Committee Reports > List of Committees > Dáil > 1967 > Committee of Public Accounts > Interim and Final Reports of the Committee - Appropriation Accounts 1966 - 1967

MIONTUAIRISC NA FINNEACHTA

(Minutes of Evidence)

Déardaoin 14 Nollaig 1967

Thursday 14th December 1967

The Committee met at 11 a.m.

Mr. E. F. Suttle (An tArd Reachtaire Cuntas agus Ciste) and Miss Bhreathnach and Mr. Whitty (An Roinn Airgeadais) called and examined.

VOTE 40—INDUSTRY AND COMMERCE.

Mr. J. C. B. MacCarthy called and examined.

268. Chairman.—Paragraph 56 of the Report of the Comptroller and Auditor General reads:

“Subhead H.—Córas Tráchtála (Grant-in-Aid)

56. Grants to Coras Tráchtála which, under the provisions of section 16 of the Export Promotion Act, 1959, as amended by section 2 of the Export Promotion (Amendment) Act, 1967, may not exceed £4,500,000, amounted to £2,655,885 at 31 March 1967, including £575,000 issued in the year under review.”

269. Have you anything to add, Mr. Suttle?

Mr. Suttle.—The accounts of Córas Tráchtála which are audited by me are presented to the Oireachtas. During the year under review the Board, out of its grant-in-aid made a grant of £75,000 to Kilkenny Design Workshops, Limited, a wholly owned subsidiary. In June 1966 Ireland House Shop Limited, London, another subsidiary, commenced trading. A loss of £7,021 was incurred in the period to March last but there is every hope that a breakeven position at least will be reached in the current year. The accounts of the two subsidiaries are audited on my behalf and are printed as appendices to the published report and accounts of Córas Tráchtála.

270. Deputy Andrews.—This loss on Ireland House would be for the first nine months of trade?

Mr. MacCarthy.—That is so.

That would be understandable. Has the position improved?

Mr. MacCarthy.—It is improving but I cannot say quite to what extent. In large measure, the sales in the Shop—they operate a shop—will determine the final position. I should not like to make a prediction at the moment but, if I could make a guess, my guess would be that the position will not be very much improved in the next account.

271. Have we any offices in London outside Ireland House?—There may be some Aer Lingus offices. In Ireland House, you have Córas Tráchtála, CIE offices, Bord Fáilte offices and also, I think, an Aer Lingus sales office, though it does not affect my Vote. I think there are other Aer Lingus premises in Regent Street and various other parts.

Is it the intention to bring them all into the one building?—There is not room in the existing building.

272. Deputy Molloy.—You spoke of Córas Tráchtála, CIE and other bodies. Are there not some other Irish agencies housed in Ireland House, Gaeltarra Éireann being one?—There may be; I am not sure.

Mr. Suttle.—Gaeltarra Éireann is there also, yes.

273. Chairman.—Has all expenditure on Ireland House come to an end?—All the adaptations?

Yes?—That again I do not know, because the premises are not State owned. They belong to the Prudential Insurance Company and there is a leasing arrangement. I am not quite sure what way the reconstruction expenditure stands. I imagine the Comptroller and Auditor General would probably know better than I from the accounts. We do not come in on it because it is done entirely by the company.

274. Deputy Molloy.—Is it expected that Ireland House will make a profit? Surely a lot of these are promotional organisations?—The Shop is separate from the other activities.

Mr. Suttle.—It is a building and they make lettings to all these other bodies. Ireland House is a letting body. They only pay rent.

Deputy Molloy.—They are private firms?

Mr. Suttle.—In effect, but Ireland House itself operates on the Shop and lettings.

Mr. MacCarthy.—The answer in relation to the Shop is yes. It is expected that the Shop itself will yield a profit.

275. Deputy Briscoe.—What is the rent paid on Ireland House?—I do not think I have the rent paid. It is included in the figure of £166,395 to cover rent, rates, taxes and offices expenses in the published accounts at the back of the Annual Report of Córas Tráchtála for 1966. The rent paid by the Ireland House Shop to Córas Tráchtála in the year ended 31st March, 1967, amounted to £3,875 based on a reduced rent of £5,000 payable under an agreement which provides for an increase by reference to turnover. The total rents received by Córas Tráchtála in the period in question amounted to £51,367.

276. That is a receipt to Córas Tráchtála?—From Aer Lingus, CIE and also the reduced rent charged—it is really an apportionment—in respect of the Shop area.

Do they meet the overall rent themselves?—They do. They are the tenants, Córas Tráchtála.

Mr. Suttle.—The gross rent of Ireland House is about £90,000 odd and they get back from the lettings about £50,000. The rent and maintenance charges amount to £94,000 and £51,000 is recoverable from sub-tenants.

Mr. MacCarthy.—And these monies are received by Córas Tráchtála and brought to account.

277. Did the Irish Government ever think of purchasing Ireland House outright?—Originally there was a scheme to purchase outright at Piccadilly Circus, London, but the development scheme was not approved by the London County Council and the idea was then dropped. These premises then became available in Bruton Street, off Bond Street—although they were not really large enough for the original concept of having everything in London: consular offices, trade sections and agricultural attaches would be in Ireland House, together with other firms like Guinness—it would be quite a big place.

Would it be cheaper in the long run to purchase the house outright?—I think it would.

278. Deputy Crowley.—There is no doubt it would be cheaper because the rent we are paying is fantastic. Could we make any recommendation?

Mr. Suttle.—The rent includes maintennance and various services.

279. Deputy Briscoe.—What is the length of the lease?—Unfortunately I do not know that because it is not a direct transaction, but I imagine it is a relatively shortish lease. It is probably renewable after some years.

Mr. Suttle.—Thirty-nine years. They got a loan for the purpose of adaptation of Ireland House and the loan will be payable over 39 years which is possibly the same term as the lease.

Mr. MacCarthy.—I think there is a review provision.

Deputy Briscoe.—The lease would be reviewed?

Deputy Andrews.—The Prudential company is not an Irish Company?—No.

It is an American insurance company?— English, but there is also a Prudential in America. What the link between the two is I do not know.

280. Could this Committee make some sort of recommendation on the subject?

Chairman.—Would that not be a matter of policy? We are precluded from dealing with policy.

Mr. MacCarthy.—What was the recommendation?

Deputy Andrews.—That we should make a recommendation that we buy out Ireland House or similar type enterprises instead of leasing over the years?—I think the difficulty is that you cannot buy them because they are not for sale. None of these developers will in fact sell.

Deputy Andrews.—It is a somewhat similar position to that which obtains in Dublin where many buildings or floors in buildings are leased instead of purchased outright in the first instance. The cost to the country must be phenomenal.

Chairman.—This is a matter of policy.

Deputy Andrews.—I appreciate it is.

Chairman.—We could pursue the matter on the Vote in the House.

281. Chairman.—Paragraph 57 of the Report of the Comptroller and Auditor General reads:

“Subhead J.—Grant to An Foras Tionscal (Grant-in-Aid)

57. The aggregate amount of grants which may be made to An Foras Tionscal to enable it to carry out its functions is limited to £30,000,000. The Industrial Grants (Amendment) Act, 1966, extended the powers of An Foras to enable it to establish, develop, maintain and manage industrial estates. The charge to the subhead in the year under review, £5,462,855, includes payments of £421,360 for the development of estates at Galway and Waterford. The aggregate amount of issues to 31 March, 1967, was £21,421,826.”

Have you anything to add, Mr. Suttle?

Mr. Suttle.—The accounts of An Foras Tionscal are audited by me and are presented to the Oireachtas. I have nothing further to add.

282. Chairman.—What is the position as regards our new industrial estates?

Mr. MacCarthy.—The two are, of course, Galway and Waterford. The charge in this particular year is made under the subhead. Of the total of £5.4 million, the payment in respect of the two industrial estates amounts to £421,000. This is pointed out in the Comptroller and Auditor General’s notes. Of course expenditure has been incurred in the meantime and the estate in Galway is already functioning to the extent that there is one factory there, the Standard Pressed Steel, which is in operation. The estate at Waterford is also well advanced and I think everything is going according to plan. They have run into water supply difficulties in Waterford but I think these will not hold up the scheme.

283. Deputy Crowley.—Generally on industrial estate schemes, do the Government make grants towards their development to the developers?—Not generally, no. These two industrial estates are, in fact, completely owned and operated by the Government, through Foras Tionscal. There has not, so far as I know, ever been a grant to a private promoter of an industrial estate.

284. Chairman.—Foras Tionscal make no grants?—I think possibly they could do it under the Act, but take, for example, a place like Chapelizod, I am quite certain no grant was ever given in respect of the industrial estate at the bridge in Chapelizod. This is again policy but it is no harm to mention that the whole question is under active review at the moment and there may be quite a new philosophy recommended to the Dáil in regard to these matters.

285. Deputy Molloy.—What are the arrangements regarding the running of these factories? If it is outside the scope of the Committee, very well?—I think the answer is that, if it is not outside the scope of the Committee, it is outside my scope as Accounting Officer: but they probably give rather advantageous rents. Would the Comptroller and Auditor General not have this information?

Mr. Suttle.—In one developed estate, that is at Shannon, the rents are as near economic as possible. In the early days, they gave very advantageous lettings to the first people, but according as they were getting better known and people were more inclined to come, they kept increasing the rent so that at the present rents received are at varying rates. The rents were cheap at first; the present ones are nearly fully economic. The new estates at Waterford and Galway have not yet developed to the extent of being fully operative.

Mr. MacCarthy.—There is one letting to the Standard Pressed Steel Company.

Mr. Suttle.—And there is one in Waterford. I think the rents in these cases are as near economic as they can negotiate.

286. Deputy Briscoe.—Do the companies have the option to buy these factories if they so desire?

Mr. MacCarthy.—Certainly not at Shannon, which is not provided for in this Vote, but I do not think that policy has yet crystallised sufficiently in the case of Waterford and Galway to enable me to answer the question. If I might give an off the cuff answer, it would be that we would welcome it if people wanted to do it.

Mr. Suttle.—I know Shannon very well and Mr. O’Regan’s idea is, if possible, not to sell. He prefers to keep control of the whole area. If he attempted to sell, you might have unsuitable development for the area in a particular factory.

Deputy Crowley.—The blocking off of access and so on.

Mr. Suttle.—In the case of Shannon an attempt is made to maintain a proper proportion between male and female labour. If it was a free-for-all, you might have factories just using all female labour and replacing men, which would be very unsuitable. From that aspect I know he would prefer to keep control.

287. Deputy Briscoe.—And he feels he can keep control by renting the premises?

Mr. Suttle.—In the case of Shannon, some of these factories were built by the people themselves. The Ripon Company built their own factory, but most of the others were built by Shannon and rented out to the operators.

288. Deputy Molloy.—How much has been spent up-to-date on the development of the two industrial estates?

Mr. Suttle.—I have not got the up-to-date figures.

Mr. MacCarthy.—The figure up to 31st March, 1967 is £421,360. The Galway figure is £348,910, and the Waterford figure is £109,907, so you might say £110,000 and £350,000.

Deputy Crowley.—That is the amount? —Yes.

I was trying to work out what was the amount of payment since March?—I would not have that.

Deputy Briscoe.—What is the anticipated expenditure over the total?—We just do not know. This is handed over body and bones to Foras Tionscal.

289. Mr. Molloy.—You have no influence over the rents charged?—It is in the hands of Foras Tionscal, just as Shannon is in the hands of the Shannon Free Airport people.

290. When you say the rent is advantageous, you mean advantageous to Foras Tionscal?—I am going upon what some industrialists tell me. They tell me they prefer to take a rented factory.

It depends on the rent?—That is why I deduced it was advantageous.

It is not working out that way in Galway, not at 6/- a square foot?—I cannot speak about that, but I feel certain they would be open to discussion on a matter like that. Obviously it would be silly if the rent was preventing the factories from being operated.

This is happening. A rent of 6/- a square foot is the full rate being charged by commercial developers. However, it is outside the scope of Mr. McCarthy’s business here today.

291. Chairman.—Paragraph 58 of the Report of the Comptroller and Auditor General reads:

“Subhead P.—Shipbuilding Subsidy

58. Reference was made in previous reports to payment of subsidy in respect of ships built by Verolme Cork Dockyard, Ltd. The charge to the subhead, £141,000, comprises a final payment of £16,312 in respect of the third ship, and payments on account totalling £124,688, in respect of the fourth, fifth and sixth ships built by the company. The payments were made on the recommendation of a special committee appointed by the Minister to examine the company’s claims.”

Mr. Suttle.—This paragraph is for information.

292. Deputy Crowley.—Has the contract price been determined for the ninth ship or the rate of grant payable?—The Government’s decision was that the rate of subsidy on the ninth ship should be 8 per cent or, alternatively, the actual loss incurred in building the ship after taking into account 60 per cent only of the charges for depreciation, whichever s the less. This formula was devised by a special team of accountants and industrial development people, that was their recommendation and that was approved. Of course nothing has been paid yet. They overlap from year to year. Some of the vessels have been completely paid off as far as subsidies are concerned. Others are not, and in the year 1967, which is the year under review, the provision put in the estimates was intended to relate to the balances on the fourth and fifth ships and advances on the sixth, seventh and eighth ships. In fact what happened was that final payment was made on the third ship which had not been provided for. It had been assumed that would be paid off in the earlier year. A payment was made on the sixth ship and on the fifth ship, and a proportion of subsidy was paid on the fourth and fifth ships, so that the latest ship in respect of which anything was paid in 1966-67 was the sixth ship, although we had visualised we should be making payments on the eighth ship.

293. Chairman.—Eight ships have had a full subsidy determined?—Yes, and on the ninth ship a subsidy has been approved in accordance with the recommendation of the committee.

294. Deputy Crowley.—As regards the committee which was set up by the Minister to examine the company’s claim, who makes up its membership?—There is a representative of the Industrial Development Authority, a representative of the Industrial Credit Company and An Foras Tionscal. I think the Comptroller and Auditor General’s Office was associated with the committee at an earlier stage.

Mr. Suttle.—There was a representative on the committee to examine the accounts locally, but the particular man who was on the job left us. I was a bit diffident about leaving anyone on the committee because, having approved, through this representative, of expenditure, I could not criticise it. Therefore when this man withdrew I just left it at that.

295. Deputy Crowley.—To whom does this committee report?

Mr. MacCarthy.—Initially to the Minister for Industry and Commerce and through the Minister for Industry and Commerce to the Government.

296. Have they made many reports to the Minister?—Yes, indeed. Every one of these things is the result of an enormous haggle. The committee always meets Mr. Verolme, and there have been not one but several reports on most of the ships.

297. Eight per cent seems to be a very low figure?—It is on a descending scale. Naturally enough, the labour is no longer as green as it was at the beginning. Initially the subsidy was for green labour; nowadays it is not so much the labour as the competition from elsewhere. Verolme himself can place an order, if he gets one, in Holland, Brazil or in Cork. It depends on what is available from Brazil and what he can get in Holland. The job of the committee is to ensure that the subsidy is at the lowest possible rate that will secure the vessel.

298. Chairman.—Is there any possibility we can ever do without a subsidy?—That is the hope, but it is not much more than that, because the building of ships is being subsidised all over the world.

Mr. Suttle.—Certainly the percentage is decreasing. On the third ship it was 15 per cent; on the fourth, 12½ per cent; on the fifth, 10 per cent; and now on the sixth, seventh and eighth, 8 per cent.

Deputy Crowley.—As the labour is getting more skilled?

Mr. Suttle.—Yes.

299. Deputy Briscoe.—How does that subsidy compare with those of other countries?

Mr. MacCarthy.—It is practically impossible to make a comparison, as I know from having been a member of a committee of the OECD in Paris. Subsidies are generally frowned upon by the OECD but not in the particular case of shipbuilding. But there is absolutely no basis for making a comparison. It would be quite impossible for anyone to know to what extent the Japanese subsidise their vessels, and that is true generally. We do not even know what the British rate is. It is incalculable, particularly with countries which have large defence orders. They can give a subsidy in a concealed way by making a special rate for defence vessels.

300. Deputy Molloy.—We are not concealing the percentage of subsidy we are giving?—No.

Are we quoting in comparison with others?—When I say we are not concealing it, we do mention it here but we do not broadcast it.

But is this not a published document which can be purchased by anybody? Maybe you would rather not have that published?—I think you have a point but, unfortunately, it was published in last year’s proceedings because some question was asked about it.

301. Deputy Briscoe.—Much of Verolme’s borrowings are from abroad?—Yes.

Would it not be a profitable thing for us to lend the money to Verolme here?— I recall quite a lot of criticism in Dáil Éireann as to the extent to which the Industrial Credit Company did enter into it.

Mr. Suttle.—The provision for expenditure for the current year to March 1968 next was £¾ million. How much of that will be spent we do not know.

302. Deputy Molloy.—On this shipbuilding subsidy, a very substantial order was lost by Verolme for the building of these Esso ships. Was it because our subsidy was not sufficient to make them competitive? Was this not a recommendation of the committee set up by the Minister?—I am sorry to say this is very positively policy because there were competitive businesses on offer at the time. It was certainly not because of any recommendation of the committee. There were other circumstances which I think could be dealt with in the Dáil but which I could not properly discuss here.

Mr. Suttle.—The committee’s function is to define the actual subsidy in accordance with a formula. The formula is a percentage subject to a limit and the committee’s function was to work within that formula, to decide what the subsidy should be.

303. Deputy Molloy.—We were binding ourselves to working to a limit. The witness has just spoken of “8 per cent or whichever was the lower”. Surely there was enough flexibility to make the company competitive in what is a most competitive market?

Mr. MacCarthy.—I think the contract which the Deputy refers to as having been lost was not lost for any reason connected with the rate of subsidy. There were other considerations which, as I say, are strictly policy considerations and even the word “lost” is slightly tendentious because while that particular vessel may not be built, other vessels will be built instead.

Deputy Crowley.—There were six vessels actually.

Deputy Briscoe.—There will be a number of shipbuilding companies tendering for these and no one would know what the other is tendering.

Chairman.—Perhaps the Deputy could pursue the matter in the Dáil. We do not want to delve into policy matters.

Deputy Healy.—I do not think the actual subsidy was the cause?—It is quite clear it was not the subsidy.

304. Chairman.—Paragraph 59 of the Report of the Comptroller and Auditor General reads:

“Subhead R.—Temporary Assistance for Industry

59. Irish exporters continued to be assisted by means of grants of up to fifty per cent of the burden which they had to bear following the imposition of a temporary charge on imports into Britain. Firms who increased their exports qualified under an incentive grant scheme for grants of up to seventy-five per cent of the temporary charge. Payments in the year of account, including £627,679 under the incentive grant scheme, amounted to £2,210,139. The Industrial Grants (Amendment) Act, 1964, enabled An Foras Tionscal to make supplemental grants in cases of exceptional difficulty and these amounted to £78,874 in the year under review. The temporary charge which was imposed in October 1964 was discontinued in November 1966. The total amount of claims paid up to 31 March 1967 was £4,488,756 and £114,281 was paid by An Foras Tionscal in special cases. I understand that the balance of claims to be met amounts to about £250,000.”

305. Chairman.—Have you anything to add, Mr. Suttle?

Mr. Suttle.—This paragraph is for the information of the Committee and I have nothing to add to it.

Deputy Crowley.—These will have reduced considerably anyway.

306. Deputy Molloy.—What is the incentive grant, referred to here, of £627,000?

Mr. Suttle.—This was a grant where a company increased its exports against the English levy.

Mr. MacCarthy.—When the British brought in the surcharge, the Taoiseach announced in Dáil Éireann, and the Dáil agreed, that that charge might be offset by a subsidy payment. The Taoiseach spoke about ascertaining the loss and making a grant of 50 per cent of that handicap. In practice, we worked out a different basis with the agreement of exporters because if we were to go in detail into every case, we would never have got anywhere. The exporters agreed to a flat rate of 40 per cent and all they had to do was to produce evidence that the surcharge had been paid at the British end and we gave a recoupment of 40 per cent. If their exports ran beyond a certain figure, we raised it, and we were in fact paying 60 per cent in some cases. There were extraordinary cases where the entire industry depended on exports to the United Kingdom market and some were in the pipeline with the IDA. These special incentive grants were devised as something which would be added to our market development grants. So far as I know, there were only a couple of cases in which this became necessary. These were industries which would otherwise have been lost. It was not considered prudent to lose them for what was clearly a temporary situation in the UK, and Foras Tionscal undertook the making of these special incentive grants in these cases.

Deputy Healy.—I take it these have now ceased altogether?—Absolutely.

307. Deputy Briscoe.—The closing sentence in the paragraph is: “I understand that the balance of claims to be met amounts to about £250,000”. Is there a closing date by which claims can be made? The scheme was discontinued in November, 1966 and it is now over a year later? —We only carried in a token provision because while the British discontinued the surcharge, we were committed, in all cases where the surcharge had actually been paid, to recoup this 40 per cent. The section which dealt with it has been scrapped but there are dribbles of claims coming in and that is why we have a token provision in the Estimate. In some cases, the documentation proved difficult to get because, for example, where an exporter dealt through an agent, very often he aggregated parcels of goods and had one receipt from the British customs, which was useless to us. We had to get it broken down and that caused quite a lot of delay in some cases.

308. Deputy Molloy.—I am not very clear on Mr. MacCarthy’s explanation about this incentive grant. You said that two firms were about to set up in Ireland who would be solely exporting?—Solely exporting, yes.

And that rather than lose these because of the British levy, these incentive grants were given?—Yes.

Is this in addition to the normal industrial grant?—Yes. It is in addition to our payment out of the Vote—this 40 per cent or 50 per cent. or whatever it may be. Over and above that, we gave these special grants.

309. It was a capital grant?—Yes.

To help them to set up the factory?—No, not to help to set up the factory. We were committed to the factory—grants had been promised—or extensions were contemplated, and at just the wrong time the axe fell in the form of the surcharge, and these companies indicated that, in these circumstances, they would be reluctant to go ahead with development. The maximum which could be given to them under the market development grant, or temporary assistance to industry as it is described, was whatever it was, and that was not enough to keep them, so Foras Tionscal negotiated, with the Government’s approval, these special incentive grants. There were only two cases.

310. Deputy Molloy.—Could we have the names of the two firms?—I cannot say from memory. I have no personal objection to giving the names, but I am not in possession of this information. The published report will give the names.

Mr. Suttle.—The firms are: Electrical Industries of Ireland, Ltd., General Electric Co. of Ireland Ltd., Gorey Leather Co. Ltd., Irish Tanners Ltd., Lana Knit (Ireland) Ltd.

Mr. MacCarthy.—That was at Shannon.

Deputy Molloy.—There are more than two?—I did not think of the Shannon one, because that is separate.

Is that the one that closed down?

Mr. Suttle.—No.

311. Deputy Molloy.—Was it the GEC factory?—

Mr. MacCarthy.—In that case it was a question of Dunleer and Dundalk, and they would not have anything in Dunleer if they had not been given this special incentive. If the Committee would be interested, the reason in the case of the electrical industry was perfectly simple. They were making things like irons and electric kettles for the British market. The trouble was that the British ladies are not so sophisticated in the use of gadgets as the Continentals, and therefore what the British market could not absorb could not be very well diverted, to more sophisticated markets. In the case of leather, unless they got some form of subsidy to make up the surcharge, they just could not start.

Deputy Briscoe.—They would not be able to compete with other manufacturers in Britain?—Leather is a very difficult thing, especially in the British market.

312. Chairman.—What is the difference between grants paid by the Department and the grants paid by An Foras Tionscal?— We pay practically no grants. That was quite an exceptional thing. This is temporary assistance for industry. The only other grants we pay are the technical assistance grants, and grants to the Irish Management Institute, the National Productivity Committee and a few bodies like that, but we do not give any capital grants.

313. Paragraph 59 which we are discussing refers to supplementary grants in cases of exceptional difficulty which amounted to £78,874?—These are the ones we have been talking about. This is a finished operation. It was just in a particular year.

314. Deputy Molloy.—Are the other members happy about this incentive grant? I do not understand it.

Deputy Briscoe.—I would regard it as a necessity. If a certain amount of expenditure has already been made in erecting a factory, and then a surcharge is imposed so that the factory cannot go into operation, it means we have thrown away a load of money for what, to have it lying idle?—It was, of course, specifically voted and authorised by the Dáil.

315. Deputy Molloy.—As regards the amount which was paid in respect of the levy, if this factory was affected by the levy, were they not entitled to the subsidy in lieu of the levy?—Up to the full extent.

Up to 75 per cent, that is, £600,000 has been in lieu of the levy?—No. I think there is confusion here: £78,000 is the figure, not £600,000. The payments, including the incentive grant, amounted to £2.2 million. The Industrial Grants (Amendment) Act enabled An Foras Tionscal to make supplemental grants in cases of exceptional difficulty, and this came to £78,874.

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

“Subhead S.—Promotion of Buy Irish Campaign

60. Reference was made in previous reports to the formation of a committee in 1964 to conduct a campaign to encourage support in the home market for Irish manufactured goods. The committee’s expenses in the year under review were met from this subhead as follows:—

317. Have you anything further, Mr. Suttle?

Mr. Suttle.—This paragraph is for information. The merger between the National Buy Irish Committee and the NAIDA was completed with the incorporation on 6th March, 1967, of the National Development Association (Forbairt). The new body will now be responsible for the promotion of the Buy Irish Campaign.

318. Chairman.—Is industry making any contribution?

Mr. MacCarthy.—I think they are, to some extent. We make a grant-in-aid but their total expenditure—I am not too sure about this—is greater than the grant-in-aid. Therefore, the contribution must come from industry. Precisely what it amounts to I am not sure, but they have received various sums, for instance, in this particular year £2,000, being contributions from firms participating in their fashion shows and things of that kind. What other sources of income they have I do not know, because NAIDA is not a State-sponsored body. The Auditor General might have some more information.

Mr. Suttle.—As this Committee was only set up last March, we would not have a set of accounts from them.

Mr. MacCarthy.—Once we pay them, we have nothing more to do with them.

Mr. Suttle.—Next year we shall have some information, but not at the moment.

319. Deputy Briscoe.—In proportion to the publicity that the Buy Irish Campaign succeeded in getting, the cost is very low, and I think we have definitely got our money’s worth as it is. I understand the members of that Committee do not receive any salary, that they have offered their services free?

Mr. MacCarthy.—That is so. The anticipation is that the thing will be entirely self-supporting by 31st March, 1969, but that is purely an anticipation. Whether it will be realised or not, I do not know.

Deputy Briscoe.—They are deserving of the highest compliments of this Committee.

320. Chairman.—Paragraph 61 of the Report of the Comptroller and Auditor General reads:

“Subhead V.—Castlecomer Collieries, Ltd.

61. Further provision was made by supplementary estimate for assistance for Castlecomer Collieries, Ltd., who had run into financial difficulties as mentioned in paragraph 58 of my previous report. £12,000 was paid to the company in the year under review to cover expenses of mining and exploratory work while its future prospects were under investigation. The total financial assistance from public funds amounted at 31 March 1967 to £115,480.”

321. Chairman.—What is the present situation in regard to Castlecomer Collieries?—Far from bright. The Dáil will probably be hearing more about it.

Deputy Briscoe.—What is the number of workers there?—I have not got an exact figure. There were 400 miners when the trouble started, but there has been a great wastage of them. It is probably about 200 now.

322. This figure of £115,000, is that for one year?—The first contribution was made by way of Supplementary Estimate which was introduced in September, 1965, and the figure which the Comptroller and Auditor General quotes in paragraph 61 would include all expenditure from that date until 31st March, 1967.

Deputy Healy.—Is that the first date that any State assistance was given to Castlecomer?—The mine was closed down, and was re-opened in November, 1965. It has been more or less kept going by the Government in the meantime.

323. Deputy Healy.—In view of the fairly large number of people employed in Castlecomer Collieries, is this figure of £115,000 considered excessive?—It is a very peculiar situation because the fact is that activity in the coal mining in Castlecomer is predictably terminable. Even on the best calculation, the place can only last a certain number of years and therefore it is really a social matter more than anything else— of tapering off the thing. You cannot create any permanent or viable asset in it.

324. Chairman.—We turn now to the Vote. With regard to Subhead L.1— Technical Assistance—could the Accounting Officer give us an outline of this expenditure?—Certainly. The main expenditure, of course, relates to these schemes for either the employment of consultants or the sending of people on courses of training, either in the field of industry or the field of distribution. There are also special provisions, one related to a survey for what is called crow coal and another was a grant to private enterprise for mineral exploration. We finance the Irish Management Institute out of this to the extent of £51,000. We finance the Adaptation Councils which have been established for the adaptation of industry to meet freer conditions and we also give a grant to the Federation of Irish Industries in respect of improved secretarial services and employment of a director of exports, a director of economics and so on and so forth. The largest single items is a provision for industrial consultancy grants and training courses which accounts for almost £270,000 out of a total grant of £370,000. The next largest item is the grant to the Irish Management Institute, £51,000; £25,000 spread over Adaptation Councils; £20,000 for the minerals; and £5,000 for the crow coal survey.

325. Under Appropriations-in-Aid there is an item relating to Recoupment from American Grant Counterpart Special Account, £5,000. How did this arise?— That refers to an expenditure by the Industrial Research and Standards Institute.

Mr. Suttle.—There is £5,000 also in respect of Technical Assistance.

Mr. MacCarthy.—That is in relation to the mineral survey. The item referred to by the Chairman, item 3—estimate, £11,000, actual sum realised, £7,176 is in respect of technical assistance grants. The details of that are: Industrial Research and Standards Institute refund, £5,252, and then the balance of £1,924 relates to expenditure under this Subhead L.1 on minerals exploration. The total is not £5,000; it is £7,176.

326. Deputy Briscoe.—Subhead N—New York World’s Fair—that is now finished? —Yes.

327. Deputy P. J. Burke.—On subhead S —Promotion of Buy Irish Campaign— where was It carried out?—That was in Ireland, and this is in fact replaced now by the grant we make to the National Development Association. A great deal of this was television advertising, grants to stores which put on Irish promotions, and so forth.

328. Deputy Healy.—Promotions outside the country, in stores, would not come under this department?—That is Córas Tráchtala normally. It is one of the main activities of Córas Tráchtála. Originally they had to give grants to the stores abroad in respect of expenses. A lot of negotiation went on and each side would put up a certain amount. The foreign stores buy all the goods so that export takes place at that point. Nowadays, the strategy of Córas Tráchtála is rather more to pay the costs to the foreign stores of sending in, in the first instance merchandising managers who have a general look around, and they are followed usually by a team of buyers. A very happy arrangement has been made between Aer Lingus and Córas Tráchtála which reduces the actual expenditure in that way because, without violating the obligations under the International Air Transport Association arrangements, the Department was able to persuade Aer Lingus to offer free seats to Córas Tráchtála which Córas Tráchtála can hand over to these buyers and avoid any payment of cash, on the understanding, of course, that if somebody wants a seat who is a fare paying passenger, then they have to pay.

Deputy Healy.—Very satisfactory.

329. Deputy Molloy.—Item 8 of the Appropriation in Aid show receipts of £307 from the sale of exhibits from the Irish Pavilion at the New York Fair. What would they be?—There were various things there which it was not considered worth while taking home again. I think I can tell you what the actual items were. There was also some furniture sold and display stands, or rather the apparatus on which the things were displayed.

Show stands?—And so on.

330. Deputy Crowley.—Also under item 8, there are receipts from Friendly Societies —this, I presume, is for registration of Friendly Societies?—Yes. Could I refer to the previous question? I find I have the information: (1) Coffee tables etc. bought by J. Downey, New York (Concessionaires for the sale of Irish Coffee at the Pavilion), £286; (2) Arklow pottery sold to Mr. Kennedy, New York; (3) Copies of the Ireland brochure, sold to News Bros. Cork, £7. That made up the £307. As regards the other question, there are fees for registration, and fees also from people who are entitled to inspect the register at a fee of 1/-.

331. Deputy Crowley.—That means there are very few friendly societies in the country?—No. There are quite a number of them. The Registrar of Friendly Societies is not in the Department; he is in the Attorney General’s Office, but it is quite a big job.

332. On Extra Remuneration—the six examiners in the Patents Office who received sums varying from £128 to £516 for examining patents applications, and who were on loan to the Patents Office, what special qualifications would they have?—They are not on loan. These examiners belong to what is known as a non-overtime class. Under an arrangement sanctioned by the Department of Finance, they are paid fees at certain rates for work performed by them outside office hours.

333. Chairman.—Is it difficult to get extra staff?—Getting the staff is a dreadful problem, because this is a scientific job, and the salaries offered in the public service are not as attractive as outside. There is also fierce competition even within the public service. The ESB will be competing with the Post Office and the Post Office competing with the Patents Office. Wherever a man foresees a better career he will go.

The witness withdrew.

VOTE 45—EXTERNAL AFFAIRS.

Mr. H. McCann called and examined.

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

“Subhead H.—Canadian Universal and International Exhibition, 1967

78. The charge of £2,378 represents expenditure in relation to a proposed Irish pavilion at the exhibition incurred before it was decided not to participate.”

335. There is a charge of £2,378 mentioned here. Was this for fees?

Mr. McCann.—When the decision was made by the Government to participate in this exhibition, our Department were charged with the responsibility of arranging it. Architects here and consultant architects at the other end were engaged in preliminary work, and these were the fees to the architects in both cases. They are on the usual minimum scale of charges.

336. What is that?—In the case of the architects in Ireland a minimum charge is approved by the Royal Institute of Architects of Ireland of 1¼ per cent of the cost of the contract. There was also the travelling expenses of the architects going to Montreal in connection with the preliminary plans. Then there was a small item of the storage of the Hollywood Stone which had been in the New York exhibition the previous year and which it was intended to use in Montreal—a sum of £85.

337. Deputy Molloy.—What was the charge in respect of the New York World Fair?—That was not organised by my Department. We would have assisted in it, but the Department of Industry and Commerce organised that.

The Department of Industry and Commerce whose Secretary has just been here has told us that a sum of £5,000 in respect of the New York World Fair——

Mr. Suttle.—It will take a number of years to get the total expenditure on that exhibition.

Deputy Molloy.—You were not involved in the World Fair?—No, except to help in regard to various aspects.

338. Deputy Briscoe.—On Subhead D.— Repatriation and Maintenance of Destitute Irish Persons Abroad—the Vote states that the reason for the extra expenditure was a change in the system of accounting?—Yes, that was the reason for the change in the amount expended as compared with that granted. We used to charge these advances to suspense accounts and then when we recovered or wrote off the sum, we discharged the suspense account. It was thought that it would ensure better control over the transactions and be more in line with recognised accounting procedure if, instead of doing that, we charged the sums to the Vote as and when they were expended and then brought back the receipt as appropriations in aid. That is the answer to the question from the accounting point of view, but there has been, in addition to that in the case of our people in Britain, a slight expansion of the scope of the help given. This really comes in the present year rather than in the previous year. As from 1st April of this year, we have given authority to accept as a charge on the subhead the cost of repaying recognised welfare societies the expenses they incur in repatriating from Great Britain unmarried mothers, both expectant and post-natal under certain conditions. Conditions in all such cases are that either a relative or other suitable or recognised agency has agreed to look after the person and that arrangements have been made for reception and care after arrival in this country. We also had previously given our Ambassador in London discretion to arrange repatriation in the case of certain young persons, especially girls who are found to be in need of care and protection and persons destitute and unfit for work by reason of physical or mental ill health. In other words, we have broadened the scope to cover such special cases.

339. Deputy P. J. Burke.—Would you have many cases?—We have limited the latter category to 100 cases per year. The total number of cases in the year 1966-67 in respect of the London Embassy was 38. We do endeavour to secure repayment of the advances.

340. Deputy Briscoe.—Do you anticipate that in future the grant under this heading will be increased accordingly?—With the extension, there will probably be a slight increase.

341. In the case of people living in areas infected with foot and mouth disease, they might have to come back to Ireland for financial reasons?—We are trying to discourage them from coming back.

342. I realise this. Will aid be available to these people where it is proved that their circumstances are such that they do need financial help?—This question has not arisen with our Department as of yet. It might be something for the Department of Agriculture. Our activity in this field up to now has been one of trying to discourage people from coming where it is not necessary to do so.

If we have to pay them to stay away, we have the machinery there?—I do not think I could say off-hand that that would be so. There are close to one million of our citizens in Britain.

343. Deputy Molloy.—It is generally known, I take it, that this assistance is available from the Embassy?—It is known in the various societies and organisations concerned with the welfare of these people, but we do not advertise it, of course.

344. With regard to subhead G—Official Entertainment—could we have an explanation of this expenditure of £22,000? Was it at home?—This covers all official entertainment at home by all Government Departments. It is mainly in respect of distinguished visitors from abroad, new ambassadors or delegates to conferences. This is a side that is expanding in recent years. As you know, it is Government policy to encourage the holding of international conferences and conventions in Ireland, not alone Inter-Governmental conferences but also those of scientific and business bodies, and it is normal practice for the Government to take some cognisance of the presence of a visiting body by holding a reception.

345. And other countries reciprocate when we visit them?—They do. It is part of the encouragement to people to hold their conventions here because of course the benefits from the hotel and tourism point of view far outweigh the cost of the reception we might put on. In the year in question, I think there were about a dozen.

346. Would that be a dozen State receptions?—No; I am not talking solely about receptions for governmental bodies. To give you an idea: there were in the year under review eleven including bodies such as the Conference of European Sugar Manufacturers, the Conference of Electrical Engineers, the Conference of the Chemical Industry, and a visit of the International Federation of Editors-in-Chief.

What form does the entertainment take— a State reception?—A reception in Iveagh House usually, hosted by a Minister.

347. You said there were 11 functions; that would be 11 receptions?—Yes, and in addition dinners and lunches for other purposes. For example, when a new Ambassador presents his credentials, it is normal for the Government to give a dinner on his arrival and also at the end of his term of office when he departs.

348. Deputy Briscoe.—With regard to subhead K—Compensation—what kind of compensation comes under this heading?— This arose out of an incident when the home of the British Military Attache was set on fire as a result of a petrol bomb explosion. It caused damage to the house, rendering it temporarily uninhabitable. The Military Attache and his wife had to obtain living accommodation elsewhere and there was the question of repairing the damage to the premises and of compensation for effects lost, and of reimbursing, according to international custom, the diplomat who was the subject of this attack.

International custom?—Yes. I might mention that there was a bomb attack on the Irish Embassy in London some time previously for which the British Government reimbursed us.

349. Chairman.—On subhead L—Losses —the explanatory note states that a messenger embezzled a sum of £1,755 from official funds. How did it happen?—This messenger was recruited, I think, in November of 1963 and he failed to report for duty on 28th December, the next month. He had apparently fled from Bonn, abandoning his family. He forged a cheque on the official account and managed to cash it at the bank in which the Embassy account was held. He also incidentally forged a cheque on the then Ambassador’s private bank account and also on the account of the Secretary of the Embassy, each of whom lost approximately £400. He managed to get access to cheque books and forged signatures, collected the money and absconded.

Deputy Crowley.—We had this two years ago?—It is the same case: it has only come into the account now.

350. Deputy Briscoe.—I suppose word has gone out to all Ambassadors to make sure that Embassy cheque books are safely locked up?—That is the normal practice in any case, and it has not been established what happened in this case. There are two possible alternatives: either he may have got access to it as it momentarily lay on the table, or, it so happened that the Secretary of the Embassy of the time had occasion to use the man to go to his private flat and he may have got hold of his key to the safe at that particular time. One of the troubles was that the law in Germany on this type of case does not protect the customer as well as it would here. I think it is reasonable to expect that if this had happened here, the bank would have had to accept liability for it because they cashed a cheque which was forged.

351. And if it did not, would our Department of External Affairs honour the amount? There was no way under international law or diplomatic law generally by which the German Government would have paid this?—The German Government would have no responsibility. This was basically the case of a criminal committing an offence and one does not accept liability for all the acts of one’s criminal citizens.

Only if they throw bombs into Embassies? —If they attacked the person, or the property of the Government, this would be a breach of the international immunity of the Mission.

352. Deputy Healy.—If I might go back to subhead F.—Information Services—what films, if any, have the Department sponsored or what have they in contemplation? —During that year, because of the financial stringency at the time, the sum available was very much reduced from normal. We did cover in that year part of the expenditure of the film “Rhapsody of a River” and also the production of a film “Ireland” for a geographic series for schools; and also out of that subhead during the year there was the purchase of prints of the very successful film “Yeats Country”.

353. Deputy Healy.—How much went to “Rhapsody of a River”?—In that year, £1,608.

354. Deputy Molloy.—To whom are these films made available?—Firstly, they are made available to our embassies who, in turn, make them available for showing to suitable audiences. We try to get commercial exposure for them, and that is one of the main factors in selecting the method of distribution. They are made available to universities and other educational institutions, and we supply our embassies with copies of them for other uses as required.

They are not available in Ireland?—There have been showings in Ireland, usually press showings when they have come out first. Some of them have been shown commercially, for instance, “Yeats Country” and some of them have won prizes at festivals. “Yeats Country”, in particular, won a large number of prizes.

355. If requests were made for these films by some Irish society I take it they would be made available to them?—Abroad or at home?

At home. I am just wondering what opportunity the Irish people had of seeing these films?—There were commercial showings of some of them.

They are available to Irish people?— That is not our primary objective except insofar as it can be done commercially. The objective is to project our image abroad. If we had some requests from societies here, it is something we would consider favourably. However, while there has been commercial exposure both in the cinemas and in the festival here, that is not our primary purpose.

VOTE 46—INTERNATIONAL COOPERATION.

Mr. McCann further examined.

356. Chairman.—Paragraph 79 of the Report of the Comptroller and Auditor General reads as follows:

“Overseas Trainee Fund

79. Reference was made in paragraph 79 of my report on the accounts for the year 1964-65 to two schemes for the training of administrators for Zambia. The cost of the schemes which were completed in 1964 and 1965 has now been determined at £55,524. Of this amount £25,361 was contributed by the Zambian Government and the balance, £30,163, has, with the approval of the Minister for Finance, been met by grants from the Fund.”

357. Deputy Molloy.—How is it that we are paying more than the Zambian Government?—This is part of our assistance to the less developed countries, and it might be that we would be paying all in certain circumstances.

358. Chairman.—Are there any new schemes?—There are no new schemes in the pipeline at present, although we have brought to the notice of a number of these underdeveloped countries the facilities we would be prepared to make available.

359. Deputy Briscoe.—Are our contributions in this respect pro rata with those of other countries?—As the Deputy will realise, the contribution that Ireland makes to the under developed states sometimes is not just what comes financially from Government sources. Our doctors, teachers and missionaries have gone out to these countries and it is probably true to say that our greatest contribution has been through human beings rather than financially. If anything I would say our financial contributions are on the low rather than on the high side.

360. Deputy Briscoe.—On subhead C.2— Travelling and Incidental Expenses—I notice that a large amount of money was provided for attendance at a possible Emergency Session of the General Assembly which was never held. How would this large amount of money arise?—It would arise as travelling and subsistence expenses of the delegation we would have had to send if it did take place.

They did go?—No. This was for an emergency which did not arise. It was a provision for an Emergency Session, in addition to the normal session, and the Emergency Session did not take place.

£9,340 was spent?—That was on the ordinary session. We provided for the ordinary session and the Emergency Session, and the Emergency Session did not materialise.

Chairman.—That is why the expenditure was less than the estimate?—Yes.

361. Deputy Molloy.—On subhead C.9.— Contribution to the United Nations Voluntary Fund for Cyprus—could we have an explanation of this?—This was a contribution towards the Voluntary Fund which finances the United Nations peacekeeping operations in Cyprus. It was the one and only special voluntary contribution we made to this Fund. As you know, we have had our troops participating in the operation since the beginning. We bear the ordinary pay and allowances of our soldiers, and the United Nations meets the extra and extraordinary expenses of the operations in Cyprus. The Secretary-General gets this money from voluntary contributions, and this was a contribution we made in that year towards that purpose. It was unique in that we have not made one before or since.

362. What are the “Extra Receipts payable to Exchequer—Interest and principal due on United Nations Bonds?”—We made a subscription to the United Nations Bonds, and the Comptroller and Auditor General indicated it was desirable that repayments should be shown in the Vote for International Co-operation as receipts.

Mr. Suttle.—They appear in the Finance Accounts.

The witness withdrew.

VOTE 43—DEFENCE.

Mr. S. Ó Cearnaigh called and examined.

363. Chairman.—Paragraph 72 of the Report of the Comptroller and Auditor General reads:

“Subhead K.—Provisions

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

The average price of cattle purchased for the Dublin and Curragh areas was £87 and £88 per head, respectively, as compared with £92 per head in each area in the previous year, while the average production of beef per head was 678 lbs. and 687 lbs., respectively, as compared with 693 lbs. and 683 lbs.”

Have you anything to add, Mr. Suttle?

Mr. Suttle.—I have no comment to make on that paragraph; it is for the information of the Committee.

364. Chairman.—Paragraph 73 of the Report of the Comptroller and Auditor General reads:

“Subhead P.—Naval Stores

73. Since December 1965 official launches have been unable to ply between Cobh and Spike Island because of the bridge erected by Irish Steel Holdings, Ltd., to link Haulbowline Island and the mainland. The Department of Defence has entered into a contract to provide an alternative boat service which cost £6,903 during the year.”

Mr. Suttle.—Again this paragraph is for the information of the Committee.

365. Chairman.—Paragraph 74 of the Report of the Comptroller and Auditor General reads:

“74. In the course of audit I learned that the procedure for delivering stores by boat to Haulbowline is time consuming and that the loss in handling loose materials is substantial. As a result of my inquiry representations have been made to the company to allow the Department use the bridge to deliver stores in a more economical way.”

366. Deputy Healy.—Do I understand that the building of a bridge by Irish Steel Holdings is costing the State, through the Department of Defence, £6,903 a year, in the provision of a boat service to Spike Island? Have they made any representations to the appropriate authority to see that naval ratings in Haulbowline and Spike can use the bridge built there out of taxpayers’ money? This, to my mind, is something with which this Committee should concern itself very seriously. We have the extraordinary position that naval ratings go down from Cork city to get to their work and must wait an hour for a ferry boat, and in the evenings have to get back, while there is a bridge there which they are not allowed to use.

Mr. Suttle.—I have been recently informed that the Department is now using the bridge and negotiations for an extension of the use of the bridge are in course.

367. Deputy Healy.—Will that cover my point?

Mr. Ó Cearnaigh.—As far as transport of stores from the mainland to Haulbowline is concerned—heavy stores such as coal, sand or anything like that—we were able to arrange with the firm on the island to use the bridge. The Department has no rights over the bridge but the firm were cooperative when we approached them, on the Comptroller and Auditor General’s initiative, to allow us the use of the bridge for certain traffic.

Chairman.—But not for people?—Not for personnel.

368. Deputy Healy.—Does the Accounting Officer feel that his Department has any responsibility for getting the use of this bridge for personnel there?—We provide our own transport services in Cork Harbour. We cover the points Cobh, Haulbowline, Spike Island, Ringaskiddy and Monkstown where we collect the personnel as necessary and run regular services between these points. No doubt the personnel would like to be able to pass over the bridge but that would be for their private purposes.

369. I would not agree that it is for their private purposes: it is to get to their duty and get home. I have known people to have been delayed for hours while waiting for the boat while the bridge is there?—We provide a transport service at fixed times.

Deputy Crowley.—I know that the Department has supplied this type of service but there are people coming to us continuously complaining about being late for work, as Deputy Healy said, and when there is a bridge there which they cannot use, it seems a very odd sort of arrangement.

370. Deputy Molloy.—What was the reason given?—It is a private bridge.

Have the Department made any representations to Irish Steel Holdings to allow their personnel to use the bridge?—Possibly representations have been made locally but officially we provide our own transport service.

371. Deputy Briscoe.—Is this not costing more money than would be necessary if the bridge could be used?—No. This money mentioned here—that is the cost of the hired transport service—arises because our boats cannot pass under the new bridge. It was in fact foreseen that they would not be able to do so and it was accepted in principle that we would have to provide different boats that would be able to go underneath the bridge.

372. Chairman.—Is it to be a permanent arrangement—the hiring service?—We do not regard it as permanent; we are casting around for a better solution, if we can find one, but we regard it as quite an economic arrangement compared with any other solution.

373. Deputy Healy.—Paragraph 73 states that official launches have been unable to ply between Cobh and Spike Island because of the bridge erected by Irish Steel Holdings, and it adds that the provision of an aternative boat service cost £6,903 during the year. Have we saved anything against that £6,900 in not having the official launches?—No.

Is it an extra cost?—Yes, it is. The Department’s own boats still have to ply between Haulbowline and Cobh and keep up a regular service.

374. Deputy Crowley.—The building of this required a certain amount of goodwill from the Department of Defence to allow the building to go ahead?—It required co-operation from the Department of Defence which made certain facilities available.

But in return, this company has given nothing to you for the tolerance you have shown?—I must acknowledge that they responded very well to our representations.

375. Deputy Briscoe.—What is the chief objection from Irish Steel Holdings to allowing personnel to use the bridge to get back to the mainland?—I could not specifically answer that because we have not put the proposition to them. All we put to them was that we get facilities to transport goods over the bridge. I daresay they have their own scheduled uses of the bridge and other traffic would interfere unduly with them.

Is there any sidewalk on it that could be used?—I do not know. I have not seen the bridge.

376. Chairman.—Who financed the building of the bridge?—Irish Steel Holdings. They erected it.

Deputy Molloy.—Did they get a grant?

Deputy Healy.—They are in a good deal of debt to the State, and I certainly would not be satisfied, as a member of this Committee, to see one Department having to pay £6,900 to cover the cost of something another Department built and not being allowed to use it.

377. Deputy Molloy.—The most extraordinary thing is that Irish Steel Holdings have not been asked to allow the personnel——

Deputy Crowley.—Of course they have? —We have not officially asked them, but possibly they have been asked at local level.

Deputy Crowley.—We have been making constant representations.

378. Chairman.—Was this problem in regard to the transport of goods and personnel not visualised when the bridge was being built?—Yes, it was foreseen that it would interfere with the Department of Defence transport service in the harbour. There was a decision in principle to get boats that would be able to pass beneath the bridge.

379. Deputy Briscoe.—Would this have been unnecessary if there had been an agreement between the parties concerned? Is Defence being forced into extra expenditure into which they might not have entered if they had negotiated the free use of the bridge?—It would not have solved the problem. What we are talking about is the passage between Haulbowline Island or Cobh and Spike Island. The bridge in question goes from Haulbowline Island to Ringaskiddy, but it does not solve the problem of providing transport between Spike Island and the Mainland.

Deputy P. J. Burke.—If people had to go round by road it would take them longer?

Deputy Crowley.—They would have to go to Cork city.

380. Deputy Healy.—If the Accounting Officer got free access for transport across this bridge, could we assume that it would reduce the sum of £6,900?—No. It would however, facilitatte the naval personnel.

381. Deputy Healy.—And of course the workers there would be facilitated?—I do not know to what extent it would facilitate them, because we provide our own transport. Irish Steel workers have their own transport service.

Deputy Healy.—Yes, but I consider that the members of the Irish Naval Service should have the same facilities for crossing that bridge as the members of Irish Steel. They are both subsidised by the State.

382. Deputy Briscoe.—As regards the special transport being run at certain times to bring people to the mainland, are these purely passenger boats?—We have three small vessels—a motor vessel and two steamships. The two steamships are for passengers, and they ply a regular service between Cobh and Haulbowline. The motor vessel is for carrying cargo as necessary between the mainland and the islands. We also have three motor launches.

Do you have a rough sea around there at all?—The passage between Haulbowline and Cobh can be rough, I believe, at times, and a light vessel would not be suitable.

What happens in the case of people who want to get to the mainland?—The small steamships are all right for that passage, but they are too big to go beneath the bridge.

Could there be a very rough journey for some people on the small steamship?— I do not think so.

Chairman.—I think we could consider this matter in connection with our report.

383. Paragraph 75 of the Report of the Comptroller and Auditor General reads:

“Subhead S.—Buildings

75. Fresh water supplies for Haulbowline are purchased from Cobh Urban District Council and are carried by submarine pipe line to the island. The steel main, renewed in 1939-40 at a cost of £5,440, gradually developed leaks and it was replaced by the Office of Public Works in 1961 by six polythene pipes at a cost of £21,000 of which fifty per cent. was contributed by the industry located on the island. A check undertaken in 1966 revealed leaks in two of the polythene pipes and when these were being repaired in March 1967 a further leak was discovered in a third pipe. I inquired whether any warranty had been obtained as to the suitability of polythene pipes for this purpose. I also asked the cost of repairing the leaks and the estimated cost of the water lost.”

384. Have you anything to add, Mr. Suttle?

Mr. Suttle.—The Accounting Officer has informed me that no specific warranty as to the suitability of the pipes was sought from the suppliers but that the Office of Public Works considered that the pipes would be suitable and have proved suitable. The cost of repairing the leaks was £438. I have also been informed that it is not possible to estimate with accuracy the cost of the water lost but that a comparison of consumption for the three years 1965/67 suggests that the loss is not serious, that the leak in the third pipe has not been repaired but it is hoped to do so early in 1968, that the system has proved to be efficient and that the six pipe system permits the isolation of a defective pipe without the cutting off of the complete supply, and that pipes at present sheathed in lead damaged by abrasion on rocks will on repair be sheathed in flexible stainless steel.

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

“Subhead CC.—Compensation

76. The charge to this subhead comprises:—

386. Deputy Briscoe.—Is there a tendency towards a rise in the number of accidents in which Army vehicles are involved?— There was a reduction in the cost in that year. In the previous year it was over £9,000. In that year it was £6,500.

Deputy Molloy.—These accidents took place at home, not among troops serving abroad?—All at home.

387. Chairman.—Paragraph 77 of the Report of the Comptroller and Auditor General reads as follows:—

“Stores

77. Reports on inspections of Civil Defence equipment on charge to local authorities disclosed that in some cases the position regarding storage and security was unsatisfactory. I have communicated with the Accounting Officer regarding the steps taken to ensure compliance with regulations.”

388. Have you anything to add, Mr. Suttle?

Mr. Suttle.—I am informed that regular inspections of these stores are carried out by the Department of Defence and that appropriate action has been taken in those cases in which storage was not satisfactory.

389. Chairman.—What is the value of the stores in the hands of local authorities?

Mr. Ó Cearnaigh.—I have not got that figure. I can let you have it.

Chairman.—Perhaps you could supply it.

Deputy Molloy.—Could we have an itemised list?

Mr. Suttle.—That would be too detailed. Could it be broken down?

Mr. Ó Cearnaigh.—We shall try to give a broad breakdown.*

390. Chairman.—Is there a difference in the value of stores between one local authority and another? Is there more expenditure in one area than in another or is the expenditure proportionate to the local contribution?—Some local authorities have developed their civil defence measures more highly than others. For instance, in Dublin civil defence is quite highly developed, and there is a wholetime civil defence officer with two or three full-time assistants and some clerical and stores staff. Therefore in that case there would be a fairly substantial expenditure on civil defence. In other areas it is not so highly developed as yet.

391. Chairman.—How is the inspection of stores carried out in the local authorities?— This situation in regard to stores came to light as a result of the reports of the Department’s own stores audit staff. They carry out a local inspection of these stores every two years and also carry out periodic stock-taking. In addition the technical officers of the Department of Defence inspect the vehicles and other technical equipment to see that they are all right.

392. Deputy Molloy.—With regard to subhead M—Clothing and Equipment—I think the Minister made a statement recently that the store of uniforms for the FCA which was acquired some years ago was sufficient to last a large number of years. A question was asked in relation to improving the uniform and he said it could not be done until present stores were exhausted. Have you any idea how long present stores are going to last?—I think it is mainly a question of cloth. The new issues of cloth should be available in the next year or two—about two years.

You will be able to change the quality of the uniform?—I hope so.

Deputy Briscoe.—What does the equipment consist of?—Webbing, boots and shoes and miscellaneous items.

393. Deputy Molloy.—When purchasing the cloth, how many yards do you purchase at a time?—The purchase is arranged by the Post Office. I could not say what quantity is purchased at a time but naturally by purchasing in large quantities, one gets better prices and also one has a reserve on hand which is very important in the case of the Defence Forces.

394. —How many years were you trying to provide for? It is alright to say that it is more economical to buy in large quantities but this is wool, which can deteriorate?—I think it is probably two years so as to be able to have uniforms and cloth available to cover a two year requirement.

395. Deputy Briscoe.—With regard to subhead N—Animals, Forage, etc.—this expenditure is on the Army Equitation School mainly?—Yes. We have a small number of draught horses that are out in barracks. They do light carting work in barracks.

396. Deputy Molloy.—With regard to subhead O.2—Helicopters—how long is it anticipated their useful life will be and when will the question of replacing them arise?— I do not think the question has arisen yet. They get quite a good maintenance. It must have been envisaged that they would be useful for many years when purchased. I do not recall that a life was actually put on them in that sense, but good maintenance can carry them forward for many years. They will presumably reach a stage of obsolescence some time.

397. Deputy Briscoe.—Are there any piston-engined aircraft still in use?—Yes. We have Chipmunks, Doves and Provosts which are piston-engined.

And what are the oldest of these?—Some would be fairly old but I have not got their age.

398. Deputy Healy.—With regard to subhead P—Naval Stores—is the refitting of a naval vessel, referred to in the explanatory note, still in process of being carried out?— The refit has been completed and the vessel is back at sea now.

399. —How many vessels are seaworthy now?—Two corvettes at the moment. The third is awaiting overhaul.

There is no provision for that overhaul?— It will appear in next year’s Estimate.

400. Deputy Briscoe.—With regard to subhead R—Solid Fuel, Electricity, Gas and Water—what is the solid fuel used for heating barracks?—Coal and turf.

What is the actual bill for these items?— In the Estimate for that year, the provision was: solid fuel, £114,300.

401. —There has been no contemplation of turning over to oil central heating as being a very much cheaper form?—The policy is to use turf, the national fuel.

It is all national fuel that is used?— Depending on the type of apparatus to be fuelled, we use turf or coal or briquettes.

Is it imported coal?—Yes, mainly ordinary household coal.

402. Deputy Molloy.—With regard to subhead S—Buildings—how much of this money was spent on Galway Barracks? Is this in relation to repairs to barracks or would it be under maintenance somewhere else?—It covers both new works and maintenance of barracks.

And how much at Galway barracks, could you say?—I am afraid I have no figures.

Could you give me a note on it?—Yes.*

403. —With regard to subhead T—Barrack Services—are you making every effort to provide houses for soldiers in the towns in which there are barracks?—The Minister answered a question on that in the last few days.

I am aware of the Minister’s answer. You have not built any houses in Galway anyway?—The policy is that it is the responsibility of the local authority to provide houses for soldiers, the same as they provide houses for other members of the community in a similar pay bracket. The Department of Defence try to help where the need is greatest and have built houses at a few barracks.

404. Deputy Briscoe.—On Appropriations in Aid—Item No. 10 mentions a figure of £1,385 for show prizes. How does this arise?

Mr. Suttle.—Those are receipts in respect of show prizes.

Deputy Briscoe.—Who keeps these, the officers?

Mr. Suttle.—No.

405. Deputy Molloy.—Is the revenue from local authorities for the helicopter service shown here under Appropriations-in-Aid?

Mr. Ó Cearnaigh.—It comes under “Miscellaneous”.

Could you give us a breakdown for each local authority?—The figures for the different local authorities are in the form of the individual claims for the use of the holicopter service. I could read down through them if you wish, or you may want a particular one.

I should like to compare them?— Limerick, £162; Kerry, £217; Wexford, £114; Limerick, £400; Tipperary, £146, £122, £150, £127; Donegal, £218, £241; Wexford £125; Cork, £249; Clare £197; Tipperary, £235; Galway, £384; Limerick, £213; Kerry, £266; Tipperary, £116; Cork, £172, £246; Leitrim, £147; Laois, £183; Galway, £198; Limerick, £188; Tipperary, £147; Cork, £183; Mayo, £215; Clare, £398, £162; Galway, £167; Limerick, £183; Longford, £134; Donegal, £250; Tipperary, £250, £134. These give a total of over £7,000.

406. —There were no receipts from private persons?—Yes, there were one or two in that year.

Were they for commercial purposes?—I have not the details of the private use of the helicopter.

407. Deputy Healy.—Could we know how much they were charged for its use?— £269.

Deputy Molloy.—What is the hourly rate?—£67 per hour of flying time.

408. —What is the position where a private person requests the helicopter in an emergency?— The matter would be considered on its merits.

But in an emergency? Who can requisition a helicopter?—Where it is requisitioned for hospital use, for the ambulance service, there is a definite arrangement with the health authorities. Generally it is the matron of a hospital who makes the requisition.

Is she the sole person who has the right to requisition it?—I do not think she is the sole person. There is an authorised procedure. It is arranged with the local authorities.

409. —If a member of the public requisitioned a helicopter, is he sent the bill?— He would be, depending upon what type of use was involved. If it was an emergency rescue, that would be attended to. If it was for the ambulance service he would be advised as to the procedure to adopt. I should imagine that the doctor attending the case would know the proper procedure.

Chairman.—Doctors are circularised by the local authorities as to the procedure?— Yes.

410. —Item No. 13 of the Appropriations-in-Aid deals with a sum of £837,000 as being receipts from the United Nations in respect of overseas allowances, stores, etc. Does that go back for a number of years?—It goes back for some period prior to that year. There is always a time-lag in the preparation of accounts after the unit returns and the store accounts, pay accounts are made up. Actually the United Nations have paid all their arrears now. This receipt will be appearing in the current year’s accounts.

411.—There were some matters in dispute as to what they should pay or should not pay. Has that been finally resolved?—It was a question of policy with which the Minister for External Affairs was dealing, and it has been, I am happy to say, finally settled. The United Nations have paid the full amount and there are no outstanding accounts at the moment, except a very recent one that was presented only in October last.

412.—In the case of our forces serving overseas, what do we pay and what do they pay?—We bear the ordinary pay and allowances and in addition we pay the overseas allowances. The overseas allowances are eventually recovered from the United Nations. The UN also provide the rations for the troops overseas at their expense. We also recover the cost of any stores that are lost or damaged.

413. Deputy Healy.—Are we at any net loss in relation to the troops serving overseas?—No, I would say not.

Mr. Suttle.—The arrangement come to is that the UN will bear the additional money that is paid out other than what the soldiers would have been paid if they never left the country.

414.—Have the negotiations with the Fox Film Company about “The Blue Max” film been satisfactorily concluded?

Mr. Ó Cearnaigh.—That has been finally settled. The company made the required payment.

Deputy Molloy.—And it is still the policy to give every assistance to film companies in the making of films?—We consider every request we receive for assistance.

VOTE 44—ARMY PENSIONS.

Mr. S. Ó Cearnaigh further examined.

No questions.

The Committee adjourned at 1.15 p.m.

The witness withdrew.

* See Appendix 8.

* See Appendix 8.