Committee Reports > List of Committees > Dáil > 1988 > Committee of Public Accounts > Report - Appropriation Accounts 1984

AN COISTE UM CHUNTAIS POIBLÍ

(Committee of public Accounts)

Déardaoin, 23 Deireadh Fómhair, 1986

Thursday, 23 October, 1986

The Committee met at 10.00 a.m.

Members Present:

DEPUTY D. FOLEY in the chair

Mr.P.L. McDonnell (An tArd Reachtaire Cuntas Agus Ciste) called and examined.

VOTE 34 (1984)—NATIONAL GALLERY.

Mr. Homan Potterton called and examined.

Chairman.—You are very welcome, Mr. Potterton.

1. Deputy G. Mitchell.—Appropriationsin-aid, £408, what is that? It is a very small figure compared to other Votes?

Mr. Potterton.—It is general receipts but it is not in any way connected with any major project. It can arise that we collect money for certain things — for example, if somebody has a xerox made in the Library, or that type of thing.

Deputy G. Mitchell.—Do you have any other facilities there for the public — for example, a restaurant?

Mr. Potterton.—Yes, we do have a restaurant.

Deputy G. Mitchell.—Where does that lie?

Mr. Potterton.—The restaurant is tendered out to independent caterers. There is also the book shop which is operated independently. Naturally, there are receipts both in the restaurant and in the bookshop but they are not part of the Vote.

Deputy G. Mitchell.—The restaurant, which is a very well-run restaurant, is run independently by a catering company on a profit basis?

Mr. Potterton.—Yes.

Deputy G. Mitchell.—Does the same apply to the bookshop?

Mr. Potterton.—No. We run the bookshop ourselves out of a trust fund.

Deputy G. Mitchell.—Any profit from that does not go into the appropriations-in-aid?

Mr. Potterton.—No.

Deputy G. Mitchell.—Who are the trustees or how is the trust fund operated?

Mr. Potterton.—The trustees are the governors and guardians and it originated from a bequest to the Gallery of money for the purposes of making publications. It is a revolving fund in that any profit are ploughed back in to making other publications and extending the services.

Chairman.—Any further questions? Thank you, Mr. Potterton.

The witness withdrew.

VOTE 4—CENTRAL STATISTICS OFFICE

Mr. T.P. Linehan called and examined.

Chairman.—You are very welcome, Mr. Linehan.

2. Deputy G. Mitchell.—You have a figure in your accounts here European Economic Community, receipts £187,000. Is that for work carried out on an agency basis for the EEC?

Mr. Linehan.—No, this is a type of “subsidy” in connection with a project like the Labour Force Survey where the participating countries get a certain amount of money to help in the cost of carrying out the Survey.

Deputy G. Mitchell.—Is that Survey carried out Europe wide?

Mr. Linehan.—In all members of the Community.

Deputy G. Mitchell.—In relation to staff wages, salaries and allowances, does that include the figure for your temporary statistics sampling people?

Mr. Linehan.—No. The temporary field force are employed for short periods of time and all expenses for that fieldwork are under subhead D — Collection of Statistics.

3. Deputy G. Mitchell.—On what basis are the staff selected? Are the same people used year after year or is there an interview process? What is the procedure for recruiting?

Mr. Linehan.—In the case of the Labour Force Survey, which is an annual enquiry, the supervisors staff are on a panel basis and we try to use the same people if they are available because of their experience. Each year the enumerators are recruited on basis of interview but with priority being given to those on the live register of unemployed.

4. Deputy G. Mitchell.—Are the statisics you take absolutely confidential, you do not release any individual data even to Government Departments, is that correct?

Mr. Linehan.—That is correct. We collect the information on the basis that it is for statistical purpose only and identified individual information is not given to anybody, whether a Government Department or otherwise.

Deputy G. Mitchell.—Are you happy that any difficulties you may have had with your statistic sampling in the recent past are now ironed out?

Mr. Linehan.—We are conscious of the fact that improvements can be made and that one has to continually look at the quality. Within that qualification we are happy that we are doing the best in the circumstances.

5. Deputy G. Mitchell.—Are you informed of international trends in statistics gathering and so on?

Mr. Linehan.—Yes we are active participants at international level.

Chairman.—How many staff are involved in subhead A — Salaries, Wages and Allowances?

Mr. Linehan.—Approximately 500.

6. Chairman.—How did the overrun of £148,000 arise?

Mr. Linehan.—The main constituents in that overrun would be that we were still processing the 1981 census and because of some staffing shortages we had to hold on to census staff longer in 1984 than we had thought we would when we were preparing the Estimates.

Chairman.—Any further questions? Thank you, Mr. Linehan.

Mr. Linehan.—Thank you, Chairman.

The witness withdrew.

VOTE 15 — STATIONERY OFFICE

Mr. Patrick Howard called and examined.

Chairman.—You are very welcome, Mr. Howard.

7. Deputy G. Mitchell.—How many staff are employed in the Stationery Office?

Mr. Howard.—One hundred and sixty-two.

Deputy Mitchell.—How are they recruited?

Mr. Howard.—They are recruited basically through the Civil Service Commission. The administration and general staff.

Deputy G. Mitchell.—Are they all recruited through the Civil Service Commission?

Mr. Howard.—No. The industrial staff are recruited in the same way as industrial staff throughout the Civil Service, through the Manpower Service and so on.

8. Deputy G. Mitchell.—I notice a figure of £4 million for binding. Is the binding done in your own Department?

Mr. Howard.—No, Deputy. In fact, the figure of £4 million is for printing and binding and it is all contracted to the private sector.

Deputy G. Mitchell.—And most of it to one particular contractor?

Mr. Howard.—No. There are a total of over 70 contractors.

Deputy G. Mitchell.—How are they selected?

Mr. Howard.—They are selected by open competitive process.

Deputy G. Mitchell.—Would the lion’s share of it go to one particular contractor?

Mr. Howard.—A significant amount would go to a few of the big firms.

Deputy G. Mitchell.—Are they selected on a competitive basis?

Mr. Howard.—Yes.

Deputy G. Mitchell.—It would be tendering?

Mr. Howard.—Yes, tendering.

Chairman.—Thank you, Mr. Howard.

The witness withdrew.

VOTE 9 — PUBLIC WORKS AND BUILDINGS

Mr. M.P. Scanlan called and examined.

9. Chairman.—Paragraph 23 of the Report of the Comptroller and Auditor General reads:

Subhead E—New Works, Alterations and Additions

In August 1979 the Department of Finance, at the request of the Department of Tourism and Transport, sanctioned expenditure estimated at £88,000, inclusive of £5,000 in fees, on an extension to Valentia Island Radio Station and in November 1981 a contract for this work in the sum of £89,958 was placed with a local contractor. It was noted that subsequent to the placing of the contract additional works were ordered as extras. These included improvements to the existing building at Valentia and the construction on outlying sites, at an estimated cost of £85,000 of buildings to house 2 VHF Stations and a communicating link station in connection with the pilot scheme for a national network of VHF Sations being undertaken by the Department of Communications (see paragraph 52). By June 1985 payments under the contract amounted to £857,612, fees paid amounted to £21,393 and the final cost was esimated at £961,986 comprising £225,256 for the extension, £272,219 for the improvement works and £464,511, recoverable from the Vote for Communications, for the two VHF stations and the communicating link station.

I asked why tenders had not been invited for the additional works and I sought information regarding the nature of the improvement works and the original estimated cost. I also inquired as to the reasons for the increased costs under each heading of the contract and whether the excess expenditure had been sanctioned by the Department of Finance.

Mr. McDonnell.—This paragraph deals with the involvement of the Office of Public Works in a project for the extension and improvement of the existing radio station at Valentia Island and the provision of further remote control coastal VHF stations. Responsibility for this service, as you know, rests with the Department of Communications. Reference is made in paragraph 52 of my Report to some matters arising out of that Department’s handling of the project. My concern, from the OPW side, was that when asked by the Department of Communications to provide buildings on three sites where VHF equipment was to be located, they arranged for the buildings to be provided as extras on an existing contract for works which were then being carried but at Valentia Island radio station. This contract at Valentia had been entered into in response to an earlier request from the Department of Communications to provide an extension at Valentia and extras had already arisen for additional work at that location.

You will see from my report that the extention at Valentia Island, which was estimated to cost £80,000 and for which the contract was £90,000, actually cost £225,000. You will see that the improvement works on the existing buildings at Valentia — I might describe these as the first set of extras on the contract — cost £272,000, and the three buildings at other sites — which I might call the second set of extras cost £465,000 against an estimate of £85,000. You will see, therefore, that the total paid to the contractor for work at the four sites — Valentia and the three other sites — was in the region of £960,000. You will also see, from paragraph 52 of my report, that the Department of Communications placed a contract for building one other VHF station at another location.

Since the date of my report the Accounting Officer has explained that when it was decided, in the course of building the new extension at Valentia. that certain additional works were urgently required and that work on the existing building should be brought forward, there was really no practical alternative to having the works added to the original contract because, he said, it would not be advisable or feasable to have more than one main contractor on the site at the same time — that is the Valentia Island site. Furthermore, as the contractor was satisfactory it was decided to seek quotations only from him. An in-house surveyor was then appointed to the project and all further work was charged on the basis of agreed rates and quantities.

As to why the building of the VHF stations at the other sites was carried out as an extra to this Valentia Island contract, the Accounting Officer told me that since the contractor was satisfactory and as two of the sites were in the same area as the main site, Valentia, and as the invitation to tender would have resulted in delay, it was again decided to seek quotations from the same contractor. That happened in May, for two of the sites. Then when the Office of Public Works were asked in Ocober 1983. to provide urgently required buildings for VHF at a third site, it was considered that they too could be provided more quickly by agreeing to treat them as an extra on the Valentia Island contract rather than by inviting tenders. In this third case he said that they were also influenced by the fact that the contractor, apart from having been satisfactory, was familiar with requirements from his experience of the other two sites. Again, he said that had tenders for this work been sought it would probably have cost substantially more.

I asked also about the increased costs under each section of the contract, that is to say the extension at Valentia, the extras in respect of improvements at Valentia and the further extras in respect of the three VHF stations. The Accounting Officer said that the increased costs in the case of the original extension, that is an increase of £135,000— £90,000 contract and the £255,000 final cost — was due mainly to extra works requested by the Department of Communications and also to additional works found to be necessary as the contract proceeded and to the impact of price variations and provisional sums.

There were two aspects at Valentia, there was an extension and there were improvements. In regard to the improvements, he stated that the only items for which, what he called base figures were available, to compare with the final cost was the re-roofing of the building and damp-proofing of the walls. These cost about £56,000 and there was no great price increases involved there. But he did say that once the decision was taken to put a new roof on the building and to dampproof the walls the OPW were put under strong pressure to bring the whole building up to the same standard as the new extension This resulted in the extra expenditure which cost £272,000.

In regard to the VHF stations, the second set of extras, as I called them earlier on, the Accounting Officer said that the increased costs related mainly to items such as masts and mast bases, which were not included in the original prices; to roads, drainage, fencing, transport costs and price variations. He pointed out that the stations had to be located where they could best serve the needs of the aviation and marine services and that they were chosen by the Department in areas which were remote, difficult of access, devoid of normal services and certainly unsuited to economical building work. I understand that since the date of my report, the Department of Finance have been seriously concerned with the handling of this project, both in OPW and in the Department of Communications. I understand that, ultimately, all of the expenditure has been sanctioned by the Department of Finance. I hope I have given a reasonable summary of the Accounting Officer’s replies. It was quite a lengthy reply but I hope I have taken the salient points from it.

10. Chairman.—Would the Department of Finance’s official like to comment?

Mr. B. Murphy.—I should just explain that the basis on which sanction was finally given by the Department of Finance was on the understanding that the works were necessary and were, in the opinion of the OPW, justified and that the prices were fair and reasonable. The breach of contracts regulations has already been brought to the attention of the Office of Public Works.

11. Deputy M. Ahern.—The Comptroller and Auditor General has read a quite long report which I think gives rise to great concern First of all normal procedures were not adhered to in that the work was not put out to tender. I would like further information as to why it was not put out for tender. Was there any particular reason for that? Were there any other contractors in the area who would have been capable of doing the work? The answer given to the Comptroller and Auditor General was that the contractor who did the work in Valentia was suitable. I would like greater details as to why it was not considered that other people would have been suitable and might have been able to do the work cheaper. I would consider this a very serious breach of normal procedures, and I would like to hear the comments of Mr. Scanlan on that.

Mr. Scanlan.—Let me explain first that, of course, the first part of the works undertaken at Valentia was put out to tender. This was the extension to the radio station. That did go out to tender and the contractor, Mr. Ladden, was the lowest tender and that was accepted. Included in that contract was provision for three modest sized concrete structures. Two of these were within the boundaries of the existing radio station and they were for the purpose of safeguarding and securing existing radio equipment which was at the bases of two masts on the site. These are quite small structures. The Department of Communications also asked us to include in the contract a modest sized concrete structure outside the boundaries on a hill quite close to house VHF equipment which they intended providing there. It appeared to be a reasonable request to do. We had a contractor on the spot and the estimated cost of that was quite modest. Subsequently, the Department came to us and said they had failed to acquire the land on which that particular VHF but was to be constructed. They abandoned that and asked us to substitute for that two other huts at two other sites, one on Valentia Island itself and one at Portmagee. These huts were larger than the one that was originally provided for. Nevertheless, they were not all that much out of line with it and because of the remote location of Valentia Island and Portmagree it was felt that it was a reasonable enough request to do. The Department strongly pressed us to get ahead with the work as quickly as possible because of the need to improve VHF transmitting and receiving services for the south-west coast, so we did it. Having done that, some time later they came and asked us to do some further work at those particular sites. We thought originally that all we would be asked to do would be the huts. Then they came along and asked us to provide bases for transmitting masts and stay wires, etc. Finally, very late in the day, they asked use to undertake similar work at a place called Knockgour Mountain near Allihees, in the Beara Peninsula. Perhaps at that point we should have cried halt. That site was far removed from the site of the operations at Valentia and, while we felt there was a very strong case for acceding to the Department’s request in regard to the ones in Valentia and Portmagee, maybe we should have stopped, said “no” and that we should have gone out to tender. We were faced with the situation where the Department were pressing us very hard to complete this network of VHF stations and we had a contractor who had proved very capable of undertaking this particular work. These sites were very isolated. They were in very difficult situations on mountain tops and roads had to be constructed into them through very deep bog. This contractor was very familiar with the site conditions. In the circumstances we acceded to the Department’s request. There is no doubt that if at the outset we had realised that we were going to be asked to undertake works on the scale that eventually developed at these three stations we would certainly have gone out to tender. But it escalated very gradually until we found ourselves undertaking very large works as extras. That is the explanation. That is the background to it.

12. Deputy M. Ahern.—I note that the Department of Communications got a VHF station built for £37,000 as against the cost for the three buildings that the OPW got done by this contractor for £464,000. Is there any significant reason why the Department of Communications were able to get one built for £37,000 and it cost you £464,000?

Mr. Scanlan.—I noted that comparison and on the face of it, they appear to have got it done a lot cheaper than we did. I am not familiar with the site in Donegal. I have visited the other two sites in order to satisfy myself that the conditions were as stated to me by my professional people. I talked with professional people on the spot and could see for myself the extent of the work involved. There are so many things which would influence the cost, such as local site conditions, weather conditions at the time of the contract, the state of the building industry in the locality perhaps, and whether tenders were high or low, so really I do not feel competent as a layman to make a valid comparison. All I can say is that our own quantity surveyor did have a look at the figures and he said that, having looked at both of them, in his view our prices, having regard to all the circumstances, were quite comparable as regards the building itself because a major part of our work was concerned with the site works roads, excavation of bog, etc. But beyond that I do not feel I can comment.

13. Deputy L. Naughten.—I would like to ask Mr. Scanlan this. The tender cost was £90,000 and the total cost of the project was in the region of £900,000. How was the cost of the additional work calculated?

Mr. Scanlan.—In the case of the improvements to the existing building it started off with a specific job of re-roofing the building, taking down the existing roof, raising the walls and putting on a new flat roof.

Deputy L. Naughten.—That was the tender part?

Mr. Scanlan.—We got a quotation on the first batch of extras. That was the specific price we got from the contractor for that work. The final cost of that part was not appreciably higher than the actual quotation, but there were reasons for a variation on it. The other works were based on the rates quoted by the contractor in his original tender for the extension. Once we got involved in these extras we brought a quantity surveyor into it so that he would closely monitor and measure each element of the work and it would be related to the prices quoted by the contractor in his original tender for things like block work, concreting, roadworks, and the amount of labour and quantities that were involved in all the other work would have been measured very closely by our quantity surveyor at all stages. This is how it was worked out.

14. Deputy L. Naughten.—One of the serious aspects I see in this particular paragraph is that it is similar to many paragraphs that we dealt with last year where there was substantial overruns, unbelieveable, on contracts placed by the Board of Works. As I see it, if a contractor is lucky enough to get in with the Board of Works it is the same as getting a blank cheque. It is impossible to control a situation like that. I am sure Mr. Scanlan would agree that that.

Mr. Scanlan.—It is very difficult.

Deputy Naughten.—Absolutely impossible. It is wide open to all types of abuse. There is absolutely no doubt about that. It is a recognised fact. There is very little difference between handling a situation in the way you have outlined that it has been handled and putting in somebody on time and material. It is a frightening abuse of taxpayers’ money. Listening to what you have said already, it would appear that the Department of Communications did not know where they were going either, that today they were carrying out one type of project and tomorrow they were doing something else. Would that be a fair enough assessment of the situation?

Mr. Scanlan.—Well, it was certainly very difficult for us to project ahead what precisely we were being asked to do in relation to the VHF stations. We knew where we were going in regard to the building work itself, to the extension and the repair work, because that was very much in our own area of responsibility. On the VHF stations, the way it developed it certainly put us in a difficult situation. If we had insisted on adhering strictly to Government contracts procedures and refused to proceed and have these done as extras, we could have come in for very serious criticism for delaying the introduction of this service. Bear in mind that the Valentia radio station played a very important role in the Air India disaster. The Department of Communications will be in a better position to emphasise the importance of this aspect to the committee. Nevertheless. I am well aware of it. They are on a 24 hour day service and during that operation they played a vital role in co-ordinating all the rescue efforts for the survivors from the tragedy. There is a second aspect to it too, that that radio station generates considerable revenue from communications with ships, sending telegrams and so on. I have seen some very significant figures for revenue. Therefore, we could have been accused of red tape tactics and that sticking too rigidly to regulations held up this very vital work.

The first point you mentioned, Deputy, was in regard to the impossibility of controlling this type of a contract. I do not accept that it is impossible but it is very difficult. There are two critical factors. When you get involved in this kind of work you must have two requirements. You must have very close supervision of the work and you must have it very closely monitored by a quantity surveyor. In each case we did that. We had consistent supervision of each of these jobs by a resident clerk of works, a very experienced man who has worked all over the world on major building construction contracts, including work in Saudi Arabia. He said the VHF station in Castletownbere was the most difficult project he had ever been faced with. He said that the weather conditions were appalling. Given the constraints under which we were operating we did our very best to control expenditure and ensure that the taxpayer got value for money.

Deputy L. Naughten.—You outlined the important role that that station plays — and none of us in questioning that role — but the contract was placed in November 1981 and when was the decision taken to extend the contract?

Mr. Scanlan.—It arose at different points.

Deputy L. Naughten.—The first extension?

Mr. Scanlan.—Early in 1982 the architect reported that he was having extreme difficulty with the foundations for the extension. He said that in the light of that he considered that if we went ahead with our first intention of replacing the original building — I do not know whether this was brought out in Mr. McDonnell’s earlier reference — once the extension was completed and staff had moved in something would have to be done about the existing building. It was in a very poor condition. Various views had been expressed about it over the years. One which we had suggested to the Department in 1977 was that maybe they should consider abandoning that building and site completely. It was a very exposed situation. We suggested they might consider moving to a new site, erecting a completely new building and abandoning the other one. In the event they said that would disrupt their service too much. In the event, it was decided to go ahead with an extention urgently to relieve the intolerable overcrowding in the building. We continued to discuss what we would do later and the intention in our recommendation was that that old building would be demolished and we would construct a new building to replace it. When the architect came across serious difficulties with the foundations he strongly recommended that if the walls of the existing building were sound the best thing to do would be to try to retain it and put on a new roof. That was the decision and in June 1982 we reported it to the Department of Transport, as it was then, and they confirmed that they were prepared to stay on that site with the old building and they asked us to go ahead. It was at that point, about June 1982, that we took the decision to carry out the first phase of extras.

15. Deputy L. Aylward.—Initially, when you received a tender for approximately £90,000 — and rightly tenders were received — you then proceeded, with extras and additional buildings, to spend almost one million pounds. That means that an additional £872,000 were spent without any tendering. Can you honestly say that this is a satisfactory procedure and that we got value for money? What consultation took place with the Department of Finance during that period before the spending of additional money was sanctioned? Was Department of Finance sanction obtained? I want to come back to the question of value for money after that.

Mr. Scanlan.—Perhaps I will take the second point first, the question of Department of Finance sanction. Because the Office of Public Works are probably the main construction agency for Government Departments we have been delegated certain powers by the Department of Finance to engage in building works within certain financial limits. At the time that this work was undertaken we were operating under a Department of Finance sanction of October 1980 and under that we had authority to incur expenditure on individual construction projects up to the estimated limit of £250,000. In other words, we were free to go ahead within that limit, with jobs at our own discretion without Department of Finance sanction subject to a number of provisos. One was that where a job was being sponsored by another Department we were to ensure that the sponsoring Department had got Department of Finance approval, in principle certainly, before the work started. Secondly, we had sanction in respect of extras or excesses on a contract. We could go up to 10 per cent over the contract price if the expenditure exceeded £250,000. If it did not exceed £250,000 we did not need the Department of Finance sanction. Those powers are reviewed from time to time and they were extended further in March 1982 when the limits went up to £1 million. There is one further proviso, that if a project is of a novel character, if we feel there is some novelty about it, that it is a bit out of the ordinary, we should go back to the Department of Finance even if it was within our delegated authority. This is a rather subjective matter. We took the view in this case that the extension was something new, the Department of Transport had got the necessary sanction to go ahead with it. It was well within out authorised limits. When we came to do the repairs to and reconstruction of the existing building, that would normally be regarded as being completely within our delegated authority. Where we are responsible for the maintenance of buildings, if we find it necessary to carry out improvements or maintenance works we do not have to go to the Department of Finance for that. The question is that when this whole thing began to snowball — and the VHF stations came into it too — in hindsight, it certainly took on a degree of novelty, to put it mildly. We were getting involved in works which seemed to be outside our normal run. At a certain stage — it was before we went ahead with the Allihies one — in April 1984 we decided that we had better alert the Department of Communications, as it then was, to the whole situation and ask them to go back and get the necessary additional sanctions. At this stage the Department of Finance communicated with us and asked us for a full report on how everything had gone, with full details of extras and everything. We did that. On the strength of this the Department of Finance gave the necessary sanction to the Department of Communications in respect of the extras on the extension, which was what they sponsored. They also gave them the sanction for the extras in respect of the VHF stations, which again was under their sponsorship. At that point the question of our authority to incur expenditure on the existing building was not raised. We went ahead on the assumption that we were acting rightly within our delegated authority. Recently the Department of Finance — to clear up the whole matter, as Mr. Murphy said at the outset — have given us final covering authority to put the matter beyond doubt. We were largely operating within fairly extensive authority from the Department of Finance.

16. Deputy Aylward.—Coming back to the question of value for money. You have built a similar type of building in Donegal for £37,803 under contract. Three such buildings built directly by the Board of Works cost £464,000. Can anybody justifiably say that that is a fair comparison allowing for all the unusual factors, the terrain and so on? If we were to make a direct comparison, materials would cost the same in Donegal as in Kerry, I presume, and I presume labour would also cost the same or thereabouts. Why the huge difference?

Mr. Scanlan.—As I explained earlier, I am not familiar with the actual details and quantities in the case in Donegal. It was not undertaken by us. On the basis of the quantity surveyor’s report, he said that there were far more extensive site works to be done in the case of our sites. We had to excavate down to eight feet of bog and fill. I know definitely that the conditions must have been appalling. When I was there in late September it was a very mild day at sea level, but when you went half way up the mountain you were lost in fog, and there was a wicked wind blowing. I do not know how anybody carried out work up there. It must have been exceptionally difficult, to put it very mildly. What the conditions were at Crockalough I do not know.

Deputy Aylward.—I would say the wind must have been blowing in somebody’s back by the figures that are there. I would like to get the comparisons. Is it possible to get those comparisons, the actual breakdown of the total costs, materials, labour and so on?

Mr. Scanlan.—In respect of the Donegal one, I will try and get these from the Department of Communications and furnish it to the Committee.

Deputy Aylward.—We are talking about similar buildings that cost four times as much in Kerry as in Donegal.

Mr. Scanlan.—It was not a building, as such, as I understand it. A lot of the work on the other two sites went on the construction of roads into the site and excavation for the masts and building. I can appreciate the committee’s concern about getting value for money. I will just make two points to give some indication of value for money. The contractor in this case tendered originally at a price of about £90,000. The final cost of the actual job that he tendered for came out at about £225,000. His tender was exceptionally low. It was 40 per cent below the next acceptable tender. The tenders ranged up to £175,000, which was not all that much short of the final cost when you consider price variations in the meantime and extras. The second point I would like to make about this contractor is that around the time he had just finished the two jobs in Valentia we asked him to undertake the job in Castletownbere. He was not anxious to do the job because at that time he had just got a major contract in open competition for the building of a big Garda station at Caherciveen. He finished that job in Caherciveen within the time limit and at a net extra cost of less than £1,000. Allowing for price variations, the actual net extra cost on that contract in Caherciveen of a contract of the size of £335,000 was less than £1,000. That is a reasonable indication that we were dealing with a very good, reliable contractor. It was the unusual circumstances in the VHF stations that caused our problems. I feel very satisfied that we did get value from this contractor and that we did our best to control the pricing and everything as it went along.

17. Deputy Naughten.—You say that he completed his contract within a £1,000 of his tender as if it were some remarkable achievement. Perhaps that is something we should be striving for all the time. We seem to take it for granted that it should overrun by 50 per cent or 60 per cent. Perhaps that is our problem. I say that by way of comment.

18. Deputy McGahon.—Like Deputy Naughten, I want to express my alarm at the number of overruns in Office of Public Works contracts that are constantly appearing before us. With all due respects to Mr. Scanlan I cannot accept that these overruns can be blandly explained away and that we are asked to rubber stamp them here. It was a racing certainty that the Department of Finance would eventually sanction it, they had no alternative. The common denominator in all these runs seems to be the involvement of the Office of Public Works. The involvement of the Office of Public Works seems to guarantee a tremendous bulge in any contract. I have to say to you, Mr. Scanlan, that it must pose a question of competency somewhere in your Department. There is a complicity in this one because the Department of Communications also seem to be involved. Perhaps a representative from that Department should be appearing before us today along with you. I cannot understand how competent people could get their sums so wrong in this instance. Surely you could have anticipated much of the overrun on this, allowing for your explanation that it was very difficult terrain. You spoke of Saudi Arabia, which is a total contrast to Valentia Island. Accepting all that, surely that could have been foreseen to a large extent. A contract that initially appears at £90,000 eventually runs into £250,000. That is unbelievable. The people out there in the real world cannot be expected to swallow that. It certainly raises a whole series of questions about competency within your own Department. I cannot accept that a piecemeal operation was not involved in this, that from time to time buildings and other things that were deemed necessary were added on. Surely that had to be anticipated and built into the plan that was initially formulated. I want again to contrast the building of public works with the private sector. How could the private sector compete with that type of thing? They cannot run to the Department and find at the end of the day, as Deputy Naughten says, an open cheque. Is there a case for the abolition of the Office of Public Works and for some other type of system to be evolved?

Mr. Scanlan.—I do not know whether to consider that last question.

Deputy McGahon.—Somebody has to consider it.

Mr. Scanlan.—This has come up here on previous occasions and we have been severely criticised for these cost over-runs. We have tried to defend ourselves on the basis that invariably we are working on behalf of other Departments who do not complete their briefs adequately at the outset. In the past they have continued to press us to make alterations in the work as it proceeds and to provide extras. Perhaps we should not have been so forthcoming and so agreeable, but we have always felt that our job was to provide what was required by the Departments, provided we were satisfied that their requests were reasonable. In the last few years this whole question of project control has become a big issue. Two years ago the Department of Finance issued new guidelines about control of projects. These guidelines are being implemented now. For the future all projects will be very strictly monitored. At the outset cost limits will be fixed for all major projects. In the case of very large projects, a Cost Control Committee has to be established. The Department of Finance are represented on this and are the sponsoring Department. In future the Office of Public Works will be better protected against this sort of situation. I do not accept that within their own area of responsibility the Board of Works are incompetent. It is for the Government to decide whether the Board of Works should be replaced and whether there is a better way of doing things. Maybe the last state would be worse than the first.

19. Deputy McGahon.—Are you suggesting there was a lack of communication and a lack of liaison between sponsoring Department and your own Office? Does the fault lie within the sponsoring Department? Surely if two Government bodies cannot liaise we have very little chance of running the country.

Mr. Scanlan.—In this case the committee will have seen that the Department of Communications obtained separate Department of Finance sanction to put up these VHF stations and the cost was to be charged to their Vote. We did not become aware of this until very late in the day. The job had started off with a very modest request from the Department to provide this hut for VHF equipment. As it was normal for the cost of construction work for other Departments, certainly for that Department, to be borne in our Vote, there was no reason for us to question to which Vote it would go. The matter escalated and subsequently we discovered that this particular aspect of the project — the VHF element — was to be borne in their own Vote.

Deputy McGahon.—Does this give you cause for concern? Can you give a guarantee that we will not be presented with the over-runs of this magnitude except in certain cases where you can have over-runs for particular reasons?

Mr. Scanlan.—Since the issuing of the new guidelines by the Department of Finance about project control every officer in my Office involved has been made very fully aware of this matter. I can never give a complete guarantee, but as far as it is within my power to do so I will be doing my utmost to ensure that this sort of situation will not arise Exceptions may arise again but in co-operation with the Department of Finance we will be doing all we can to prevent this happening in the future.

20. Deputy McGahon.—Does a preferential cartel exist within the Office of Public Works for particular builders?

Mr. Scanlan.—Good Lord, no. I do not see how a cartel could operate because we are normally bound to go for open tender.

Deputy McGahon.—The lowest tender is not always accepted?

Mr. Scanlan.—No. We have a responsibility to ensure that if we do give a contract that it is given to a reliable contractor. There is no use in giving it to a contractor who is going to go broke half way through the contract. We examine them very carefully.

Deputy McGahon.—I accept that, but sometimes it is very hard for a young, developing company to break into the Public Works area because of the presence of established contractors who have given good services over the years. Nevertheless, this is something that many builders are very aggrieved about and about which they have come to me. They believe there is a favoured list within the various Departments and within your Office.

Mr. Scanlan.—I am very surprised to hear that. We have a long record of helping small contractors to develop. What happens is that they can apply to us to be considered for contracts and if we feel that a particular contractor has not the experience or the capability for handling a large project we encourage him to apply for smaller contracts. We have brought on quite a number of contractors in this way. If you have any problems about contractors I would be pleased if you would furnish them to me.

21. Chairman.—Before moving on to the Vote, may I just make a point? This contractor came in on an original tender for £90,000. When did that work start?

Mr. Scanlan.—About November, 1981. The contract was placed in November, 1981 so it was about that time.

Chairman.—When did the work finish?

Mr. Scanlan.—It finished at various times. The final one, which was the Allihees job, finished in June 1984.

Chairman.—Between 1981 and 1984, as a result of additional work, he went from £90,000 up to just under £1 million. As Accounting Officer were you concerned with the overrun in this situation?

Mr. Scanlan.—I was concerned that so much work was given to one contractor under the same contract, as extras, without normal competition. I would always be concerned about that. The question of the over-run, whether the money was justified or not, most of it was justified by the Department of Communications. I would certainly be concerned about the procedural aspect.

Chairman.—As a result of that experience. is there any stipulation that you will not have a repetition of that?

Mr. Scanlan.—I think everyone has learned his lesson not only from this, but from other cases in recent years where there have been cost over-runs. Everybody has become very conscious of this. Actually they have been issued with very clear instructions. In future if a Department ask for some extra alteration it may only be conceded if there is a saving in some other area. If they will do without something else we may carry it out.

22. Chairman.—We will move on to the Vote. I wish to make a point in relation to F3 — Rents, Rates, etc. — £15,384,000. What is the actual breakdown there between rents and rates?

Mr. Scanlan.—Most of it would be rent. Rates on Government property are normally paid by the Valuation Office. We pay small amounts — there are circumstances in which we would buy a property — but the greater part would be rent.

Chairman.—You are not paid on the full valuation?

Mr. Scanlan.—No, but the Valuation Office pay a bounty in lieu of rates which almost amounts to the same thing.

Chairman.—This is not charged to your account?

Mr. Scanlan.— No, it is not.

Chairman.—On rented property mentioned, was all that property occupied for the period the rent was paid?

Mr. Scanlan.—No, I would not say that it was all occupied because we are constantly moving staff around and we are always trying to consolidate our utilisation of accommodation. In the last few years, with the contraction of the public service, numbers have been falling and we have been reviewing the occupancy. In certain areas there is a little bit more elbow room than there was some years ago and we are trying to rationalise it with a view to off-loading accommodation. At any one time there would be a certain amount of office space vacant while this is happening.

Chairman.—What proportion would be vacant?

Mr. Scanlan.—I think it would be very modest. I have not got the details but perhaps I could send a note to the committee if you wish about showing exactly how.

23. Deputy G. Mitchell.—On Subhead E—New Works. Alterations and Additions — I want to ask the Officer a number of questions, which I think are of a very interesting nature, in regard to where there was quite a lot of money spent on sundry items. Could you tell me, in regard, for instance, to the Papal Cross development in the Phoenix Park, what work took place there that cost the sort of money it did? What exactly was done?

Mr. Scanlan.—The cost of the construction and erection of the cross itself was not paid for by the Office of Public Works. That was done out of the special fund which was set up by the Hierarchy for the event. But, as the event took place in the Phoenix Park, there were a lot of remedial works that had to be undertaken in the general area. The park suffered a fair amount from that particular event. Cables were laid.…

Deputy Mitchell.—It was not the cost of erection itself?

Mr. Scanlan.—No.

24. Deputy Mitchell.—What about the cost of fitting out of the Ombudsman’s office, £80,000. What sort of fittings cost £80,000?

Mr. Scanlan.—It would have been related mainly to furniture and perhaps some carpets. I have not the exact details but that is the sort of thing. When somebody moves into a new office even though the building may be in reasonable condition, there may be partitioning to subdivide for their particular use, construction of public offices and that type of thing, but I do not know the exact details.

Deputy Mitchell.—Could you not rent a fully fitted out office for less than £80,000? It seems a lot of money to fit out an office for a relatively small staff of the Ombudsman’s office.

Mr. Scanlan.—I do not think so. It had to be fitted out particularly for their purposes. It is a substantial building. It is not a huge block of accommodation, but it is substantial. Building costs are quite expensive.

25. Deputy Mitchell.—I suppose in relation to what you are spending, they are not, compared to — for instance, you spent £3,991 million on embassies. Who carried out the work? Why for instance, did you spend £95,000 on the development co-operation office in Dar-es-Salaam, on fitting out an office in a Third World country? Why did it cost £95,000?

Mr. Scanlan.—I presume because we could not get it done any cheaper, Deputy.

Deputy Mitchell.—Who did the work?

Mr. Scanlan.—We get it done locally through contractors. We look after the furnishing and provision of embassies and consulates all over the world and I do not know what precisely was done in that particular instance.

26. Deputy Mitchell.—There is £168,000 for fitting out the embassy at Beirut. What was that for?

Mr. Scanlan.—Well, Beirut is a very special situation. God only knows what it was spent on in Beirut. It could be repairing bomb damage.

27. Deputy Mitchell.—O.K. Let us take one, not a special case. You spent £243,000 on the embassy in Canberra for a new chancery. Why £243,000 for a new chancery? What did they require a new chancery for?

Mr. Scanlan.—Offhand, I do not know, Deputy. I have not got the exact details. But if you want a breakdown of the details of these works——

28. Deputy Mitchell.—I do. You spent £340,000 improving the residence at the embassy in Lagos. What was that for?

Mr. Scanlan.—Again, I have not got the exact details.

29. Deputy Mitchell.—O.K. We will get them on the record and come back to you. You spent £290,000 fitting out the embassy at Nairobi. Have you any idea how many staff we have in Nairobi?

Mr. Scanlan.—No, not offhand.

30. Deputy Mitchell.—The embassy at New Delhi, improvements to the residence at the embassy, £331,000. What type of improvements?

Mr. Scanlan.—I know there was a major scheme of repair and renovation carried out in New Delhi over a number of years. What that particular expenditure was spent on I do not know, but again I will supply the details.

31. Deputy Mitchell.—Fitting out embassy at Peking, £645,000. Is this the one where you sent someone over to fit the carpets?

Mr. Scanlan.—Yes.

Deputy Mitchell.—£645,000 for fitting out the embassy. Does that not seem extravagant?

Mr. Scanlan.—I do not know what the labour costs and everything are, what construction costs are like in Peking.

Deputy McGahon.—Wages are not big there.

32. Deputy Mitchell.—You spent £650,000 improving the chancery at Washington. Do you know what that was for?

Mr. Scanlan.—Sorry, Deputy, we did not spend £650,000 at the Washington chancery; it is the estimated provision.

Deputy Mitchell.—You spent £17,000 in 1984, but the estimated cost is £650,000?

Mr. Scanlan.—Actually a contract has just been placed for that work. That is one on which I can talk with some personal knowledge, because I first saw the chancery in Washington back in 1968 and on that occasion it was in an appalling condition. I saw it again some years later; and last October, when the scheme for this work was fully developed, I had business in New York and I went up to Washington to have a last look at what was going to be done at this particular place. If ever a place needed work to it it was the chancery there. The staff were working in very overcrowded and unsafe conditions. A lot of that work is going to be related to fire and security precautions, so in that instance I am quite satisfied that the work is going to be fully justified. They have waited nearly 15 years to have something done to the chancery and it kept being put off. The Department of Finance criticised us for not getting on. They gave a sanction for this work a good few years ago and we have been criticised for not getting on with it before now.

33. Deputy Mitchell.—You have in a figure of £600,000 for President Reagan’s visit. What does that cover from the Office of Public Works point of view? What did you spend it on?

Mr. Scanlan.—In the case of any State visit the Office of Public Works are called in to carry out any special works that are necessary. In this case we were asked to undertake works at the various venues where President Reagan and his party met the public or had public functions, including at Ballyporeen, constructing stands, etc.

34. Deputy Mitchell.—I would like to ask, under Vote 9, subhead E, that we recall the Accounting Officer of the Department of Foreign Affairs, when be has supplied a detailed breakdown of this expenditure in advance.

Chairman.—Agreed.

35. Deputy McGahon.—I want to support Deputy Mitchell on this. While I accept that we cannot have ambassadors going around on bicycles and we cannot have embassies in tents in some of these countries — indeed, I spent a pleasant evening in Bonn in May — some of these figures are alarming, £645,000. It is reasonable of Deputy Mitchell to ask for some type of explanation of that type of money. Again, I would query the involvement of the Department in this area. Surely an ambassador in a particular country could get jobs done in a reasonable manner and at a lower cost. Perhaps it is the involvement of your own Department that is inflating some of the prices in this type of thing. Perhaps I am wrong but I suspect that it could be. Could I just refer you briefly to subhead F.5—Repair of Courthouses — and suggest that some of the money you spent on embassies could be more gainfully employed here in this country in refurbishing courthouses which are in most cases in appalling condition and are an affront to everybody, whether the fortunate or the unfortunate who have to appear in them. A sum of £100,000 seems to me a very small amount of money to spend on the courthouses around the country, which, as I say, are—

Deputy Mitchell.—But the judges do not live in the world of “Dallas” and “Dynasty”.

Deputy McGahon.—Nevertheless I do not think they are very happy about it. I note that there is an under-expenditure also. Why did that occur? Surely every county council must be crying out for the money to be expended on courthouses?

Mr. Scanlan.—The Commissioners are not responsible for the maintenance of courthouses. That is primarily the responsibility of the local authorities. If a local authority fails to carry out their statutory function, the Minister for Justice can call on the Commissioners of Public Works to carry out the work and recover the cost from the local authority. In this case the money was spent in Waterford. It is only very occasionally that we get drawn into this situation, but we have to recover the cost from the local authority.

Deputy McGahon.—Do you always get it?

Mr. Scanlan.—We do. It only arises occasionally and we do get it back. It is not for me to say whether the money would be better spent on the courthouses — it is not our problem —

Deputy McGahon.—It is mainly the concern of the county councils?

Mr. Scanlan.—Yes.

Deputy McGahon.—It is a very unfair imposition on county councils.

36. Deputy Naughten.—I would endorse Deputy Mitchell’s proposal that we ask the Accounting Officer to come back with more detail about the expenditure under some of those headings. Very large sums of money have been spent on maintaining our embassies abroad. I would like some details of that expenditure.

Deputy Mitchell.—I wonder could we get the Office of Public Works to do the Deputies’ offices to quite the same standard in the future? We might then understand how it costs this sort of money.

37. Deputy Naughten.—I note that under subhead C — Post Office Services — the estimate was £845,000 and the expenditure was £551,000.

Mr. Scanlan.—What is the question?

Deputy Naughten.—The original estimated expenditure was £845,000. Is that correct?

Mr. Scanlan.—That is correct and it was reduced in the supplementary.

Deputy Naughten.—The real expenditure was £551,000. What was the reason for the over-estimation?

Mr. Scanlan.—Originally payment for all services rendered by the Department of Posts and Telegraphs had to be made by the Departments but from 1 January, 1984 payments are now made directly to the two boards. The assessment by the Post Office of the costs is being done on a different basis. We now pay directly for everything. Letters have to be stamped and it is now possible to control the expenditure a lot better. It is evident that there has been a cut-down on charges to the Post Office as a result.

Deputy Naughten.—So there has been a huge saving to the Office of Public Works as a result of An Post becoming a semi-State body?

Mr. Scanlan.—So far there has been. I think it is fairly general in other Departments as well.

38. Deputy McGahon.—In regard to subhead J — National Monuments — I see that £3,067,000 is available. What exactly do you do in that area? Is it in regard to castles?

Mr. Scanlan.—No, we have over 800 structures or sites from various periods. There are early pre-historic sites such as Newgrange, and there are early Christian sites, monasteries, and also castles. There is a whole range of buildings and they are maintained throughout the country. That is where the money is spent.

Deputy McGahon.—I see there was an under-expenditure of £184,000.

Mr. Scanlan.—Yes. The original grant was for £2,800,000. Coming to the end of the year a Supplementary Estimate was sought as it appeared that we would exceed the provision. We received a supplementary sum of £200,000 from the Oireachtas. At the end of the day, some of the payments which we anticipated did not mature. Possibly we could have done without the supplementary £200,000, but at the time we thought we would need it.

39. Deputy Naughten.—Subhead F.5 — Repair of Courthouses — I was under the impression that it was the local authorities responsibility to repair courthouses?

Deputy Mitchell.—Not necessarily in Dublin, I understand. The Corporation do some but the Office of Public Works do most.

Mr. Scanlon.—We are responsible for the Four Courts and one or two others. Throughout the provinces it is different.

40. Deputy Naughten.—In regard to “Recoveries from EEC in connection with certain arterial drainage operations” £1.3 million was realised and the estimate was for £2 million.

Mr. Scanlan.—The receipts do not come directly to us from the EEC, they come through the Department of Agriculture. They usually come very late in the year. We invariably have this problem coming up towards the end of the year. Sometimes the Department of Agriculture receive them so late that by the time they are transferred to us they go into the next year. But on occasions the EEC themselves do not make the payment until early January. But subsequently the money will come to hand.

Deputy Naughten.—How is the amount of money you are entitled to get assessed? Do particular works qualify for a grant from the EC as distinct from other works? I note the total expenditure was in excess of £10 million.

Mr. Scanlan.—There are two EC directives concerning money for drainage. One is the western drainage programme. A regulation in 1978 and again in 1981 provided that a grant totalling £15.3 million, comprising 50 per cent of eligible expenditure incurred on arterial drainage schemes in the western region in the period from 1 January 1979 to 31 December 1986 — that is the money that comes from the European Agriculture Guidance and Guarantee Fund — FEOGA — and comes to us through the Department of Agriculture, but as well as that—

Deputy Naughten.—That would be the Boyle-Bonet basin?

Mr. Scanlan.—There were three schemes: the Corrib-Mask-Robe, the Boyle and the Bonet. We also get money in respect of cross Border drainage from the Regional Fund — the Monaghan Blackwater. We receive the money under two different schemes.

41. Deputy McGahon.—Subhead G.1 — Arterial Drainage — Surveys — grant £335,000. How is that money spent? Who carries out the surveys? Are they done by you or by outside specialists?

Mr. Scanlan.—We have measurement gauges around the country on most major rivers. We are constantly collecting information about river flows, rainfalls and so on. This information is fed back into the system. When we come to prepare a particular scheme there may be more expenditure on staff who are actually planning and designing the scheme. As you know, the Government suspended planning of drainage schemes a few years ago. That money is almost entirely on this question of measuring river flows and also there was some ongoing work on two of the schemes. We had some consultants doing work in Dunkellin in relation to ground water conditions.

Deputy McGahon.—Coastal erosion? You are not responsible for the inland rivers?

Mr. Scanlan.—No.

Deputy McGahon.—It has to refer to the coast?

Mr. Scanlan.—Yes, it has to be on the coast.

Chairman.—Thank you, Mr. Scanlan.

The witness withdrew.

VOTE 35—FISHERIES.

Mr. P. Whooley called.

Chairman.—No question.

VOTE 36—FORESTRY.

Mr. P. Whooley further called and examined.

42. Deputy G. Michell.—May I draw your attention to an article in The Irish Press on 10 October, which was headed “Forestry Body Misled Dáil Group over Price Deal”? I presume you have read the article already. It refers to the US-based Medite company of Clonmel. I am not commenting on the accuracy or otherwise of the article. I note there has been a follow up in The Irish Times this morning. This is in relation to — although it says the Public Accounts Committee — evidence given apparently to the Public Expenditure Committee. Could you tell us what year this refers to and would you like to comment on the accuracy of these reports?

Mr. Whooley.—I would, with your permission, Chairman, like to comment. First, the report was totally incorrect. I wrote to the newspaper at the time stating that it was incorrect. I also wrote to the secretary of the Public Expenditure Committee asking whether such a report was in existence, whether such an allegation was contained in it and what was the basis for that allegation in the light of the evidence and the information that officials of my Department had made available to the committee on the matter. I have had no reply to that letter. The matter. I have had no reply to that letter. The report of the Committee has come to hand late last evening. The allegation which was made in relation to misleading the committee is still contained in it. While I cannot say what my Minister may or may not do, I would expect that we will be pursuing that matter further. The year in which the agreement Deputy, concluded was 1983.

43. Deputy Mitchell.—There is one particular point which says that there was a procedure for regular review built into the contracts, that the committee had been advised that that is the case. Is that generally the case in contracts, that there is a procedure for regular review?

Mr. Whooley.—I am in a little difficulty in answering that question because of the same problem I had with the Public Expenditure Committee, namely that there was a nondisclosure clause in the agreement. Because of that clause I had been legally advised to exercise the utmost caution in giving any details in relation to the firm involved on the grounds that I could be held to be in breach of the contract and render myself and the Department and the Minister liable for compensation. That was the situation as I explained it to the Public Expenditure Committee.

Deputy Mitchell.—I understand the contracts were made available to that committee?

Mr. Whooley.—Not by me.

Deputy Mitchell.—They did have copies, according to reports.

Mr. Whooley.—I understand that a copy was made available by a particular member or members of an Advisory Group which the Committee had. That is only an understanding. I have no firm information.

44. Deputy Mitchell.—That committee concluded that they did not offer value for money?

Mr. Whooley.—That is what the report says, but the question you asked was did I give them the information that there was a regular review. The answer is definitely no. I never used the word “regular” in written, oral or in any other submission to the committee.

45. Deputy Mitchell.—I do not want to go into the matter which has already been raised with you and which, in any event, relates to 1983. In relation to contracts of this kind placed by your Department in general, is it normal that the contracts are secret contracts and not available? Where does public accountability come into it if this sort of clause is involved?

Mr. Whooley.—If I might explain, these are the only two cases of long term contracts we have had. They are in relation to pulp wood. The reason we have them in relation to pulp wood is that it is not unusual to have such contracts where a company in investing very heavily in capital. It is not unusual for them to look for some security of supply or long-term contracts. Before these two firms were established we were in a situation where a market for pulp wood did not exist in this country. In fact, we were paying to get rid of it. However, that is beside the point. The normal type of contract we have is a short term contract, say where we have a tender accepted by a sawmill for the supply of a stand of timber. There would be clauses that the timber would be taken at a fixed price and by a particular date. The bulk of our stuff would be sold on that type of tender, namely short term contract. What I am saying to you really is that the two contracts to which you refer were two specific ones in relation to pulp wood and arose because of the long-term investment of large sums of capital for the processing of pulp wood.

46. Deputy Mitchell.—You are aware that the House has devolved on this committee the power to send for persons, papers and records? Are people entering into secret contract with your Department aware that ultimately the Dáil has to be satisfied as to the spending of public funds?

Mr. Whooley.—I respect the authority of the Dáil. However, I felt I had to comply with the legal advice I had got which was the highest legal advice available to the Government that I could not disclose details of the contract. That was my situation. I said to the committee that if they were dissatisfied with that then they had other courses of action open to them. That was as far as I could go in giving evidence.

47. Deputy Mitchell.—I do not know what the powers of the Public Expenditure Committee are but if this committee decides to send for any records we expect to get those records. I do not intend to raise it on this particular issue but that is the job of this committee. This committee has the job of audit function, not any other committee. It is this committee that decides to send for papers, persons or records in relation to past expenditure.

Mr. Whooley.—In case I am being misunderstood, or regarded as being obstinate, I would like to explain that my whole attitude is to try to co-operate and help Dáil committees in their work. As well as acting under legal advice I was also acting under guidelines approved by the Government for the giving of evidence by civil servants before Oireachtas committees. My interpretation of those guidelines is that I was specifically prohibited from disclosing commercial information in relation to individual firms. I stress the words commercial information in relation to individual firms. I think such information would scarcely be disclosed to the Dáil itself, even in reply to a Parliamentary Question.

48. Deputy Mitchell.—I am not going to pursue it any further except to say that if you put it to test at this committee I think your advice would be found to be wrong. I could advise you of that. You might look up some of the High Court possibilities for any witness refusing to give evidence before this committee. With regard to wildlife conservation, how is my friend, the fox, getting on since last year?

Mr. Whooley.—I think last year you were wondering whether the fox population was decreasing — it is not a protected species under the Wildlife Act but it is afforded a certain amount of protection under the Act, most importantly from cruel or non-selective hunting methods. The number of wild fox skins exported each year is approximately 32,000 according to the information we have. The advice I have from the Department’s experts is that despite fears expressed from time to time of the fox becoming an endangered species here, there is no evidence to support that. The numbers are being maintained, despite scarcities in some areas.

Deputy Mitchell.—Could you give me the number of exported pelts again?

Mr. Whooley.—Thirty two thousand, at a value of £1½ million.

Deputy Mitchell.—That is the export figure for the last year?

Mr. Whooley.—That is roughly an average over the last couple of years, an average per year.

Deputy Mitchell.—What is the population figure for foxes?

Mr. Whooley.—I do not have that figure.

Deputy Mitchell.—Are they a protected species?

Mr. Whooley.—No, the fox is not a protected species under the Wildlife Act but it is afforded a certain amount of protection under the Act from cruel and non-selective hunting methods.

Deputy Mitchell.—Have you no idea what the population figure is?

Mr. Whooley.—I am afraid I have not. I would only be guessing.

49. Deputy Naughten.—I would just like to ask the number of staff employed in our commercial forests?

Mr. Whooley.—There are about 1,000 to 1,100 between administrative and inspectorial staff and there are about another 2,500 industrial workers, these would be the forest workers. We are talking about a total of some 3,500 altogether.

Deputy Naughten.—Your total sales of timber last year was £13 million?

Mr. Whooley.—In 1984 the figure was around £13 million. It was £16 million last year.

Deputy Naughten.—Would you not consider that an extremely low output for the vast number of people involved and the vast area of lands planted? Would you not consider it an extremely low timber yield from that amount of manpower and vast State investment?

Mr. Whooley.—Many of our forests still have not come into production or are only coming into production now. The age of the estate is very important. A forest only starts coming into production at about 20 years of age onwards. Our big expansion programme in planting was in the fifties. The trees then planted will not reach maturity until the next decade. Greater sales of timber would be starting then.

50. Deputy Ahern.—How many years?

Mr. Whooley.—The rotation is 40 to 45 years for full maturity. One starts thinning around 20 years and from there onwards. Our rotation period which is a relatively quick one, in comparison with European standards,—it is practically half at around 40 years. There is a lot of other work done by the forestry workers some of which is of a social forestry nature. It is not solely commercial. This is one of the criticisms that is levelled at us, that we have not a mandate to operate commercially. There is a certain amount of truth in that. For example, in the seventies the type of land we were able to buy for forestry was really the residual land that nobody wanted. It was not top grade tree-growing land. That is forgotten now. But nobody in the seventies wanted to sell land for forestry. The scene is changing with surplus difficulties in agriculture and better quality tree-growing land is now available. That is a factor that would have inhibited output in the past.

51. Deputy Naughten.—What amount of land did you acquire for forestry over the last two years and what was the average cost per hectare, or per acre?

Mr. Whooley.—I have it for 1984. We acquired 285 properties involving a total of 6,192 hectares.

Deputy Naughten.—You have not got the figures for 1985?

Mr. Whooley.—There were 6,192 acquired in 1984 and in 1985 6,890 odd.

Deputy Naughten.—The average price?

Mr. Whooley.—In 1983 it was about 5,700 hectares. The average would be about—sorry the average price.

Deputy Naughten.—The average price?

Mr. Whooley.—I can give you the average price per hectare for 1984. It was £629. I do not have the average price for 1985.

Deputy Naughten.—We are not dealing with 1985, so that is understandable. How many hectares were planted over the last two years?

Mr. Whooley.—Afforestation and re-afforestation in 1983 was 6,827; in 1984, 6,959; and in 1985, 6,288 hectares.

Deputy Naughten.—Why did it drop so much in 1985?

Mr. Whooley.—It depends on the availability of resources.

52. Deputy Ahern.—Is it due to the embargo that you are not allowed take on enough staff?

Mr. Whooley.—No, I am talking of financial resources.

Deputy Ahern.—What about manpower resources?

Mr. Whooley.—The embargo would apply, but our real problem would be the availability of funds.

Deputy Ahern.—If you were given finances would you be able to take on a lot more manpower on the ground planting trees? Would there be scope for that?

Mr. Whooley.—Yes. We could take on more and we could also plant a lot more if we had the resources. I would like to get that point across.

53. Deputy Naughten.—But you have the manpower there anyhow on the ground?

Mr. Whooley.—Not enough of people permanently, but naturally we take on a lot of workers on a temporary basis for planting.

54. Chairman.—May I make just one point? Can you utilise the social employment scheme?

Mr. Whooley.—We have investigated that and the reply we got from the Department of Labour was that it is not available to us for ordinary forestry work. We are still looking into the matter in the hope that we could use it for certain jobs. I personally—and I know my Minister would feel the same — would like to see it used for certain jobs that at the moment we may not be able to do in regard to the maintenance of the forests due to lack of funds. I would like to see it availed of for that.

55. Deputy Naughten.—So would I, as a matter of interest. I think it is stupid that you cannot avail of it. How many hectares have you at present ready or coming on-stream for planting over the next two years? In other words, how much of the land you acquired since 1983 has been planted?

Mr. Whooley.—I will have to speak from memory on this. We have a total plantable reserve of the order of 40,000 hectares but a substantial part of that would not be available for planting. I have not got the figures. I think there is a Dáil question to be answered either today or next week on this matter, that gives some figures. I cannot recall the figures offhand but could I send you the information?

Deputy Naughten.—I would appreciate it.

Mr. Whooley.—The total plantable reserve is 40,000 hectares but that would include areas for wildlife conservation, land that would be blocked from planting because of turbary rights, grazing rights or lands in regard to which the legal formalities for acquisition had not been finally cleared. The total available for planting would be about half of the total but I would like to confirm that.

Deputy Naughten.—Occasionally, one comes up against the problem where the Forestry acquire lands near to someone’s house and very often the land owner feels that he can utilise the lands better for agricultural purposes than the Forestry can for forestry or, alternatively, he may be afraid to have a forest very close to his house. What is the policy of the Department in that situation?

Mr. Whooley.—To the extent that we can. Deputy, we try to be reasonably accommodating. We do not go out to grab — a bad word — agricultural land or land that has agricultural potential, but sometimes we are asked to do very awkward things. For example, we may have an area half developed and planted. It may be five or six years old and suddenly someone asks us to sell that land to him. That is a different position.

Deputy Naughten.—That is a different question to the one I asked.

Mr. Whooley.—Normally we try to be reasonably accommodating at the stage of acquiring land unless it would block or impede in any way the further development of the forest plantation in regard to access etc.

56. Deputy Mitchell.—Very briefly, could Mr. Whooley get some information for me on the state of the population of the fox and whether it will need to be protected at some stage or not? I would like to hear further about that if I could.

Mr. Whooley.—I will do the best I can, I am sure that the wildlife section of my Department will be able to make some “guesstimates”— but I expect they will be “guesstimates” — as to fox population.

Chairman.—Thank you, Mr. Whooley.

The witness withdrew.

The Committee adjourned.