Committee Reports > List of Committees > Dáil > 1960 > Committee of Public Accounts > Interim and Final Report - Appropriation Accounts 1959 - 1960

MIONTUAIRISC NA FIANAISE

(Minutes of Evidence)

Dé Céadaoin, 7 Nollaig, 1960.

Wednesday, 7th December, 1960.

The Committee sat at 11 a.m.

DEPUTY COSGRAVE in the chair.

Mr. Liam O Cadhla (An tArd-Reachtaire Cuntas agus Ciste), Mr. C. J. Byrnes and Mr. P. S. MacGuill (An Roinn Airgeadais) called and examined.

VOTE 61—OFFICE OF THE MINISTER FOR SOCIAL WELFARE.

Mr. P. J. Keady called and examined.

215. Deputy Jones.—With regard to subhead D.—Telegrams, Telephones, Postal Expenses, etc.—on what basis was this adjustment charge of £8,741?

Chairman.—There is reference in the Note to an adjusting charge claimed by the Post Office and Deputy Jones is anxious to know the basis on which that was made?

Deputy Jones.—Was that the actual cost or was it because of a large number of communications passing through?

Mr. Keady.—That included adjustments, in the year 1959-1960 in respect of the year 1958-1959, of a sum of £8,821. The Department of Posts and Telegraphs prepared the Estimate for this. It was based on the certified postings from the headquarter offices of our Department and also on the Stationery Office return of the value of the official paid stationery issued for the purpose of our services. These returns are not available until after the close of the year.

Deputy Jones.—That would mean a larger volume of communications passing through?—The Estimate was provisional. They were not in a position to check the actual expenditure until the year 1958-1959 was over.

216. Deputy Sheldon.—Does that happen every year?—I think this is the second year. It happened before.

Deputy Booth.—Will the accounting officer always be working a year in arrear?—In this case, yes, but I think they have probably got a more stable basis for estimation now.

And it will still be estimated subject only to adjustment?—Yes.

217. Chairman.—With regard to subhead K.—Transport and Compensation— can you say if the saving was substantial or not? You mentioned that the increased expenditure was offset by running expenses having been lower than was anticipated?—We bought a higher proportion of new cars in that year than we had anticipated, with the result that the running costs were much lower than we had anticipated.

Deputy Sheldon.—I take it that the other side of the picture occurs in the Appropriations in Aid where you sold more old cars than you anticipated?— That is right.

218. With regard to subhead M.— Losses, Item No. 3—where a loss of £10 is charged, I see that, in fact, there was not a loss because a balance of remuneration in excess of £10 was withheld?—But it was not credited to the subhead. It was a saving on Subhead A. The actual loss is charged to subhead M.

219. Deputy Booth.—In regard to No. 4 on subhead M., do I take it that the same thing applies and that £14 was a total loss?—That is right.

Deputy Sheldon.—The £4 does not affect it?—No, except as a saving on subhead A.

220. Deputy Moloney.—With regard to item No. 3 in the Appropriations in Aid —Repayment in respect of agency services performed on behalf of the British Ministry of Pensions and National Insurance— what service was rendered for this payment? Is there not a reciprocal arrangement?—There is no connection with the reciprocal arrangement. We operate, as agents, on behalf of the British Ministry of Pensions and National Insurance, a scheme of general practitioner attendance for ex-members of the British Forces in Ireland. They pay a capitation rate for each member affected and we pay over to the doctors who work this scheme for them. The amount shown there is our administration cost which we recover from the British Ministry.

221. Chairman.—In connection with the case where a clerical officer obtained children’s allowances illegally, is there any method of preventing a recurrence of that?—That case is connected with forged school attendance certificates. Suspicion was aroused because the school was a Vocational school and the boy concerned was 20 years old. When we made enquiries, we found the certificate was forged.

VOTE 62—SOCIAL INSURANCE.

Mr. P. J. Keady further examined.

222. Chairman.—Paragraph 95 of the Report of the Comptroller and Auditor General reads:—

“Subhead A.—Payment to the Social Insurance Fund under section 39 (9) of the Social Welfare Act, 1952.

95. Payments from this subhead to the Social Insurance Fund in the year under review amounted to £3,930,000. As indicated in previous reports such payments are subject to adjustment when audited accounts of the Fund are available.”

Mr. Ó Cadhla, have you anything to add on this paragraph?

Mr. Ó Cadhla.—The account, which has been audited, showed that £106,000 has been overdrawn from the Vote. That amount will be adjusted in the current year.

223. Chairman.—What was the reason for the excess of expenditure over income and the payment to the fund being less than was expected?—It should be understood, first of all, that the grant of £4,334,000 was a balancing figure, being the amount by which the estimated expenditure exceeds the estimated income. These transactions total some £17,000,000 —about £10,500,000 expenditure under various heads, unemployment benefit, sickness benefit etc. and income of £6,500,000 mainly contributions and interest. We saved £209,000 on unemployment benefit. We paid that amount less than we expected to pay. We saved £25,000 on widows’ contributory pensions. We got £93,000 more in contributions. That accounts practically for the whole £404,000. In addition, there was an overdraw of £106,000, as pointed out, which included, again, surplus contribution income and additional savings on disability benefit.

Chairman.—The Vote itself is on page 193.

224. Deputy Sheldon. — Could the Accounting Officer elaborate on subhead B.—Investment Return? How are these interest rates determined?—The principle underlying it is that the Exchequer is liable for interest on the amount expended on the acquisition, completion and furnishing of Áras Mhic Dhiarmada. The interest is arrived at as the average rate of interest earned on the Fund. This is not shown, as a rule, until after the financial year has concluded. In addition to the average interest earned by the securities, the Fund gets 3½ per cent. depreciation on the furniture cost.

VOTE 63—SOCIAL ASSISTANCE.

Mr. P. J. Keady further examined.

225. Chairman.—Paragraph 96 of the Report of the Comptroller and Auditor General reads as follows:

“Overpayments.

96. Sums recovered in respect of overpayments charged in prior years’ accounts were:—£13,662 in cash, credited to appropriations in aid, and £4,168 withheld from current entitlements. Overpayments amounting to £3,369 were treated as irrecoverable. The total amount of overpayments not disposed of at 31 March 1960 was £45,358 as compared with £31,745 at 31 March 1959. During the year ninetyeight individuals were prosecuted for irregularly obtaining or attempting to obtain social assistance and convictions were secured in eighty-six cases.

Deputy Booth.—With regard to the total amount of overpayments not disposed of, there appears to be a considerable increase over the previous year. Does that mean that this is the result of closer supervision or has there been, in fact, an increase in overpayments during the particular year now?

Chairman.—To what do you attribute the increase in the overpayments? It is £45,000 as against £31,000?—We recorded new overpayments in 1959-60 of nearly £40,000. I am not in a position to say whether that obtained in 1958-59. We recorded fresh overpayments of nearly £40,000 and we recovered about £21,000 in the same year and cancelled or wrote off about £6,000. The actual amount outstanding at the end of the year, £45,000 odd, is less than one-quarter of one per cent. of the total payments.

226. Deputy Moloney. — Could the Accounting Officer give us a clearer picture as to how this question of overpayment arises to that extent?—It mainly arises where a deciding officer revises his award retrospectively where there was fraud, where a person claiming to be ill was working or claiming to be unemployed was signing on while working. Wherever there is fraud the revision of the decision is retrospective and creates an overpayment.

Deputy Moloney.—It is obvious that that, at the moment, is a reason for such a large volume of overpayments. The records are such that they calculate very accurately

227. Deputy Booth.—Was the number of individuals prosecuted during the year higher than in the previous year?—From recollection. I think last year there were 72 prosecutions.

And this year it is 98?—Yes.

Deputy Moloney.—Have all these prosecutions been warranted? The amounts are small in some cases. I have seen them for £1 and 30/-. I know that the prosecution costs £15 and £20?—In addition to whatever fine is imposed the offender is sometimes required to pay the costs. The main object of the prosecution is to act as a deterrent by publicity.

Deputy Booth.—Has this action had any effect in that connection? Has the Accounting Officer got any indication that this stepping-up of the number of prosecutions has reduced the number of false claims being made for assistance?—I do not think it is possible to say that. It is impossible to say how many people who would have been fraudulent are deterred from being fraudulent by these prosecutions.

Deputy Moloney.—I asked if the Accounting Officer would say that prosecutions, particularly in cases where small amounts are involved, were warranted.

Chairman.—Mr. Keady said it acts as a deterrent.

Deputy Moloney.—He said the party is brought to court, fined, and so on. Most of these are very poor people. We are fining poor people and making their position actually worse.

Deputy Sheldon.—How do you condone fraud?

Chairman.—I think we could not condone fraud.

Deputy Moloney.—No, there is no point in that. But we are entitled to have our own views.

Chairman.—That is the Deputy’s own view but the Accounting Officer is satisfied that it is warranted.

228. Deputy Sheldon.—I want to make a point in regard to the Note on subhead C. — Unemployment Assistance — which states that the numbers of recipients of unemployment assistance were lower than expected. “Expected” is not a very happy word; “estimated” might have been better?—Yes.

229. Deputy Desmond.—Subhead I. refers to grants towards the supply of footwear for necessitous children. Could I be told the number of local authorities availing of this?—All the public assistance authorities, 32.

Could I be told how many of these local authorities are getting 50 per cent. and how many are getting below that and at what rates?—Thirty of these 32 are getting about 50 per cent. and two are not.

Could I be told how much less than 50 per cent. the two are getting?—The only information I have is that it is a very small sum beneath the 50 per cent.

230. Is it correct to say that at least in Cork it is much below the 50 per cent.?— It was one time, to my recollection.

It still is, is it not, particularly the old South Cork Board of Public Assistance? —I am informed that it is only about 30 to 35 per cent. in North Cork.

We applied for the full thing year after year but we have consistently been turned down, have we not?—We can only recoup 50 per cent., up to the limit of the grant.

231. Deputy Booth.—On what ground is the grant calculated below 50 per cent.?

Chairman.—What is the reason for not giving the maximum?—We apportion it over all the local authorities to approximately 50 per cent. in proportion to their own expenditure.

232. Deputy Desmond.—In that case, there is no apportionment to South Cork on the 50 per cent. basis of their expenditure. That is the difficulty.

Chairman.—Is there any reason why Cork gets less than the 50 per cent.?—I think it is because they spent less themselves previously.

Deputy Desmond.—No, we spend more. It is the very reverse. Why are we not getting 50 per cent.?—I expect it is governed by the amount available to us which is £37,500 which is then allocated on the basis of 50 per cent. in proportion to their expenditure.

Deputy Desmond.—That is our difficulty—basing 50 per cent. on the total. It just works out that 30 local authorities are getting 50 per cent. of the amount being made available. What is left? It means South Cork is able to get only 30 to 35 per cent.

Deputy Sheldon.—In relation to that, there was a saving.

233. Chairman.—Can the Accounting Officer say that the money is allocated proportionately over each authority or is there a different basis of allocation as between one local authority and another? —I think it is true to say that Cork, from our point of view, was overspending and the grant does not apply to the amount by which they overspent.

Deputy Desmond.—The difficulty there is that South Cork had never been questioned regarding the persons that got the advantage of the grant. In view of the fact that the local authority had never been questioned on that score it is strange that there is a sum of £2,301 left over. Still there is only 30 to 35 per cent. of the local contribution being offered by way of grant.

Chairman.—Perhaps the Accounting Officer would send a note to the Committee?—Very well.*

234. Deputy Sheldon.—Has there been any difficulty about getting supplies of footwear in the last year?—I have not heard.

235. Deputy Moloney.—With regard to the Notes explaining the causes of variation between expenditure and grant, on page 195, we read, under subhead C.— Unemployment Assistance—that the numbers of recipients of unemployment assistance were lower than expected. There is a very drastic reduction there. I wonder were there any special circumstances which brought about that saving?—We estimated that the expenditure in 1959-60 would be about 8½ per cent. less than in the preceding year. That was the basis of the Estimate but, in actual fact, for the first 2½ months the provision was being exceeded. From about June onwards the number of claims ran about four per cent. less than we had anticipated. From November to mid-March it was running at seven per cent. less and for the balance of the year it ran at 10½ per cent. less.

I accept that there were less claims. Was that due to having more employment or was it that qualification certificates may have been withdrawn for some people?—I do not think it was due to that. It was a genuine fall in the number of applications.

236. Deputy Desmond.—Would the extension of the Employment Period Orders from October to November have had any bearing on it in the rural areas?—I think they were extended by about two weeks. My recollection is that the saving was of the order of £10,000 to £12,000.

Deputy Desmond.—So that it would have had some bearing on it?—Yes.

The witness withdrew.

VOTE 49—AGRICULTURE.

Mr. J. C. Nagle called and examined.

237. Chairman.— The first paragraph of the Report of the Comptroller and Auditor General on this Vote is No. 49 which reads:—

“Subhead F.3.—Veterinary College

49. Under new arrangements made during the year for the teaching of veterinary medicine University College, Dublin, and Trinity College, Dublin, which have a faculty and school, respectively, of veterinary medicine, under took responsibility for the appointment and remuneration of professors and other teaching staff. In addition to students’ fees, which were formerly appropriated in aid of the vote, the university authorities may receive annual grants towards the expenses of their establishments, and provision for these is made in the vote for 1960-61. The facilities available at the Veterinary College of Ireland are shared by both university authorities but the property of the College remains vested in the State. The Minister for Agriculture is still responsible for its management and maintenance, and the expenses of the College including the remuneration of non-teaching staff continue to be charged to the vote.

Compensation allowances in accordance with the provisions of the Superannuation Acts have been awarded to professors and other members of the teaching staff of the Veterinary College whose offices were abolished in consequence of these arrangements.”

Can you say, Mr. Nagle, are the new arrangements working satisfactorily in connection with the Veterinary College? —I believe they are working satisfactorily. It had, of course, been the intention for a long time to transfer this particular form of education from the State to the Universities. That is what has been done in most other countries and while it was a rather complicated operation to effect we believe the change over has proceeded quite smoothly.

238. Under the new arrangement has the title of the degree for a veterinary surgeon been changed from M.R.C.V.S.? I notice the letters M.V.B. in some cases? —The qualification now is a university degree in Veterinary Science, M.V.B. in one case and I think it is B.V.M. in another.

A distinction without a difference?— That automatically gives the holder the right to registration in the Register of the Royal College of Veterinary Surgeons in Britain and in the Register of the Veterinary Council of Ireland in Ireland.

It gives full reciprocity?—It does.

239. Has this change meant any increase in the demands on the Exchequer? —It has, for a number of reasons. First of all, we now have two Faculties of veterinary medicine, one in University College, Dublin, and the other in Trinity College, so naturally some additional staff is required in order to provide for the two Faculties. The total number of teaching posts has also been increased. It was necessary to do that in order to satisfy certain requirements of the Royal College of Veterinary Surgeons.

240. Chairman.—Paragraph 50 of the Report of the Comptroller and Auditor General reads as follows:—

“Subhead K.5.—An Foras Talúntais

50. In pursuance of an agreement with the Government of the United States of America providing for the use of moneys standing to the credit of the American Grant Counterpart Special Account, An Foras Talúntais was established under the Agriculture (An Foras Talúntais) Act, 1958 to review, facilitate, encourage, assist, co-ordinate, promote and undertake agricultural research. In accordance with sections 10 and 11 of the Act the Minister for Finance paid to An Foras out of the Counterpart Special Account sums of £840,000 and £1,000,000 to establish a Capital Fund and an Endowment Fund, respectively.

A number of research units together with associated properties and stores formerly administered by the Department were transferred to An Foras during the year. These included the Peatland Experimental Station, Glenamoy, Co. Mayo, Grange Farm, Dunsany, Co. Meath and Johnstown Castle Agricultural College, Co. Wexford. And a grant of £145,665 was paid from this subhead to An Foras under section 12 of the Act.

The form of the accounts of An Foras has been approved by the Ministers for Agriculture and Finance, and these accounts will be audited by me.”

Can you say what is the value of property transferred to An Foras Talúntais? —We transferred four different holdings with the chattels which were contained in those holdings. The most valuable property would have been Johnstown Castle Agricultural College. Originally that property was donated to the State so that there was no question of any purchase moneys when the State acquired the property, but, considerable sums were spent by the State on the development of Johnstown Castle—for example on the erection of modern soil science laboratories and so forth. In round figures, I would think the total capital expenditure on Johnstown Castle, taking into account the value of the land, would not be far short of £300,000. The other properties would not be worth that amount of money. The next one, in order of size, would be Glenamoy where experiments are proceeding on peat land. The value of the land there would be very limited but the buildings and chattels were worth nearly £70,000. In the case of Grange, County Meath, the value of the chattels transferred was £16,000 approximately, and the land would certainly be worth £30,000 to £40,000. Finally, there are Derrybrennan and Clonsast where the chattels were of a rather modest nature and valued at £1,800. The land would be of rather slight commercial value and so I would say a couple of thousand pounds would cover these two cases.

241. Chairman.—Paragraph 51 of the Report of the Comptroller and Auditor General is as follows:—

“Subhead M.6.—Farm Buildings Scheme and Water Supplies

51. The expenditure is made up as follows:—

242. Chairman.—Paragraph 52 of the Report of the Comptroller and Auditor General reads:—

“Subhead M.7—Land Project

52. The payments made in the year under this head are as follows:—

What was the average amount per acre of the grant under the Land Project Scheme during the year?—The average grant in 1959-60 was £14.11.5.

Deputy Booth.—Is that under Section A?—Yes.

243. Deputy Moloney. — What was covered in the provision for the “Purchase of Machinery, Implements, etc.”?— That expenditure of £1,745 was in respect of maintenance of land reclamation machinery operated by the Department in that year. For example, it covered the purchase of fuel, spare parts and also taxation and repairs. There was no purchase of new machinery in the year.

What machinery does the Department require? Would it relate to Section B, which has been closed down?—Yes, this would relate to Section B. Although we ceased to accept applications under Section B as from November, 1958, there were already on the books a considerable number of approved applications which had to be honoured. Some of these Section B cases have not yet been finally completed although we hope they will be terminated in this financial year.

244. Deputy Booth.—What would be the average cost per acre for the work carried out under Section B?—It would be in the region of about £50.

245. Deputy Moloney. — There is a figure mentioned of £14,084 for “Payments to Office of Public Works.” What were those payments for?—The Office of Public Works carries out certain agency work on our behalf where, what I might call bigger schemes of an arterial nature, have to be undertaken locally in order to enable individual local schemes to be carried out. For example, if we have in mind to give grants in three or four local cases and there is a general drainage problem arising in the district and that drainage problem is not solved there will be no advantage in each individual proceeding with his field drainage. In such circumstances the Office of Public Works assists us by carrying out any local arterial work which will be needed and we repay the cost of such work.

246. Chairman.—Paragraphs 53 and 54 of the Report of the Comptroller and Auditor General are as follows:—

“53. Under section A of the project an occupier of land who undertakes approved work himself is entitled, when the work has been completed to the satisfaction of the Department, to a grant amounting to two-thirds of the estimated cost subject to a maximum of £30 per statute acre. Grants to farmers under this section of the project amounted to £1,662,111 in the year as compared with £1,389,753 in the previous year.

54. Because of the restriction of work under section B of the project, to which reference was made in my previous report, machinery, equipment and spare parts became surplus to requirements and were sold by competitive tender for £18,467. Items valued at £2,466 were retained by the Department for use on its farms, and equipment valued at £200 was transferred to other departments. Payments to contractors under this section during the year amounted to £185,332 compared with £306,734 in the previous year.”

Deputy Jones.—What is the value of the items sold by competitive tender for £18,467? Was that a book value?

Chairman.—Spare parts and equipment?

Mr. Nagle.—This relates to the sale of reclamation machinery, spare parts and workshop repair tools which had previously been acquired for use under Section B of the Project. These were, in general, sold by competitive tender. A number of implements were transferred to some of our own schools where they were needed.

Deputy Jones.—What I want to know is what was the book value of the equipment sold by competitive tender for £18,467? What was the value of it?—I cannot say at the moment what the exact book value of the item is. Of course, I can get it later.*

247. Chairman.—Paragraph 55 of the Report of the Comptroller and Auditor General reads:—

“Subhead M.8—Lime and Fertilisers Subsidies

55. The expenditure from this subhead is made up as follows:—

The reports of officers of the Department who inspected the records of the various firms to verify subsidy claims were examined by my officers with satisfactory results.”

248. Chairman.—Paragraphs 56 and 57 of the Report of the Comptroller and Auditor General are as follows:—

“Subhead M.11—Bovine Tuberculosis Eradication Scheme

56. The net expenditure on the scheme was £5,083,992, made up as follows:—

57. The gross cost of the scheme from its inception in September 1954 to 31 March 1960 was £13,085,444 and receipts from the disposal of cattle for slaughter amounted to £5,445,643. The net cost was therefore £7,639,801. Allocations towards the cost were provided from the Grant Counterpart Special Account (£700,000) and the National Development Fund (£653,000).”

Deputy Jones.—With regard to compensation in respect of reactors, £7,575,199, could you tell us how much of that money is on the £15 headage grant and how much is by way of full compensation for cattle slaughtered? I take it that the £15 headage grant applies here?—It does, yes. The bulk of the expenditure here would be expenditure other than on the £15 headage grant scheme. I have some information which bears on the matter. A total of 128,000 cow reactors and 39,000 non-cow reactors were purchased by the Department during this year and, under the southern scheme, an additional 41,000 cow reactors were sold by herd owners under the headage arrangement. If that is multiplied by £15, you will get the cost.

249. Chairman.—Would you have any average figure for herd reactors?—We have. In 1959-1960 the average loss per reactor we disposed of was in the region of £23.

Deputy Sheldon.—That relates to the £5,000,000 net figures of loss and not to compensation?—That would be the net loss, the difference between what we paid and what we got.

250. Deputy Moloney.—I should like to get some information in regard to fees to veterinary surgeons, £1,044,991. Could you tell us the number of surgeons participating in this work and then we can get the average? Perhaps if Mr. Nagle has the average, he will tell us what it is? —Yes. The total number of veterinary surgeons engaged under the scheme in 1959-1960 was 526. The amount of fees paid to these 526 veterinarians was just over £1,000,000, so that the average per veterinary surgeon, was in the region of £2,000.

Does the figure of £1,044,991 represent the fees or does it include other supplementary payments or expenses?—It repreents fees.

Fees only?—Yes. May I add that no payment is made to the veterinary practitioner in respect of travelling expenses or in respect of any lay assistance he may require when he is engaged in testing, tattooing and so on. All that is included in his fee. It is a flat figure.

251. Could we go further at this stage and ask to be given a brief explanation as to how the fees are paid, how the veterinary surgeons are compensated for their work in connection with their participation in the scheme?

Chairman.—That was answered before.

Deputy Moloney.—I was not a member of this Committee then.

Deputy Booth.—A recent answer to a Parliamentary Question showed a break-up of the fees payable.

Chairman.—There is an explanation of it in the Report of the Committee of Public Accounts for 1957-1958 in a minute sent by Mr. Nagle to the Committee.

Mr. Moloney.—I will get it from that.

Chairman.—Is the basis still the same?

Mr. Nagle.—It is exactly the same. Yes.

252. Chairman.—This does not include any payments to staff?—No. This figure of £1,044,991 is entirely for veterinary practitioners.

253. Deputy Jones.—May I go back to ask a question in regard to compensation in respect of reactors? Are reactors in the southern scheme disposed of by way of the headage scheme?—In the south, at the moment, we are paying only on cow reactors because clearance measures have not yet been introduced there. They have not reached the clearance stage so that the compensation payable applies to cow reactors only.

May I take it, then, that the sum of the £7,575,199 was spent in areas other than the south on both cow and other reactors?—That would be correct, except for the £615,705 headage grants in the south.

254. Chairman.—Paragraphs 58 and 59 of the Report of the Comptroller and Auditor General say:—

“Subhead M.12.—Grants for Pasteurisation of Separated Milk, etc.

58. Grants to creameries towards the cost of approved pasteurising plant amounted to £29,159 in the year. This amount was recouped to the Department from the American Grant Counterpart Special Account and credited to appropriations in aid (see paragraph 67).

59. I have communicated with the Accounting Officer regarding certain refunds in respect of grants, which have been credited to a suspense account.”

Have you anything to add to that, Mr. Ó Cadhla?

Mr. Ó Cadhla.—Certain irregularities appertaining to these grants came to light. I understand they are still under investigation.

Deputy Booth.—The grants were made in respect of alleged fraudulent applications?

Mr. Nagle.—Certain aspects of this matter are at the moment in the hands of the competent legal authorities. If you wish——

255. Chairman.—This question is sub judice, but can you say at this stage what amount has been refunded?—Certainly. It appeared that overpayment by the Department had been actually made to an amount of slightly over £3,000. Up to date, that is up to today, refunds have been received of about £1,700 which have been lodged to a suspense account.

I suppose we will be informed, in due course, of the outcome?—Yes.

256. Chairman.—Paragraph 60 of the Report of the Comptroller and Auditor General reads:—

“Subhead M.13.—Payments to Pigs and Bacon Commission

60. The scheme introduced in April 1956 to support the price of Grade A bacon exports is administered through the Pigs and Bacon Commission and is financed from the proceeds of a levy on bacon pigs purchased by curers together with a State contribution. Due to a decrease in the quantity of Grade A bacon exported, the amount of subsidy paid was less than anticipated.”

The exports of Grade A. pigs are much lower this year compared with the previous year?—In the year 1959-1960, yes. The exports fell and the number of pigs in the country fell. Pigs are notorious for the manner in which they fluctuate. The curve of production is very much upwards at present. I am afraid, we are going to have a much bigger bill than we anticipated in the current financial year.

257. Chairman.—Paragraphs 61 to 63 of the Report of the Comptroller and Auditor General are as follows:—

“Subhead M.14.—Losses on Disposal of Wheat and Payments to Wheat Growers, etc.

61. The expenditure under the subhead is made up as follows:—

62. Reference was made in paragraph 45 of my previous report to the arrangement under which An Bord Gráin would purchase and dispose of so much of the 1958 wheat harvest as was not millable into flour. The accounts of An Bord to 31 August 1959 showed losses at that date of £259,647 towards which £150,000 was paid on account in 1958-59. A further payment on account of £200,000 was made in the year under review.

63. In paragraph 44 of my previous report I referred to ex-gratia payments to growers in respect of wheat of the 1958 harvest sold to authorised purchasers and to payments on account thereof amounting to £297,337. During the year £169,544 was paid in respect of balances due, and £2,021 was refunded to authorised wheat purchasers in respect of miscellaneous expenses incurred. The reports of officers of the Department who inspected the records of the wheat purchasers to verify claims were examined by my officers with satisfactory results.”

Deputy Sheldon.—Could Mr. Nagle say what the position was at 31st August, 1960?—I wonder would I be permitted to give an estimate which, I think, is fairly accurate, of the over-all results of these operations because they have extended into three financial years? Would that be in order?

Chairman.—I think so, subject to correction at a later stage if the figures are found to vary in any way.

Mr. Nagle.—The over-all position is somewhat as follows. The loss of An Bord Gráin which, of course, meant the difference between the price at which they took over wheat from the millers and the price at which they disposed of that wheat can be put at £1,096,000. Against that An Bord Gráin had levy funds to the extent of £706,000. That left a net deficiency of £390,000 which is being made good by the State. Secondly, special payments were made to the growers by my Department. They cost £469,695. The total of these two figures, that is, the net loss of An Bord Gráin and the special payments to growers, would be about £860,000. That would be the cost to the Exchequer. That has been split up between three financial years according as An Bord Gráin’s transactions moved forward. On the credit side, the Exchequer—not my Department’s Vote, of course—has received the proceeds of a temporary £2 a ton customs duty on wheat which, all told, has brought in about £558,000.

Deputy Sheldon.—I take that, in relation to the £390,000, the Department owes the Board about £40,000?—That is right.

258. Chairman.—Paragraph 64 of the Report of the Comptroller and Auditor General reads as follows:—

“Subhead P.—Subsidies on Dairy Produce

64. The expenditure from this subhead was as follows:—

One-third of the loss on exports by the Butter Marketing Committee is charged to the Dairy Produce (Price Stabilisation) Fund and payments from the Fund to the Committee in respect of export losses in the years 1958-59 and 1959-60 are referred to in paragraph 68.”

Deputy Jones.—What is the amount of the subsidy per cwt. on butter which is exported?—The figures are as follows. The average price realised for butter exported in 1959-60 was 371/11d. per cwt. We must deduct certain expenses amounting to 12/-a cwt. That gives a net return to the Butter Marketing Committee, in that year, of 359/11d. per cwt., or, may we say, 360/-a cwt. The cost to the Committee of this butter was 442/- per cwt. so that the losses incurred averaged 82/- per cwt.

Deputy Moloney.—So the average subsidy during the year under review was 82/-?—About £4 per cwt.

Can we take it that two-thirds of that was met by the State and the other one-third was met by the industry?—The other one-third was met by the Price Stabilisation Fund.

That was contributed to by the producers, or the industry as a whole?—Yes.

259. Chairman.—Paragraph 65 of the Report of the Comptroller and Auditor General reads as follows:—

“Subhead S.—Losses

65 In paragraph 46 of the report on the accounts for the year 1955-56 reference was made to repayable advances of £922,717 to Comhlucht Siúcre Éireann, Teoranta, to finance the importation and distribution of superphosphate. Due mainly to a substantial fall in the world price of superphosphate the amount realised on sales, less expenses, fell short of the amount advanced. Repayments by the company, including £1,475 in the year under review, amounted to £453,168 and provision was made by supplementary estimate to write off the balance of £469,549.”

Is this the final report of this scheme?— Yes. A Supplementary Estimate was taken in order to bring the issues to the notice of the Dáil. The amount voted was credited as Appropriations in Aid. It is a self-balancing item.

260. Chairman.—Paragraph 66 of the Report of the Comptroller and Auditor General reads as follows:—

“Subhead R. — Appropriations in Aid

Rent of lands and premises occupied by Colucht Groighe Náisiúnta na h-Éireann, Teoranta

66. Reference was made in paragraph 32 of the report for 1957-58 to the arrangement under which the National Stud Farm at Tully, Co. Kildare, was occupied by Colucht Groighe Náisiúnta na h-Éireann, Teoranta, under annual licence, and to the purchase by the Minister of the landlord’s interest in portion of the lands for a sum of £17,000. Under a revised licence the company was granted the right to use and occupy the lands at a rent of £1,400 per annum and a sum of £2,800 in respect of the two years from 26 March 1958 to 25 March 1960 was received and brought to account as appropriations in aid.”

261. Chairman.—Paragraph 67 of the Report of the Comptroller and Auditor General reads as follows:—

“Recoupment from American Grant Counterpart Special Account in respect of grants to certain rural organisations, pasteurisation of separated milk and technical assistance

67. The agreement dated 17 June 1954 between the Governments of Ireland and the United States of America provided for the use of the balance, £6,000,000 approximately, in the Grant Counterpart Special Account for the benefit of the Irish economy. It also provided for the negotiation of subsidiary agreements which would contain detailed specifications of the nature of the projects agreed on, including a budget and a plan of expenditure in each case. The amounts allocated under the various subsidiary agreements in respect of projects sponsored by the Department of Agriculture, together with recoupments from the Special Account up to 31 March 1960, are shown in the following statement. The amounts recouped were credited to appropriations in aid.

The allocation to the Agricultural Institute is accounted for in the accounts of An Foras Talúntais.”

Deputy Moloney.—Am I right in assuming that what happens is that the Department assists a certain number of organisations? Am I right in assuming that a particular number is selected for this American Counterpart Grant and that recoupment comes in those cases to the Department but in the first instance the Department pays the money? Is that what happens?—That is the procedure.

262. Chairman.—Paragraph 68 of the Report of the Comptroller and Auditor General reads as follows:—

“Dairy Produce (Price Stabilisation) Fund

68. The rate of levy on creamery butter manufactured on or after 1 July 1959 was reduced from 26s. 8d. to 9s. 8d. per cwt. The income of the Fund amounted to £646,421 as compared with £1,179,551 in the previous year.

The payments from the Fund were as follows:—

What functions does the Butter Information Council perform?—This Council consists of representatives of the main butter-exporting countries all over the world— for example, Denmark, New Zealand, Holland and ourselves. Each of these countries contributes to the Fund, roughly in proportion to the extent of its exports to the British market. The money is used in publicity campaigns to try to persuade people to eat more butter. This particular campaign is conducted without any reference to any particular country’s butter. It is an “Eat More Butter” campaign. We think it has been reasonably successful.

263. The Vote itself is on page 122. Is there any danger of overlapping between the research work done by the Department and that carried out by the Agricultural Institute?—I would not think so. We have transferred to the Institute our biggest research establishment which was Johnstown Castle. The only substantial area of research which has been retained is cereal breeding. I think reasonably adequate arrangements have been made between An Foras Talúntais and the Department to ensure there will be no overlapping.

264. Deputy Booth.—I am surprised at the explanation that the expenditure under this includes a payment of £18 to a bank in respect of special cheques. Is it a common practice to have specially-designed cheques for various branches of departmental work? It seems an unusal procedure or does this perhaps mean that they were just specially printed with the experimental station name on it or a special design?—It is rather unusual. It was a rather large sub-account in one of the local banks. The operations of the station were quite complicated from the accounting point of view. Arrangements were made by the local manager of the station and the bank to put special headings on the cheques. We were advised by the local manager that it assisted him considerably in the discharge of his accounting responsibilities. It was not known exactly when the property would be transferred to the new research institute, unfortunately, and when a decision was made it so happened that a fresh supply of these cheques had been ordered. Also, I understand that the bank account was changed. In other words, the new owners of the property have a different bank. That made it rather difficult to ask the original bank to foot the bill for these special cheques.

Was it just a question of a different heading on the cheque? The explanation refers to a special design?—My information is that they were specially designed cheques which facilitated considerably the book-keeping work of the station. Unfortunately, I have not a specimen cheque with me.

Deputy Sheldon.—Would it be the type where the paid cheques would almost act as a Day Book?—I think so.

265. Chairman.—Is the veterinary staff up to strength yet?—Not yet. We have lost some persons from the veterinary research station laboratory to the Universities in the course of the changeover of veterinary education to the Universities. There, we burn, so to speak, between two fires. On the one hand, we regret very much losing some of these expert veterinary research men. On the other hand, we have an obligation, under international agreements, to ensure that the new veterinary faculties of the Universities are staffed to the agreed strength. Therefore, we felt an obligation to facilitate the release of our own civil servant veterinarians where they were needed for University posts. We hope, in the course of a few years, to remedy the present situation.

Is it that there is a shortage of suitably qualified veterinary surgeons for this purpose or has the remuneration anything to do with it?—I would say there is a shortage of veterinarians in the country at the moment, both private and public. The civil service pay has been increased rather substantially during the past year.

266. Deputy Booth.—What are the qualifications of the recorders who are referred to in the explanatory note? The explanation sets out that, of 36 recorders who were expected to be employed, only 24 were, in fact, employed by the end of the year. Is that by reason of not having people properly qualified as recorders or has this been working at half pressure?— The scheme envisaged all of these artificial insemination stations participating in this new project. There were nine stations. We envisaged a total of 36 recorders, on average, at these stations. Not all the stations have yet come into the scheme. It is not a question of shortage of qualified men or anything like that. On the whole, we thought a fairly good start had been made though we did not get complete participation in the first year. We hope to have complete participation within the next year.

Is that participation voluntary or has any pressure to be used to bring these stations in?—It is really a voluntary matter. We had a number of meetings with the artificial insemination station authorities lasting over a few months and we evolved an agreement with the stations in regard to this scheme under which they would employ these recorders and supervise them and we would give them a contribution to the cost.

267. Deputy Sheldon.—Under subhead F.2.—Grants to Private Agricultural Schools, etc.—I take it these capital works are for buildings and the supply of equipment in the schools and that the work is going on but had not been completed at the end of the financial year rather than that the work was abandoned?—That is correct. There was no abandonment but very often we find that these capital works take much longer than the schools originally estimated and then we ask for a re-vote in the subsequent year of the amount under-expended.

268. Deputy Booth.—Does the saving under subhead E.3. have any connection with the position under subhead F.3.— Veterinary College? Had any of the staff been transferred to the Veterinary College? I notice, in the explanatory notes, that there was a saving due to unfilled vacancies. Were any of those vacancies filled during the year from the personnel affected by subhead E.3.?—Not really. In fact, I do not think there would be any direct connection between the figure in subhead E.3. and that in subhead F.3.

The saving under subhead F.3. was due to a shortage of veterinary surgeons?— Yes, and also, to some extent, to the fact that some of the teaching staff transferred to the Universities before the closing of the financial year.

269. Deputy Desmond.—In regard to subhead F.9.—Rural Groups Advisory Service—have we had replacements for the four parish agents who resigned during the year?—No, these men have not been replaced.

In the case of demonstrations, which proved less costly, would that have any bearing on the number of demonstrations which were given in the areas in which the four parish agents had been before they resigned?—Certainly, the decline in the expenditure is a factor arising from the decline in the number of parish agents.

Deputy Sheldon.—Are there any salaries borne in this subhead?—No.

Chairman.—Is there any explanation why they are declining?—Well, the present policy is not to replace a parish agent if and when he resigns. The present policy is in general to confine the advisory and extension work, to the staffs of the county committees of agriculture.

Deputy Sheldon.—I am just wondering where the salaries were borne?—Under subhead A.

270. Under subhead G.1.—Improvement of Milk Production—I notice that there was a drop in the number of cow testing associations. Can you say how many associations went out of existence?—In the year 1959 there were 117 associations with 36,500 cows. In the previous year, 1958, there were 126 associations with 41,400 cows so that there has been a definite decline.

Can you say what was the reason for that?—This trend has been noticeable for quite a number of years and there are probably a number of reasons. One reason is that many farmers claim that the scheme does not lead to any particular goal which is of great value. We question that. A number of people believe that they go on recording and do not see any substantial reward for it at the end.

Is there any alternative method of recording?—I was just coming to that point. We discussed this whole matter with all the interests concerned. Our belief generally is that milk recording, or cow testing to give it its old fashioned name, should really be associated with progeny testing. The two things should be linked together and then you have a definite objective in the scheme as it helps you to identify the best breeding stock as well as identify the best cows in your herd, and to discover where those cows came from originally, what bulls sired them and so forth. All these things go together. I may add that, although we have had protracted discussions of a possible re-organisation of this particular scheme on the lines I have roughly indicated so far we have not come to any financial agreement with the various interests. We hope we will during the coming year.

271. Deputy Sheldon.—On subhead G.2. —Improvement of Livestock—in relation to subhead I.—Special Agricultural, etc. Schemes—certain stock animals were not available to the extent required because of a lack of suitable type and quality and, in subhead I., there was additional expenditure because of the purchase of extra bulls. How could that arise? It was possible to buy extra under subhead I. but there were not enough available under subhead G.2.?—I think the distinction would be that, under subhead G.2., the bulls in question would include imported bulls, bulls purchased in Britain, whereas, under subhead I., generally speaking, the bulls would be purchased within the country itself.

My query was just in relation to the note on subhead G.2., which says “In addition stock bulls and pigs of suitable type and quality were not available …” Would it be possible that a higher standard is sought under the scheme under subhead G.2. than in the scheme for subhead I.?—That might apply to a certain extent. I think that would be correct.

272. Deputy Jones.—In regard to subhead H.—Grants to County Committees of Agriculture—and taking it in conjunction with subhead F.9., does this mean, from the lesser expenditure under subhead H., that there is not an increasing service being made available to the farming community through the County committees of agriculture? There was a surrender of £7,500?—That saving was of a very casual nature. I would regard it as a fairly normal variation on the original estimate.

273. Deputy Desmond.—In view of the decline in the number of parish agents could we get any idea to what extent that service is being taken over by the county committees of agriculture in view of the fact that there is a saving of £7,547?—I think I am right in saying that, if you look at the expenditure under subhead H., year by year, you will see an increasing tendency, both in the Estimates and in the actual amounts expended, in the numbers of instructors employed by county committees of agriculture. In general, nowadays, we encounter very little resistance among county committees of agriculture to increasing the number of their advisory officers where there is a need for them. We now have 215 instructors in agriculture, including temporary instructors, compared with not more than about 50 before the war.

274. Deputy Sheldon. — On subhead K.4.—Grants to Certain Rural Organisations—do I take it that the intention is that this subhead will disappear?—Yes, that would be the case when the money is spent.

275. On subhead M.1.—Miscellaneous Work—I see in the Estimates that there was provision for two trade officers, at a cost of £1,564, and I see that the saving was £1,168. Do I take it that there were no trade officers at all for most of the year in Britain?—There was one trade inspector in London for the whole year and we had a vacancy for the entire year in Liverpool.

The Estimate was for two at an expenditure of £1,564 and there is a saving of £1,168 so that it does not look as if the man in London was getting very much pay?—It would be difficult for me to comment on the salary level but, may I say that, during the present financial year we have succeeded in re-grading the posts in London and Liverpool which now have the status of a Third Secretary in the Department of External Affairs.

Chairman.—A grade which most people are more interested in getting out of?— However, it represents an advance in our case.

Deputy Sheldon.—On the face of it it looks as if he only got £400 for his year’s work.

Deputy Desmond.—Has the second post been filled yet?—Not yet.

276. Deputy Booth.—On subhead M.6. —Farm Buildings Scheme and Water Supplies—does the over-expenditure here not call for some explanation? I am amazed that there are explanations for variations of smaller proportion.

Chairman.—There is no note on subhead M.6., Mr. Nagle, and Deputy Booth is anxious to know if there is any explanation?—In fact, the excess was due, first of all, to increased expenditure on grants for silos. The rate of grants for silos was increased and that led to quite a fair increase in the applications. There was also an excess on the water supplies grants which are becoming increasingly popular.

277. Deputy Sheldon.—There is a comment I should like to make on Appropriations in Aid, in regard to item No. 18, and the use that was made of the word “secondment.” I quote from The Quarterly Review, 1897. It says: “The practice of secondment seems to us as objectionable as the word is ungrammatical.”

Chairman.—I have no doubt Mr. Nagle will note the import of that.

Mr. Nagle.—I take the point.

278. Chairman.—I have the accounts of the Dairy Disposal Company. There are copies on the table for members of the Committee.*

279. Deputy Booth.—There is a note, on page 136, referring to a claim for £665 against a land reclamation contractor. Apparently proceedings were taken against the Minister and judgment given against him?—This is a rather complicated case and I would have to go into some detail to explain what happened, if

I may. In this case the work commenced in March, 1954. In June of that year the applicant complained to the Department about the quality of the work done. This, of course, was a Section B case. It was inspected at that stage and it appeared that some closed drains were not of the required depth. Some open drains had not been constructed to specification and some outlets had not been fully built up. The contractor was told to remedy these defects, but, although he agreed to do so, I understand that a relative refused to allow the workmen access to the holding except on the understanding that all the closed drains would be reconstructed. Apparently, our inspector did not consider all the drains required to be done. However, in November, 1954, agreement was reached in regard to the work necessary for the satisfactory completion of the scheme but at that stage the contractor declined to carry on any more work on the holding. In January, 1955, it became necessary to rescind the contract. The scheme was then completed directly by the Department, at a cost of £605, against which we held a sum of £200 which was the balance unpaid on foot of the contract with the contractor. However, the farmer then pressed a claim for damages in respect of losses incurred on account of the delay in completing the scheme and a civil bill was issued for £443.15s. On counsel’s advice, a sum of £111 was lodged in court. A decree was given against the Minister for £139 10s., with taxed costs. which amounted to £120 18s. 2d., so that the total additional expenditure incurred, allowing for the sum of £200 which we retained from the contractor, was £665. We were legally advised against taking any steps to recover this amount because it was not believed we would succeed. It has certainly been an expensive case. We proceeded on the basis of legal advice.

280. Deputy Sheldon.—With regard to a mobile workshop unit lent to the Department, is that on permanent loan or is it for some particular time? Usually one sees things lent by one Department to another without charge. This is the first time I have seen a charge made?—I take it that there is no passage of money. This is a book entry, I think, in order to account for the use of the particular machine. Cash or money did not pass.

Is it to be used permanently by the Department of Agriculture or just for a short time?—This was actually used for a short time, from November, 1958 to May, 1959 on a special job.

The witness withdrew.

The Committee adjourned.

* See Appendix XVIII.

* Note by Accounting Officer: The book value of the various items of equipment sold by competitive tender was £18,451.

* See Appendix XIX.