocks of knitwear had been kept until 1956 when they were allowed to lapse; and that no store accounts were kept for tweed. In the absence of proper store accounts for tweed it was not possible to measure the accuracy of the stocks as ascertained at stocktaking. The evidence indicated that when an attempt was made to assess what tweed should be in store at 31 March, 1956—by aggregating receipt vouchers and issue vouchers—a surplus of 30,000 yards emerged. Questioned regarding this discrepancy the Accounting Officer advanced the view that the stocktaking must have been incorrect as the 1957 stocktaking on the same basis revealed a surplus of only 8,000 yards. The Committee feels that little reliance can be placed on these figures. In its view while the discrepancies might have been due to faulty stocktaking, they might equally be attributable to other causes.

The Committee fails to understand how a business of this magnitude could be efficiently carried on without proper records of the movement of stocks. It feels compelled to record grave dissatisfaction with the methods of control as being entirely inadequate for the proper safeguarding of stores. It has been informed that a system of store accounting was installed in October, 1957, and it desires to be informed regarding the efficiency of its operation.

(Signed) JAMES M. DILLON,

Chairman.

19th February, 1958.