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APPENDIX II.MINUTE OF THE MINISTER FOR FINANCE ON A REPORT DATED 10 MARCH, 1966, OF THE COMMITTEE OF PUBLIC ACCOUNTS.Paragraph 1— Following are the further observations of the Minister for Finance on paragraphs 3,4 and 12 of the report dated 22 February, 1961; paragraph 25 of the report dated 5 September, 1962; and paragraphs 12, 14, 18, 21, 27, 34, and 35 of the report dated 12 November, 1964, of the Committee of Public Accounts. A. REPORT DATED 22 FEBRUARY, 1961.RATES ON GOVERNMENT PROPERTY.3. Payments for water supplies. Some further progres has been made and the Committee will be informed when the matter has been concluded. POSTS AND TELEGRAPHS.4. Erroneous payment by the Post Office Savings Bank. A further repayment of £3 11s. 4d. was received during 1965-66 and efforts are continuing to recover the outstanding balance, which now amounts to £200 3s. 11d. DEFENCE.12. Consumption of electricity. The negotiations with the Electricity Supply Board are still in progress and the Committee will be informed of the outcome. B. REPORT DATED 5 SEPTEMBER, 1962.POSTS AND TELEGRAPHS.Paragraph 2— 25. Misappropriation of moneys at sub-post offices. The Committee set up in the Department of Posts and Telegraphs to ascertain whether more effective measures could be devised to safeguard public funds is satisfied that the systems of accounting, check, supervision and inspection are, in general, sound and that there is no important aspect of the systems of control or of the Department’s relations with depositors in which a substantial change is necessary. In general, losses are small (especially so when related to turn-over), are sporadic in occurrence, and arise mainly in circumstances that make preventive measures extremely difficult. Over the service as a whole, during the ten-year period ended 31 March, 1964, the totals of cash transactions and of known losses through dishonesty amounted to £2,351 million and £22,500, respectively. These figures give an average loss of .002 pence to the £. The Committee did not attempt to estimate the total cost to the Department of the many checks in operation. However, the Committee considered that in view of the volume of business transacted, the number of centres at which business is conducted and the rising cost of staff, the cost aspect must be constantly borne in mind. Experience has shown that misappropriations are comparatively few and the amounts lost small in proportion to the cost of any additional checks. While not recommending any new check, the Committee made suggestions (which were adopted by the Department) on points of detail which may make existing checks more effective. It recommended also that publicity about the various services should stress, discreetly and indirectly, the various points on which public co-operation was necessary but that, in view of the need to continue to attract small savings, no restrictions should be imposed which might make the transaction of business in post offices less attractive. C. REPORT DATED 12 NOVEMBER, 1964.AGRICULTURE.Paragraph 3— 12. Irregularities in claims for guarantee payments by certain exporters. Proceedings were instituted in the two cases in question in the Dublin District Court in March, 1966. The trials are expected to take place next October, and the results will be notified to the Committee in due course. DEFENCE.14. Court Rules regarding recovery of value of property stolen. The Minister is informed that the District Court Rules Committee, in the course of the general revision and consolidation of the District Court Rules on which they are at present working, are redrafting the relevant Rule to remedy the defect. PRISONS.18. Services provided for the treatment of mental illness among prisoners. After full examination, it is the considered view of the Departments of Justice and Health that the services provided for the treatment of insane prisoners in the Central Mental Hospital and in district mental hospitals are operating efficiently and as economically as medical considerations allow. ROINN NA GAELTACHTA.21. Glasshouses. See comment on Paragraph 26 of Report dated 10 March, 1966. PUBLIC WORKS AND BUILDINGS.27. Arterial drainage schemes carried out under contract. See comment on Paragraph 24 of Report dated 10 March, 1966. LANDS.34. Dwellinghouses erected by Land Commission contractor. In the third case the migrant has accepted an alternative holding with existing buildings, has been given a repair grant of £500 and has been paid £225 in respect of legal costs. The three defective houses have been reallocated under purchase agreements containing a clause acknowledging that the new allottees have inspected the buildings and are satisfied with their condition. The Land Commission have recently claimed recoupment from the sureties of the expenditure on legal costs, aggregating £837 5s. 0d. No acceptable response has been received and the question of taking legal proceedings is under consideration. GENERAL.35. Audited accounts of bodies who receive subventions from voted moneys. Consideration of the Committee’s proposals regarding review of the accounts of State-sponsored bodies which receive subventions from voted moneys is proceeding in the light of the comments of the Departments concerned. D. REPORT DATED 10 MARCH, 1966.Paragraphs 4, 13 and 29. These paragraphs do not appear to call for comment. PUBLIC WORKS AND BUILDINGS.Paragraph 5—Inventories of furniture in Embassies and Legations abroad. It is hoped to complete the examination and revision of the inventories in the next six to nine months. Paragraphs 6-9—Conversion of Templemore Military Barracks into a Garda Training Centre. The Minister shares the Committee’s preference for realistic estimates as a basis for authorising expenditure and for detailed plans and firm specifications as a basis of contracts. At the same time he must, if the occasion arises, have regard to exceptional considerations which in an individual project might justify a departure from the normal practice of lump sum contracting. In the present instance a substantial amount of adaptation and renovation work was involved and considerations of urgency arose which were paramount. In the circumstances, the system of a schedule of rates with approximate bills of quantities, as recommended by the professional advisers, was adopted. The final cost of the works included in the original contract was comparatively close to the original tender figure, if increases under the price variation clause are omitted. The Minister, nevertheless, intends that the lump sum contract system should, as heretofore, be adopted save in the most exceptional circumstances. The professional bodies representing architects, quantity surveyors and civil engineers have been consulted on the Committee’s view that it should be possible to negotiate a fee for large contracts. All three bodies have rejected this suggestion save where negotiation is already provided for in the rules and regulations of their organisations. (See the Accounting Officer’s letter of 30 Mean Fomhair, 1964 printed as Appendix XXI to the Report of the Public Accounts Committee on the Appropriation Accounts for the year 1962/63). The bulk of the furniture at the former training centre was unsuitable for use in the new quarters and a large quantity, because of wear and tear, had no more than scrap value. Suitable items, after repair where necessary, were transferred to Templemore and the requirements of new furniture were thus reduced by about £4,000. The remainder of the old furniture has either been taken into store for re-issue, where appropriate, for Garda purposes elsewhere or has been sold by auction if unfit for further use. A figure of the amount so realised is not available as the items were bulked with others for the purposes of auction. AGRICULTURE.Paragraphs 10 and 11—Tenders for reactor cattle. Since 1 April, 1965, contracts for the purchase of reactors have been allotted on the basis of competitive tenders received from individual canning firms. The distortion of normal trade which was caused by the heavy clearance of reactors at the peak of the Bovine Tuberculosis Eradication Scheme and which gave rise to combined tendering by the canning firms, is not likely to recur. The clearance of reactors under the Brucellosis Eradication programme should not reach the same intensity. The Minister has arranged to have consideration given to the Committee’s suggestion should there be any indication of a recurrence of the situation. DEFENCE.Paragraph 12—Civil Defence Equipment. Because of the voluntary nature of the Civil Defence service, it was not possible to estimate accurately the equipment requirements in advance. Provisional strength targets for each branch of Civil Defence had to be set and the training equipment requirements for each sector determined. Approximately one-fifth of these requirements, except in the case of radiation-measuring equipment, has been purchased to date. The total quantity of radiation-measuring equipment (which is also operational equipment) required, on the basis of the strength target set for the Warden Service, was to be purchased over the four years from 1961/62; in fact slightly more than 50% of requirements has been purchased to date. As the major hazard in a nuclear war would be radioactive fall-out, radiation measurement equipment is an essential requirement. This equipment is available only from sources outside the State; it could not be procured at short notice; and alternative equipment could not be got or improvised in an emergency. In the circumstances, it is considered that the equipment stocks purchases are not excessive. The Minister understands that the stocks of radiac instruments and rescue outfits now held in store amount to £54,000. Following a decision to decentralise this equipment so as to be better prepared for emergency conditions, it is expected that the bulk of the items still in store will be issued to local authorities shortly. The holding of some stocks in store for comparatively lengthy periods cannot, however, be avoided because of (a) the difficulty of closely aligning purchases with strengths, (b) the contingency of a rapid expansion if crisis conditions developed and (c) the need for maintaining a stock of replacements. The Department of Defence considers that, in the light of experience to date, deterioration and obsolescence do not present a serious risk. OFFICE OF THE MINISTER FOR EDUCATION.Paragraph 14—Grant-in-aid to Comhdháil Náisiúnta na Gaeilge. Detailed audited accounts are, in fact, furnished to the Department of Education annually by Comhdháil Náisiúnta na Gaeilge and are open to the scrutiny of the Comptroller and Auditor General. VOCATIONAL EDUCATION.Paragraph 15—Expenditure on the X I I International Apprentice Competition. The Minister understands that accounts have been furnished by the Department of Education to the Comptroller and Auditor General, together with information concerning the disposal of equipment used in connection with the XII International Apprentice Competition. HEALTH.Paragraph 16—Minor Receipts of Health Authorities. The analysis requested by the Committee is as follows:—
TRANSPORT AND POWER.Paragraph 17—Bord Fáilte Éireann—grants towards the development of holiday accommodation. The question of providing information on grants paid by Bord Fáilte Éireann for the development of holiday accommodation is being examined in conjunction with the general question of the reference of accounts of State-sponsored bodies to the Public Accounts Committee. Paragraph 18—Accounts of Córas Iompair Éireann. The Minister is in consultation with the Department of Transport and Power regarding the Committee’s comments on the information available to that Department about the accounts of Córas Iompair Éireann. The Minister notes that the Committee regards this matter as being part of the larger issues raised in paragraph 35 of the Report of the Committee of Public Accounts on the 1962/63 Accounts which he has at present under consideration. COURTS.Paragraph 19—Fees payable for licences to keep petroleum, etc. A Bill to consolidate and amend the law relating to petroleum and other dangerous substances is at present being prepared in the Department of Industry and Commerce. The position in relation to fees payable on the issue of a licence to keep petroleum or other substances of a like nature is being reviewed in this context. The Committee will be informed in due course of the results of this review. NATIONAL GALLERY.Paragraph 20—Inventories of pictures, etc. The Minister understands that inventories of pictures and other works of art in the National Gallery will shortly be completed. AGRICULTURE.Paragraph 21—Phosphatic Fertiliser Subsidy. The Minister agrees with the Committee and has brought their views to the attention of the Accounting Officer who has informed him that, apart from the examination carried out by the Department of Industry and Commerce, investigation into the accounts of fertiliser manufacturers and traders, periodic checks of the stocks, books and other records of the manufacturers and importers are carried out by officers of the Department of Agriculture and Fisheries. In the case of all fertilisers sold at the subsidised price the manufacturer or importer must show clearly, on the invoice or other document relating to the sale, the full price of the fertiliser, the amount of subsidy allowed and the net amount payable by the purchaser. It is also a condition of the subsidy scheme that importers and manufacturers must require wholesalers and retailers to undertake to supply every customer with a receipt or invoice for each sale giving particulars of the full price, the Government subsidy and the amount payable. These provisions ensure that the full benefit of the subsidies reaches the ultimate purchaser. Paragraph 22—Fines incurred by millers The decline in wheat production, coupled with the fact that under present-day marketing conditions the bulk of the wheat crop is taken up in the period up to the end of October each year, renders the making of the Purchase Percentage Order unnecessary. The Order was not made for 1965/66 and, unless unusual circumstances arise, it will not be necessary to make it in future. It is, however, considered desirable to retain the power to make the Order so as to ensure that home-grown wheat will be purchased as offered by growers. The reference to remission of nominal fines incurred by the holders of milling licences will not, therefore, appear in the Appropriation Account for 1966/67, or thereafter, unless circumstances require that an Order be made. In this event care will be taken to phrase the reference in the Account in such a way as to avoid giving a false impression that irregularities have occurred. Paragraph 23—Accounts of Dairy Disposal Co. Ltd. In view of the request of the Committee that they would like to have before them accounts that meet the requirements of the Companies Act, 1963, the accounts of the Dairy Disposal Co. Ltd. and its associated companies, for the year ended 31 December, 1964, recently presented to both Houses of the Oireachtas are in the form of a combined balance sheet and combined profit and loss account as envisaged by the Act. PUBLIC WORKS AND BUILDINGS.Paragraph 24—Intermediate river drainage schemes Contracts have been placed for five Intermediate River Drainage Schemes— the Owvane, County Cork, the Matt, County Dublin, the Duff, Counties Sligo and Leitrim, the Abbey, County Donegal, and the Brickey, County Waterford. The Owvane, Matt and Duff schemes have been completed and the Abbey and the Brickey are still in progress. The Commissioners’ Cost Accountant has examined the costs of the three completed schemes. Inclusive of overheads the actual costs of the Owvane, the Matt and the Duff were £53,328, £21,645 and £92,994 respectively. It has been estimated that, if the Owvane scheme had been carried out by direct labour, the cost would have been 11% lower and that under incentive bonus conditions the cost by direct labour would have been 18% lower. The cost of the Matt scheme by direct labour with incentive bonus would have been about 5% lower and without bonus 6% higher than the contract cost. In the case of the Duff scheme the cost by contract was 12% lower than the estimated cost by direct labour without incentive and 3% lower than the direct labour cost with incentive bonus. If the Owvane catchment, where torrential flows and unstable river banks made conditions unusually difficult, is excluded, the indications so far are that from the view point of cost there is little to choose between the contract and direct labour methods of carrying out intermediste river drainage. Examinations of the costs of the Abbey and Brickey schemes will be made when they are completed. Incentive bonus was first introduced on the Broadmeadow Drainage Scheme in 1962, when the cost of the work-already carried out was about £100,000. The remaining works were completed under incentive conditions at a cost of £200,000, approximately, making a total of £300,000, approximately, for the scheme. All works were completed in 3½ years. It has been estimated that without incentive the cost would have been £340,000 and that about 4½ years would have been needed for completion. The bonus system was extended to the Inny scheme in 1963, the Moy in 1964, and the Killimor in 1965. Performance targets at these schemes are being reached and it is expected that cost reductions and time savings will be achieved. FORESTRY.Paragraph 25—Claims against St. Patrick’s Copper Mines, Ltd. The Department of Lands held discussions with the Receiver and were told by him that he has no funds at his disposal for settlement of the Department’s claims against St. Patrick’s Copper Mines, Ltd. A settlement depends on the outcome of negotiations at present in hands for the sale of the Company’s assets. The Minister feels that the only course in the circumstances is to await the outcome of the negotiations. ROINN NA GAELTACHTA.Paragraph 26—Storm damage to glasshouses The Committee will be informed of the ultimate financial loss when it has been ascertained. Paragraph 27—Returns to growers The lower average returns to tomato growers in Connemara—as compared with County Donegal—relate, in recent years, to the houses described as “heated” in the statistical summary published by the Department of Agriculture. Although heating equipment was installed in these houses it was in many cases not used to full advantage, if at all. The main factor contributing to this under-utilisation was the reluctance of growers to use turf since they were not convinced that heating would lead to a satisfactory increase in income. Linked with this there was, in some cases, the preference of growers to sell their turf for cash income rather than use it as fuel for heating their glasshouses. OFFICE OF THE REVENUE COMMISSIONERS.Paragraph 28—Remission of tax The feature which caused the difficulty in this case was the absence of assessments in the circumstances outlined. Prior to 1963 there was no power to raise such assessments. Section 9 of the Finance Act, 1963, confers such power and consequently the difficulty will not arise in future. Paragraph 30—Automatic data processing equipment An Interdepartmental Committee was set up in 1962 to ensure as far as possible the maximum degree of co-ordination between Government Departments in the utilisation of automatic data processing equipment and, in general, the optimum degree of user of such equipment. The Committee keeps itself informed of the use being made of existing installations and of possible further fields of economic user. It examines and advises on all proposals made for the installation of automatic data processing equipment in Government Departments. The Committee is representative of the Departments with actual or potential interest in automatic data processing and has at its disposal, as required, the experts who are engaged full time on this work as members of the ADP unit of the Department of Finance. Proposals made by the Revenue Commissioners for new automatic data processing equipment are at present being examined in the Department of Finance with the assistance of the Interdepartmental Committee.
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