MIONTUAIRISC NA FINNEACHTA
(Minutes of Evidence)
Déardaoin, 18 Meitheamh, 1964.
Thursday, 18th June, 1964.
The Committee sat at 11 a.m.
DEPUTY JONES in the chair.
Mr. E. F. Suttle (An tArd-Reachtaire Cuntas agus Ciste), Mr. J. R. Whitty and Mr. L. V. O’Neill (An Roinn Airgeadais), called and examined.
VOTE 38—NATIONAL GALLERY.
Mr. J. White called and examined.
301. Chairman.—This is Mr. White’s first occasion before the Committee and I should like to welcome him to the meeting.
Mr. White.—Thank you very much.
Chairman.—In regard to subhead B.— Purchase and Repair of Pictures (Grant-in-Aid)—were there any particular acquisitions of note during the year?—As far as subhead B is concerned the Gallery did not make any purchase under it. As you are aware, they did make some purchase under funds provided from other sources, such as the Shaw Bequest, but the figure of £2,500 under the subhead is utilised almost completely for the restoration of pictures or the keeping of frames and the repair of works in the Gallery, and is not sufficient to cover purchases.
The witness withdrew.
VOTE 29—LOCAL GOVERNMENT.
Mr. J. Garvin called and examined.
302. Chairman.—Paragraph 28 of the Report of the Comptroller and Auditor General reads as follows:
“Motor Vehicle Duties, etc.
28. A test examination of the revenue from motor vehicle duties, etc., was carried out with satisfactory results. The certificates and reports of the Local Government auditors who examine the motor tax transactions of local authorities are made available to me.
The gross proceeds in 1962-63 amounted to £7,407,520 compared with £6,998,657 in the previous year. They include fines amounting to £66,564 collected by the Department of Justice, £5,927 in respect of fees received under the Road Traffic Act (Parts VI and VII) (Fees) Regulations, 1937, and £63,507 received from Government Departments in respect of Stateowned vehicles. £6,053 was refunded and £7,402,500 was paid into the Exchequer during the year leaving a balance of £140,941 as compared with £141,974 at the end of the previous financial year.”
Have you anything to add to this Mr. Suttle?
Mr. Suttle.—The collecting authorities for motor tax purposes are the county and county borough councils. The tax collected is lodged locally in motor tax accounts and then transferred to a Central Motor Tax account in the National City Bank, Dublin. The fines collected by the Department of Justice are penalties imposed under the Road Traffic Act, for parking, speeding, etc. The fees under the Road Traffic Act (Part VI and VII) (Fees) Regulations, 1937 collected by local authorities relate to such items as competency and fitness, certificates, public service vehicles, vehicle plates, drivers’ and conductors’ licences and badges.
303. Chairman.—In regard to subhead B. —Travelling and Incidental Expenses—the explanatory note refers to attendance of officers at special courses. What were these? —Various courses were involved, mainly in relation to housing and town planning. Some of them were based on seminars, some of them were held in Britain and some on the Continent where the conferences are open to our people as well as the local specialists.
304. In regard to the explanatory note on subhead C.—Expenses in connection with International and other Congresses—what do the letters ECE stand for?—The Economic Commission for Europe.
305. Deputy Lalor.—On subhead J.— Grant to the Road Fund—is that all the money that is paid to the Road Fund?—No. This is merely a supplement of the Road Fund. The Road Fund for that year would amount to more than £7 million. This is a State grant made in particular years to the Road Fund to enable extra grants to be made to local authorities where it was considered that the closure of local railway lines brought more traffic on to the roads so as to necessitate further improvement works in these areas.
Where does that grant appear in the Road Fund?—The grant in the Road Fund does not appear in the Appropriation Accounts.
Mr. Suttle.—There is a separate account for the Road Fund.
Deputy Lalor.—I thought all income and expenditure as far as Government Departments are concerned were shown in the Appropriation Accounts?
306. Deputy Carter.—On subhead K.— Grants for the Acquisition, Clearance and Improvement of Derelict Sites and for Works of Public Amenity—the expenditure is going up. Is the derelict site scheme being worked? Are grants being sought by local authorities? —Yes, and by private persons. The number of applications is tending to increase from year to year. We provided for what we calculated would be the actual payments in the year, but no doubt there was much more pending than is represented by the payments made, in respect of which preliminary investigations were being carried out.
307. Chairman.—On subhead L.—Contributions towards Loan Charges of County Councils in respect of Seeds and Fertilisers Supply Schemes—the note says claims were not received in sufficient time to enable payment to be made. Was there any particular reason for the delay in submitting these claims?—First of all, they have to be the subject of application by the individual and they would not have been cleared in the county council accounts and have reached the Department in time to make payment in the financial year in question. They would, therefore, arise in the next financial year.
Is it a continuing matter?—No. It was in respect of conditions arising out of storms and bad weather that occurred in one particular season.
308. On subhead M.—Appropriations in Aid—does the drop in receipts as compared with the estimates as shown in item No. 4— Expenses repayable by County and County Borough Councils under Section 17 of the Local Authorities (Combined Purchasing) Act, 1939—indicate that receipts were less than expected or that some of the accounts were not paid in time?—It is possibly due to the latter. If, on the preparation of this estimate, we were aware that the net amount falling to be repayable by the local authorities would be £10,000, then it should be and must be realised. The drop may be due to the fact that payment was not made by one or two local authorities in the year. Whatever is payable under section 17 of the Act of 1939 is statutorily due by the county councils and county borough councils and there is no question of our not realising it.
309. On the Notes to the Account, what were the circumstances of the overpayment to the temporary messenger in respect of a period of sick leave?—I am sorry I am unable at the moment to enlarge on the note on this matter as to what the circumstances were.
You might send us a note as to why it was written off—Yes, certainly.*
310. There is also reference to expenditure on the National Development Fund. Are these schemes completed or will there be further expenditure under that heading? —It is practically fully incurred by this.
There will not be further expenditure on that?—No.
Deputy Carter.—That expenditure is mostly on regional schemes, water schemes and so on?—Some of it. Some of it was for road schemes.
The witness withdrew.
VOTE 51—OFFICE OF THE MINISTER FOR SOCIAL WELFARE.
Mr. W. A. Honohan called and examined.
311. Chairman.—On subhead A.—Salaries, Wages and Allowances—The explanation for the non-expenditure of the total granted is stated in the Notes to be the non-filling or delayed filling of vacancies. Does this mean that it is not intended to fill some of the vacancies?-In some cases, yes, or it may mean, that within the year we did not get round to filling them. In the main, however, it is because we could not get the staff immediately they were required—clerk typists, clerical officers and so on.
Does it indicate any question of reduction of staff?—It does sometimes. Every time there is a vacancy we have to consider whether it ought to be filled. That process is continuous.
So that part of this non-filling saving would be due to policy?—Yes.
Deputy Carter.—Would any of it be due to mechanisation of accountancy methods?— Not to any extent in that particular year.
312. Chairman.—Are you having difficulty in getting, say, clerk typists?—Yes, there is normally delay in getting staff from the Civil Service Commission. There is always a number of unfilled vacancies.
Deputy Lalor.—Would the reduction in staff relate to local insurance agents and the withdrawal of quite a number of social welfare officers from the country?—Yes.
Deputy Treacy.—Do these vacancies apply mainly to Dublin or to the country?—The vacancies are mostly at headquarters. I can give the figures: clerk typists—37, clerical officers—26, staff officers—7. These are the general service grades. Then we have local agents—16, social welfare officers and supervisors—6. These were the numbers of unfilled vacancies at 31st March of the year of account.
Can Mr. Honohan satisfy us that essential services operated by his Department are not suffering as a result of the shortage of staff or deferment of appointment?—I believe I am in a position to say that.
313. Chairman.—In regard to the Appropriations-in-Aid, in item No. 4—Miscellaneous —what are the main items that realised the sum of £1,289?—The main items were: impressed stamp fees, £430, and sales of motor cars and parts, £140. They represent about half the amount.
314. Is not impressed stamping a regular feature?—Yes.
Would it be more appropriate to put in that as a separate heading?—The amount is very small. It is certainly regular in the sense that there are 310 employers at present regularly using these machines. I understand it used to be mentioned separately but it has been combined in recent years.
315. Deputy Treacy.—Could we go back to item No. 2.—Repayment in respect of agency services performed on behalf of the British Ministry of Pensions and National Insurance? Perhaps Mr. Honohan would elaborate on the nature of the services performed on behalf of the British Ministry in respect of the figure shown?—The Department of Social Welfare are administrators in this country on behalf of the British Ministry of a scheme for general practitioner treatment of British ex-service personnel who are disabled by war service and who are resident in Ireland. The British Ministry pays a capitation rate for each ex-soldier entitled to treatment, and this money goes into the Irish Invalided Soldiers Medical Fund, out of which payments are made to doctors providing treatment in accordance with the scheme. The cost of the administration being done by the Department is claimed from the British authorities after the end of each financial year.
Do you feel this figure may have to be increased in the future by reason of the improvement of reciprocal arrangements between ourselves and the British in this respect?—I think that is a different matter. This is for general medical treatment to British ex-soldiers here. There are about 5,000 at present and this figure is reducing year by year as they die off. I cannot see that the amount required for administering the scheme will go up by reason of any reciprocal agreement we may reach.
I take it the reciprocal arrangements to which I am referring are not covered in this head at all?—No.
Where might we find that figure?
Chairman.—I think it comes into the next vote. Social Insurance.
Mr. Honohan.—Yes, reciprocal arrangements comprise social insurance matters.
316. Chairman.—The Note to the Account refers to payment under subhead B of £47 in respect of the cost of repairing damage to two Departmental vehicles involved in accidents. What is the size of the fleet of cars operated by the Department at the moment? —13.
VOTE 52—SOCIAL INSURANCE.
Mr. W. A. Honohan further examined.
317. Chairman.—Paragraph 79 of the Report of the Comptroller and Auditor General reads as follows:—
“Subhead A.—Payment to the Social Insurance Fund under Section 39 (9) of the Social Welfare Act, 1952
79. Payments from this subhead to the Social Insurance Fund in the year under review amounted to £7,611,000. These payments are subject to adjustment when the audited accounts of the Fund are available.”
Have you anything to add, Mr. Suttle?
Mr. Suttle.—The Accounts of the Social Insurance Fund for the year ended 31st March, 1963 have been audited. The amount due to the Fund in respect of the year to 31st March, 1963 was £7,412,555 and this sum represents approximately 39 per cent of the expenditure from the Fund for the year. At 31st March, 1963 the Fund had overdrawn State grant to the extent of £127,460.
318. Chairman.—Members of the Committee have a copy of Accounts of the Social Insurance Fund*. The current account on page 2 shows a payment in respect of old age (contributory) pension of £4,896,118. That is approximately half the assistance Vote. Then, in respect of unemployment benefit there is a figure of £3,204,250, which is approximately twice the Vote. The same applies to the item widow’s (contributory) pension which is also approximately twice the Vote. Is there any particular reason for that?—The amount for old age (contributory) pension is about £5 million and for unemployment benefit, about £3 million and for widow’s (contributory) pension, £3½ million. Your point is that these represent only half the Vote?
In respect of old age (contributory) pension the amount is about half the Vote and for unemployment benefit and widow’s (contributory) pension, approximately more than twice the Vote. I suppose these figures will adjust themselves because of the introduction of the contributory and non-contributory schemes. Is that the explanation?—In so far as I understand the question, the amount for the Social Insurance Vote represents just the contribution of the State towards these schemes, whereas the amounts in this list of payments represent the total amount paid out in these benefits towards which contributions are also paid by the worker and employer. So that one must look at the thing in a broad way, that is to say, the expenditure on benefits of £17½ million plus administration, making the total of £19 million on this account, is met by the State only to the extent of £7½ million.
I will come back to it when we reach the Social Assistance Vote because I think I have not conveyed exactly what I want to get.
VOTE 53—SOCIAL ASSISTANCE.
Mr. W. A. Honohan further examined
319. Chairman.—Paragraph 80 of the Report of the Comptroller and Auditor General says:
“Sums recovered in respect of overpayments charged in prior years’ accounts were:—£30,641 in cash credited to appropriations in aid and £5,817 withheld from current entitlements. Overpayments amounting to £7,166 were treated as irrecoverable. The total amount of overpayments not disposed of at 31 March 1963 was £65,114 as compared with £57,043 at 31 March 1962. During the year 60 individuals were prosecuted for irregularly obtaining or attempting to obtain social assistance and convictions were secured in 57 cases.”
Have you anything to add to that paragraph, Mr. Suttle?
Mr. Suttle.—The overpayments outstanding at 31st March, 1963 under the heads of assistance were: old age pensions £36,873, children’s allowances £1,022, unemployment assistance £13,551, widows’ and orphans’ (non-contributory) pensions £13,668. Three individuals were prosecuted on charges relating to children’s allowances, 55 on charges relating to unemployment assistance and two on charges relating to widows’ and orphans’ (non-contributory) pensions. The total sum involved in these charges was £949.
Chairman.—I notice that £7,166 of the overpayments charged in the prior years accounts were written off?
Chairman.—While only £163 is to be charged in the present Appropriation Accounts. Does this mean that the bulk of the overpayment was not discovered until after the relevant Appropriation Accounts were closed?—Yes, I think that could be said.
320. Were there any prosecutions relating to old age pensions which provided the major portion of the outstanding overpayments?— In the year of account there were no prosecutions in respect of old age pensions. Perhaps I should add that in the case of old age pensioners we do not prosecute; we take civil proceedings which are not recorded here under the head of prosecutions.
You take civil proceedings to recover?— Yes.
Why is there a distinction between the two?—I suppose, on humanitarian grounds and the age of the people concerned.
Deputy Treacy.—Could I have an explanation of the differentiation in the method adopted, that is, civil proceedings and prosecution? I am not very clear.—Prosecution implies a criminal offence and a punishment accordingly, irrespective of the question of recovering the amount.
I appreciate that. Would the witness elaborate on the manner in which old age pensioners are dealt with?—The purpose is solely to recover the money, without seeking any penalty or seeking to charge the person with a crime.
Chairman.—Does the Department in all cases proceed in that fashion or does the Department retain the amount involved by making deductions from payments?—Where we can deduct from benefit or assistance, we do so.
Without proceedings in the courts?—Yes. Sometimes prosecution is proceeded with irrespective of whether we recover the amount or not, in a serious case, a wilful case, where the Department feels that the case should be brought to court and the person prosecuted —that is, apart from old age pension cases.
Deputy Lalor.—That is from the point of view of discouragement, really?—Yes, quite.
Like Deputy Treacy, I am not quite clear. Civil proceedings are taken in order to recover the money but the person concerned cannot get a month in jail?—Yes.
But you can get a decree against him?— Yes.
Deputy Treacy.—Once the case goes to court, is it not a matter for the Justice to determine whether there will be a jail sentence in addition to any fine that may be imposed? How do the Department stipulate in advance the limitation of the sentence or the decision of the court?
Chairman.—I think the answer which Mr. Honohan has given is that it really depends on the type of proceedings they take.
Deputy Treacy.—Suppose the case goes to court, how could the Department restrict the decision of the Justice?
Deputy Carter.—They do not seek to.
Chairman.—I do not suppose they seek to do anything like that. It is a question that we could not ask Mr. Honohan to answer because he has only to account for expenditure of moneys.
321. Chairman.—Turning to the Vote itself, perhaps I can make myself clear on the point I was mentioning earlier. The total grant for subhead A.—Old Age Pensions—is £9,534,000, while the payment shown in the current account of the Social Insurance Fund is £4,896,118, for Old Age (contributory) Pension that is, approximately half of this Vote. Subhead D.—Widows and Orphans Non-contributory Pensions—shows a grant of £1,908,000 while the account shows £3,467,000 for contributory pensions, and in relation to unemployment benefit the position is about the same. Now, in the case of the old age pensions, the accounts of the Fund show approximately half the amount in the Vote while in the others the accounts show approximately double the amounts in the Vote. Is there any particular reason for that?—Yes. In the case of old age pensions, the £4.9 millions in the Social Insurance Fund represents contributory pensions as against the £9½ millions in the Social Assistance Vote which represents non-contributory old age pensions. The non-contributory pension scheme has been there since 1908 whereas the contributory old age pension schemes were only introduced within the last few years. That is one point of distinction. At the moment there are more people drawing non-contributory old age pensions than contributory pensions, the latter of course being confined to people who were insurable. In the other two schemes, it just happens that there are more widows entitled to contributory pensions than to non-contributory pensions. It is the same with unemployment benefit as compared with assistance. We must also remember that the rates of benefit are higher than the rates of assistance, which helps to explain the higher amount.
Would the tendency be for the Vote to decline as more people come in for contributory pensions?—Yes.
How many non-contributory pensions are there at the moment?—At 31st March, 1963 there were 115,873 non-contributory pensions.
The qualification period for entitlement to contributory pensions was recently extended to 20 years, was it not?—There was a change which made the conditions more liberal.
Would you expect that there would be a big increase in contributory pensions as a result?—There would be an increase, but I do not know whether it could be described as a big increase.
Deputy Carter.—Do you anticipate that the Fund will bear all the claims, or will there have to be subventions towards it continually?—The financing of the scheme is broadly determined on the basis that the contribution rates will meet about two-thirds of the expenditure and the State the remaining one-third. There is no doubt that if more persons become entitled to contributory pensions in the future, then the rates of contribution will have to be increased as well as the State subvention.
At the moment it is provided for as to onethird?—Yes.
Chairman.—This amount provided by the Oireachtas will continue all the time, will it not?—Yes, that is part of the structure of the Scheme.
322. In regard to subhead E.—Grants under the Education (Provision of Meals) Acts, 1914 to 1930, as amended—could you say roughly what percentage of the children attending school avail of these meals?—I am afraid I could not answer that question. I could give you the number of children for whom meals were provided.
Are all the children entitled to meals?—It is up to the school to join the scheme, and if the school joins the scheme, the pupils are entitled to meals.
Is there any means test applied?—No, not within a particular school.
Generally is there a means test in regard to the entitlement of children to meals?—No, there is no means test operating.
What I want to convey is that, if any particular school applies, may they operate the scheme independently of the means of the parents of the children?—Yes.
Deputy Treacy.—Is this scheme generally availed of throughout the country or does Mr. Honohan know of any worthwhile area in which the scheme is not in operation?—The schemes are at present in operation in the four county boroughs, 41 urban districts and 14 towns. It is not a rural scheme. To give an example: in the county borough of Dublin, it is operating in 168 national schools out of a total of 277.
When you say it is not a rural scheme, are you implying that it is not available in the national schools?—In the rural parts.
Deputy Lalor.—It is not available in a town where there is not an urban district council or town commissioners?—No.
Deputy Carter.—The scheme is working more smoothly since the School Meals Act was amended? Some time ago the scheme was amended to meet certain difficulties which had arisen in the administration of the scheme?—All I can say is that it is working smoothly and we have no complaints.
Deputy Lalor.—Would it be possible for the Committee to get a complete breakdown of the manner in which this £76,000 was paid out to various county borough councils and county councils?—Yes, certainly.*
323. Deputy Lalor.—On subhead I.— Grants towards the Supply of Footwear for Necessitous Children—it seems that under this system the amount of grant continually decreases because it is based on the amount the council used the previous year. If a county council or local authority issue vouchers for £1,000 worth of goods and only £900 worth of those vouchers is cashed, the following year the amount allocated is reduced to £900. The grant is constantly reducing. That has happened in Laois for the past three years and, in my opinion, it is not in the spirit of the scheme. I am wondering if the Department could apply itself differently in that regard.
Chairman.—That is verging on policy. It will be found from the Committee’s Reports that the operation of the footwear scheme has been discussed on a number of occasions. We shall have to ask the Minister questions on how the scheme should be operated. Mr. Honohan can only be expected to answer in respect of this sum of money. We would have to raise questions of policy in the House on the Estimate.
Deputy Lalor.—There was £14,000 left unspent under this subhead and the explanation given is that expenditure by local authorities was less than sufficient to earn the full allocation of grant provided. In giving that explanation the accounting officer is not, I believe, giving the real reason.
Chairman.—The accounting officer operates under regulations made by the Minister in regard to the scheme.
Deputy Lalor.—Why make provision for expenditure that cannot be spent?
Chairman.—We are bordering on policy and I should not like to continue on those lines.
324. Deputy Treacy.—Could we ask for the figures as to those county boroughs and county councils which did not avail of the grant?—Twenty-two local authorities spent less than the amount necessary to secure the full amount allocated. Three local authorities received 50 per cent of their expenditure. These were Kilkenny, Roscommon and Sligo.
Could we have a more detailed note in regard to the counties involved in that?
Chairman.—Would you prefer to send a note?—Yes.*
Deputy Treacy.—How many of these so-called free vouchers were returned and not availed of by the recipients by reason of the charge laid down?
Chairman.—I do not think these vouchers come back to the Department?—No. We get only a claim.
Deputy Treacy.—You have no knowledge of the number not availed of?—No.
325. Chairman.—On Appropriations in Aid—while recoveries under other headings are close to the estimates, is there any reason why as indicated in item No. 5 recoveries of widows’ and orphans’ non-contributory pensions overpaid should be two-and-a-half times the amount estimated? Were you extra successful in this regard?—No. It was due principally to large amounts that were recovered in five cases. These amounted to over £1,000.
326. In regard to item No. 7—Miscellaneous —what were the main headings in that?—In the main, the receipts here consist of refunds from ten local authorities of grants towards the supply of footwear for necessitous children and from three local authorities of grants towards the supply of fuel for necessitous families.
Could you give us the details of those?—A sum of £498 was involved in the case of the ten local authorities where the refund was in respect of footwear, and £412 in the case of the three local authorities where the refund was in respect of fuel. I would have to send you a note* if you wish to know which local authorities they were.
Deputy Treacy.—We would welcome that.
Chairman.—Yes, when you are sending the note in regard to to the other matter.
The witness withdrew.
Mr. J. C. Nagle called and examined
327. Chairman.—Paragraph 41 of the Report of the Comptroller and Auditor General reads as follows:
“Subhead C.C.3.—World Food Programme (Grant-in-Aid)
41. A grant-in-aid of £300,000 was provided by supplementary estimate to meet this country’s contribution to the World Food Programme jointly administered by the United Nations and the Food and Agriculture Organisation. These moneys may be issued to the Organisation or utilised to purchase food in this country for dispatch abroad. The Programme will continue in operation for three years to 1965. £28,588 was contributed up to 31 March 1963. The account of the grant-in-aid is appended to the appropriation account.”
Have you anything to add, Mr. Suttle?
Mr. Suttle.—This country’s contribution to the World Food Programme was fixed by the Government at 840,000 dollars (£300,000) and this amount, provided by Supplementary Estimate, has been paid into a Grant-in-Aid Account. It was decided that over a period of three years 240,000 dollars of this will be contributed in cash and 600,000 dollars in food. The payment in the year under review was a cash contribution and no food was purchased in the year.
Have you any idea how it was utilised?— Yes. So far we have paid two of the annual cash contributions of 80,000 dollars each, which means one more cash contribution will be due next year. As regards the products made available, we have now actually supplied milk powder to a total value of 296,000 dollars. That represents the total expenditure to date.
Chairman.—Have you any idea of the size of the cash contribution?—The cash contribution is really used to pay for services, for example, the shipping of the particular products which are donated by the member Governments, and the distribution and transport to the recipient country. Of course you will understand that it is not enough for a Government to make a donation of a product; It has to be shipped overseas, usually to a faraway country such as Pakistan so that cash is also contributed to cover that kind of cost.
328. We are represented on the FAO; are we represented on this joint organisation?— No. We are a member of FAO and of course of the United Nations. This programme is looked after by a joint secretariat representing the United Nations and FAO and the governing council similarly consists partly of representatives elected by the United Nations and partly of representatives elected by the FAO. We are not among these.
329. Deputy Treacy.—Is it appropriate to ask what countries have benefited by this grant?—You mean by our contribution?
Yes?—Pakistan has been the main beneficiary so far. Milk powder was sent there to alleviate distress resulting from a cyclone which occurred there and caused great devastation.
Is that the only country?—Also at a later stage—not in the financial year covered here—powder was required by the governing body of the World Food Programme for Cuba where a similar disaster occurred in 1963, as a result of a hurricane.
Was the Castro regime in operation then?— Yes.
330. Deputy Lalor.—We have apparently contributed £300,000 already?
Deputy Lalor.—Is this the first year?
Mr. Suttle.—The total is £300,000, to be spent over three years. All the money was provided this year and was put into a special fund, and will be issued over a period of three years. There will be no further mention in the Appropriation Accounts of a contribution for this fund.
Deputy Lalor.—Have we sent any money so far?—296,000 dollars was mentioned for milk powder?
Mr. Suttle.—No food was provided in the year under review. All we gave was a cash contribution to the funds in 1962-63.
Deputy Lalor.—Of how much?
Mr. Suttle.—It is shown in the account.
Mr. Nagle.—80,000 dollars.
Mr. Suttle.—The whole amount in the subhead was transferred to an account printed on page 111. £28,588 was sent out in cash. The balance of the money remains there for use in the following two years.
Deputy Lalor.—Since then, we have sent no cash?—We have sent cash and food.
That is what I was trying to get at. As we are a food-producing nation, would it not be better for us to contribute in food?
Chairman.—I think Mr. Nagle has explained that it is not sufficient to provide food. We must also make a money contribution to enable the food to be sent from here to the benefiting countries.
Deputy Lalor.—I presume there are countries that a cash donation might suit. If we provide food, we also provide the money to transport it?
Mr. Suttle.—The cash contribution goes to the organisation. We have no control over its disbursement and it might be spent on sending American food to Timbuctoo.
Deputy Lalor.—It might be better to do it in food.
Chairman.—I think it is policy.
Mr. Nagle.—If I may make one comment on that—when this programme was initiated, it was agreed between the many Governments discussing the introduction of the programme that every Government should make a contribution in cash as well as in goods, and I think every Government has indeed honoured that undertaking. I might add that in our case the proportion of our total contribution represented by cash is rather smaller than in many other cases.
331.—Deputy Treacy.—What did Cuba benefit under this scheme in the way of finance?
Chairman.—I think we should have to ask that of Mr. Nagle if we are all here next year. It is not in the account we are dealing with at present.
Mr. Nagle.—May I say, with your permission, that the Committee will perhaps understand that any country that is contributing to this world programme is obliged to meet the requests made by the governing council. It is not possible, for example, to make a choice of countries that you might assist. In this case a request was made and under the constitution there was no option but to honour the pledge.
Deputy Treacy.—I appreciate the point.
332. Chairman.—Paragraph 42 of the Report of the Comptroller and Auditor General reads:
“Subhead K.6.—Farm Buildings Scheme and Water Supplies.
The expenditure is made up as follows:—
Have you anything to add, Mr. Suttle?
Mr. Suttle.—The Farm Building grants are paid to rated occupiers of agricultural land towards the construction of new farm buildings, the improvement of existing buildings, the laying and repair of roadways, paths and yards and the construction of tanks, silos and cattle enclosures. In the year under review the grants charged to this subhead for water supplies were for the installation of piped water to farm dwellings only. Grants for the extension of water supplies to farmyards and fields are borne on subhead K.11— Bovine Tuberculosis Eradication Scheme— and were available only to participants in the Bovine Tuberculosis Eradication Scheme.
Chairman.—I notice you have exceeded the £1 million mark in respect of construction and improvement of farm buildings?
Mr. Nagle.—We have, and the rate of expenditure is still continuing to rise.
333. Deputy Carter.—I could ask this question on the paragraph or on the subhead but as it is very brief I shall put it on the paragraph. In subhead K.6.—Farm Buildings Scheme and Water Supplies—the personnel includes roughly 57 unestablished officers. Those officers would have a number of years’ service, I presume? Some of them would be a fairly long time in the service?—Some of them, Yes.
334. Deputy Carter.—In connection with grants for the construction and improvement of farm buildings, etc., the expenditure is £1,078,858. It is a very important feature of farming life. I notice that there is no architect in that particular section, It has not the services of an architect in respect of farmyard lay-out and so on?—No. It is true that we do not employ an architect. We have an engineer in this particular section. There is also an engineer employed on the Land Project, and I would suggest that in the case of most applications under the Farm Buildings Scheme architects plans would hardly be necessary. For example, in the case of the reconstruction and renovation of buildings, which is a fairly big part of the activities, the experience of the men we employ and the general know-how which they have acquired over the years would probably be sufficient and, also, I would think that, on the whole, the type of building which would be erected on the average holding in this country would not be of an elaborate nature. We have, of course, issued certain standardised designs, for example for cow byres which are, so to speak, working models. We do not insist on their being followed in every detail, but I think they are of some use as a general indication of the kind of building we like to see put up. We also supply specifications as to materials, and so forth.
335. Chairman.—Is there a standard of life for these grants? Can they be repeated at any stage?—I think we relaxed the restrictions there some time ago. At one time there was a rigid ban on an applicant coming back, but I think the general feeling now is that if his further application represents useful work of a genuine nature it should be considered on the merits, and quite a number of these cases are now turning up.
336. Would that apply to things like haybarns and similar items?—I do not think it would apply in the case of a haybarn, which is a special kind of building. We would not allow it there. But, the extension of a cow house, for example, which was the subject of a grant some years ago would be the kind of activity we would consider, especially as policy is now aimed at an increase in the number of cows.
Where there is a question of replacing a haybarn built on a grant 30 years ago, would an applicant be considered?—I would say that it would depend again on the circumstances. If the original structure had been properly built, and if there were no flaws, and if there was nothing on the record which led one to have any doubts about the soundness of the original structure and if, for one reason or another, it became either useless or so obsolete as to be of very little use, then I think we would certainly consider very carefully giving a fresh grant.
We had experience of another Department in regard to a scheme where they built to the most rigid standards thought possible but they did not prevail against freak weather conditions and they are being done again.
337. Paragraph 43 of the Report of the Comptroller and Auditor General is as follows:
“Subhead K.7.—Land Project
43. The payments made in the year under this head are as follows:—
An occupier of land who undertakes an approved scheme of reclamation work on his holding 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.
The payments to the Office of Public Works are in respect of salaries and travelling expenses in connexion with drainage surveys and works.”
Have you anything to add, Mr. Suttle?
Mr. Suttle.—State assistance is provided under the Land Project for the construction and improvement of watercourses, the removal of unnecessary fences, intensive field drainage, the removal of scrub and boulders the application of ground limestone and phosphates to the reclaimed land and necessary work ancillary to the foregoing. The outstanding commitments under Section B of the scheme—discontinued since November 1958—are almost cleared.
338. Chairman.—In regard to the grants to farmers, what would the average grant per acre be of the £1,528,196 involved?—In 1962-63, the average grant was £16 5s. 0d. per acre.
Do these grants tend to increase, or do they remain constant?—The average grant certainly has been increasing. For example, the figure in 1958-59 was £14 16s. 0d. It fell a little in 1959-60 to £14 11s. 0d. and it went down also in 1960-61 to £13 12s. 0d. but in 1961-62 it jumped to £15 4s. 0d. and in 1962-63, as I have said, it was £16 5s. 0d. I think it can be taken that the current figure would be perhaps about £18 or getting on to £20 an acre.
339. Deputy Carter.—Is it the experience of the Department that more of this work is being done progressively by sub-contractors who do the work for applicants at a fee?—I think a great deal would depend on the actual size of any particular scheme. Where the scheme is of any considerable dimensions, for example, if the scheme relates to a large farm of 200, 300 or 400 acres and the area of land dealt with is substantial, say, 50 or 100 acres, then I think the tendency is for the farmers to employ contractors to do the job and that is probably a good thing in the case of the big job but, of course, our grant is not affected by that. We cost the estimate at the current local costs, and if the job costs the farmer more he still gets the same grant. Similarly, if he can strike a very keen bargain, he will still get the same grant.
340. Chairman.—In connection with the last part of the paragraph which refers to the payments to the Office of Public Works in respect of salaries and travelling expenses in connection with drainage surveys and works, what is the nature of these surveys that are carried out on your behalf?—Cases do arise where it becomes necessary occasionally, in view of the possibility of considerable Land Project works in an area having such effects as to cause an undue outflow into certain streams and rivers, and so forth, to have the place broadly surveyed with a view to preventing any trouble of that kind. The payments here cover what we call river surveys and drainage works which the Office of Public Works carried out on an agency basis. The payments received fall into two categories, first of all, the salaries and travelling costs of the engineering staff of the Office of Public Works, and secondly maintenance work on a particular river, that is, the Rye River. I should add that following a suggestion made by the Committee of Public Accounts it was recently arranged to discontinue recoupment to the Office of Public Works for the salaries and travelling expenses of those engaged in drainage works. This arrangement will operate from the year 1964-65.
Chairman.—You mentioned a particular river. Is there any reason why that is not the care of the local authority? Do they not recover the amount from the land owners?— As far as I remember, the arrangement in respect of this river was a rather special one. If the Committee wish, I could furnish them with the full details.
If you would not mind, we should be glad to have them.
341. Paragraphs 44 and 45 of the Report of the Comptroller and Auditor General read:
“Subhead K.8.—Lime and Fertilisers subsidies.
44. The expenditure from this subhead is made up as follows:—
The reports of officers of the Department who inspected the records of the manufacturers and importers to verify subsidy claims were examined by my officers with satisfactory results.
45. From 1 September, 1961, the phosphate subsidy scheme and the subsidy scheme for home produced superphosphate were amalgamated as indicated in paragraph 45 of my previous report. In order to ensure that the full benefit of the fertiliser subsidy would reach the farming community it was decided that the Department of Industry and Commerce should carry out an annual examination of the accounts of the home manufacturers with a view to advising the Department of Agriculture of any significant change in the cost of producing superphosphate. The results of the examination of accounts for the 1961-62 fertiliser season are expected to be available shortly.”
Has the examination of the 1961-62 manufacturing accounts by the Department of Industry and Commerce been completed?— Yes, I understand it has been completed, and that the view of the Department of Industry and Commerce was that the prices fixed were not unreasonable.
Do they notify you of the outcome of this in detail?—They inform us that they have made a full investigation but they only give us their conclusions.
They do not give you anything in detail?— They do not give us the details, nor do we ask for them. We regard this as a function of that section of the Department of Industry and Commerce.
342. Paragraphs 46, 47 and 48 of the Report of the Comptroller and Auditor General read as follows:—
“Subhead K. 11.—Bovine Tuberculosis Eradication Scheme.
46. The expenditure is made up as follows:—
Receipts from the sale of cattle slaughtered under the scheme amounted to £2,515,709 for the year and were credited as appropriations in aid.
47. Where reactor cows were purchased by the Department under the scheme it was the practice to dispose of them to canning firms on the basis of quarterly competitive tenders. But for the quarter ended 31 March, 1963, joint venture bids by two or more firms were submitted for the various tendering areas of the Six Southern Counties. The Department, however, did not regard the prices quoted as competitive but following discussions with the firms an increased offer was accepted.
48. The gross cost of the scheme from its inception in September, 1954 to 31 March, 1963, including expenditure under the scheme of Guarantee Payments in respect of exports of fat cattle and carcase beef, was £39,714,651 and receipts from the disposal of cattle for slaughter were £11,618,542. The net cost was therefore £28,096,109.”
Have you anything to add to that, Mr. Suttle?—Paragraph 46 just gives the usual analysis of the expenditure under this subhead. I think Mr. Nagle might give the Committee a few more details on Paragraph 47.
343. In regard to Paragraph 46, in previous years, Mr. Nagle, you were able to give the losses which occurred in disposing of reactors. What is the position regarding the year 1962-63?—The average loss on cow reactors in 1962-63 was £30 11s. compared with £29 1s. 8d. for 1961-62, so that there is an increase there. In the case of non-reactors, the loss worked out at £19 5s. 3d. in 1962-63 as against £18 14s. 5d. in 1961-62.
Both figures are showing an increase?— They are.
344. Would you be able to give ussomething further on Paragraph 47?—Certainly. I think I should begin by explaining that on the 1st October, 1962, that is to say, the last quarter of 1962, we began to purchase directly the cow reactors which were becoming available in what we call the six southern counties. Up to that time we only bought the reacting store cattle in the south in certain cases and high class pedigree cows. It was decided, in order to speed up eradication and in view of the fact that the incidence of bovine tuberculosis had fallen quite a lot in the south, to make a big effort and go in and purchase all the cow reactors we could get. We were aided there by some compulsory legal measures. I need not say that the number of cows in the south is very big and as the incidence of bovine tuberculosis in the same area, although it had fallen, was still big the number of reactors among cows was naturally still very large. Tenders were invited for this quarter ending 31st December, 1962, and about six to eight firms tendered. It was observed that in some cases, although not in all, there was an identity of quotations. I think in more than half the tenders there was an identity of quotations. When we came to request tenders for the quarter ending March, 1963, the quarter referred to in the Report, we said in our circular letter inviting tenders something to the effect that we would hold ourselves free in the event of equal tenders to draw by lot the firms to which the tenders would be awarded. When the tenders were received we found that they were on the basis of joint venture bids. In other words, for each of the three areas into which we have the south divided, the tenders received from about eight firms appeared to have been arranged in such a way that each of the eight firms would get a certain amount of business in some area, so that no firm would be left out. We consulted legal advisers and others as to the validity of joint venture bids, and we were told they were not illegal. In the case of joint venture bids the firms coalesce and we were unable to carry out our previous intimation that in the event of identity of bids we would reserve the right to draw by lot, because the quotations were coalesced by the several firms. That was not illegal. Naturally this did perturb us quite a lot, and we also had an informal word with the Fair Trade Commission in case there was any aspect which might come before them. It seemed to be rather doubtful whether it was within the province of the Fair Trade Commission, but, as well as that, there was the practical difficulty that the machinery of the Fair Trade Commission is not a very quick moving one. It cannot be, in the nature of things. In this case we had to get reactors removed, and we had to make arrangements in quite a short period of time. At the same time our feeling was that, on the whole, the quotations appeared to be rather low. Several meetings were then held with the meat trade who had tendered and their argument was very briefly this: our incursion into the cow trade in the south was a highly important development, and the Department was now actually handling, in the last quarter of 1962, at least 55 per cent of the total cows purchased by the meat firms—in the first quarter of 1963, I think the percentage was something around 40. The meat and canning interests held that this was a highly important development from their point of view, that is to say, the handling by the State of a very large percentage of their raw material which ordinarily they would buy according to normal commercial methods. They made the further point that, if the system of competitive tender was literally carried out, the result might be that they would have to close down some factories because another factory or other factories might get the bulk of the contract. They made quite an issue of the question of people being thrown out of work in various parts of the South. They also declared that the price tendered was a fair and reasonable one, and that they had to tender in advance as against normal commercial practice whereby they can go out and buy week by week and alter their prices week by week. In this case they had to tender a quarter in advance; they had to take all types of cows which we delivered to them, whether or not they were entirely suited to their canning purposes or their manufacturing purposes. As a result of all these discussions, they raised what you might call their collective bid by, on the average, about one halfpenny per pound, and that was accepted. This was a very critical stage in the bovine tuberculosis eradication scheme from the point of view of rapid eradication. I do not think it would have been possible to delay on this matter, which would have been the only possible course open, that is, to make no contract. That would have held up the scheme and could conceivably, in the long run, have proved more costly because, as we all know, reactors breed reactors. The cheapest TB scheme, even though it is expensive at the time, is the one which gets rid of the disease in the shortest possible time. If you wish to have my opinion of the final figure of one halfpenny per pound extra, my feeling would be—and it is only a feeling; I cannot prove it—that it was rather on the low side. I would have to add, in fairness, that this view would be strongly opposed by the meat trade. I am not in a position to give concrete proof in regard to the opinion I expressed, but I think it is only right I should say so much.
Chairman.—We are very grateful to you for the long explanation. It was a serious problem at the time, and perhaps the Committee could come back to that at a later stage.
345. Deputy Treacy.—Mr. Nagle has made a very elaborate statement, but I wonder if he could give to us a little more information in respect of the actual contract. May I take it that all meat processing factories in the South benefited and, if so, was it on an equitable basis?—Yes. I think you can take it that all the firms who tendered, numbering nine, shared in this contract during this quarter and, I would venture to think, on a basis which was acceptable to each of the firms, because when this situation arose these firms dealt with us as one. Our invariable practice has been to invite tenders from about 20 firms, but we never received quotations from more than about nine. Only about nine were actively interested in this business.
346. Deputy Lalor.—What was the final per lb. price negotiated?—The average price, including the halfpenny, was 1/4½d. per lb.
347. How did that compare with the price which was being paid in other parts of the country before what Mr. Nagle called a joint venture bid was made or, as I would describe it, a ring was formed?—In the same area in the same counties in the December quarter the price tendency was lower; it was 1/4d. But it must be added that usually the October-December quarter is the heaviest one from the point of view of the supply of cows, and as a result it often happens that the market price would be somewhat lower in that quarter than in other quarters of the year so that a price of 1/4½d. in the March quarter of 1963, while actually greater than the price we got in the December quarter, would be partly affected perhaps by this normal seasonality in market prices. How the price paid for our reactors compared with the price paid for non-reactors is difficult to say, because the lists published by the canning firms at the time did not in all cases convey enough information to enable us to make an accurate comparison, but again our conclusion was that the price paid for non-reactors was on the whole higher than the price paid to the Department for reacting animals. The meat trade of course would say in defence of that, first of all, that they were dealing with completely healthy animals from the TB point of view and secondly, that they were buying of their own free will and judgment in the purely commercial sense, when they liked, and how many they liked. I think there is probably little doubt but that the price for the reactor cows was less than for the non-reactors.
Mr. Suttle.—I think the accounting officer will agree with the view that the March quarter was really a climax in the problem that had been building up for some considerable time. Is that right?
Mr. Nagle.—As I said, the tendency which, if you like, reached a kind of climax in the March quarter of 1963, was primarily discernible, we thought, in the December quarter of 1962, and there were some cases of it perhaps earlier.
Business suspended at 1 p.m. and resumed at 1.15 p.m.
Mr. Nagle.—Would you allow me a final comment on this matter? I should, perhaps, have pointed out earlier that there was no other market available for these reactor cows except this particular industry. For example, it would have been quite impossible to have exported these cows alive because they were all reactors. There is no market to which we could have sent them. The meat industry was really the only market which would absorb reacting cows at the time.
348. Deputy Treacy.—Why was the contract for these cattle confined to the south?— The firms were not confined to the south. The firms were located in many different parts of the country, including, for example, County Kildare and County Dublin. There was no question of confining the tenders to any area at all.
Deputy Lalor.—We will get an opportunity of discussing this in the preparation of our Report?—Yes.
349. Chairman.—Paragraph 49 of the Report of the Comptroller and Auditor General is as follows:—
“Subhead K.12.—Grants for Pasteurisation of Separated Milk, etc.
Grants to creameries towards the cost of approved pasteurising plant and can-washing equipment amounted to £21,489 in the year. This amount was recouped to the Department from the American Grant Counterpart Special Account and credited as appropriations in aid (See paragraph 56).”
Have you anything to add to that paragraph, Mr. Suttle?
Mr. Suttle.—The Agreement between Ireland and the United States of America dated March, 1955 governs the scheme under which half the capital cost of providing new pasteurising plant and can-washing equipment at creameries is met from the Grant Counterpart Special Account. The scheme is in operation since 1956-57.
Chairman.—I presume nearly all the premises are now equipped, Mr. Nagle?—Yes. At the present moment all premises have the facilities for pasteurising skim.
What is the position in connection with can-washing?—The can-washing side of this project has not been availed of to any considerable extent at all. It is rather disappointing but, perhaps, understandable because it is a rather expensive business even though we provide a grant.
Deputy Lalor.—Have many of the creameries, or have any, arranged to put in equipment for can-washing—what proportion?— The proportion would, of course, have been quite small. In the particular year under review we paid 21 grants altogether, of which only one was for can-washing equipment, the rest being for pasteurisation of skim. I have not here the exact number over the years for can-washing equipment. I can supply that figure if the Committee wishes but the figure would certainly be very small.*
350. Chairman.—Paragraph 50 of the Report of the Comptroller and Auditor General is as follows:—
“Subhead K.14.—Payments to Pigs and Bacon Commission.
The payments are as follows:—
These payments are accounted for in the accounts of the Commission.”
In regard to the payments to the Pigs and Bacon Commission, could the accounts of the Commission be furnished for the information of the Committee?—Certainly, if the Committee would like to have the accounts.
Mr. Suttle.—The Accounts for the year ended December 1962 were presented to the Dáil in March, 1964.
Chairman.—The Committee might like to see copies of the accounts.†
351. Paragraph 51 of the Report of the Comptroller and Auditor General is as follows:—
“It was decided to utilise £75,000 out of the balance in the Marketing of Agricultural Produce Account for the development by the Commission of export markets for pigmeat and pigmeat products. The Department was advised, however, that such a grant would come within the scope of section 28 of the 1961 Act which provided that grants paid under that section shall be used to defray any loss incurred by the Commission in relation to the export of bacon and shall not be used for any other purpose. To enable the grant to be used for its intended purpose payment was authorised from this subhead through the medium of a supplementary estimate with an offsetting appropriation in aid to the vote by way of transfer from the Produce Account.”
Have you anything to add, Mr. Suttle?
Mr. Suttle.—This paragraph sets out how an allocation to the Pigs and Bacon Commission out of the Marketing of Agricultural Produce Account was made available for the purpose for which it was intended. It was really a legal-accounting problem, which was overcome in this way.
Chairman.—Does the Department exercise any control over the nature of the expenditure involved?
Mr. Nagle.—The Commission has to make a report to us, I think twice a year, as to how the money has been actually expended and, of course, it was made clear when the money was given to them that this was strictly for market promotion purposes, and I may say that the Commission has adhered very rigidly to these requirements.
352. Chairman.—Paragraphs 52, 53 and 54 of the Report of the Comptroller and Auditor General are as follows:—
“Subhead K.15.—Losses on Disposal of Wheat, etc.
52. The expenditure under the subhead is made up as follows:—
53. Reference was made in previous reports to the arrangement under which An Bord Gráin would purchase and dispose of so much of the 1960 wheat crop as was not utilisable for milling into flour. The net losses involved, according to the accounts of the Board, amounted to £1,989,448 including £3,416 being expense of refunding levies on the 1961 wheat crop.
54. It was decided to make ex-gratia payments of 12s. 6d. per barrel to growers whose wheat of the 1962 crop was declared unmillable and who sold it at the animal feed price.”
Have you anything to add, Mr. Suttle?
Mr. Suttle.—The accounts of Bord Gráin for the year to 31st August, 1963, recently certified by me, show a net loss of £2,193,585 against which payments on account were made as shown in the paragraph. With the bulk of the 1962 crop disposed of, the accounts show a trading loss on wheat of £469,218, payments of ex-gratia bonus to growers, £1,100,663 and subsidy on barley exported in lieu of feed wheat, £286,045.
353. Chairman.—Paragraph 55 of the Report of the Comptroller and Auditor General is as follows:
“Subhead N.—Marketing, etc., of Dairy Produce.
55. The expenditure is made up as follows:—
The payments to An Bord Bainne are accounted for in the accounts of An Bord.
To enable the price of creamery milk to be increased by one penny per gallon as from 1 June, 1962, arrangements were made to pay from the Exchequer to each creamery a creamery milk price allowance of one penny per gallon on the quantity of milk received in the creamery as from that date. The allowances paid to 31 March, 1963, amounted to £995,783.”
Have you anything to add to that paragraph Mr. Suttle?
Mr. Suttle.—The 1962-63 accounts for An Bord Bainne are not yet available. I have nothing to add to the information contained in the second part of this paragraph.
354.—Chairman.—Paragraph 59 of the previous Report of the Comptroller and Auditor General indicated that £2½ million was the calculated loss in anticipation of exports in relation to butter stocks held by the Butter Marketing Committee. Is there any indication of the actual loss?
Mr. Nagle.—A figure representing anticipated loss on butter stocks held by the Butter Marketing Committee?
Chairman.—Yes. On page 97 of the report you will find the export loss content of butter stocks.
Mr. Nagle.—I think I recollect this. This was the butter stock transferred to Bord Bainne when they started operations?
Chairman.—Yes.—The position then was that it was thought undesirable that An Bord Bainne should commence, so to speak, in debit, so that the stocks of butter produced before An Bord Bainne came into operation in the butter market were transferred to them at a book price corresponding to the then ruling price in Britain and that closed the transaction. In other words, if it transpired, as indeed happened, that prices thereafter in Britain went higher than the prices ruling at the time that the butter was transferred, the Board would benefit. On the other hand, if export prices declined, the Board would lose something. It was thought better to make a once-for-all arrangement of this kind. In fact, the arrangement did benefit the Board to the extent of something over £300,000 because the actual price of butter on the export market moved up and not down after the date on which this transfer was effected. On the other hand, the price could have moved down, in which event we would not have recouped the Board for the loss.
355. Chairman.—Paragraph 56 of the Report of the Comptroller and Auditor General is as follows:
“Subhead P.—Appropriations in Aid.
Recoupment from American Grant Counterpart Special Account in respect of grants to certain rural organisations, pasteurisation of separated milk and technical assistance.
The amounts allocated and the recoupments from the American Grant Counterpart Special Account of expenditure incurred up to 31 March, 1963, on projects sponsored by the Department of Agriculture 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.”
Have you anything to add, Mr. Suttle?
Mr. Suttle.—This paragraph is for the information of the Committee. I have nothing to add.
356.—Chairman.—Paragraph 57 of the Report of the Comptroller and Auditor General is as follows:
“General Cattle Diseases Fund.
The General Cattle Diseases Fund, established by the Contagious Diseases (Animals) Act, 1878 was wound up on 31 March, 1963, in accordance with the provisions of section 3 of the Diseases of Animals Act, 1960. The balance standing to the credit of the Fund on the winding up date was £6,307 16s. 11d. and this amount falls to be appropriated in aid of the vote for 1963-64.”
Have you anything to add, Mr. Suttle?
Mr. Suttle.—This was a fund set up in 1878 which it was considered did not nowadays serve any effective purpose.
357. We will now turn to the Vote itself. In regard to subhead D.I.—Agricultural Schools and Farms—the note says that the saving was chiefly on the provision for general expenses at Ballyhaise Agricultural Station due to certain factors. What happened exactly?—Frankly, it is rather difficult to say. I think that what happened was that for some reason quite a number of accounts were rendered to the college very late, and they went into the next financial year before they could be paid. As far as I remember I think it was almost an accident that this happened.
358. In connection with subhead I.6.—An Foras Talúntais (Grant-in-Aid)—have the Foras Talúntais accounts been presented to the Dáil for 1962-63 and, if they have, could copies be made available to the Committee?— I think they have been submitted to the Dáil and of course they can be supplied to the Committee.
Could you arrange to have copies made available to us?—Certainly.*
359. In regard to subhead K.3—Payments to the Agricultural Credit Corporation, Limited, in respect of Loans—the note seems to imply that the Department would be underwriting loans to the Agricultural Credit Corporation. Is that the position?— That is part of the explanation, but the special storm damage loans which were introduced after the very bad storms towards the end of 1961 are also included here. In this case the rate of interest was only 2 per cent and the repayment period was extended to 15 years, so that the Department paid the Corporation an annual subvention based on the difference between 2 per cent and 6¼ per cent which was its usual rate of interest. It also includes some payments to the Corporation for irrecoverable losses on loans but these are fairly small and the amount recouped in 1962-63 was £115 11s. 8d.
360. In regard to subhead K.K. 11— Bovine Tuberculosis Eradiction Scheme— Guarantee Payments in respect of Export of Fat Cattle and Carcase Beef—this was something we referred to on a previous occasion. Have there been any further complaints in this case since the note of the Minister for Finance in a previous report that a number of claims under investigation could not be paid?—The matter has not been cleared up entirely, but it was found possible to pay some of the claims which were held up at the time of the Committee’s last meeting. In some of the other cases, we are not entirely satisfied yet, so the claims have not been paid in full, but no net loss has arisen.
361. Deputy Lalor.—In regard to subhead K.13.—Grants to Bacon Factories—are the bacon factories not modernising as the Departwould wish or have things improved since 1961-62?—They have improved quite a lot since then because about November, 1962 the percentage grant was raised from one-third to one-half, and as a result there was quite a big increase in the number of applications. If I may for a moment go into the year 1963-64, we expended over £90,000 in grants as against less than £23,000 in 1962-63 and in 1964-65 we are providing £150,000 which we think will be used.
Chairman.—Do you exercise control over the grants payments?—We do.
Is there an over-riding limit to the grants which factories may get?—We now aim at an over-riding limit of, I think, about £30,000. We do not want these grants to compete, so to speak, with major grants which might be available from other sources. We regard these as grants for doing works of a practical nature that would help the factories, and therefore we have that maximum figure.
362. In regard to the Appropriations in Aid, item No. 2—Receipts from sale of vaccines, live stock, farm produce, etc: Veterinary Research Laboratory and Farm at Abbotstown—the note says that sales of tuberculin for private testing continued to decline. Is there any reason why this should happen?—Well, I suppose the reason is that the vast bulk of tuberculin testing is done under our instructions, and paid for in full by the State.
363. On item No. 17—Repayment by the Co-operative Fruit Growers’ Society, Ltd., Dungarvan, in respect of the principal portion of loan instalments paid to the Agricultural Credit Corporation, Ltd., on behalf of the Society—can you give any indication as to when payments made will be refunded?—It is very difficult to say. I do not regard the outlook as very hopeful in that respect. The Society have been under a number of difficulties, and I have always felt from the beginning that their financial position was not an easy one because so much of their capital consisted of interest-bearing loans.
364. In regard to item No. 21—Receipts from sale of cattle slaughtered under the Bovine Tuberculosis Eradication Scheme— receipts were estimated at £3,058,400 and only £2,515,709 was realised. Is that attributable to lower salvage prices?—I have figures here both for the number of animals estimated and actually received and also the salvage prices. Salvage was realised on just a little short of 90,000 animals, whereas the estimate was based on 102,000 animals. The average price came to a little over £28 a head but we had estimated £30 a head. These two factors would account for the reduction.
365. In connection with item No. 27 (b)— Fees for inspecting canned and open-pack meats—inspection fees on exports were abolished as from 1st April, 1962. Are inspections still being made under this heading?—Yes.
But no fees?—No.
366. On the Notes, an ex-gratia payment of £499 was made towards the cost of replacing culverts which were extensively damaged by floods. What circumstances attached to that?—There were two schemes of reclamation work carrying grants to the amount of something over £3,500 which were approved for holdings of two applicants in County Meath. A considerable part of the scheme consisted of clearance and improvement of a stretch of water course of about one and a half miles, which flows through the two holdings. The area of land on the holdings estimated to be improved was 347 acres. The water course runs through a good deal of flat land and the level and flow of water is such that it had at some time been necessary to construct a weir to retain a supply of water for one of the holdings. The specification in respect of five culverts to be constructed on the water course, therefore, provided for a single line of piping of 42 inch diameter which seemed adequate, but in October, 1960, during a period of heavy rainfall and before the newly constructed culverts had properly consolidated, flooding occurred and this caused the destruction of, or very extensive damage to, the culverts. Investigation showed that under the conditions which obtained a very much greater volume and rapidity of flow occurred than could have been anticipated from the terrain or could have been normally foreseen. Investigations also showed that culverts of the dimensions already provided were not fully satisfactory, and that it would be necessary to replace them by five bridges of a seven foot span. No liability was admitted by the Department but it was considered, having regard to all the facts of the case, that we should contribute towards the cost of construction of the bridges to replace the damaged culverts.
367. On page 108 there is reference in the Notes to subhead G.—Seed Distribution Scheme—indicating that it includes additional expenditure estimated at £394 in obtaining substitute supplies of seed potatoes as a result of the failure of the merchant to supply the seed required by his contract. Was the Department protected in the contract against such a contingency?—Yes. The contractor in question did not supply the seed although he had been warned that in the event of default he would be liable for the consequential loss. In fact we were obliged to seek the seed from other sources on the most favourable terms available, which we did with the approval of the Government Contracts Committee. We then pursued the contractor in question, but he alleged that his contract was subject to supplies being unsold, and he alleged that we came along to him rather late in the day, unreasonably late. We did not accept that, but we took legal opinion and the advice we got was that we would have some basis for bringing a claim but that if the case were brought to court the prospects of succeeding were very poor. We were advised to negotiate with the contractor in question and he finally offered a sum of £51.
368. In regard to the Account on page 110 of Receipts and Payments in relation to the Marketing of Agricultural Produce (Grant-in-Aid), does the Department exercise any control over marketing by Bord Bainne?—Bord Bainne must give an account of how they spend this money, and I think we have defined as carefully as possible the objects on which the money should be spent.
369. The Account shows payment of fees and expenses to consultants in connection with a survey of continental food markets. Have all the surveys been completed?— These surveys are completed. They have not been formally put on sale but they have been circulated very widely in the country. One of the reasons we were advised not to publish them fully was that there was a lot of useful information which we did not want to be giving gratis to other countries.
370. Deputy Carter.—In connection with the turkey publicity campaign, the Account shows an expenditure of £2,665. Was that all incurred at home on publicity, or had we any part in publicity abroad?—This was entirely for publicity in Britain.
371.—Deputy Lalor.—There is a very small payment of £138 under the heading “Grants in respect of exports of AFD processed carcase beef.” Would that not be a Sugar Company project and, as such, how does the Department come into it?—I think there was a technical problem which arose here because the firms—I think there was more than one— engaged in the AFD processing of carcase beef for export could not qualify under the guarantee payments scheme that we had in operation at that time in regard to the export of cattle and beef, because of the technicality that the animals from which the beef was derived were not slaughtered in the exporters’ premises. That was a condition we had written into the scheme which was devised with reference to the structure of our meat export industry. We completely overlooked the fact that a couple of firms handling the AFD process would not fit in with that general condition, and it was in equity thought that they should get the small export guarantee payments which they would have received if they had been sending meat out in the normal state. That is the explanation of the payment.
In that year very little was sent out under that heading?—Very little.
372. Chairman.—In regard to the Account of the Dairy Produce (Price Stabilisation) Fund on page 112, are there any developments in winding up that account?—Yes, it has either happened or is imminent. I am advised that we hope in the next few months to close this fund finally.
373. Members of the Committee have received copies of the Consolidated Balance Sheet of the Dairy Disposal Company Limited and Associated Companies as at 31st December, 1962.*
Chairman.—We are very much obliged to you, Mr. Nagle.
The witness withdrew.
The Committee adjourned.