Committee Reports > List of Committees > Dáil > 1963 > Committee of Public Accounts > Report - Appropriation Accounts 1961 - 1962

MIONTUAIRISC NA FINNEACHTA

(Minutes of Evidence)

Déardaoin, 21 Márta, 1963.

Thursday, 21st March, 1963.

The Committee sat at 11 a.m.

DEPUTY JONES in the chair.

Mr. E. F. Suttle (Secretary and Director of Audit), Mr. J. Whelan and Mr. J. R. Whitty (An Roinn Airgeadais) called and examined.

VOTE 46—POSTS AND TELEGRAPHS.

Mr. Leon Ó Broin called and examined.

474. Chairman.—Paragraph 76 of the Report of the Comptroller and Auditor General reads:

“Subhead I.—Losses

76. The losses borne on the vote for the year ended 31 March 1962 amounted to £7,469. A classified schedule of these losses is set out on page 143. At page 144 particulars are given of 17 cases in which misappropriations, thefts, etc., amounting to £428 were discovered; the sums in question were made good and no charge to public funds was necessary.”

Have you anything to add, Mr. Suttle?

Mr. Suttle.—That is the usual formal paragraph. The amount charged to the vote was £7,469 as compared with £28,879 in the preceding year. Compensation for loss of or damage to parcels and insured letters was £4,124 compared with £3,744 in the preceding year.

475. Chairman.—Details of the losses which are dealt with in the paragraph are set out on page 143. There are three items of loss of registered letters in transit mentioned. Can we have some information on these items?—Yes. The first one—An Uaimh Head Office, £200—is a case of a registered letter containing £400 in notes that was lost in transit between Buckinghamshire and An Uaimh. The registration fee paid on the letter covered compensation for the full amount of the contents. Joint investigations by the British and ourselves failed to establish the point of loss and, in accordance with an arrangement we have, the total amount of the compensation involved was borne equally between the British and the Irish Post Offices. The second one was rather similar, in fact, exactly similar. A letter containing £400 was lost between London and Kells. We could not agree as to where the letter was lost and we shared the amount equally. The third one was a registered letter containing £250 in notes lost between Durham and Limerick. The missing item was due to have been forwarded from Dublin with others to Limerick but there is no record of its arrival at Limerick. The cost of the compensation was £250, which fell on us because of evidence that the loss occurred while the letter was in our custody.

476. In regard to the item, Irregular issue and fraudulent negotiation of money orders in the Accountant’s Branch, that appeared some years ago in a note in the Report of the Comptroller and Auditor General of 1958?—Yes. It was also mentioned in the Report of 1959-60. I gave a fairly detailed explanation of what occurred on that occasion and there was some comment by members of the committee.

The only thing is—is there any particular reason for the long delay in writing it off? Did you hope to recover?—No. I think I explained on the last occasion that there was no hope of recovery except what we did recover by way of the loss to the offender, if that is the word, of the gratuity of £700 and a pension of £250 a year. The Department of Finance having now given us the necessary authority, the amount has been written off.

477. On page 144 there is an item of registered and insured letters lost, £649. Apparently, that does not include the three items referred to on page 143. Is there some difference between them?— These are ordinary cases where we pay compensation to members of the public in respect of loss of or damage to registered or insured letters where the burden is clearly on us to pay.

478. There is another item—I think we had it before—that is, the presentation of commemoration, etc., stamps. I think it was agreed previously that they would not be shown as a loss?—This is the last account in which they will be so shown. I explained on the last occasion that we were making a change which will be carried out in the next account.

479. I notice from the paragraph on page 144 commencing: “Transactions during the year . . . .” that a large volume of work is done. You do not seem to have taken any credit for a large amount of work you do for the Department of Social Welfare?—These are Post Office transactions and give the background to the losses. We either charge up as services rendered what it costs us to do Social Welfare work or recoveries are brought to account in the Appropriations in Aid.

480. Chairman.—Paragraph 77 of the Report of the Comptroller and Auditor General reads:

“Stores

77. A test examination of the store accounts was carried out with satisfactory results.

In addition to the engineering stores shown in Appendix No. 11 as valued at £1,404,744 on 31 March 1962, engineering stores to the value of £41,227 were held on behalf of other government departments. Stores other than engineering stores were valued at £488,415 including £210,090 in respect of stores held for other government departments.

Including works in progress on 31 March 1962 the expenditure on manufacturing jobs in the factory during the year amounted to £48,732, expenditure on repair work (other than repairs to mechanical transport) to £73,358, and expenditure on mechanical transport repairs to £15,672.”

Have you anything to add, Mr. Suttle?

Mr. Suttle.—This paragraph contains the usual information relating to engineering and other stores held by the Post Office at the end of the year. It also includes the value of work done by the Post Office Factory. The stock of engineering stores increased by £253,010 in the year under review.

481. Chairman.—Appendix No. II, on page 147 of the Appropriation Accounts, goes with paragraph 77. I notice the item “Engineering Materials Purchased, £1,286,660” and then there is the item “Stores taken into stock in 1961-62 but not paid for on 31st March, 1962, £315,648”. Do you not pay for goods as soon as you take them into stock?— Are we on subhead F.?

Appendix No. II deals with paragraph 77 It is the same thing, “Engineering Materials Purchased”, in the Appendix on page 147, is referred to? It says “Stores taken into stock in 1961-62 but not paid for”?—I will send you a note on that.*

482. Deputy Lalor.—I notice that total stocks at the end of the year showed an increase. What is the reason for that? Does it mean that there was a slowing down on the installation of telephones? —The two things are related, in a sense, to subhead F. as a whole. As you see, we spent £145,511 less than the amount voted. By December of 1961-62 we were aware that we were not going to spend the total provision we had obtained for equipment to be installed and work done by contractors due to a variety of reasons and we decided to spend some of this money in building up and adding to our stocks for future years because, of course, we are expanding rapidly on the telephone side. We thought this was the wise thing to do, to divert some of this money which was not going to be paid over to contractors into stockpiling.

I understand the main difficulty, or one of the main reasons why we are so much behind time with the installation of new telephones was not so much scarcity of cash as difficulty of procuring the telephones—the difficulty of getting supplies. Here we have a case, in 1961-62, where we accumulated stocks and finished up the year with more telephones in stock, I presume, than we started the year with. Would that be the position? Why should that occur?—We have more materials, as it were, to enable us to carry out our programme, which is not, of course, done in one year. It is a continuing programme. We had substantial savings, amounting to over £250,000, arising out of delays in undertaking or completing certain contract works. These delays arose out of the inability of contractors to make deliveries of materials or to complete installations in time and this inability has many causes. Contractors in this telecommunication field are under heavy pressure, as you probably know, for supplies for both civil and military purposes outside Ireland. Much of the equipment is of an extremely complicated nature and a hold-up in the supply to the contractor of one component, due, say to a strike, or something of that sort, can be a real obstacle. Moreover, the pace of technical development is such that contracts are frequently the first for the large-scale manufacture of a design and that gives rise to particular difficulties. The result was that we had a considerable amount of money to the expenditure of which we were committed to but which, in fact, we could not pay over. We thought it wise, in those circumstances, to build up supplies of materials for the part of the programme which we would do ourselves.

483. The explanatory note in regard to subhead F.—Engineering Stores and Equipment—says that the variation between expenditure and grant was mainly due to delays in undertaking or completing certain contract works. I gather that the explanation is delay due to contractors being unable to supply us with equipment more than to delay in carrying out contracts for installation?—It covers both things. It covers both the supplies of materials and installation jobs being done by contractors.

Deputy Clinton.—And contractors’ difficulties are difficulties caused sometimes by a change in the specification due to modern developments. Is that so? Do you change the specification?—We would not change in the middle of a contract.

I thought that was given as one of the reasons?—No. In some cases we did give the contractors something in the nature of a prototype job and this gave rise to difficulties and delays.

Is there a time clause in those contracts? Is there a penalty for delays that cannot reasonably be accounted for, and that type of thing?—We have various provisions but there are difficulties of implementation.

484. Chairman.—Paragraph 78 of the Report of the Comptroller and Auditor General reads:

“Revenue

78. A test examination of the accounts of Postal, Telegraph and Telephone services was carried out with satisfactory results.

The net yield of revenue for the years 1961-62 and 1960-61 is shown in the following statement:—

£10,500,000 was paid into the Exchequer during the year leaving a balance of £586,893 at 31 March 1962 as compared with £812,769 at the end of the previous financial year.

Sums due for telephone services amounting to £3,009 were written off during the year as irrecoverable, as compared with £3,950 for the previous year.”

Have you anything to add, Mr. Suttle?

Mr. Suttle.—No. This paragraph is for information. During the year 351 claims for telephone services were written off as irrecoverable. In no case did the amount exceed £100 and all were written off under delegated powers.

485. Chairman.—It is interesting that there was an increase in the telephone service and telegraph service and a drop in the postal service. Is there any theory as to why that should be?—There was some slight improvement on foreign telegrams. In terms of trading deficits and surpluses, there was a deficit that year on the postal side and on the telegraph side and a surplus on the telephone side.

486. Chairman.—What I had in mind was that there was an increased revenue in 1961-62 over 1960-61 in both the telegraph and telephone services but the postal service revenue declined. Paragraph 79 of the Report of the Comptroller and Auditor General is as follows:

“Post Office Savings Bank

79. The accounts of the Post Office Savings Bank for the year ended 31 December 1961 were submitted to a test examination with satisfactory results. The balance due to depositors, inclusive of interest, amounted to £107,484,344 (including £16,007,051 in respect of the liability to Trustee Savings Banks) on 31 December 1961, as compared with £101,557,983 at the close of the previous year. Interest accrued during the year on securities standing to the credit of the Post Office Savings Bank Fund amounted to £4,062,103. Of this sum £2,651,819 was applied as interest paid and credited to depositors, management expenses absorbed £306,936 and the balance £1,103,348 was set aside towards provision against depreciation in the value of securities.”

Have you anything to add, Mr. Suttle?

Mr. Suttle.—This paragraph contains the usual information about the Savings Bank. In 1961 the liability to depositors increased by £6 million. As compared with the preceding year deposits rose by £1 million while repayments rose by £½ million.

487. Deputy Booth.—I should like to raise a point on the question of the value of the securities. Is there any movement in the investments or are these investments kept more or less the same over long periods?—As you know, the Post Office Savings Bank is primarily the responsibility of the Minister for Finance. We manage the Bank but we do not manage the investments but perhaps the representative of the Department of Finance might say something on that.

Mr. Whelan.—Deputy Booth has raised a question of policy. I think it would be better if a note were sent to the Committee on the question.

Chairman.—Will you send a note to the Committee, please.*

Deputy Booth.—The point I had in mind was whether it was kept constantly under review and whether changes in investment were made to increase the security or was it just let lie there with an increasing amount being set aside against possible depreciation.

Mr. Suttle.—There is an account of the Savings Bank laid on the Table of the House each year and that gives details of the securities held.

Mr. Ó Broin.—I have a copy of that before me. In the year ended 31st December, 1961, that is the last year that falls within the financial year 1961-62, the balance due to depositors was some £0.7 million more than the then current market value of the securities but, of course, over and above the stock exchange securities, there remains the security of the State itself.

488. Chairman.—Paragraph 80 of the Report of the Comptroller and Auditor General is as follows:

“80. I had a survey made of the procedures of the mechanised accounting system which was introduced at the commencement of the year under review and found them to be working satisfactorily.”

Have you anything to add, Mr. Suttle?

Mr. Suttle.—No, I have no comment.

489. Deputy Carter.—What section was mechanised?

Mr. Ó Broin.—The Savings Bank.

Deputy Kenny.—Did the introduction of the mechanised accounting system displace any worker?—We were able to absorb elsewhere without any difficulty the displaced people.

Deputy Clinton.—Did it effect a saving? —Yes; there was a very substantial saving.

Deputy Booth.—Can you say that you had an improvement in the speed and accuracy of the accounting?—Yes; this is so. On this question of mechanisation, you will be reading the minute the Minister for Finance sent you in reply to the committee’s report of 5th September, 1962 and I should like to add a word or two to correct any impression that this mechanisation in the Savings Bank was the only economy that we were making in the Post Office. In fact, reorganisation work aiming at achieving greater economy and efficiency goes on all the time and had been going on before we brought in this mechanisation in the Savings Bank. For instance, some years ago, reorganisation of the telephone accounts sections was carried out and resulted in savings of the order of £25,000 at that time; this, of course, would be a much larger sum in current values. A further reorganisation of these sections is being planned at present which will yield further economies though not at first of so spectacular a nature. Much of the office work in the Engineering Branch was also mechanised some years ago. In other fields, a reorganisation of rural posts resulted in a better service and a reduction of 400 in the number of part-time postmen. The telegraph service was very radically reorganised. The deficit of almost £400,000 in 1954-55 was reduced to £137,000 in 1959-60, and despite increases in wage rates, etc., it is still below £200,000. We had industrial consultants employed in the Engineering Branch who did a good job for us. I just mention these to show that the search for economy and efficiency is continuous.

Deputy Carter.—Was it mostly on the advice of consultants that you acted?— No. We bring in consultants when we are satisfied that they have something particular to contribute. We have our own Organisation and Methods people in the Post Office who are fully occupied with this question of looking at services and seeing what can be done to improve them and make them more efficient.

490. Chairman.—We will now turn to the Vote, on page 141. In regard to subhead B.—Travelling and Incidental Expenses—the explanation of the variation is “Increased subsistence rates and storm damage repair work”. How much of it was due to increased subsistence and how much to storm damage?—£26,000 for increased subsistence and £20,000 for storm damage.

491. In regard to subhead C.—Accommodation and Building Charges—could you analyse the expenditure of the subvention shown in Part III of the Estimate, for rents and rates, sites and buildings? —Yes. We spent more than the grant on light and heat by £11,556 and less on rent and rates and sites and buildings— about £23,000 less. The increase on light and heat was due to the E.S.B. increase of 10 per cent, roughly, beginning 1st November, 1960, which we had not provided for, of course, in the Estimate. Then, new premises and improved lighting and heating also increased the user of electricity. Turning to rent and rates —the saving there was due to the fact that the British Post Office presented their accounts late in respect of cross-Channel telephone circuits. On sites and buildings, savings arose out of delays in undertaking or completing certain building works and protracted legal difficulties concerned with the acquisition of an important site.

492. On subhead D.—Conveyance of Mails—the explanation is “Casual variations”. Could you analyse that expenditure for us?—The variation is really only 0.9 per cent over £1,000,000. There was a saving of over £20,000 on the conveyance of mails by rail and there was an expenditure of more than what was granted on the other three—that is, conveyance by road, sea and air. The saving on the conveyance by rail was due mainly to the rail strike in the Cork area, which saved us £15,000, and to the replacement of rail by road services in the Donegal area from 1st April, 1961. There are increases on the other three. The increase on conveyance of mails by road is due to more mail being brought by road to Dublin for the Irish Shipping boats and to Cobh for the Cunard boats, which would formerly have gone by rail and boat to ports in Great Britain and to the fact that rail services in the Donegal area were replaced by road services at some extra cost. On the conveyance of mails by sea, the excess is due to a number of factors. An account for the previous year, for instance, from the British Post Office was not presented until 1961-62 and payments for letter mails conveyed by Cunard ships from Cobh previously made to the British Post Office and charged to revenue are now made direct to the shipping company and charged to the Vote. On the conveyance of mails by air, the excess arose mainly on mail to the Congo. This cost £11,000 for which there was no provision in the subhead.

493. Deputy Lalor.—In that connection is there any way of checking the comparative cost of conveyance of mail by road and by rail? I presume it is impossible to compare the costs. Has the cost of distribution of mails in the areas where railway lines have been closed increased as a result of the substitution of road transport?—I could not answer that immediately in a general sort of way. Our experience very often is that we are able to do the job as cheaply as it can be done by anybody else.

Deputy Kenny.—With regard to the conveyance of mails by road, for what period do contractors tender? Is it an annual contract or is there a period of three, four or five years?—I am afraid I cannot answer that immediately. I would have to send you a note about that.* I am not sure that there is uniformity in this matter.

494. Chairman.—On subhead E.— Postal and General Stores—could you analyse that expenditure?—Yes. The variation is 1.5 per cent on the grant and there are four main items—mechanical transport, uniform clothing, stamped stationery and miscellaneous. Under mechanical transport, stamped stationery and miscellaneous, we spent less than the amount of the grant. That accounts for almost all of the saving.

What did you say the figure was?—I say most of the saving was effected under these three heads—£5,500.

495. What is stamped stationery and what was the expenditure on it?—We buy water-marked paper not merely for our own use but for the use of other Government Departments—the water-marked paper that is made up ultimately into stamps of various sorts—social insurance stamps, widows’ and orphans’ pension orders, savings certificates and so on. This paper is passed over to the Director of Stamping of the Revenue Commissioners who are authorised by warrant by our Controller of Stores to manufacture stamps in certain ways and up to certain amounts. These are brought back to us and then issued as and when required.

496. Deputy Lalor.—In relation to subhead F.—Engineering Stores and Equipment—it has been said that a certain saving arose because of difficulty in completing contracts and the opportunity was taken to buy in stores. Why did not we buy in more stores in that case? There is £145,000 not expended. Could we not have bought more stores?—Even the buying of stores is rather difficult in this particular field. We might, in fact, have been trying to get more—I have not the details—but did not succeed in getting them.

Deputy Clinton.—Delivery might not have been possible?—That is true. We are operating in a difficult field.

497. Chairman.—In regard to these figures on subhead F., could you tell us what was spent in each of those items— (1), (2) and (3)?—Yes. The actual expenditure on the first one, that is, inclusive cost of equipment installed and work done by contractors was £551,800; stores and equipment, direct purchases, £1,352,041; the third one, purchases for the Civil Aviation and the Meteorological Services, £145,569.

There was a question of contractors. Were any of these contractors at fault?— I suppose they were at fault in that there were delays in their undertaking works but, as I said earlier, it is very difficult really to do anything about this.

498. In relation to subhead K.1.— Grant equivalent to Net Receipts from Broadcasting Licence Fees (Grant-in-Aid) —I notice you received the precise sum you estimated. Is that the equivalent of the net receipts?—Approximately, yes.

499. In regard to subhead K.3.— Salaries, Wages and Allowances—what staff is covered by that provision?— Although the Broadcasting Authority, on its establishment, took over the operation of the sound broadcasting system and the control of the staff engaged on it, it was not possible to arrange for the definitive transfer of all the staff by that time. Civil servants serving in Radio Éireann had to be given the opportunity of deciding whether they wished to remain with the new Authority and, likewise, the Authority had to have the opportunity of deciding whether it wished to retain them. In order to safeguard their Civil Service status and any superannuation benefits they might be eligible for, it was decided to bear the salaries and wages of such staff on the Vote for Posts and Telegraphs and to regard them as on loan to the new Authority until they were formally transferred. The transfers, because of negotiations with staff and other factors, took quite a long time to complete and, in fact, were not completed until this year, 1962-63. The expenditure under subhead K.3. is in respect of these salaries and allowances. The amount paid, together with superannuation contributions in respect of established staff is, of course, recovered from the Authority. The amounts recovered are brought to account as an Appropriation in Aid under subhead T.10.

500. Deputy Lalor.—In this Department, apparently, in the year 1961-62, there were 250 additional civil servants employed over and above the figure for the previous year. How can that be accounted for?—Generally by the fact that we are an expanding Department.

In what section, mainly?—Telephones. We are expanding all the time, bringing in more engineers and engineering workmen and technicians of various sorts and, of course, clerical staff to handle the development on the telephone accounts, and so on.

My experience is that engineering workmen are taken on on a casual basis. They would not go in as permanent increases?—I am looking at the Estimate for 1961-62. There was no change in the Accountant’s branch and a change of 20 heads in the Stores Branch. The big change is in the Engineering Branch which moved from 2,587 to 2,766. That is where the big change takes place.

237 of that increase is apparently made up of increased inspectors?—Inspectors, technicians and other technical staff.

Is there a breakdown of that?—I cannot give you a breakdown now but it can be taken that what is happening in connection with the telephones is that we are creating more and more gangs in various places throughout the country and these have to be supervised, and so forth.

Deputy Clinton.—And that supervision in normally carried out by an engineer or a qualified person?—Yes. If the Committee is interested, I would be very glad to send him a breakdown.

Deputy Lalor.—Yes, please do.*

501. Deputy Booth.—In regard to No. 1 of the Appropriations in Aid—Recovery in respect of Telephone Capital expenditure —would that be the actual amount recovered from new telephone users or how is that recovery made?—No. Each year a programme showing, in detail, the various telephone construction works is provided for in the estimated expenditure on each item and this is prepared for authorisation by the Department of Finance and the total amount of this programme is the estimated appropriations in aid under this subhead T. Expenditure when actually incurred on the works which make up the programme is recovered from Telephone Capital Account and is appropriated here in this heading. The total amount appears as appropriations in aid realised.

So, the Department was authorised to spend £2½ million and in actual fact spent very slightly less?—£2,411,700—yes.

502. Chairman.—The explanation in regard to item No. 3 of the Appropriations in Aid is “Higher staff costs arising from pay increases”. That item is Receipts from Social Insurance Fund. The receipts from the Savings Bank Fund are not proportionately up on the estimate. Would they not have been similarly affected by pay increases?—They would, I should say, but I cannot say anything more than that. If you like, I will give you a note on that point.*

503. With regard to item No. 10— Miscellaneous—there is an increase there of £27,577. Could you give us some of the amounts estimated under the headings? —I am sorry I have not got the breakdown of these in terms of money. I can give you particulars of the main items that were involved. They are very miscellaneous in every sense of the word. For instance, they include payments from outside bodies for works performed for them; receipts in respect of rent of Post Office premises—premises which we rent to other people; receipts from wireless transmitting fees and examination fees; receipts from Radio Éireann; receipts for carriage of newspapers by Departmental vans; special leave given to certain officers at cost of substitution; the commission paid on the repurchase of stamps, and so on. There is quite a lot of things of that sort.

You estimated certain receipts which have been exceeded?—Yes.

I just wanted to know if you had any idea of what was estimated under these headings (a) to (d)?—I have not got the actual figures at the moment but we exceeded the estimate by 38 per cent— £27,000—and if you like, later on I can give you a breakdown of this but I have not got the particulars with me.*

504. Deputy Kenny.—What are transmitting permits?—Wireless transmitting and examination fees. These fees are payable by operators of business radios and people operating amateur transmitting sets. Under international regulations also the Government of each country has to guarantee the competency of operators in certain fields and to do so by issuing certificates of prescribed standards. Fees have to be paid by the examinees.

505. Deputy Lalor.—In relation to Nos. 5 and 6 of the Appropriations in Aid— what type of sale is this? What is being sold? What is covered?—Engineering stores first of all. The engineering stores recovered from various works through the country are brought to the Stores Branch and graded either as being fit for reissue or as scrap. Sales of the scrap engineering stores are arranged periodically by the Stores Branch and the proceeds of these sales are credited here.

Scrap is non-engineering?—Not the scrap referred to under subhead T.5 I have been talking about. But there is also non-engineering scrap under subhead T.6. Scrap metal, which we sell along with old vans and cycles, etc.

Deputy P. J. Burke.—Are they auctioned in the ordinary way?—Yes.

Deputy Clinton.—Or sold by tender?— Or sold by tender.

506. Chairman.—In regard to (f)— —works carried out for and services rendered to outside bodies including staff on loan—how much does staff on loan represent and to what bodies were they loaned. The amount is £38,654?—We were lending staff to the United Nations or some of their specialised agencies. That is one example. Certain officers of the Department are on loan to the two main Post Office Unions and their wages are paid out of voted moneys and recovered from the Unions and appropriated in aid of the Vote. That is another example I can think of. Or is that what you have in mind?

Chairman.—What I had in mind is that some of that £38,654 is for works carried out or services rendered to outside bodies and some of it is due to staff on loan. How much of it was due to staff on loan and to whom were they loaned?—As regards works performed for outside bodies, almost all the receipts under this heading are from county councils and others for shifting Post Office plant to facilitate road widening and construction schemes; some from private persons for accidental damage to our plant, generally caused by motor accidents or tree felling; from the Electricity Supply Board for replacing existing wires with insulated wires where the Board erect power lines crossing our circuits, and so on. But, if you would like any more detail than that, I will be very glad to give it to you.*

Chairman.—Yes. Thanks.

507. Deputy Lalor.—In regard to the Losses of Stores—apparatus destroyed and written off—£2,050—was that just the one particular loss or was there a series of losses?

Chairman.—Deputy Lalor is referring to the second item under Losses of Stores, and wants to know whether it is just one item or a series of items?—You can take it to be a series of items.

508. Deputy Kenny.—Item No. 2 of the Notes indicates that in 44 cases of damage to official vehicles in which no claim against members of the public arose, the drivers were held to be guilty of negligence; that the cost of making good the damage was £1,565; that a total of £5 was recovered from the officers concerned in four cases. That would be £1 5s. from each of the four officers. That appears to be a terribly small sum to have recovered out of a cost of £1,565? —Yes. It looks small but you may take it that each case is gone into very carefully and we thought that this was reasonable.

Deputy Booth.—When the explanation states that the drivers were held to be guilty of negligence, does that mean that they were held to be entirely responsible or does it not mean that they were held to have been negligent in a contributory way but not, possibly, entirely responsible?—I think the Deputy is right.

509. Chairman.—The first paragraph of No. 2 of the Notes refers to a case of damage to immobile departmental property which resulted in a loss of £13?—I see that. I have not got the particulars. I shall send you a note. †

510. Item No. 3 of the Notes says that four claims for repayment services amounting to £31 were abandoned. Two claims were reduced to £13 under the halving agreement. I take it these were motor accidents?—We have agreements with a number of insurance companies in relation to traffic accidents under which we forbear to make claims. These arrangements are designed to cut out costs of litigation et cetera and the results we regard as satisfactory.

511. Deputy Carter.—No. 6 of the Notes refers to damage to telephone kiosks. There were 384 cases of stores stolen from these kiosks. That seems to be an annual charge and seems to be increasing. I suppose there is no way of reducing the damage and that it is not possible to take measures that would prevent such damage. Does it arise from theft of directories or otherwise?—Frequently it is even worse than that. Instruments are smashed and electric bulbs removed.

Deputy Booth.—As the number of telephone kiosks erected increase your costs are bound to increase proportionately?— We suffer a good deal in this respect but we just do our best, with the help of the police, to control the depredations; but we are not very successful, I am afraid.

Deputy Carter.—It is a scandal. People ask for the facility and then allow public property to be damaged in that fashion. Would it be possible to issue an appeal on the civics side for help in preventing this type of damage?

Deputy P. J. Burke.—Usually the only protection is to have the telephone kiosk in a public place. It is surprising that even in the city and county of Dublin telephone kiosks should be damaged.

512. Chairman.—No. 5 of the Notes strikes me as being a rather unusual case. The Note says, “A consignment of radio valves was, on delivery, found to be both short in supply and below specification.” Could we have some information on that?—We placed a contract in November, 1959, with an American firm for the supply of various types of valves required for the maintenance of radio equipment for civil aviation purposes. It was a condition of the tender which formed the basis of the contract that payment should be made by an irrevocable letter of credit. The letter of credit provided that payment would be made against the priced invoice and full set of clean shipped bills of lading. When the contract was placed a letter of credit was opened in favour of the firm through the Bank of Ireland. In December, 1959 the firm advised despatch of all the valves on order and on production of the relevant documents, payment in respect of the valves was released to the firm under the terms of the letter of credit by the New York Bank concerned. When the consignment was received here, however, it was found that only part of the quantity invoiced and for which the firm had been paid had been despatched and that the valves received were unsuitable. The contractor was advised of the discrepancy in the delivery and of the unsuitability of the valves. Despite subsequent repeated requests by letter and cablegram, neither a reply nor a further delivery was received from the contractor. We, therefore, asked the Department of External Affairs to have an approach made to the firm by that Department’s officials in New York. In reply, the Department of External Affairs sent us a report from a firm of investigators, from which it was clear that the firm was no longer in business and that there was no possibility of getting replacement delivery under the contract. That is, roughly, the story.

Deputy Kenny.—How did you first get in contact with this company? Was it through a recommendation or through the Department of External Affairs?— I could not answer that question specifically but we have various means of finding out what firms in various parts of the world are in business of this sort.

Deputy Booth.—Could you tell us whether the Department had dealings with this firm before?—We had previous contracts with this firm and they had presumably concluded them in a satisfactory way.

513. Is it possible to work with an irrevocable letter of credit? It seems unusual that a Government Department should be bound in that way because it does put the purchaser in rather an unsafe position. I can quite see that in cases where the credit-worthiness of the purchaser is open to doubt a trader at a considerable distance might ask for an irrevocable letter of credit but dealing with a responsible Government Department of a fairly solvent Government it seems unusual: Is that so? Is it an unusual provision?—I think it must be but, anyhow, this was a condition of the firm’s tender that we accepted, that payment should be made by irrevocable letter of credit. I do not know enough about the details but perhaps we were not in a position at that time to question this particular thing. Perhaps we did not pay too much attention to it, were more concerned with getting the valves. Would you like me to write to the Committee further on the subject?

I do not think it would be worth pursuing it further but I presume it is possible that these appeared to be the only suppliers who could give delivery at all of the specific type of equipment—were they? —I do not know what the situation is in that regard—whether they were the only pebbles on the beach or not.

Deputy Booth.—Of course, you could give us some indication as to whether irrevocable letters of credit are common requirements or not, it would be all to the good. I personally would be a little bit doubtful of a supplier who asked for that from a Government Department.

Chairman.—Would you like a note on this matter?

Deputy Booth.—Yes. I would consider that it is not a normal requirement.

Mr. Ó Broin.—In any case, we have made up our mind that letters of credit will not be opened in future except in the case of firms of world-wide repute or whose bankers guarantee repayment in the event of non-fulfilment of contract.

Deputy Booth.—That is all right.

514. Chairman.—There are Appendices on pages 146, 147 and 148. In regard to J.—Statement of Superannuation and other Non-Effective Payments for the Year 1961-62—there is a saving of £8,000 there on the estimated £557,000. The details, compared with the Estimate, show a saving of £20,000 on item 2, and excess of £15,900 against the provision of £15,000. Would you like to comment on that?—There was a small excess in annual allowances; a substantial excess on the gratuities to unestablished officers while in the other four categories there were savings—that is, on gratuities to established officers, workmen’s compensation, compensation allowances under Article X of the Treaty and agency payments. Of course, expenditure under this subhead J., as you will understand, is affected very much by variations in the number of officers who die, retire, marry or meet with accidents. So, it is very hard to be accurate in our estimation or more accurate than we have been.

The witness withdrew.

VOTE 47—DEFENCE

Mr. Aodh Mac Brádaigh called and examined.

515. Chairman.—Paragraphs 81 to 87 of the Report of the Comptroller and Auditor General deal with this Vote. Paragraph 81 reads as follows:

“Subhead K.—Provisions and Allowances in lieu

81. Statements have been furnished to me showing the cost of production of bread at the Curragh bakery and of meat at the Dublin and Curragh abattoirs. The unit costs are as follows:

The average price of cattle purchased for both the Dublin and Curragh areas was £74 per head as compared with £74 and £77, respectively, in the previous year, while the average production of beef per head was 702 lbs. and 686 lbs., respectively, as compared with 686 lbs. and 703 lbs.”

Have you anything to add, Mr. Suttle?

Mr. Suttle.—The increase in the cost of bread in the year under review is due to a fall in production of about 10 per cent. In the case of meat at Dublin, the increased unit cost of labour was offset by a reduction in the price of cattle and the increase in the case of the Curragh was due to a 15 per cent drop in total production also.

516. Chairman.—How does your cost of production of meat and bread at Dublin and the Curragh compare with contract prices in other commands?— They work out much the same.

There is not much variation?—Not a great deal.

Deputy Booth.—Is the drop in production due to troops being overseas?—Yes.

I presume your output of bread and meat is affected by the absence of troops overseas?—Yes.

Does the number of men employed show a corresponding decrease?—No, not altogether.

Are they all military personnel?—Yes.

517. Deputy Clinton.—As a matter of interest, in what way is this purchasing done? Is it by contract? Is it let out to butchers and contractors?—The meat is purchased by an agent.

An agent for the Department?—Yes.

Deputy Kenny.—Does the same agent buy for all the Curragh and Dublin?— Yes.

Deputy Clinton.—And then the Army butchers look after it from there on?— Yes.

Deputy Booth.—Is the purchase of cattle or of meat?—Cattle on the hoof.

Deputy Booth.—It is not purchases of meat precisely.

518. Deputy Clinton.—In what way is the agent paid? Is he paid on a per head basis or is he paid a salary or in what way is he remunerated for this agency?—It is not a salary. It is on a per head basis.

Do you know what the per head allowance is?—I have not got that information. I will let you have a note on it.*

I should like to have a note on it. Also I should like if we could have some idea of the number of cattle purchased. I assume that sheep come into this as well?—No.

Sheep are not purchased in that way? —No, only cattle.

Deputy Booth.—I presume the agent is given instructions to purchase a certain number of cattle. He may not increase his remuneration simply by buying more? —No. He is told the number of cattle we want per week.

And he just carries out the instruction? —That is so.

519. Chairman.—There are accounts produced in regard to these production costs?—There are.

Chairman.—And these are available to members if they would like to see them.

Deputy Clinton.—I should like to see them.

Mr. Mac Brádaigh.—The Comptroller and Auditor General, of course, sees them but if the members of the Committee want to see them——

Chairman.—Could the Committee see these?

Mr. Suttle.—Yes.

Chairman.—Does the Committee wish to see these?

Deputy Clinton.—I should like to have them.*

520. Deputy Kenny.—Regarding the purchase of meat, what is the procedure for the purchase of mutton?—It is purchased by contract. We go out to tender and buy at the lowest suitable tender price.

521. Chairman.—Paragraph 82 of the Report of the Comptroller and Auditor General reads as follows:

“Subhead M.—Clothing and Equipment

82. In September 1960 deficiencies were discovered in the clothing account of a Unit of an Fórsa Cosanta Áitúil. A non-commissioned officer was subsequently convicted in a civil court on a charge of stealing clothing valued at £663 and sentenced to a term of twelve months’ imprisonment, the warrant not to issue if he repaid £200 at once and the balance within six months. £200 was paid into court in April 1961 and I have inquired whether the balance of £463 has yet been received. I have also inquired regarding the security checks in force at the barracks from which the clothing was taken.”

Have you anything to add, Mr. Suttle?

Mr. Suttle.—In reply to our inquiries in this matter I am informed that the balance of £463 repayable by the non-commissioned officer concerned has not yet been received. The normal security checks were in operation at the barracks in the period during which the clothing was stolen. The Accounting Officer stated: “I am satisfied that the existing regulations and practice, if observed, are adequate to prevent the suppression of receipt vouchers; but if a ledger keeper should succeed in pilfering and in covering it by suppression of the relevant receipt voucher or vouchers, only a complete cross-check of all issue and receipt vouchers, when the relative stores accounts were being audited, would ensure beyond doubt that such pilfering and suppression would eventually be discovered. In practice only a percentage cross-check of this nature is done. It is not considered that the likelihood of such incidence would justify the staff or time which a complete cross-check would necessitate.”

522. Chairman.—How did these deficiencies come to light?—They came to light during a stocktaking.

Deputy Booth.—Was not there a question of a hand-over of stocks by the unit accounting officer who was posted to the Congo and a special stock check carried out before his successor came?—Yes, there was a hand-over.

It was a special stocktaking on a handover?—There was also an inspection check.

Is not there some question of an amount lodged in court in connection with this matter?—Yes. The position in that case is not clear. The case is still with the Attorney General on the question of an appeal to the Supreme Court which is under consideration.

There is a certain sum lodged?—There is a small sum lodged—£80 odd. This man was prosecuted and was sentenced to imprisonment, not to be enforced if he paid £200 forthwith and the balance within six months. He paid the £200 but not the balance, except for £80 lodged in court. Legal difficulties arose and the Attorney General took action in the High Court which was unsuccessful. He is now considering an appeal to the Supreme Court, we understand.

In the year under review there was no payment made by the officer in question or by any other officer? In this financial year there is no contribution by anybody else?—No, it was in the subsequent financial year.

Chairman.—Does the amount mentioned by the Comptroller and Auditor General, £663, cover all the deficiencies?—Yes, as far as the thefts are concerned. We have got £200 of that. The net deficiency now is £463.

523. Under the security arrangements in existence at barracks how is it that a non-commissioned officer could get away with such a bulky amount of stuff?—The instructions for military policemen on main gates are that they will examine all passes of soldiers entering or leaving barracks. Bundles, parcels, suitcases, etc., can only be taken from barracks under permit signed by an officer and are subject to inspection by the military policeman and may be returned to the headquarters of the unit concerned. The probable explanation is that this particular sergeant who was well-known in the barracks, was continually bringing out items of clothing for An Fórsa Cosanta Áitiúil in the course of duty and that the military policemen became accustomed to this.

Deputy Booth.—I think there is more than a possibility that Army transport which was moving in and out with supplies could have been used for moving these boots and things. It is a very difficult check to make when supplies are moving in and out of a barracks for a military policeman on duty to be able to say: “That is in order and that is not”?—That is true. This sergeant did regularly move stores to Collins Barracks and to Gormanston.

As part of his normal duty?—Yes.

So that there was always clothing moving in and out?—Yes.

It would become a routine matter as far as the military police were concerned? —That is so.

It was a comparatively easy matter to put in 50 pairs of boots and then arrange that the engine of the lorry would stop at an appropriate time and somehow pairs of boots would fall out of the lorry?—Yes.

524. Deputy Carter.—Was the deficiency discovered long after the annual stocktaking?—It came to light as a result of an inspection check.

That means the annual stocktaking— the normal check?—It was an inspection check.

525. Deputy Kenny.—Is all this equipment, boots and clothing, kept in one barracks?—Yes. This was the equipment of a battalion.

Deputy Booth.—And certain special units of that battalion were stationed in other barracks?—Yes, in Collins Barracks and, during training, in Gormanston.

526. Chairman.—Paragraph 83 of the Report of the Comptroller and Auditor General reads as follows:

“Subhead S.—Barrack Maintenance and New Works

83. The sanction of the Department of Finance was obtained in November 1961 for the reconstruction, at an estimated cost of £2,674, of the roof of a workshop built in 1956 by direct labour under the supervision of the Corps of Engineers. I inquired how the roof became defective so rapidly and I was informed that the corrugated asbestos sheets had developed cracks in many places; investigation showed this had occurred because the sheets had been incorrectly fitted due to inexperience on the part of the tradesmen and of the engineer officer in charge of the work.”

Have you anything to add, Mr. Suttle?

Mr. Suttle.—With regard to this roof, the corrugated asbestos sheeting was wrongly fixed. The sheets were overlapped to the extent of 1½ corrugations instead of 1 corrugation. They were nailed through the overlap and through the centre of the sheets and this was, again, not in accordance with the manufacturer’s specifications. That was apparently the cause of the cracking. The cost of a new roof is not yet available. I do not think it is completed yet.

Mr. Mac Brádaigh.—No. It is not yet available. The work was held up during the winter.

527. Deputy Treacy.—Are we to take it that the tradesmen and the engineer referred to in this matter were bona fide tradesmen and engineer, as such?—They were.

Fully qualified?—Yes. The engineer officer was a fully qualified officer and the tradesmen were fully qualified. Apparently, there were some new directions which had been issued by the firm. This was supposed to be a new type of sheeting. The firm were contacted and their explanation was that this material was a new type of corrugated sheeting which had been introduced three years previously and that a change in the manner of overlap was recommended in their catalogue. Apparently, on the instructions of the engineer officer who had charge of that work and who is no longer in the Army, the sheets were put on with the 1½ overlap, instead of one corrugated overlap as the manufacturers claim it should have been. The manufacturers contended that that was the cause of the cracking and they were not prepared to allow any compensation. We have heard of another roof that was put on subsequently strictly in accordance with the manufacturers’ instructions, with the one overlap, and that roof also cracked.

528. Deputy Clinton.—That is just the question I was going to ask—was there a check on the bona fides of that explanation because I know from experience that it is quite common practice to give an overlap of 1½ corrugations and it looks to me to be a very lame explanation on the part of the asbestos firm who supplied the materials. It probably is more like the distance between the purloins and certainly not the overlap. It looks a very lame explanation which should have been pursued a bit further?—We did pursue it. We referred it to the Attorney General and, in view of the attitude of the manufacturers that the roof was wrongly put on. the Attorney General advised that we had no case.

Chairman.—Did the manufacturers, when sending the sheets, include any instructions about fixing?—They say that it was in their catalogue. We are not clear that it was. We get a considerable amount of literature from manufacturers. Some of it goes to the engineer officers, some to the Department, and some to the foreman on the job. We do not exactly know whether or not this particular instruction with regard to the new method of overlapping went directly to the officer in charge of the job.

Was the officer held to be responsible in any way?—The officer had gone from the service at the time this matter came to light and it was not possible to pursue it with him.

529. Deputy Kenny.—You mentioned another roof?—We know of another case in which the roof was put on in accordance with the manufacturers’ instructions and similar cracks appeared. The party concerned complained to the manufacturers and after very considerable argument the manufacturers replaced a number of sheets of corrugated asbestos. That is all they did. The party had to put on the new sheets themselves at their own expense.

Chairman.—Did this come to light subsequent to the advice you got?—Yes.

530. In the light of that does the Department now intend to do anything about it?—In view of the manufacturers’ attitude that the roof was wrongly put on in the first instance, we had no case against them. We did not follow the manufacturers’ instructions.

Deputy N. Egan.—It is sheer nonsense to maintain that cracks would occur in corrugated asbestos sheets from lack of sufficient overlap. A leak would occur but not a crack. It is absurd to suggest that a crack would occur. A leakage is understandable but not a crack.

Deputy Clinton.—The complaint is, that there was too much overlapping, not that there was too little—too much they say.

Mr. Mac Brádaigh.—The overlapping was 1½ corrugations instead of one.

531. Deputy Treacy.—Having regard to the doubt which exists as to whether the defect was due to this asbestos sheeting being incorrectly fitted by tradesmen under the supervision of an engineer or whether it was an ingrained defect in the corrugation itself, I should like to know what disciplinary action, if any, was taken against either the engineer or tradesmen and what was the nature of it?—No disciplinary action was taken for the reason that the man in charge of the work, the engineer officer, had left the service before the defect came to light. The roof was on three or four years at the time.

Was this a native product?—Yes.

532. Chairman.—Paragraph 84 of the Report of the Comptroller and Auditor General reads as follows:

“Subhead U.—Compensation.

84. The charge to this subhead comprises:—

Have you anything to add, Mr. Suttle?

Mr. Suttle.—This paragraph is the usual detail supplied to the committee. I have no comment.

533. Chairman.—I notice the bulk of the amount of the charge to the subhead is due to compensation for damage or injury in cases of accidents in which Army vehicles were involved. Do you consider your accident rate higher or lower than the average user of commercial vehicles?—I am afraid we have no way of telling that. It was a fairly average year for us.

534. You train your own drivers, of course?—Yes. They have to do a very stiff course.

For how long do you train them before you allow them out on the road?—I could not answer that offhand.

Deputy Booth.—The answer is the training goes on for a very long period but it should be remembered that there is an additional hazard created with military transport. It is very often moving in convoy and moving sometimes on a main road. I do not think it would be quite fair to make a comparison between ordinary commercial user and Army transport.

Chairman.—Always provided, of course, that all the accidents in this list occurred on main roads.

Deputy Booth.—There is always an additional hazard if you get a number of lorries in convoy, not for the convoy itself—but for other road users. Obviously military convoys tend to produce crises from time to time.

535. Deputy Lalor.—I see that the estimate provision was on the basis that claims would be in the region of £19,000, which showed an increase of £10,000 over the estimate for the previous year. Why was the estimate increased to such an extent? Were we anticipating more accidents?—It is only an estimate but in making an estimate you have to take into consideration the cases that are then pending. There may be some very big cases pending when the estimate is made.

Mr. Suttle.—There was one big case in that year of about £10,000.

Deputy Lalor.—Apparently the case went better for the authorities than was expected.

Mr. Suttle.—No. It is the £9,000 really. They knew of that case beforehand and the possible liability attached to it.

536. Chairman.—Paragraph 85 of the Report of the Comptroller and Auditor General reads as follows:

“Subhead Z.—Appropriations in Aid

85. Four military hospitals were approved by the Minister for Health for the purposes of section 25 of the Health Act, 1953, with effect from August, 1960. This approval enabled claims to be made on the appropriate health authorities for payment of a daily capitation rate in respect of all patients eligible for institutional services under the Health Acts. As a considerable number of these claims remained unpaid at 31 March, 1962, I inquired regarding the steps being taken to recover the amounts due. I was informed that of the total amount outstanding at 31 March, 1962, £12,743 was due from one health authority who had agreed to accept liability for £2,441 but had made proposals, that are under consideration, for discharging the remainder on a modified basis acceptance of which would involve a substantial reduction in the claims.”

Have you anything to add, Mr. Suttle?

Mr. Suttle.—The question of the liability of the local authority in this case is still being discussed between the Department of Health, the local authority and the Department of Defence.

Deputy Clinton.—Could we know what health authority is involved in this?— Kildare.

537. Deputy Booth.—Is this not an ascertainable liability? Where does the doubt arise? Why does the Department of Defence have to negotiate? Is it not an ascertainable liability?—The health authority will not pay us.

It is not a question of being unable to ascertain the amount but of being unable to get the amount?—It is readily ascertainable. When we could not get our money we asked the Department of Health to help us to see that the terms of the Health Acts were operated. They negotiated with the health authority concerned.

Deputy P. J. Burke.—Is this in respect of ordinary military personnel?—Yes. The objection of the health authority was to the incidence of hospitalisation amongst soldiers as compared with the incidence of hospitalisation amongst civilians in their area. They claim that hospitalisation of soldiers is very much higher than amongst civilians, which is so, and that they should not be required to pay for that.

538. Chairman.—Are these claims legally enforceable?—Presumably they are. As I say, we went to the Department of Health to get their backing for our claim. They decided to negotiate and have proposed a compromise which we are examining at the moment. There is something in the health authority’s case that the incidence of hospitalisation amongst soldiers is higher than among other members of the community, because when soldiers living in billets get ill, they have to be put into hospitals whereas the ordinary civilian is kept in bed for a few days at home.

Would that not be applicable also to other health authorities where there are military establishments and what would happen if you gave a preferential to one health authority?—That is one of our problems at the moment.

539. Deputy P. J. Burke.—Is anybody, except soldiers, admitted to these hospitals?—Only soldiers.

What happens in the case of a family? —It is strictly soldiers, except in the case of the families section of the hospital in the Curragh. There is no dispute with the health authority in connection with this section of the hospital, which is operated for the families of soldiers in the Curragh.

Chairman.—This matter is liable to come up for other counties also where there are military hospitals. Is that the position?—That is so.

540. Deputy Lalor.—The point at issue in this case is—is it a case that the Kildare health authority is being asked to supply medical treatment or hospitalisation under the Health Acts to soldiers? —To pay the appropriate cost.

The full cost?—The amount prescribed under the Health Acts.

In actual fact are not they supplying the hospital for the Army?—They are required to pay in respect of the treatment of patients in accordance with the Health Acts.

Deputy Booth.—It is not correct to say the health authority is supplying the hospital?—No.

It is the Curragh Military Hospital?— Yes, but it is a recognised hospital for the purposes of the Health Acts.

Deputy Lalor.—The authority has to staff the hospital?—No. We staff the hospital and manage it, but claim from the authority in respect of each patient in the hospital, the amount to which we are entitled under the 1953 Health Act.

541. That would be that you would be claiming 27/6d. a week, or something like that?—I think it is 11/6d. a day.

Deputy Clinton.—Ten shillings?—It was 8/- originally. Before the operation of the 1953 Health Act, we ourselves met the cost of our own hospitals. Where a soldier was treated in a civilian hospital we had, of course, to pay for his treatment. Then the position was changed by the 1953 Health Act. The health authority became responsible for the treatment of certain classes of people in their hospitals or in hospitals recognised by the Department of Health. Our hospitals were so recognised and in those circumstances we made a claim against the Kildare health authority and against other health authorities.

Deputy Treacy.—I take it that the Army authorities are seeking no more or no less than what the health authority usually pays to private institutions or private hospitals that is a subvention of 10/- or 11/- a day?—That is the position.

Deputy Treacy.—That is quite reasonable, I think.

542. Chairman.—Prior to the Minister for Health approving of these military hospitals, the Army vote carried its own charges?—Yes.

Deputy Treacy.—If private institutions are allowed to get this subvention, why not the Army?

Chairman.—That is something that we can talk about later.

Deputy N. Egan.—Do civilians go into this hospital also?—No.

Chairman.—It is purely for military personnel?—Except for the families section of the military hospital at the Curragh. There is no dispute about that. The dispute is about the soldiers treated in the hospital.

543. Deputy N. Egan.—What is the procedure about St. Bricin’s Hospital on Infirmary Road, Dublin? Is that a military hospital?—Yes.

Do you get any allowance from the health authority?—We do. We make claims against the Dublin health authority.

Deputy N. Egan.—Are they paid?

Deputy Clinton.—Promptly.

Deputy Lalor.—It is for the treatment of soldiers?—Yes.

Take St. Bricin’s. Take the old IRA men?—That is in a different category. Old IRA men who apply for pension or special allowance are taken in for examination.

That is not charged to the health authority?—No.

544. Deputy Booth.—What would happen in the case of a soldier being injured? He would not be covered by the health authority?—He would.

Even though he is injured on duty?— Yes.

He still would be paid for by the health authority when he is hospitalised for any reason?—He would.

545. Chairman.—Paragraphs 86 and 87 of the Report of the Comptroller and Auditor General read as follows:

“Statement of Losses

86. Losses written off during the year are detailed in a statement appended to the account. The total is made up of:

The corresponding figures for losses in the previous year were £54 and £4,396.

87. A contract was placed in May, 1960, for a supply of beef liver to a military camp for a period of six months the estimated weekly requirement being 270 lbs. Because no liver was ordered during the first two weeks of the currency of the contract the contractor gave notice of termination, and a claim for losses arising from the failure to order was settled by his acceptance of £31 lodged in court and a payment of £11 for legal costs.

In reply to my inquiry I was informed that it had always been considered that in the case of running contracts for foodstuffs a clause in the standard form used which permitted variations from the estimated requirements also protected the Minister even in the unlikely event that no order at all was placed. Legal opinion obtained in this case was that under the existing conditions some quantity must be ordered; amendments which would protect the Minister would be incorporated in future contracts for foodstuffs.”

Mr. Suttle.—The money involved in this question is very small but there was a question of principle regarding the terms of contracts in general use in the Army for the supply of foodstuffs. It was an occurrence that might have happened before but no one took any action until this man took action and now the contract position has been settled, we hope.

546. Deputy Kenny.—Before we leave the matter of the supply of beef, what happens to the offal, the skins and so on —how are they disposed of?—The offal is sold by tender.

Deputy Booth.—The receipts for these sales appear under the Appropriations in Aid.

547. Chairman.—Has the standard form of contract been long in use?—As far as we know it has been in use since the Government Contracts Committee was set up. The difficulty related to the clause which provided that the Minister does not bind himself to accept any quantity. In this particular contract we did not order anything at all. It might happen with regard to any contract that in a particular week you might not order anything or after a time might stop ordering but in this contract nothing was ordered, even in the first week and the legal advice was that we were not covered for that reason. What happened was that normally the Curragh is able to supply itself with beef liver but, at this time, that was not so. We went out to contract for beef liver. At the time that the Curragh authorities were notified that the contract had been placed they had bought in a quantity of sausages and black pudding to make up for the absence of beef liver and had enough on their hands for the first week or two of the period of the contract. The contractor claimed that he had got in extra liver to meet our contract and when no order was forthcoming in a week or two he phoned and was told that no liver was wanted. So, he cancelled the contract and took legal proceedings.

Chairman.—I presume you reviewed this form of contract?—The form of contract has been changed. It was brought to the notice of the Government Contracts Committee and the form has been amended.

I take it the same information has gone out to other purchasing Departments?— The purchasing Departments are represented on the Government Contracts Committee.

548. In regard to subhead A.—Pay of Officers, Cadets, N.C.O’s and Privates— how are the numbers keeping up? Is the Congo operation any incentive to recruiting?—I am afraid not.

Are your numbers keeping up?—They are about the same as last year.

549. Deputy Lalor.—In relation to subhead A.2.—Expenses of Equitation Teams at Horse Shows—the amount expended was less than the grant. Was there any limit to the amount of shows the Equitation Team attended?—No. The Royal Dublin Society are the Irish representatives for the international show jumping organisation and at the beginning of each year they send us a list of Continental shows and we select the shows which we think should be attended during the year.

Deputy Clinton.—What is responsible for the saving? Is it that you decided to attend fewer shows or that the expenses on individual shows were less?—The expenses were considerably less than estimated for.

I wonder why. You would imagine that these expenses would be going up rather than falling. Were there fewer horses?— In sending teams abroad the travelling expenses are covered by a contract and the contract that year was lower than we had anticipated.

The freight on horses?—Yes.

550. Chairman.—In regard to subhead J.—Mechanical Transport—the explanatory note refers to clerical errors. The same explanation also appears in regard to subheads O., P. and S. Is it the practice to allow errors of that type to be corrected? How do you satisfy yourself that there is an error?—We have to satisfy ourselves that there is, in fact, a genuine clerical error. If we are satisfied, we accept it.

Deputy Booth.—On the assumption that if the error had not been made the contract would still have gone the same way?—Yes.

Chairman.—It seems to occur regularly?—It occurs fairly frequently.

Could the contractor be compelled to supply?—Possibly he could but if he brought us to court I do not know how he would fare. If he were able to satisfy us that it was a clerical error he probably would be able to satisfy a court. The amounts, in any case, are small.

The amounts in these cases come to almost £200?—The individual amounts are small.

Deputy Booth.—Would it be because sometimes the Department feel that it creates ill-will with contractors, and might make it difficult to get contracts in future, to be unduly strict with small amounts? —We admit only a small minority of the claims made.

551. Deputy Lalor.—On subhead J.— Mechanical Transport—the explanatory note says that a saving of £7,005 was partly offset by an excess of £2,670 on maintenance. I take it that that was due to the non-delivery of trucks?—Yes, due to vehicles being ordered and not paid for before 31st March.

The £2,670 on maintenance was an enforced loss that should not have been suffered if the trucks had arrived?—Of course, considering the amount of the estimate, it is only a small variation.

552. If I may return to subhead A. One of the first questions asked by the Chairman was had there been any improvement in the position in regard to numbers. I notice that under subhead A.3.—Bounties, Rewards and Gratuities —there was more money spent than granted. The explanatory note says the amount of gratuity payable for extension of service was increased from £10 to £25. It would appear from that that a number of personnel actually stayed on. Would that not have made for a net increase? The increase there may have arisen from the fact that there was an increase in the re-enlistment gratuity from £10 to £25. That £15 increase would cover 389 people. Are there more reenlisting?—There is no appreciable increase in the number of men staying on after the initial period of enlistment.

They are going out just as normally?— Yes.

553. Chairman.—On subhead K.—Provisions and Allowances in lieu—has the ration allowance been changed since 1961-62? What is the present rate?— The present rate is 3/8d. a day. That compares with 3/6d. in the previous year.

554. Deputy Treacy.—On subhead M. —Clothing and Equipment—the explanatory note refers to non-delivery of equipment. Was that due to source of manufacture, inability to deliver on due date or did it result from difficulties in distribution?—Failure on the part of the manufacturer to deliver. This is a recurring problem each year because, as I explained last year, there is only a very limited number of manufacturers who will undertake to make uniforms and they have to cater for the Post Office, the Garda and ourselves. Although the contract is placed, on condition that the uniforms will be delivered within the year, it very often happens for some reason or another that they are not so delivered.

Does this mean some hardship in relation to change of uniforms for our troops? —No; we manage.

What about the styling of our suits to have them more in keeping with modern trends and of better fabric?—That has been under consideration for some time. Financial aspects have still to be ironed out, but conclusions have been reached departmentally as to a suitable cloth and design for a new uniform.

Deputy Treacy.—That is very welcome.

555. Deputy Booth.—The actual discrepancy between expenditure and grant is considerably less than normally. My recollection is that normally the delay in supplying uniforms was even greater than in this year. Does this year’s account show an improvement?—No. There was an under-expenditure of £6,000 odd on allowances for officers’ uniforms due to retirements, claims for dress uniform allowances not having materialised and a smaller number of cadets being commissioned in that year. So that, apart from the soldiers’ uniforms there was a saving of £6,000 odd.

Deputy Booth.—I thought we normally saved even more than that. I think you have done rather better this year than previously, as far as the manufacturers are concerned.

556. Deputy Treacy.—In relation to the lighter type of fabric that troops are obliged to wear in the Congo, could you say whether that comes under this heading and is manufactured in this country? —It is manufactured in this country and we pay for it initially but recover from the United Nations Organisation.

Deputy Booth.—It does not come under this subhead at all?—No.

It is just a cross-entry?—Originally it was supplied by the United Nations Organisation when the troops got to the Congo. After some considerable difficulty we succeeded in having the present arrangement made whereby we order the uniforms, have them made here and the United Nations Organisation refunds the cost.

Deputy Treacy.—How does it compare with the United Nations Organisation uniform?—We think it is better.

557. Deputy Carter.—In regard to the second item in the Estimate—Civilian Clothing on Discharge—in most cases do they opt for the allowance in lieu of the actual issue?—In most cases they ask for the allowance.

558. Deputy Clinton.—On subhead N. —Animals, Forage, etc.—the explanatory note says that the saving is due to the number of horses purchased having been less than anticipated. Does this include horses for the Equitation School?—It is for the Equitation School.

Only, and not ordinary horses for carts?—There may be some of those, but it is almost entirely for the Equitation School.

559. Chairman.—I presume the Asgard was purchased under subhead P.2.— Naval Service?—There was a supplementary estimate for it.

Where is she based now?—Dún Laoghaire.

Is that a permanent arrangement or is it intended to bring her around the coast?—The intention is that we should do whatever is considered best in order to preserve her. She has been used last summer, and will be this summer, for training Slua Muirí personnel in Dún Laoghaire. There is no decision as to what will be done with her permanently.

Deputy Treacy.—May I take it that everything that can be done has been done to make her ship-shape?—Yes. She was overhauled in the spring of last year and is in very good condition.

560. Chairman.—On subhead T.—Military Lands—the Curragh land was transferred to your Department in the year? —Yes.

How did portion of the commonage come to be railed off?—As you know, there are sheep grazing rights on the Curragh. The Racing Board purchased the grazing rights of a certain number of sheep in order to enable them to take over that amount of land of the Curragh.

Were the graziers compensated?—Yes; their rights were bought out.

Deputy Booth.—That was under the Curragh of Kildare Act?—The Curragh of Kildare Act, 1961. Actually, one of the parties involved was the Land Commission. There was another Government Department that had some rights there also. The Racing Board extinguished enough rights to enable them to take over the area of the Curragh that they wanted. The remaining sheep grazing rights are not being interfered with.

Deputy P. J. Burke.—The people who surrendered their traditional rights will have no further right to graze?—No; they have been paid for their rights.

561. Deputy Kenny.—Are the rights held exclusively by people who have land in the Curragh?—There are people far removed from the Curragh who have sheep-grazing rights there.

Deputy N. Egan.—How did that come about?

Deputy Clinton.—It was commonage.

Deputy N. Egan.—I can understand people adjoining the Curragh having commonage?—I suppose persons who originally had rights could have sold them. The thing goes back a very long time and is rather involved but I suppose an original holder of rights could have sold his rights to some other sheep-owner.

562. Deputy P. J. Burke.—Who is the ruling authority in respect of the grazing rights?—The Department of Defence is supposed to see that a grazier has not more sheep there than he is entitled to have.

Deputy Booth.—The Lands Section of the Department?—Yes.

Deputy P. J. Burke.—It is very involved.

563. Deputy Lalor.—The saving on the subhead was due mainly to expenditure on maintenance having been less than estimated. There was a saving of £1,860. Was that brought about by reason of the fact that there was less land to maintain?—Not necessarily. Certain jobs provided for were not carried out or completed.

564. Chairman.—In regard to subhead Y.2.—The Reserve Defence Force—An Fórsa Cosanta Áitiúil and An Slua Muirí (Grants-in-Aid)—there was a saving on the provision for An Cór Breathnadóirí. What are the functions of An Cór Breathnadóirí?—It is intended to be a reserve force in connection with civil defence, to be responsible for reporting locally on radioactive fallout, taking readings, and so on. The Cór will be attached to the Army.

Will they have volunteer aid from civilians just the same as civil defence?— They will be carrying out the military aspect of civil defence and they will be members of the Reserve Defence Force.

565. Deputy Treacy.—Cad is brígh le “Breathnadóirí” i mBéarla?—Watchers —observers—Observer Corps.

Deputy Treacy.—“Vigilantes”, is dócha.

566. Deputy Booth.—In regard to subhead A.A.—Expenses in connection with the Offences against the State Acts, 1939 and 1940—is this amount of £450 gratuity paid to the representatives of each of two deceased officers in respect of their services on the Special Criminal Court or is that purely a coincidence that they had that service?—These were officers who were members of the Special Criminal Court set up a good many years ago and subsequent to their retirement they continued, under the terms of their appointment, to draw a small allowance each year. These were the last two. They died during this period and a gratuity was paid to their widows.

They had a form of retainer even though the Court was not sitting?—That is so.

567. Chairman.—On the Appropriations in Aid—is the United Nations Organisation paying up your claims promptly?—Yes; it has paid five. We have two outstanding which we hope to get shortly. They have paid us in all £796,849 15s. 10d.

Deputy Booth.—In respect of the year under review?—No; it is very difficult to relate it to a particular year—up to and including the 36th Battalion, up to a year ago.

They more or less pay as you go?— We try to present a claim for each battalion.

568. In respect of item No. 4—Sale of surplus stores and unserviceable clothing —there is a supplementary of £140,000 in the Estimate. Does that mean that the Department is still proceeding with the sale of obsolete weapons?—That was a big sale of obsolete weapons.

It is all weapons?—Yes.

Is that nearly concluded now?—It was just the one transaction.

It has cleared off a tremendous amount of surplus stock?—That is so.

Deputy Booth.—It is a tremendous amount of money to realise.

569. Deputy Clinton.—In regard to item No. 8—Sale of cast horses—how many horses did the £505 cover?—I am afraid I could not answer that.

Deputy Lalor.—In connection with items Nos. 7, 8 and 9, I notice that it is not possible to forecast with a great degree of accuracy the receipts under these headings. In respect of these three items it should have been possible to make a forecast. In preparing the estimate would it not be possible to estimate what would be realised under each heading?—We cannot say in advance. If something happens a horse, we sell him but we do not fully know in advance what is going to happen during a financial year. The estimate is prepared nearly six months before the commencement of the financial year.

570. Deputy Kenny.—In respect of item No. 22—Receipts for X-ray and aerial photographs—how is it that you have such receipts?—X-rays on behalf of the Civil Service Commission and Government Departments are carried out in St. Bricin’s Hospital.

571. Deputy Lalor.—In respect of item No. 11—Revenue from bands—does that mean that when the band is asked to go somewhere to play there is a payment made?—It goes out on a fee basis.

Does it not go out on a recruiting basis also?—It does. It is used for recruiting.

If some organisation invites the band to attend the organisation must pay travelling expenses?—And a fee for the band.

Even though that band might be in that area a month afterwards on a recruiting campaign?—That is so.

572. Deputy Booth.—In respect of the second item of the Notes, there is a reference to four officers on loan to the United Nations. Are these officers still on loan to the United Nations, who were paid by the United Nations while on loan?—Yes; there are still officers on loan, not necessarily the same ones.

Are they still in the Lebanon?—One in the Lebanon.

And the others?—The others are in the Congo.

On the United Nations staff in the Congo?—That is so.

VOTE 48—ARMY PENSIONS.

Mr. Aodh Mac Brádaigh further examined.

573. Deputy Lalor.—It would appear necessary to spend money on travelling expenses of applicants for pensions and that the cost of having them examined was less than the cost of travelling. How is that? I thought one would work hand in hand with the other?—No. If they are brought for examination to St. Bricin’s, the expenditure comes under subhead H. If, however, a man is called to St. Bricin’s for medical examination and the Army Pensions Board has satisfactory evidence that he is unfit to travel, a local doctor is appointed to examine him and the expenditure comes under subhead I. It is not the sort of thing that can be forecast very well.

The witness withdrew.

The committee adjourned.

*See Appendix XXVIII.

*See Appendix XXIX.

*See Appendix XXX.

*See Appendix XXXI.

*See Appendix XXXII.

*See Appendix XXXIII.

*See Appendix XXXIV.

†See Appendix XXXV.

*See Appendix XXXVI.

*See Appendix XXXVII.