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IMEACHTA AN CHOISTE.THE PROCEEDINGS OF THE COMMITTEE.Déardaoin, 12 Samhain, 1964.Thursday, 12th November, 1964.1. The Committee met at 11 a.m. 2. Members Present. The following members were present:— Deputy Jones (in the Chair), Deputies Booth, Patrick J. Burke, Clinton, Patrick Hogan (South Tipperary), Kenny, Lalor and Treacy. 3. Report of Committee. The Chairman brought forward a Draft Report for consideration. (i) Paragraphs 1 and 2 agreed to. (ii) Paragraph 3. Paragraph read as follows: “External Affairs. 3. The Committee notes that the Minister remains convinced that the publication of details of expenditure on entertainment might prove an embarrassment to distinguished guests. While it recognises that this might be true in a very small number of cases where foreign visitors are concerned, it is unsatisfactory that more information is not available to the Committee so that it could judge the scope and standards of entertainment provided at public expense, and if necessary report to Dáil Éireann.” Amendment proposed (Deputy Booth): “In line 3 to delete ‘While it’ and substitute ‘and’, and to delete all words after ‘are concerned’ in line 5 and substitute ‘The Committee, however, notices from the British volume of Appropriation Accounts that reasonable details are given of expenditure on hospitality, and it trusts that the Minister will be able to go some distance in meeting its views in this matter.’” Amendment agreed to. Paragraph, as amended, agreed to. (iii) Paragraphs 4 and 5 agreed to. (iv) Paragraph 6. Paragraph read as follows: “Health Control of expenditure of health authorities 6. The rise in the cost of drugs and medicines and the increase in recent years in the proportion of health expenditure attributable to these items has been noted. The Committee would like to be informed whether there is a pharmacy attached to each health authority hospital or whether in some cases prescriptions for out-patients are dispensed by retail chemists.” Amendment proposed (Deputy Booth): “To delete the second sentence and substitute: ‘The Committee wishes to be informed of the comparative costs of dispensing in pharmacies attached to health authority hospitals and by retail chemists so far as prescriptions for out-patients are concerned.’” Amendment, by leave, withdrawn. Paragraph agreed to. (v) Paragraph 7. Paragraph read as follows: “Public Works and Buildings Disposal of spare parts 7. The Committee notes the final results from the disposal of surplus and obsolete stores which accumulated over a number of years at the central engineering workshop. The losses to public funds have been substantial, but the Committee trusts that useful lessons have been learned about the importance of careful forward planning for the purchase of stores having regard to changes in design and improvements in performance of modern plant and equipment.” Amendment proposed (Deputy Booth): “To delete all words after ‘substantial’ and substitute ‘but the Committee wishes to be informed of the steps which have been taken to avoid such losses in future.’” Amendment, by leave, withdrawn. Paragraph agreed to. (vi) Paragraphs 8 to 18 inclusive agreed to. (vii) Paragraph 19. Paragraph read as follows: “Health 19. The Committee trusts that the importance of the proper classification of expenditure will be impressed on the Health Authorities concerned. Having regard to the mounting expenditure on the health services in recent years, the Committee inquired whether the Department could forecast a reduction in the foreseeable future. It is pleased to learn that the cost of treatment of tuberculosis continues to decline, and that with advances in medical science and better organisation the number of patients in mental hospitals will go down appreciably, and probably costs will also show a reduction. But in relation to general hospitals, the Department did not see much prospect of a reduction in expenditure because of new techniques in treatment, and rising costs of staff remuneration which was a very important element in the expenditure on this service. In its Report dated 6th April, 1960, the Committee wondered whether, in the interests of economy and efficiency, cost accounts were kept by the authorities, and it was furnished with details regarding the precise responsibilities undertaken by the Department of Finance and the Department of Health in controlling expenditure. In reverting to this subject the Committee considers that utilisation of general hospital bed accommodation must be an important factor in the economy of the health service administration. What would be the approximate occupancy ratio is a question the answer to which would be of considerable interest to the Committee.” Amendment proposed (Deputy Patrick Hogan, South Tipperary): “In line 24, after ‘occupancy ratio’ to insert ‘in each of the different hospital categories’.” Amendment agreed to. Paragraph, as amended, agreed to. (viii) Paragraphs 20 to 22 inclusive agreed to. (ix) Paragraph 23. Paragraph read as follows: “Industry and Commerce 23. £22,000 is charged to the vote in respect of a loss incurred as a result of a trade loan guarantee given in May, 1955, by the Minister for a bank loan to the Slaney Cabinet Works. The original loan was £30,000 but the company failed to meet its obligations and the Minister was called upon to honour his guarantee. Including interest due, £30,218 was paid from the Central Fund to the bank. The Minister appointed a receiver in February, 1959, who kept the business going until January, 1960, when it was sold as a going concern. The total amount realised by the receiver was £20,688, of which £1,307 was required for preferential creditors, and £11,161 for the expenses of running the business, including £3,430 for his fees and outlay. Having regard to the substantial loss to the Exchequer in this case the Committee desires to be furnished with a copy of the receiver’s account and with details of his fees which it considers are rather high.” Amendment proposed (Deputy Patrick Hogan, South Tipperary): “In lines 14 and 15 to delete ‘receiver’s account and with details of his fees’ and substitute ‘receivership account and details of the receiver’s fees and outlay’.” Amendment agreed to. Amendment proposed (Deputy Booth) “To add to the paragraph the following: ‘The Committee would also like to know why it took almost twelve months to dispose of the business.’” Amendment agreed to. Paragraph, as amended, agreed to. (x) Paragraph 24 agreed to. (xi) Paragraph 25. Paragraph read as follows: “Public Works and Buildings 25. The Committee was informed that when the work commenced the fees for the architects and quantity surveyors were estimated at £35,000. They have recently been estimated at £60,000 but the ultimate figure is not yet known. It does not seem to be right that continuing profits should be made from a never-ending proportion of the money to be spent.” Amendment proposed (Deputy Booth): “To delete the last sentence of the paragraph and substitute the following: ‘The Committee feels that in large contracts of this nature it should be possible to negotiate an agreed fee with the architects and quantity surveyors, and that in this particular case the fees have been inflated by reason of the facts referred to in paragraph 24.’” Amendment agreed to. Paragraph, as amended, agreed to. (xii) Paragraphs 26 to 29 inclusive agreed to. (xiii) Paragraph 30. Paragraph read as follows: “Agriculture Bovine Tuberculosis Eradication Scheme 30. The Comptroller and Auditor General drew attention to a departure from normal practice in competitive tendering for the disposal of reactor cows to canning firms in the quarter ended 31st March, 1963. Joint venture bids, submitted for the various tendering areas of the six southern counties, were not regarded as competitive by the Department but following discussions with the firms an increased price offer was accepted. The Committee was informed that on 1st October, 1962, the Department began to purchase directly the cow reactors which were becoming available in the six southern counties. As a certain identity of quotations was observed in the tenders submitted for the quarter commencing on that date it was decided to reserve the right in the event of equal tenders being submitted for the quarter ending 31st March, 1963, to draw by lot the firms to which the tenders would be awarded. But tenders were submitted on the basis of joint venture bids, that is, for each of the three parts into which the area was divided the tenders received from firms appeared to have been arranged in such a way that each of the firms would get a certain amount of business in some area. The validity of this procedure was, however, considered not illegal. The position was discussed in meetings with the firms who represented that from their point of view a highly important development had arisen with the State handling a very large percentage of their raw material which ordinarily they would buy according to normal commercial methods; that a system of competitive tendering might result in some factories closing down because others might secure the bulk of the contracts; and that the price tendered was a fair and reasonable one. As a result of the discussions, however, the firms raised their collective bid by, on the average, about one halfpenny per lb. which was accepted. Again the Committee was informed that as the bovine tuberculosis scheme was then at a very critical stage from the point of view of rapid eradication it would not have been possible either to delay or to make no contract as the scheme would have been held up and could conceivably in the long run prove more costly. Also, there was no other market available for these reactor cows except in this particular industry. But the Department felt that the final figure of one halfpenny per lb. extra was rather on the low side. The Committee has considered the evidence presented and notes the close relationship with ancillary matters previously adverted to in paragraphs 6 and 27 of its Report on the 1961-62 Accounts. It is concerned that a concerted approach would appear to have been employed by the canning firms to take advantage of the Department in its efforts to dispose of cow reactors at a fair and reasonable price. It would accordingly be glad to learn to what extent the Department is in a position to satisfy itself that excessive profits, at Exchequer expense, have not accrued to the canning firms.” Amendment proposed (Deputy Booth): “In line 20 to delete ‘The validity of’.” Amendment agreed to. Amendment proposed (Deputy Booth): “To delete the last sentence of the paragraph.” Amendment, by leave, withdrawn. Paragraph, as amended, agreed to. (xiv) Paragraphs 31 and 32 agreed to. (xv) Paragraph 33. Paragraph read as follows: “Agriculture Special Agricultural, etc., Schemes 33. Under the Seed Distribution Schemes a merchant failed to supply seed potatoes as required by his contract and the Department incurred additional expenditure of £394 in obtaining substitute supplies. The Department held the contractor liable for the consequential loss but later was legally advised that the prospects of succeeding in recovering the loss in Court were very poor. As a result of negotiations £51 was accepted from the contractor and the balance of £343 was written off. On a number of occasions in recent years previous Committees have commented on losses arising from the non-enforcement of the terms of contracts. This Committee is disturbed to learn that the legal advice obtained by the Department indicated that the prospects of successfully pursuing this case in the Courts were poor. It would accordingly like further clarification of the legal position.” Amendment proposed (Deputy Booth): “To add, at the end of the paragraph‘ and in particular as to whether there was unreasonable delay on the part of the Department in formulating its claim and, if so, whether this was the factor which made the contract unenforceable.’” Amendment agreed to. Paragraph, as amended, agreed to. (xvi) Paragraph 34 agreed to. (xvii) New paragraph. Amendment proposed (Deputy Booth): “Before paragraph 35 to insert the following new paragraph: ‘35. In the course of its deliberations the Committee has noted that a very substantial proportion of total Government expenditure is not subject to any audit by the Comptroller and Auditor General nor to any scrutiny by the Committee, and in particular it refers to the amounts of voted moneys paid to State sponsored bodies and to the expenditure as set out in the annual Financial Accounts. While the Reports of State sponsored bodies and the Financial Accounts are laid before both Houses of the Oireachtas no opportunity is given for their detailed consideration. The Committee therefore recommends that Dáil Éireann should consider some amendment of its Standing Orders to provide for the reference to the Committee, or to some other Committee constituted for the purpose, of the audited Accounts and Reports of all State sponsored bodies which receive subventions from voted moneys, and also of the Financial Accounts.’” Amendment, by leave, withdrawn. (xviii) Paragraph 35 agreed to. Draft Report, as amended, agreed to. Ordered: To report to the Dáil accordingly. 4. Conclusion of Business. The Committee concluded its business at 1.20. p.m. |
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