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

AN COISTE UM CHUNTAIS POIBLÍ

(Committee of public Accounts)

Dé Céadaoin, 12 Samhain, 1986

Wednesday, 12 November, 1986

The Committee met at 9.30 a.m.

Members Present:.

DEPUTY D. FOLEY in the chair

Mr. P. L. McDonnell (An tArd-Reachtaire Cuntas Agus Ciste) and Mr. P. Furlong (Department of Finance) called and examined.

VOTE 12—OFFICE OF THE ATTORNEY GENERAL

Mr. Matthew Russell called and examined.

173. Chairman.—Paragraph 24 of the Report of the Comptroller and Auditor General reads:

Subhead E. — General Law Expenses

The miscellaneous law expenses of the Chief State Solicitor’s Office, including the cost of stamping court documents, are met from this subhead. In October 1984 it came to light that amounts paid to a staff member in respect of the stamping of court documents and other expenses had been claimed fraudulently over a number of years. I asked the Accounting Officer how these irregularities occurred and the nature of the controls applied prior to payments being made. I also asked if he was satisfied that revised procedures introduced following the discovery of the irregularities were such as to ensure that there would not be a recurrence and I sought information as to the amount involved in this instance and what action had been taken to recover the loss.

The Accounting Officer informed me that, from the evidence available, the irregularities occurred where the officer concerned presented petty cash vouchers for cases which did not exist, for documents which did not need stamping and for witnesses’ expenses in cases where there were in fact no witnesses.

He also informed me that the practice when issuing funds from petty cash was to accept the officer’s signature on the voucher certifying that the expenditure was being necessarily incurred as stated. These paid vouchers supported the requisitions made periodically by a senior official for replenishment of the funds disbursed.

The revised procedures provide for each voucher to be authenticated by a senior official before presentation for payment, having satisfied himself as to the purpose for which the money is required. The Accounting Officer assured me that he was satisfied that these procedures will prevent further irregularities being perpetrated.

He stated that the extent of the defalcation in this instance has not as yet been determined but that he considered the possibility of recovering any of these monies to be remote.

Mr. McDonnell.—There is just one paragraph on the Office of the Attorney General in my 1984 Report. It is one of the rare occasions when I have had to have a paragraph on the Vote for that Office. It deals with an irregularity which occurred in the Office of the Chief State Solicitor. My concern was that there appeared to be weaknesses in the internal control which may have facilitated the perpetration of this irregularity. As you will see from this paragraph, it seems that there was a need for some improvement in the internal control procedures there. You will also see from my report that the Accounting Officer has assured me that these improvements have been implemented. That is about all I have to say. At the date in 1985 of my report I did not have information about the extent of the irregularity.

174. Deputy Crotty.—I wonder if the Accounting Officer could inform the committee if it has been ascertained how much money was defrauded in this instance? Is it known at present?

Mr. Russell.—No, Sir. The exact amount is not known. Investigations established a positive loss of at least £1,100. In order to arrive at a more precise figure — and it would be higher than that — a great deal of work requiring very lengthy sifting through several thousand documents would have been required; and in view of other demands on the staff and the belief that it would be impossible to recover the money from the officer in question, this was not done.

Deputy Crotty.—In other words, you are saying that your Office has no intention of ascertaining what was the total amount?

Mr. Russell.—That would be the present intention.

Deputy Crotty.—What is the extent of pretty cash in your Office over a 12 month period or over any period?

Mr. Russell.—The petty cash float in question is, of course, that held in the Chief State Solicitor’s Office. It is normally kept at a level of £1,000 and, as this is diminished the Department of Finance are requested to top it up again. That is the manner in which it is done.

Deputy Crotty.—How long was this fraud going on?

Mr. Russell.—It is believed that it commenced approximately two and a half years before it was detected.

Deputy Crotty.—Are you satisfied that fraudulent behaviour could carry on in an Office like yours for two and a half years without detection?

Mr. Russell.—No, it is a very unsatisfactory event which caused a great deal of uneasiness in the Office, particularly since it was the first case of dishonesty in 50 years detected among any of the staff of the Attorney General. Immediately on its detection, measures were taken to change the system.

Deputy Crotty.—How many staff are in your Office?

Mr. Russell.—In the Chief State Solicitor’s Office there would be approximately 130.

Deputy Crotty.—It is hard to believe that there could be fraudulent conversion of funds of £1,100 in a pool of £1,000 petty cash at any time. How can you explain that there could be fraudulent conversion of that much funds in a small amount of money? It was a small pool?

Mr. Russell. —Yes.

Deputy Crotty.—There must have been no controls available?

Mr. Russell.—I do not think I would entirely agree with that. The defalcations were carried out in the form of small sums throughout; that is to say, a sum would be claimed in respect of expenses for a witness or a stamp on a court document or a payment of that type. The amounts involved were small and they were carried out at irregular intervals. Thus there were no startlingly large or noticeably large demands upon the fund, which was used by a number of officers in the High Court section.

Deputy Crotty.—What has happened to the officer concerned?

Mr. Russell.—He has been dismissed.

175. Chairman.—It must be very obvious to you that there is a weakness in the internal control of your Office to say that this could continue for a period in excess of two and a half years.

Mr. Russell.—There was such a weakness, Sir. I accept that.

Chairman.—Are you now satisfied that that position is remedied?

Mr. Russell.—In so far as it is humanly possible, I am.

176. Deputy G. Mitchell.—I want to ask a question on a different subject. I want to ask specifically about expenditure made by the Attorney General’s office in connection with the Kerry Babies tribunal.

Chairman.—It is not coming up here.

Deputy G. Mitchell.—It is under the question of fees paid by the Attorney General’s office to barristers.

Chairman.—Not in this year.

Deputy G. Mitchell.—It did arise in 1984.

Chairman.—I will leave you in on the Vote on the same point.

177. Deputy Naughten.—I understand that I heard the Accounting Officer say that he reckoned £1,100 was misappropriated?

Mr. Russell.—A minimum of that.

Deputy Naughten.—What could the maximum be?

Mr. Russell.—It is very difficult to assess but it is believed it would not be in five figures.

Deputy Naughten.—What belief have you for that? How do you ascertain that? Have you established the length of time this was going on?

Mr. Russell.—We believe it was going on for two and a half years.

Deputy Naughten.—But it could have been going on for much longer?

Mr. Russell.—Not much longer; at a maximum, three and a half years.

Deputy Naughten.—Why are you so sure that it was only going on for three and a half years?

Mr. Russell.—Because the duties of the officer concerned only allowed him access to it over that time.

Deputy Naughten.—But it could be as high as £10,000?

Mr. Russell.—It is possible.

Deputy Naughten.—Were the controls not extremely lax to say that they could have allowed for this type of situation?

Mr. Russell.—Unfortunately, a good deal of trust has to be placed on the officers who are paying these fees, either to other solicitors’ offices or to the court offices in the High Court, in the sense that there is the constant daily requirement of payment of these fees, often arising at short notice. Short of appointing another officer to stand over, so to speak, and do very little else other than stand over, each of the officers who had access to this float it would not be possible totally to rule out this sort of defalcation.

Deputy Naughten.—Can I take it then that you have somebody standing over those officers at present?

Mr. Russell.—Each officer must now obtain the signature of a superior officer before he makes a demand.

Deputy Naughten.—Why was that not done prior to this?

Mr. Russell.—In 50 years this had not happened. This, of course, is not a total answer. I am very much conscious of that.

Deputy Naughten.—Are you sure it did not happen?

Mr. Russell.—Yes. In so far as one can be certain about any human matter, I am certain it did not happen.

Deputy Naughten.—Would you not accept that, the Accounting Officer for that Department, the person in control of the funds of that Department, was equally as responsibile as the person who is taking the funds in so far as adequate and proper control procedures were not introduced in that Office?

Mr. Russell.—An Accounting Officer must take responsibility for any loss. I accept that. In the case of small withdrawals from a petty cash float one has to strike a balance between the extent of the access to that float one can give officers who are seeking to withdraw, say, £4, and the cost to the public of requiring that officer to submit his £4 requirement to a variety of more highly paid people who would devote their time to scrutinising the validity of the request. It is, unfortunately, a matter of balance, particularly in a large office which is working under rather constant pressure, which is the difficulty about an office which services the courts.

Deputy Naughten.—Surely every step should be taken to ensure that a repetition of this will never happen again?

Mr. Russell.—Yes. I agree with that and the moment the matter was detected the system was changed.

Chairman.—We will move on to the Vote.

178. Deputy G. Mitchell.—I want to come to the question of the costs of barristers and solicitors who are hired by the Attorney General’s office and, indeed, by the Chief State Solicitor’s office and the DPP’s office, but I will not deal with the DPP’s office just now. Is Mr. Russell aware that arising from the Kerry Babies Tribunal, for instance, Thomas O’Dwyer and Co., Solicitors, representing 25 gardaí were paid £344,763, that Downing, Courtney and Larkin, solicitors, representing three superintendents, were paid £324,586 and that Patrick Mann and Co., solicitors, representing the Hayes family were paid £351,323 and that in addition counsel for the State—

Chairman.—Sorry, Deputy, this does not come under this brief.

179. Deputy G. Mitchell.—I am just about to indicate where it does come in, if I could finish the sentence. In addition £155,292 was paid to counsel for the State and counsel for the Tribunal, presumably by the Attorney General’s office. The Tribunal only sat for 85 days but could Mr. Russell tell me, in relation to expenditure of this kind, what control there is in his office in relation to fees charged by barristers and solicitors acting for the State? If he cannot tell me specifically about the Kerry Tribunal case could he tell me in general what controls there are?

Mr. Russell.—Fees for counsel appearing for the State in all matters, both court matters and also the Kerry Tribunal, are fixed by the Attorney General. It is not a matter of counsel presenting a bill. They are paid such fee as the Attorney General considers fit and appropriate for the work carried out by counsel.

Deputy G. Mitchell.—Would the Attorney General be head of the Bar?

Mr. Russell.—Yes, the Attorney General is leader of the Bar and in addition it has been the practice invariably that counsel accept, with greater or less reluctance sometimes, the fee fixed by the Attorney General for them.

Deputy Lyons.—I always knew he was not qualified for the job.

Deputy Naughten.—That comment is unwarranted and grossly unfair.

180. Deputy G. Mitchell.—In the case of this particular tribunal, but generally in regard to tribunals, 85 days costing the State £1.175 million — what sort of fees do they expect if they are not happy with the fees set by the Attorney General?

Mr. Russell.—The figure you quote I think includes the costs you mentioned a moment ago, am I correct?

Deputy G. Mitchell.—Yes.

Mr. Russell.—These costs are paid by the Department of Justice out of their Vote in connection with tribunals of inquiry. The fees paid by the Attorney General were counsels’ fees in respect of counsel who appeared for the Tribunal and counsel who appeared for the State.

Deputy G. Mitchell.—Is it not a fact that for most of the 85 days the four counsel representing the Tribunal and the State had nothing to do? They sat there, did nothing, and got paid £155,291.

Mr. Russell.—No, I could not agree with that. Counsel appeared for the Tribunal in order to ensure that the case was adequately presented to the Tribunal, that no side in the case, as I will call it, was enabled to present an unbalanced picture to the Tribunal, that all matters which the Tribunal required to be elicited in public were elicited in public and that nothing was concealed by any side to the case. That was the function of counsel for the Tribunal. Counsel for the State were necessary because the Tribunal’s counsel, being neutral counsel, could not “defend” the State. Therefore, the State’s interests had to be safeguarded by the presence of counsel.

Deputy G. Mitchell.—You are aware of the two senior rule. In this case there were three firms of solicitors and there were 14 counsel for a tribunal. In general, the head of the Bar, the Attorney General, sets the fees and yet the members of the Bar think the fees are rather low. Why do you think it is necessary to hire two counsel and a junior counsel to represent the State in cases? Why do we pay for two senior counsel and one junior counsel?

Mr. Russell.—I might say, first of all, that what is commonly called or, indeed, miscalled, the two senior rule is not a rule which binds the Attorney General, if indeed it exists. In some cases it is necessary that there should be two senior counsel and a junior counsel, depending on the complexities of the case, the size of the case and the nature of the case, or the time when the case is heard. The Attorney General will authorise the retention of two seniors only in cases where he considers it appropriate to do so. It is not a matter for counsel to decide that there shall be two seniors in the case although frequently, owing to the exigencies of their practice or the circumstances I have just mentioned, they ask for it. Sometimes their request, if made, is granted and sometimes it is refused, but the Attorney General does not see himself bound by any two senior rule nor does he apply one.

Deputy G. Mitchell.—Do you not think it outrageous that this is really a case of a closed shop, that the Attorney General can set fees for barristers who can engage may be even three barristers on either side in any case and yet they are dissatisfied with the rate of these fees despite the fact that the fees are enormous and despite the fact that it is a closed shop operation? Is it not really an area that needs to be turned on its head? Is it not an area that is badly in need of reform and is it not an area that is costing the State a small fortune?

Mr. Russell.—I am afraid I would have to disagree with a number of those questions or assertions. The Attorney General fixes the fees paid to his counsel. He has no control over the fees demanded by counsel in the marketplace. With barristers, as with people in humbler avocations, whether it is mending a fuse in a house or selling a head of cabbage, it is what the market commands that has to be paid. If you do not want to pay the proper——

Deputy G. Mitchell.—I sometimes doubt if it is humbler though.

Mr. Russell.—If one does not wish to pay the electrician the fee he asks for then one does without one’s fuse being mended. If the State does not wish to have its interests represented in court by counsel, or by counsel of merit and ability, then it will have to settle for the second, third or fourth best and in the long run that will cost the taxpayers a great deal more money than it would if they got the best counsel. But the fees paid by the Attorney General to his counsel are regarded by the Bar, almost universally I think, as less than the fees which they would obtain in the marketplace from ordinary litigants.

Deputy G. Mitchell.—May I just say in reply, if you want to hire an electrician you do not have to hire an engineer to instruct the electrician and when you take on one electrician you do not have to take on three electricians or, as in the case of this tribunal, 14 electricians. That argument does not stand, the whole matter needs to be greatly reformed.

Mr. Russell.—I would suggest that the analogy is better drawn with the person entering hospital for an operation. He will not find one person prepared to empty his bed pan, give him an anaesthetic, open him up, and then give him pills afterwards. He will find himself engaging a number of people to perform these different tasks. I think that is the analogy which is more accurately drawn with the Bar than that of the electrician.

Deputy G. Mitchell.—The likelihood is that, if he pays a surgeon to do the job, that is the man who will turn up on the day and have read his brief.

181. Chairman.—As Chairman, I would like to make a statement that I want to dissociate myself from the remarks and the insinuations made by Deputy Mitchell with regard to the legal profession involved in the Kerry Babies Tribunal. I believe the fees involved were set by the Attorney General and he is the man that is responsible for the fees.

Mr. Russell.—Thank you. Sir.

182. Deputy Naughten.—Could the Accounting Officer inform the committee of the total cost of the tribunal?

183. Chairman.—Sorry, Deputy. There is a Dáil question down on that point.

Deputy Naughten.—I am sure that will not prevent the Accounting Officer from—

Chairman.—There is a Dáil question down. I am not allowing that question.

Deputy G. Mitchell.—Chairman, are you acting as chairman of the Committee or a Deputy for Kerry here this morning?

Chairman.—I am acting as Chairman—

Deputy G. Mitchell.—I think it was rather biased of you. It is out of order. You are out of court this morning.

Chairman.—This does not come into the brief this morning. There is a Dáil question down on that. I, personally, have a question down.

184. Deputy Naughten.—I was not aware that there was a Dáil question. The matter has been raised here and discussed. I think it is a reasonable question for the committee to ask, since there has been a wide-ranging discussion on it, with regard to the approximate cost to the State from the Attorney General’s office as distinct from other costs. I would imagine that the question you have down is the cost to the State. I am referring to the Attorney General’s office.

185. Chairman.—I will not pursue the point, but I will just say to you and I will leave it to yourself — that, being from Kerry, I have a Dáil question down on that point. So, if you want to pursue your question, right. But I wanted to tell you that I have a Dáil question down to the Minister for Justice on that point. So, if you wish, you can pursue your point.

Deputy Naughten.—I take it, Chairman, that the question you have down would be dealing with the overall cost.

Chairman.—The overall cost of the Kerry Babies Tribunal.

Deputy Naughten.—Right. What I am asking is the cost to the Attorney General’s office, which is a different question. There are different costs involved.

Chairman.—It is the same thing. It is the overall cost of the Tribunal which the Attorney General is responsible for. I will leave it to yourself. I do not mind. I just want to put it on record.

Deputy Naughten.—All I would say is — I do not want to take issue with you on this — but is it a question that if, for example, there are Dáil questions down on other Votes, we may be prevented at a later stage from asking questions relevant to that Vote if there is a Dáil question?

Chairman.—I made my point. It is not within the brief of the Vote we are discussing here this morning. I allowed Deputy Mitchell in, as a matter of courtesy, because he asked me so—

Deputy Naughten.—If you are ruling me out on the grounds that it is not within the brief of the Vote we are discussing, I accept that. But we could be getting into a very grey area if you were preventing me from asking the question because there was a Dáil question on the Order Paper.

Chairman.—No, I am just telling you that I personally have a Dáil question down. However, if you wish I will let you pursue it, but I am telling you I personally have a Dáil question down, being from the area involved.

186. Deputy Crotty.—I want to say — I am talking against my own colleagues here now — that the Chairman is very liberal here. Actually, he is too liberal because we go into matters of policy, which we should not be discussing here. We should be questioning the Accounting Officer on the brief before us and on the disbursement and the spending of the funds which were voted to them and if they were voted correctly. I do not think the Chairman is being unreasonable.

187. Deputy Naughten.—As I said, I have no objection if you are ruling me out because it is not within the ambit of the Vote. I would seriously question ruling me out because of a question on the Order Paper. That is all I will say.

188. Deputy Mitchell.—There is a Vote this morning for £340,000 for Counsel’s fees and that is quite a legitimate matter to examine on.

Chairman.—If it comes within the brief of the Vote before us.

189. Deputy Lyons.—On that point that you have just raised, does the item that has been discussed now come within the terms of reference of the 1984 accounts?

Chairman.—No.

Deputy Lyons.—How did you allow something that will have to come up again on the 1985 accounts and partly on the 1986 accounts? I suppose Deputy Gay Mitchell has to be complimented for getting into the media headlines at this stage, and he will have two more runs at it when we are doing 1985 and 1986.

Chairman.—I want to say in fairness——

Deputy Lyons.—Let me finish, Chairman. We are discussing this matter now without the observations of the Comptroller and Auditor General. It will come up again, and it is likely to come up again and again and again.

Deputy G. Mitchell.—Could I just say to Deputy Lyons that I have a well known interest in the question of reforming the courts — I have a Private Members Bill in the House — and the questions I put were every bit as relevant to the fees that are voted here this morning as they were to the costs.

Chairman.—We will stick to the Vote before us.

Deputy Lyons.—I have no problem with reforming, as Deputy Mitchell said. Of course, this item that he raised needs to be examined even more fully than we have done this morning.

Chairman.—And it will.

Deputy Lyons.—I want to make the point that this examination we have gone through this morning, untimely as it is, is insufficient, in my view. The whole area of that tribunal, and perhaps others as well, will have to come under our scrutiny.

Chairman.—Assuming we are still here when we are discussing the 1986 accounts. I will leave Deputy Mitchell in. We will stick to the Vote. Any further questions on that Vote.

190. Deputy Crotty.—Getting down to subhead D. — Fees to Counsel — £320,000, how many Counsel were involved in those fees?

Mr. Russell.—A total of 159.

Deputy Crotty.—What was the largest sum paid to any Counsel?

Mr. Russell.—I am afraid I have not the figures before me for that. These figures are frequently given, however, in answer to Dail questions. However, I regret to say that I have not the copy of a reply given in the Dáil recently. Therefore, I cannot answer that question.

Deputy Crotty.—Could the Accounting Officer make that available to us in a note, Chairman?

Mr. Russell.—Certainly.

191. Deputy Crotty.—How are Counsel employed by the Attorney General’s Office? Is it on ability or on a rota or specialisation in any particular field? How does he employ or retain Counsel?

Mr. Russell.—The Attorney General is bound by statute, namely, the Prosecution of Offences Act, to distribute State work among Counsel on the basis of ability. Indeed, even apart from that statute, that is the only way of getting value from Counsel, because, like every other occupation, Counsel vary in ability and in experience and particular expertise. The Attorney General, who is familiar with the qualities of members of the Bar, selects Counsel on the basis of “horses for courses”. There are some Counsel who excel at matters of personal injuries, the assessment of compensation for personal injuries, and there are others who deal with matters of patent law, law of contract, and so on, and he selects Counsel on the basis of their abilities and experience in the particular field of litigation in question.

Deputy Crotty.—I see. Are there particular panels set up for different areas by the Attorney General’s Office?

Mr. Russell.—Not panels, but the names of Counsel who are expert in given areas are known to the Attorney General and to his officers; and, geographically, of course, there are also circuits upon which Counsel practise. Consequently, in a case in the Circuit Court in, say, Kilkenny, one would select a Counsel who practises on that circuit to represent the State, unless the case was — and this is a rare event — something of an extremely specialised kind in which Counsel from another circuit would be selected to represent the State.

192. Deputy Crotty.—I see. On costs and fees received by the Chief State Solicitor’s Office, £65,000 was realised. What are these costs and fees?

Mr. Russell.—These are cases where the court has awarded costs to the State against a litigant. These are pursued by the Chief State Solicitor and recovered from the litigant in question, wherever possible. That possibility naturally depends in large measure upon whether the person has money or not.

193. Deputy Crotty.—How can you explain then this Vote realised more than was estimated? I am sure the Chief State Solicitor’s Office is aware of the awards that are made to the State.

Mr. Russell.—When a case begins one cannot be certain of the outcome and one does not know the outcome until the court gives its decision. That decision will either award costs to the State or it will not. If costs have been awarded to the State, it is then a matter of pursuing the party concerned to extract the money from him. This can be a long drawn out process. If the person has no real assets it is a process which would cost a great deal of money and realise nothing. In any given case, when it begins, unless the litigant happens to be a notoriously wealthy person, one is unlikely to know in advance whether, if one wins, one will be able to extract the money.

194. Deputy Crotty.—What were the total awards made to the State Solicitor for 1984?

Mr. Russell.—It would not be possible to say what the total of costs awarded were because the normal verdict of the court is typically, “dismiss the plaintiff’s action against the State and award costs to the State”. The amount of costs in that case could not be ascertained until, in the first place, the costs were taxed before the Taxing Master and the certificate of the Taxing Master emerged stating a figure. It is only then that one knows how much the costs in that case are. The Taxing Master charges a fee for taxation and therefore if one is seeking to recover costs against a person who has no assets the State does not waste money proceeding to a taxation, paying a fee on it and spending the time of people in the taxation, when it knows it will not be able to recover a penny at the end of it. In that case all one would know about the costs were that costs were awarded to the State but that they were irrecoverable.

195. Deputy Crotty.—Who decides whether or not a client has money? Can there be hidden assets? How is this ascertained? It seems extraordinary considering that awards are not pursued in all cases. Who decides whether a client has funds or assets of any kind?

Mr. Russell.—The inquiries and investigation made into this matter are similar to the inquiries and investigations that would be made by any solicitor representing any member of the public who had the misfortune to find himself involved in litigation with somebody. It is a commonplace that a solicitor will say to the client “You have won your action but the man who sued you has no money at all”. Therefore, it is an empty formula to seek to recover the costs against him; the man just has not got them. This is a commonplace of litigation, unfortunately, which has existed, I suppose, since litigation was invented. The State is in no worse a position than any litigant in this regard.

196. Deputy Crotty.—Finally, there is extra remuneration for two officers for duties as delegates at meetings abroad. Was this the total cost of those meetings and what were the meetings?

Mr. Russell.—These meetings in general would be meetings of the EEC in Brussels, and such allowances are mainly recoverable from the EEC.

Deputy Crotty.—In this case were these recoverable?

Mr. Russell.—I believe they were in large measure, but I cannot say precisely how much of the £638 was recovered. It would be possible to obtain that information.

Deputy Crotty.—Could you give us information on that please?

Mr. Russell.—Yes.

196. Deputy McGahon.—A very brief inquiry concerning subhead G. — Law Reform Commission. What exactly do the Law Reform Commission do? What do we get for an expenditure of £282,000.

Mr. Russell.—I hope I will not be entering areas of policy in my reply. The Law Reform Commission were set up by the Oireachtas in the belief that the law required reform in a manner which was not being utilised to date. Until the Law Reform Commission were set up law reform tended, it was believed, to be rather spasmodic and each Department was responsible for proposing law reform in this particular area. The belief was expressed in the Oireachtas that Departments varied between each other in regard to the enthusiasm with which they pursued law reform. It was thought that a centralised agency charged with law reform over a wide area and dealing with law reform only, and therefore not distracted by the day-to-day activities which ordinary Departments have to engage upon, would be a more efficacious way of reforming the law. The Law Reform Commission therefore were set up and produced a succession of papers and reports advocating law reform in a variety of areas. In some of these areas the Oireachtas have accepted and acted upon the Law Reform Commission’s recommendations. In other areas the recommendations are being considered by the relevant Departments. In other areas the recommendations of the Law Reform Commission were not accepted.

Deputy McGahon.—Could I ask you is it still in being? Is it an on-going situation and how many people are involved?

Mr. Russell—At the moment the Law Reform Commissioners have not been appointed following the expiry of the terms of office of the last Commissioners. The staff of the Law Reform Commission, that is, the research staff, the people who do what I will call for want of a better word, the donkey work, in producing material for the Commissioners are at work on the programme which had been drawn up by the outgoing Law Reform Commission and approved by the Government.

197. Deputy McGahon.—Do you see a need for continual upgrading by the Commission of various aspect of law? Is it something that we are going to have to live with in the future?

Mr. Russell.—The Law Reform Commission?

Deputy McGahon.—Yes.

Mr. Russell.—Lawyers tend to think that the law is perfect and does not need reform, but I understand that view is not widely shared. I presume therefore that there will always be a call for law reform by people who are dissatisfied with the law in a given area at any given time. I am not aware of any decision — but it would be entirely a policy decision — that the method of law reform which involves a Law Reform Commission is to be replaced by any other method of law reform.

Chairman.—Thank you, Mr. Russell.

Mr. Russell.—May I make one point of clarification, Sir? When speaking about the delegates’s allowances paid to the officers — the question which Deputy Crotty raised — I was in error when I said that the delegate’s allowances are recoverable. What is recoverable from the EEC is the travel and subsistence expenses of officers travelling to the EEC. The delegates’ allowances are not recoverable. I am sorry if I misled the committee.

Chairman.—All right, Mr. Russell. Thank you.

The witness withdrew.

VOTE 19 — CIVIL SERVICE COMMISSION

Mr. Paul Casssidy called and examined.

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

Mr. Cassidy.—Thank you, Chairman.

198. Deputy M. Ahern.—I see in front of me in Vote 19 an unusual happening. It is less than granted expenditure for each heading?

Mr. Cassidy.—That is right.

199. Deputy Ahern.—That is peculiar. What happened in 1984 that there was not as much spent as was granted?

Mr. Cassidy.—The basic reason that that happened in 1984 was that there was a general fall-off in some areas of our work which reflected some decisions we made. For instance, the executive officer school leaver competition was interview only. We did not run a written examination. Some competitions, such as the clerical assistant competition were cancelled that year. Some competitions were amalgamated as well. In fact, we decided that, starting in that year, for competitions such as the clerical officer competition and the adult executive officer competition we would hold them on a biannual basis, that is, every two years instead of one. That was reflected generally in a fall-off in work. We re-deployed some of our staff. It also led to reduced costs in terms of examiners’ fees, printing fees and so on.

200. Deputy L. Naughten.—While I notice there is a substantial drop under the heading A.2 — Examiners, etc. — the same drop does not appear under heading B.1 — Travelling and Incidental Expenses. In fact, the reduction there is very small. One would imagine that there would be an appropriate reduction on the expenses there.

Mr. Cassidy.—There is not necessarily an exact correspondence between them. Looking at heading A.2, that heading includes fees for superintendents, examiners, medical examinations, chairpersons of interview boards, etc. As I said, some of the school leaver written examinations were not held, so therefore our fees to superintendents and examiners for those things would have been considerably reduced. On subhead B.1 — Travelling and Incidental Expenses — that is made up of travelling and subsistence, official entertainment and miscellaneous expenses, which includes cleaning services and so on. Cleaning services and things like, newspapers, and so on, are fairly fixed. The official entertainment, if you want to use such a term, basically consists of our giving lunches to people from the private sector, managing directors etc., who give their time free to us and get in return a lunch every day of the interview board. The travelling and subsistence expenses did fall fairly considerably. Within the B.I provision we had estimated £71,000 for travelling and subsistence and £53,000 is the figure I have here for the out-turn. A lot of travelling and subsistence would arise in relation to local authority competitions where the local authority would provide us with people for interview boards, they would come up to Dublin and their travelling and subsistence would be paid by us. There was not such a fall in work on the local appointments side; but at the end of the year we would get back that money from local authorities through an arrangement we have with them, which comes under Appropriations-in-Aid.

201. Deputy McGahon.—To what do you attribute the drop in overall volume of work and why did it occur?

Mr. Cassidy.—As I say, there were a number of decisions we took. We did not hold some school leaver competitions that year. We did not hold the clerical assistant competition that year, and we did a few other things which reduced the volume of work. We substantially dropped our staff numbers that year. At the beginning of the year our authorised figure was 203 and we had dropped to 159 by the end of the year. Over the period since 1981 — we have dropped actually from 216 people to 138 at the end of 1984, which I think is probably the most substantial drop in numbers within the Civil Service. In other words, we reacted to the situation; we did not hold people.

202. Deputy Crotty.—Could the Accounting Officer inform us where were these people employed subsequently? Were they dismissed from the Civil Service?

Mr. Cassidy.—Really, basically in three ways. Firstly, there was a real drop in authorised numbers, which meant that posts went. Secondly, there was a number of vacancies left unfilled. Thirdly, we gave some people on loan to places such as the Ombudsman’s Office, which was being set up at the time and which needed a back-up at the initial stages to get them going.

203. Deputy Crotty.—On subhead C. — Post Office Services — there is a fairly large reduction. In the explanation it notes that there were ”Fewer examinations” — naturally that caused a reduction — but it goes on” and new procedures adopted to reduce postage costs…” What were these new procedures?

Mr. Cassidy.—There were basically two reasons for that. Firstly, before the Post Office went semi-State the situation was that when people wrote to Government Departments they would not have to pay postage but we would have to reimburse the Post Office for the cost of that postage. When they went semi-State that situation was changed. The other reason and possibly the main reason is that we introduced a procedure designed to reduce costs whereby we did not acknowledge applications for posts. Before that we used to acknowledge every application. We do not acknowledge applications now but we inform candidates that if they have not heard from us by X date they should contact us. That saved us a considerable amount in postage.

Deputy Crotty.—I am sure it would also save staff.

Mr. Cassidy.—Yes, we have reduced our staff considerably.

The witness withdrew.

VOTE 20—OFFICE OF THE OMBUDSMAN

Mr. D. Curran called and examined.

Chairman.—I understand this is your first time to appear before the committee, Mr. Curran. You are very welcome.

204. Deputy Naughten.—In 1984 your expenditure was £243,000. How many staff were employed then and how many staff are employed now? Has your workload greatly increased over the past two years? What is it costing to run your office in 1986?

Mr. Curran.—At the end of 1984 we had 18 staff employed but from April 1985 the remit of the Ombudsman was extended greatly. In 1984 we were only dealing with the Civil Service and we had four investigators and one senior investigator to look after the Civil Service end of things. From April 1985 we took over health boards, local authorities, Bord Telecom and An Post. That meant we had then four units in the office in each of which there were four investigators and a senior investigator. That is a total of 16 investigators and four senior investigators. We also took on some more clerical staff bringing the total number of staff in the office at present to 40.

205. Deputy Naughten.—Did your workload increase substantially with the introduction of health boards, Bord Telecom and others? Have you more complaints in regard to bodies like the health boards and Bord Telecom than you had from the Civil Service?

Mr. Curran.— Yes, we have. In the first year we had about 2,000 complaints and a significant proportion of those were invalid in the sense that they were not within our remit. So you could say that in the first year we had about 1,300 valid complaints. When the health about 1,300 valid complaints. When the health boards, local authorities and Bord Telecom came into our remit the numbers increased dramatically. In 1985 the number of valid complaints shot up to about 5,500. We would have had about another 1,000 invalid complaints as well. Approximately 500 or 600 would have come from local authorities and about 400 from health boards.

205. Deputy Naughten.—What is the response of Government Departments, health boards and local authorities to your queries and investigations?

Mr. Curran.—The response is improving dramatically. The greatest number of complaints relate to the Department of Social Welfare. In the last year we received well over 1,200 quick responses from the Department of Social Welfare. Officers at higher executive officer or assistant principal officer level have come back to us and changed their own decisions when we told them the facts of the case. That is without conducting any formal investigation into the case, but just pointing out the facts of the case to them. Without that sort of co-operation we could not have dealt with the number of complaints we dealt with.

206. Deputy Naughten.—Do you find, for example, that senior executive officers, or CEO’s, try to justify the decision they have taken, or rather do they tend to accept the argument you put forward and adhere to your request?

Mr. Curran.—We find both. It depends both on the Department and, significantly, on the level at which the decision was made. Generally we find that the higher the level at which the decision was made the less likely we are to get a quick response saying they had made a mistake. In those instances we tend to get a letter back very quickly justifying the original decision and no great readiness to look anew at the case. That applies really only to a small number of Departments and even within those Departments, generally speaking, only to the very top layer of management.

207. Deputy G. Mitchell.—Could you tell me what the success rate in the Ombudsman’s office is? You must have some measure of success. Secondly, could you tell me the number of complaints you received in relation to Telecom Éireann with regard to telephone bills and your success rate there?

Mr. Curran.—In relation to the success rate generally — and I put success in quotes — if you talk about complaints resolved in favour of the complainant that is certainly one benchmark of success. As I said, in 1985 we had about 5,500 complaints and one-third of all cases completed would have been resolved in favour of the complainant. In other words, we would have examined or investigated those complaints and found that the complaint made to us was justified, that the Department, health board or local authority or whatever, were wrong in their original decision. In another one-third of those cases the actual decision complained of might not have been wrong but the people who came to us were probably looking for the wrong thing, so we were able to direct them to other areas where they had a right of benefit or grant or whatever. In the other one-third we would have found in favour of the public body.

Deputy Mitchell.—And Telecom Éireann?

Mr. Curran.—With regard to Telecom Éireann we are finding in favour of the complainant in a smaller number of cases now. We have found in favour of Telecom Éireann in 41 per cent of cases.

Deputy Mitchell.—And against them? Would that mean that 59 per cent—

Mr. Curran.—No, because a number are discontinued or withdrawn. The process is fairly—

Deputy Mitchell.—How many in favour of the subscriber?

Mr. Curran.—About 29 per cent in favour of the subscriber.

Deputy Mitchell.—And the total number of complaints against Telecom Éireann?

Mr. Curran.—We keep a two year running total for Telecom Éireann because the time span can be long in some cases. The total number received was 2,524.

208. Deputy McGahon.—With no disrespect, Mr. Curran, I want to suggest that the Office of the Ombudsman is unnecessary in this very small country. I think we are simply aping the British. I do not believe that the Office of the Ombudsman has been particularly successful. Certainly, in regard to people from my region, I am unaware of any success. I feel that the Office is simply duplicating the work of public representatives and T.D.’s in particular. For a workforce of 40 dealing with 6,000 queries, that is not a particularly high number, because many T.D.’s would have to deal possibly with up to 5,000 queries a year, depending on the area that they come from. I feel that many of the Ombudsman’s clients are disaffected people who go from one T.D. to another pursuing a hopeless cause. I feel that the Office of the Ombudsman is simply duplicating the work of public representatives, and from my observance you are not particularly successful. The cost of the Office of Ombudsman is likely to escalate in the years to come and I do not believe it is justified in a country so small as Ireland. Could I finally ask you: was the building which you occupy bought out of public funds or was it a new cost to the State?

209. Chairman.—In fairness to Mr. Curran, that is a matter of policy. There is another forum in which to raise that question.

Mr. Curran.—May I just reply to some of the points made? In relation to the situation in the United Kingdom, if it is aping any country it is not aping the United Kingdom. The United Kingdom does not have an Ombudsman; they have a parliamentary commissioner, which is not just a different title, in fact he has different functions. The United Kingdom Ombudsman or parliamentary commissioner has a staff of investigators of about 99 people and a lot of clerical staff, but the number of complaints that he investigates is about 200 in a year. That perhaps highlights the work that an Ombudsman’s office does on complaints. We do not deal with representations. We do not ask a Government body or any public body to do something for somebody. We have statutory powers of investigation where we can go in and look at any file, any document, interview anybody in the organisation from the top to the bottom. It is not just a matter of writing to the Department and getting their reply. We are not necessarily satisfied with their reply. We can investigate. We can go from the top to the bottom. Our success — and there has been success — to a great extent is in the number of cases that we have resolved in favour of the complainant, where they have been writing to Departments over a period of years.

210. Deputy McGahon.—Are you suggesting that people in the Departments have given wrong decisions to the public over the years and people in local authorities? Are you suggesting that local authorities do not receive submissions from T.D.’s or public representatives on behalf of these people and give them the proper treatment? Are you suggesting that you have greater access to fair play and that you always get that fair play?

Mr. Curran.—No, I am not suggesting that there is any element of unfair play on the part of local authorities or Government Departments. What I am saying is yes, we do have greater access to the files, the documents and to the people who made the original decision. I am not suggesting that there is any question of malpractice on the part of the people who made the original decision. Every large organisation makes some mistakes and what I am saying is that, when we go in and look at the files anew and put some new evidence to the people, that very often — and this is the point I would like to stress — they themselves change their decision.

211. Deputy McGahon.—In that area do you have any difficulty in getting local authorities or health boards and so on to reverse their original decisions?

Mr. Curran.—We would have difficulty originally. When we do an investigation and when we look at the files and when we get more information from the complainant, very often it is the complainants’ fault in the sense that they do not present their own case adequately. When we present additional information and additional evidence and when we talk to the person who made the original decision, they themselves are in a position to see the case in a different light. That is what has been happening in a large number of cases.

Deputy McGahon.—So, overall you would view the first year of the working of the Ombudsman as being successful?

Mr. Curran.—Certainly, one test would be this. Every country in Europe has an Ombudsman. All I can say is that by reference to any other ombudsman’s office in Europe that I know about, the Irish Ombudsman’s Office is hugely successful.

212. Deputy Crotty.—It would appear that the staff in the Ombudsman’s Office has increased fairly dramatically from 1984 to the present. I think the Accounting Officer mentioned from 18 to 40?

Mr. Curran.—Yes.

Deputy Crotty.—Is this justified, taking into consideration the number of cases handled by the office, 5,500? The Accounting Officer mentioned that a lot of these would be trivial matters that would be dismissed quickly. We are all aware of these sorts of situations. That would boil down to reduce them to half of that. So you would be talking about a case or a case and a half per week for each of the staff in the office? Is that justified? Is the office excessively staffed? Is there staff there just for the case of building up an office, as usually happens in these type of organisations, that you have Parkinson’s Law?

Mr. Curran.—I hope not. The fact is that, even with the number of complaints we are receiving at the moment, we are finding it difficult enough to complete the cases in a short time. The cases are not all equal. Of the 5,000 cases, some are more easily dealt with than others. Many of the Department of Social Welfare cases are relatively easy to deal with. The more difficult ones we find are health board cases. They on average tend to take a lot more time to deal with than any other type of case. It is difficult to take just a number of cases and decide on an average number for each investigator. While there are clerical staff involved, there are only four investigators per area.

213. Deputy Crotty.—The clerical staff is fairly extensive? Could the Accounting Officer explain to us what particular type of problem he has with the health boards and why the difficulty arises particularly with the health boards?

Mr. Curran.—The problems by their nature are very often far more complicated. We very often have to get in touch with medical consultants and medical people involved in the decision. While we cannot disagree with the medical opinion, very often the medical opinion or the involvement of a doctor has been complained about and has contributed to the complaint. We have to interview a lot of people in the health board area. By definition, the complaints in the health board area, particularly, say, in relation to either hospital care or entitlement to hospital benefit abroad or something like that, by their very nature are far more complex than, say, an application for a house grant to the Department of the Environment. These cases take a lot more time than would an ordinary case from a Department.

Deputy Crotty.—I am not particularly happy with the reply regarding health. Could we get in a note some sort of expansion of the reply in relation to the problems that are encountered by the office with health boards and why there should be so much time of this office taken up, particularly with the health section? I agree with the Accounting Officer that in regard to State grants for reconstruction or new houses you either qualify or do not qualify. It does not bear investigation; it can be dismissed out of hand. I am sure, as Deputy McGahon mentioned, that the same people have travelled the circle so that it is well travelled by the time it reaches the Ombudsman’s Office. It is the same with the Department of Social Welfare — a phone call and in most cases it can be fixed in two minutes. I feel, maybe it is not justified, that the office has built up very quickly to a large office. I just want to be satisfied that it is justified. If we could get the problems that are encountered in the health board and the steps taken to investigate them I would be quite happy.

Mr. Curran.—Yes, I can do that. In reply to you, Deputy, I was conscious that I cannot give examples of individual cases because these are confidential——

Chairman.—If you could supply a note, it would suffice.

214. Deputy Naughten.—I would have to disagree with both of my colleagues. I think the Ombudsman’s Office is doing an excellent job and anything I have heard about it leads me to compliment you and your staff on the excellent job you are doing. This has not happened to me, but I know of cases where in dealings with health boards — seemingly it is because of the grey area of eligibility for particular services — the minute your office got on about it the client’s request was acceded to, whereas numerous other representations made before that were turned down flatly.

Chairman.—I wish to be associated with these remarks because I know of cases too where you have been very successful and I wish to congratulate you on the tremendous work your office are doing.

Deputy Crotty.—If that is the situation, I think that there are grey areas for the health boards and they need to be investigated.

Chairman.—I would accept that. I know of particular cases where the Ombudsman has been very successful.

Deputy Crotty.—The note from the Ombudsman will be of benefit to us. The situation should not arise where the Ombudsman’s Office must be contacted.

215. Deputy McGahon.—I would like to disassociate myself from the comments which infer that the health boards are not doing their job. In the area that I represent, the NorthEastern Health Board are an outstanding success and are very humane in their dealings with cases. I certainly feel that they could not be doing a better job. Could I ask Mr. Curran if he has complaints about medical examinations? Does he have complaints about appeals against disqualifications for sickness benefits? Do you have many of those complaints?

Mr. Curran.—We do. Before I answer that, I would like to clarify my own position in relation to the health boards. I did not mean to imply that the health boards were any worse or any better than anyone else. What I was saying was that the nature of the complaints in the health boards are such that they take a longer time to examine.

Deputy McGahon.—Yes, because you have to get in touch with a lot of——

Mr. Curran.—With a wide range of people.

Deputy McGahon.—And they are not always available?

Mr. Curran.—That is right.

The witness withdrew.

VOTE 13—OFFICE OF THE DIRECTOR OF PUBLIC PROSECUTIONS.

Mr. S. O’Leary called and examined.

216. Deputy Crotty.—How many people are employed in this office?

Mr. O’Leary.—There are 19.

217. Deputy Crotty.—Generally, what is the function of the office?

Mr. O’Leary.—To decide who shall be prosecuted with what.

Deputy Crotty.—In regard to subhead D. — Fees to Counsel — how many counsel were involved? There was an expenditure of £810,000.

Mr. O’Leary.—In 1984 there were 30 senior counsel and 89 junior counsel. I have a list here which I could hand in to you.

Deputy Crotty.—How are these employed? Is there a panel set up, or how do the office decide on who should represent them in a particular case?

Mr. O’Leary.—There are panels. There would be a panel for Dublin and after that there would be one prosecuting barrister for each county. For example, Cork would be sub-divided into three.

Deputy Crotty.—This is for Circuit Court work?

Mr. O’Leary.—Yes.

Deputy Crotty.—How are these panels formed? How does counsel get into a panel?

Mr. O’Leary.—By reputation. In other words, if they are good enough.

Deputy Crotty.—Through their expertise.

Mr. O’Leary.—Yes.

Deputy Crotty.—Is there any reason at any time to remove someone from the panel?

Mr. O’Leary.—It can arise.

Deputy Crotty.—Does it arise?

Mr. O’Leary.—It has arisen.

218. Deputy McGahon.—In reply to Deputy Crotty’s question about what your function is, you replied to decide who to charge with what? Does that mean you decide every case in the country and do Garda superintendents not have any input into it?

Mr. O’Leary.—Yes, of course they do. That was a very brief answer. Every case in the country cannot pass through our hands. We simply could not cope with them and most cases in fact are commenced without reference to the Director but, in the ultimate, only the Director can decide whether any case can go before a jury. Of course other cases can be referred to us and, ideally should be if time permits, before charges are preferred.

Deputy McGahon.—Do you consult with the local superintendent?

Mr. O’Leary.—We rely completely on the Garda. We can only act when they bring us into action.

Deputy McGahon.—So basically they direct you?

Mr. O’Leary.—They advise and recommend charges.

Deputy McGahon.—They advise, so basically they are deciding?

Mr. O’Leary.—They can charge in the first instance without reference to us at all except in certain cases.

Deputy McGahon.—Then why should they have recourse to you at all?

Mr. O’Leary.—Because, firstly, nothing can move before a jury without our say so. Secondly, certain things can only be dealt with in the District Court with the Director’s permission. Thirdly, any case that is brought in the name of the Director can be stopped by the Director if he thinks the evidence is not sufficient.

Deputy McGahon.—In the case of Gardaí being prosecuted, obviously you would make the decision. There would not be any involvement by Garda personnel even at a very top level?

Mr. O’Leary.—They would investigate it the same as any other crime.

Deputy McGahon.—They would give you a recommendation?

Mr. O’Leary.—Yes.

Deputy McGahon.—Do you monitor the cases in any way? Do you take cognisance of the results of cases involving Garda personnel?

Mr. O’Leary.—We note them if we see what happened.

Deputy McGahon.—But it is not your function to take any further action?

Mr. O’Leary.—No, once we present our case to the court that is the end of it as far as we are concerned.

Deputy McGahon.—Has John Citizen any comeback against the Office of the DPP? Can you be brought to court?

Mr. O’Leary.—If we commit a crime.

Deputy McGahon.—I am not suggesting that you commit a crime, but can a citizen take the Office of the DPP to court? can he take a civil case against the DPP?

Mr. O’Leary.—If he can prove that the DPP or any officer of the DPP had been guilty of a civil wrong.

Deputy McGahon.—He would probably need the help of the Holy Ghost, but it is possible to do so?

Mr. O’Leary.—The same as it is possible to sue any citizen for anything.

Chairman.—No further questions. Thank you, Mr. O’Leary.

Deputy Crotty.—We are getting the list?

Mr. O’Leary.—Yes

The witness withdrew.

VOTE 18—OFFICE OF THE MINISTER FOR THE PUBLIC SERVICE.

Mr. Kevin Murphy called and examined.

Chairman.—You are very welcome.

Mr. Murphy.—Thank you, Chairman.

219. Deputy Crotty.—On subhead A.2 — Consultancy Services — I note you had £107,000 less than granted. Could we have an explanation of why and what the consultancy services involve and entail, please?

Mr. Murphy.—The consultancy subhead covers a wide range of items. In some cases it is the cost of consultants who participate in management surveys of other Departments. It also covers administrative research work which the Institute of Public Administration does for the Department. The reason for the surplus there largely rises from the fact that we do not engage consultants unless we feel it is absolutely necessary. While we had expected a number of fairly large projects in Departments in that year — in the Department of Social Welfare for example there was a big survey — where we thought we would use consultants, in the event we did not use them on the scale we expected and that is the explanation for that.

220. Deputy Crotty.—On subhead B.1 — Travelling and Incidental Expenses — expenditure was £75,000 more than granted. Could we have an explanation for that?

Mr. Murphy.—Yes, in fact that subhead covers quite a lot of things other than travelling. It is travelling and incidental expenses and the excess in 1984 was due largely to expenditure on public service advertising. You may recall that, in an effort to improve the image of the Civil Service and to highlight the changes which had been introduced by the then Minister in relation to making civil servants less anonymous by wearing name badges and giving their names when answering the telephones, there was an advertising campaign which included advertising on television under the logo of, I think, “It’s all part of the service”. We spent more money on that than we had anticipated at Estimates time.

Deputy Crotty.—Was the campaign successful and are all the officers carrying out the duties which were related to them at the time, particularly civil servants? In other words, has the campaign been carried through, or was it just a campaign for that year?

Mr. Murphy.—I think so, definitely. One will always find isolated incidents where perhaps one could find cause for complaint, but I would like to feel that we could say that in terms of relations with the public generally and particularly in public offices there has been quite a distinct and noticeable improvement.

Chairman.—No further questions.

VOTE 21 — SUPERANNUATION AND RETIRED ALLOWANCES

Mr. Kevin Murphy further examined.

Chairman.—No question.

VOTE 49 — INCREASES IN REMUNERATION AND PENSIONS

Mr. Kevin Murphy further examined.

Chairman.—No question. Thank you, Mr. Murphy.

The witness withdrew.

VOTE 44 — FOREIGN AFFAIRS

Mr. S. Donlon and Mr. P. Furlong (Department of Finance) called and examined.

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

Office of Public Works Suspense Account

Reference was made in paragraph 50 of the 1980 Report to the accumulation of a large balance, including £1 million of unidentified items, on the suspense account to which the Department of Foreign Affairs charges expenditure which it has incurred on the construction, furnishing and maintenance of Irish embassies and official residences abroad and which is recoverable from the Office of Public Works (OPW).

In 1984 it was noted that the balance on the account included expenditure of £520,000 incurred prior to 1983 which OPW has not accepted as properly chargeable to its Vote. As this amount has, therefore, not as yet been charged to any Appropriation Account I enquired as to what action was being taken to investigate the nature of the expenditure and to determine how it should be treated. I also enquired whether all the items of expenditure constituting the £520,000 were properly authorised in the first instance and why it had not been accepted by OPW as a charge to its Vote.

The Accounting Officer has informed me that £300,000 relates to the period May 1978 to September 1982 and falls into four categories:

In the case of rents and associated charges the Accounting Officer saw the problem as stemming from OPW’s insistence that the expenditure be analysed in detail and this was a time consuming task. He explained that because obligations in relation to such charges were defined in lease agreements, and such agreements were never entered into without the approval of OPW, his Department’s view was that such amounts should be refunded without the need for excessively detailed breakdowns.

In the case of the next two categories some £113,000 of the £151,000 was in respect of fitting-out costs and purchase of furniture for embassy premises in Jeddah and Beirut for which the prior approval of OPW was not obtained. However, OPW had since accepted the expenditure in question as necessary but the Department of Finance had not yet sanctioned it.

The remaining £55,000 in respect of the period May 1978 to September 1982 is made up of a large number of small items and some more substantial ones, including some for which approval had been sought from but not yet given by OPW. These would arise wherever it proved impossible to await formal prior approval by OPW but the Department’s standing instructions to its missions abroad emphasise the importance, except in emergency situations, of awaiting such approval of all proposals involving expenditure which is proper to the Vote for Public Works and Buidlings.

In regard to expenditure of £220,000 relating to the period prior to May 1978 the Accounting Officer has informed me that the Department has yet to be advised by OPW as to what this represents and of the reasons for withholding refunds.

Mr. McDonnell.—This paragraph in my report for 1984 on the Foreign Affairs Vote relates to expenditure incurred on Irish missions abroad. The expenditure on repairs, maintenance and so on of the Irish missions abroad is chargeable to the Vote for the Office of Public Works, which the committee discussed last week. In practice what happens is that the expenditure is met in the first instance by the embassies abroad and when the embassy accounts come into headquarters recoupment is sought by the Department from the Office of Public Works. This paragraph deals with the delay or perhaps the difficulties the Office of Public Works had in accepting certain items of expenditure properly chargeable to its Vote. The result is that this expenditure has not been charged to any appropriation account even though it has been incurred quite some time ago. The committee will see that there has been some problem about this before because it was referred to in my 1980 report. In the report for 1984 which is now before the committee I have referred to the uncleared balance of expenditure incurred prior to 1983 on the basis that it did not seem unreasonable to me that all of that expenditure might have been identified and allocated before the end of 1984. In his reply, which is in the paragraph, the Accounting Officer divides this into expenditure which was incurred prior to 1978 and expenditure incurred from 1978 onwards. He divides it into a number of categories. He has analysed it and he has explained the situation in regard to each of these. In doing so, in regard to the first category, he makes a very valid comment about the rents, but in regard to one of the other items I understand that the Department of Finance have not yet sanctioned the excess expenditure on the embassy at Jeddah. In regard to expenditure relating to the period prior to 1978 the committee will see from the last four lines of the paragraph that there were still some difficulties to be resolved. The overall balance in this account is, of course, changing constantly. The £520,000, incurred prior to 1983 is actual expenditure up to September 1982. Because of a technical difficulty in getting accounts from the Embassies abroad in before the end of the year the practice is to have the expenditure for the 12 months up to the previous September charged in any one calendar year’s account. That £520,000 has been reduced to £281,000 but amounts are constantly being added to that in respect of the more recent expenditure arising. As far as I am aware, the same difficulties have not arisen in identifying and clearing items in more recent years.

222. Chairman.—How much did it cost to fit out and furnish the embassy at Jeddah and how much of this money was approved and not approved?

Mr. Donlon.—The figures available to me are that the total cost of the scheme, which was for adapting, fitting out and furnishing the building was £233,000 of which initially £146,000 had been sanctioned. If you recall the nature of the job being done and the local conditions which had not been encountered previously either by ourselves or by the Office of Public Works, it is reasonable to say that when the project was initially approved we did not have a complete idea of what was needed, particularly to meet the local climatic conditions. Not all of the work, and in particular not all of the costs incurred in furnishing, have yet been sanctioned by the Department of Finance. Approximately £87,000 remains unsanctioned. We are confident that that will be cleared up fairly quickly.

223. Chairman.—Just to make a point, more than £100,000 was over-expended on the original estimate.

Mr. Donlon.—We are talking about additional items rather than about cost over-runs. As work proceeded it became clear to the people on the spot, to the ambassador and to the local project architect engaged by the Office of Public Works that the work which we had thought at the beginning would be sufficient to meet the needs was not sufficient. For example, you need very efficient air-conditioning plants to cope with local climatic conditions — something we had no previous experience of. These conditions also dictate the nature and quality of furnishing needed. These problems came to our attention only as the project proceeded.

Chairman.—Surely a situation like that is far from satisfactory, on the basis that if that was in a private enterprise it would not be acceptable as the original estimate was in the region of £140,000. Was it the Board of Works who carried out this work?

Mr. Donlon.—Most of the work was carried out under the supervision of the Board of Works but the Board would not have carried out the detailed work on the ground.

224. Deputy Naughten.—With regard to the uncleared balances, has that situation improved since the date of this report?

Mr. Donlon.—Yes, the situation now, as the Comptroller and Auditor General says, is that the uncleared balances are now approximately £281,000 as opposed to £520,000 at the time of the writing of his report.

225. Deputy Naughten.—There are a number of figures referred to in paragraph 57. What does the £281,000 that has not been approved by the Board of Works consist of?

Mr. Donlon.—The figure is approximately made up of the following: expenditure incurred pre-May 1978 of £220,000 — we await from the Office of Public Works the reasons why refunds are being withheld — and for the subsequent period, the remaining figures relate to matters such as rents, services charges, maintenance and new works.

Deputy Naughten.—Would this be rents on embassies abroad or rents here?

Mr. Donlon.— This would relate to rents on buildings abroad. There are approximately 80 buildings abroad leased on behalf of the State by the Office of Public Works. Most of these are rented on, perhaps, a ten-year lease which would have a built-in escalator clause. The main difference between the Office of Public Works and ourselves is that we have to pay the rent as it increases automatically under the escalator clause. The Office of Public Works take the position that each time there is an increase they must examine the increase and the reasons for the increases. Meanwhile, someone has to pay the rent, including the escalator clause, because we are legally obliged to do so under the terms of the lease assigned.

Deputy Naughten.—That would be understandable if, for example, there was a rollover situation for six months or eight months. We are talking about years here rather than months.

Mr. Donlon.—Yes, but you are talking about a Vote which is not within my control.

Deputy Naughten.—What you are suggesting then is that the procedures applied by the Board of Works towards refunding the Department of Foreign Affairs are too rigid and that they are not refunding the moneys they should be refunding? Is that correct?

Mr. Donlon.—I do not think as an Accounting Officer I would ever say that another Accounting Officer was too rigid in the application of his procedures. The procedures are there. They were not devised either by me or by the Accounting Officer of OPW. We have to live with them and that is what we are seeking to do. But there is no doubt that the procedures are creating the difficulties that you referred to.

Deputy Naughten.—But the OPW would have approved of the terms of lease of those buildings, I understand, when they were leased?

Mr. Donlon.—That is correct.

Deputy Naughten.—It would appear from what you are saying that they are not prepared to abide by the terms of these leases. Is that correct?

Mr. Donlon.—No, they have to review each time. It is not that one Department has a role in this, there are two and sometimes three Departments involved.

226. Deputy Naughten.—Chairman, could we have the views at this stage of the Department of Finance on this particular issue?

Mr. P. Furlong (Department of Finance). —Just to outline as briefly as I can the role of the Department of Finance, and to re-iterate that as the Accounting Officer has already pointed out, there are two Departments involved — OPW and the Department of Foreign Affairs. Likewise in the Department of Finance there are two separate sections involved. The Foreign Affairs section of the Department of Finance is responsible for giving approval in principle to the negotiation or renegotiation of leases. This is given on the basis of applications submitted by the Department of Foreign Affairs. That then is used by the Office of Public Works as the basis for going through the process that the Accounting Officer had already outlined. To the extent that the Office of Public Works have difficulty with the detailed terms, they are then, submitted for decision to the Department of Finance section responsible for the Office of Public Works. The fact that there are two separate Departments involved and two separate sections in the Department of Finance may complicate matters, but the procedure is clearcut. Approval in principle is given by the Foreign Affairs section in the Department of Finance. Office of Public Works then negotiate the details and if they have problems they get covering sanction for the expenditure from the Office of Public Works Vote section in the Department.

227. Deputy Naughten.—It would appear that covering sanction should have been given for some of this money quite some time ago?

Mr. Furlong.—I am not aware of the details, but in practice I can assure the Deputy that any requests for sanction presented to the Department of Finance are cleared very quickly. There is no delay at all on routine matters like that in the Department.

228. Chairman.—Could I suggest that we adjourn now until 12.15 p.m.?

Sitting suspended at 11.15 a.m. and resumed at 12.15 p.m.

Chairman.—Deputy Naughten is in possession.

229. Deputy Naughten.—I was asking the Accounting Officer about the balance of the £222,000 which is for pre-May 1978. You stated that you were waiting for the Board of Works to come back to you with clarification? Is that right?

Mr. Donlon.—I am sorry, I did not hear that.

Deputy Naughten.—The £220,000. I think you stated that you were awaiting the Board of Works to come back with clarification as to what those items were? Is that right?

Mr. Donlon.—That is correct.

Deputy Naughten.—Would you not have submitted the bill to the Board of Works for expenditure on offices under your control rather than the other way around?

Mr. Donlon.—We would have submitted the bills. The Office of Public Works begin to refund the cost to us. Sometimes we have to await clarification as to which items they have immediately accepted and which items require further examination. When they have completed their internal processes sometimes they may have to go to the Department of Finance for sanction, or they may have to come back to us for further clarification. It is not unusual that they would authorise the payment of part of a bill immediately or authorise the refund to us of part of a bill. They would initiate inquiries relating to the balance of the bill. When I say we are awaiting clarification it is in relation to items which they could not at first sight authorise refunds to us.

Deputy Naughten.—But you are awaiting clarification for eight years for some of those.

Mr. Donlon.—In some cases that is correct. Because of an ever-diminishing balance the figure has dropped now quite substantially, but obviously we continue to try to clear it as quickly as possible.

Deputy Naughten.—Is it not practically impossible to justify expenditure eight, nine or ten years ago?

Mr. Donlon.—It becomes more difficult as time goes on. It is never impossible, assuming the firms we dealt with are still in business. Very often we can provide the clarification from our own information. It has not up to now proved impossible although as time goes on it can become more difficult.

230. Deputy Naughten.—With regard to the over-run on embassies in Beirut or in Jeddah, what was the total cost of the embassy in Jeddah?

Mr. Donlon.—Could I preface my remarks by pointing out that I am not the Accounting Officer for the expenditure incurred. Therefore I am relying on information provided to me by the Accounting Officer of the Office of Public Works. As an Accounting Officer I do not have responsibility for funds used in connection with the purchase, leasings, maintenance or repair of buildings abroad.

Deputy Naughten.—Just hold it there until we get some clarification on this. It was my understanding that your Department request that certain works be carried out. Is that correct?

Mr. Donlon.—We are the client and we identify a need. We draw that need to the attention of the Office of Public Works but they are the people who have the professional expertise needed to assess how that need can best be met and it is they who proceed from then on. For example, we draw the attention of the Office of Public Works to the fact that the Government have decided to establish resident diplomatic relations with Saudi Arabia and that we will require accommodation in Saudi Arabia. We give the Office of Public Works our view of the approximate space needed, and other requirements, and then they produce the solution to the problem that we have identified for them. Then they proceed in close consultation of course with us. We do not have within the Department of Foreign Affairs, for example, architects or engineers or surveyors and therefore we have no professional expertise in the area of property.

Deputy Naughten.—But surely you would be concerned with the cost of providing this accommodation and the cost of providing it?

Mr. Donlon.—Naturally we are all concerned with the cost but that is not the responsibility of the Department of Foreign Affairs. That is the responsibility of the Office of Public Works to whom the money is voted by you and your colleagues in the Dáil. No money is voted to the Department of Foreign Affairs for property purposes.

Deputy Naughten.—But the work is carried out on behalf of the Department of Foreign Affairs. Any work that was carried out in Jeddah was carried out—

Mr. Donlon.No. No building work of any description can be carried out on behalf of the Department of Foreign Affairs. All we can do is to identify a need to the Office of Public Works. Then they decide how that need might be met and then the work carried out in Jeddah or anywhere else is carried out on behalf of the Office of Public Works not on behalf of the Department of Foreign Affairs.

Deputy Naughten.—The money is out of the Vote for Foreign Affairs, is that not right?

Mr. Donlon.—No. It is met out of the Vote for the Office of Public Works. We facilitate the Office of Public Works to this extent that, in the first instance, we will pay a bill, in, for example, Saudi Arabia because we happen to have a bank account there. Then the bill is forwarded to the Office of Public Works for a refund to us. There is no money in the Vote for Foreign Affairs spent on property.

Deputy Naughten.—It is spent on furnishings and fittings.

Mr. Donlon.—No, all of that comes from the Vote for the Office of Public Works.

231. Deputy Naughten.—Could I have the Comptroller and Auditor General in on this? We are discussing paragraph 57 which deals with over-runs in that Department which have occurred as a result of expenditure in certain embassies.

Mr. McDonnell.—I think the Accounting Officer is making a distinction between carrying out something on behalf of the Department of Foreign Affairs in the sense that the expenditure is not going to be a final charge on the Department of Foreign Affairs. Obviously the expenditure by the Board of Works is not carried out on behalf of the Department of Foreign Affairs. The expenditure, as he says, is ultimately going to rest on the Office of Public Works. As I understand it, the initial disbursement of funds on the particular works that might be undertaken is done through the account of the embassy, whatever it may be and is then recoverable. It is a final charge, as he says, on the Office of Public Works. The problems arise where, as it is said in the paragraph, expenditure may be incurred for whatever reason and the process of having the need accepted as something which is to be met by the Office of Public Works takes place perhaps either at the same time or perhaps afterwards.

232. Deputy Naughten.—That clarifies the situation for me in so far as that we are in order in asking for details with regard to the costings of embassy accommodation, the provision of embassy facilities in Jeddah.

Mr. Donlon.—I will certainly answer any questions.

233. Deputy Naughten.—I asked what the overall cost of it was.

Mr. Donlon.—The figure which I will provide for you is the figure provided to me by the Office of Public works. On that basis the cost of the adaptation, fitting out and furnishing the Embassy at Jeddah was £233,000.

Deputy Naughten.—How much was approved?

Mr. Donlon.—Of which, before the work started, £146,000 was approved.

Deputy Naughten.—What was the reason for the size of the over-run in costing there?

Mr. Donlon.—The over-run — although I think the word “over-run” is not an appropriate word to use in this instance — additional work become necessary — the cost of that additional work was £87,000. The items covered by that £87,000 are as follows: additional interior painting and additional exterior repaintin. Both of those arose because of the pace at which paintwork in Saudi Arabia deteriorates as compared with the pace of deterioration here in Ireland. It is the first time we had property in that area and we deiscovered that repainting is required on a relatively frequent basis. A third additional item that arose was the need to erect wooden fencing around the property to provide for privacy in accordance with the very strick local custom. We had not been aware until then that it was necessary to shield off, for example, all activity in a garden so that the passers-by could not see it. That would be regarded as offensive in the area.

Chairman.—I am sorry, Mr. Donlon. We have to break for a vote.

234. Deputy Naughten.—We had established that the cost involved in the Jeddah embassy was £233,000 and that there was an over-run. Have the Department of Finance approved this over-run in expenditure?

Mr. Donlon.—With respect, it was not that there was an over-run.

Deputy Naughten.—I will re-phrase it. Additional work — additional work was undertaken which has been the subject of discussion with the Department of Finance to get sanction. The Department of Finance have accepted that the expenditure was appropriate and while the formal sanction has not yet arrived it is expected that it will arrive shortly. When were the Department of Finance approached to approve this additional expenditure?

Mr. Donlon.—Again, I am being put in some difficulty because it is not my Vote. I have never seen a file. This is handled by the Office of Public Works and it is the Office of Public Works who would obtain sanction from the Department of Finance. I am operating only on the basis of information provided to me by the Office of Public Works and that would not include such detail as this.

Deputy Naughten.—So it is the Office of Public Works who are seeking sanction for the additional expenditure and not the Department of Foreign Affairs?

Mr. Donlon.—That is correct.

Deputy Naughten.—I am genuinely confused as to why it should be referred to in a paragraph dealing with Foreign Affairs if it is the Board of Works who are seeking sanction for the over-run.

Mr. Donlon.—Because, in the first instance, we pay the bill to satisfy the local builder.

Deputy Naughten.—Surely you did not pay the bill without the Department of Foreign Affairs or the Office of Public Works approving the payment since, as you stated earlier, you had not the technical expertise to decide whether the amount of money due was correct or whether the work that was carried out was approved.

Mr. Donlon.—We would, generally pay the bill only when the work had been inspected and approved by an OPW representative. In this case an assistant principal architect expressed satisfaction with the result.

Deputy Naughten.—An architect from the Board of Works approves of the payment by the Department of Foreign Affairs?

Mr. Donlon.—Yes.

Deputy Naughten.—But when the Department of Foreign Affairs seek recoupment from the OPW they say, “No, we cannot do that”.

Mr. Donlon.—They never say no, they just say, “wait”.

Deputy Naughten.—But they have not paid it.

Mr. Donlon.—Well, they have not refunded it to us yet.

Deputy Naughten.—So they are not accepting the documentation by their own architects? Is that correct?

Mr. Donlon.—You are bringing me into an area that I am not very familiar with. I do not know the internal procedures of the Office of Public Works other than that I know there is a professional technical side and there is an administrative side.

Deputy Naughten.—I do not know the internal procedures between the Department of Foreign Affairs and the OPW but you cannot blame me for being somewhat confused.

Mr. Donlon.—Certainly not.

Deputy Naughten.—It was my understanding that your Department had sought approval from the Department of Finance for this additional expenditure.

Mr. Donlon.—Such matters relating to buildings are handled by the Office of Public Works and that includes seeking the appropriate sanctions from the Department of Finance. In the exceptional case of Jeddah we provided the Department of Finance with additional detailed clarification.

235. Chairman.—I would like to call in the Comptroller to clarify that.

Deputy Naughten.—I am certainly confused about it.

236. Chairman.—I would like to clarify the position with regard to the payments.

Mr. McDonnell.—As I said in my report that the Office of Public Works had since accepted the expenditure but the Department of Finance had not yet sanctioned it. That is correct. I thought in this instance that the Department of Foreign Affairs had corresponded directly with the Department of Finance on it. That is the information in my brief. I have a letter dated 29 November 1985 to the Department of Finance from the Department of Foreign Affairs dealing with this item. I do not know whether the procedures were different in relation to other expenditure but certainly what I say in the report is correct. I know Deputy Naughten’s concern is that I gave the impression that the Department of Finance had been requested by the Department of Foreign Affairs to sanction it. That is where his difficulty lies. As I understand it, I did not give a wrong impression. I have a letter here dated 29 November 1985 from the Department of Foreign Affairs to the Department of Finance.

Mr. Donlon.—Could I add to that that I think the letter the Comptroller is referring to is an 18 page submission.

Mr. McDonnell.—It is.

Mr. Donlon.—It was prepared in consultation with the former Ambassador to Jeddah and it was an attempt to give the fullest possible background, given the exceptional circumstances of the expenditure. At the request of the Department of Finance in this exceptional case we prepared a very detailed document for them explaining why we thought the disputed expenditure should be sanctioned.

237. Deputy Naughten.—What date was that?

Mr. Donlon.—I do not have the precise date. It was November 1985.

Deputy Naughten.—That sanction has not come through yet?

Deputy Naughten.—It has not yet come through.

238. Deputy Naughten.—Why has the sanction not come through?

Mr. Donlon.—I am not in a position to answer for another Department. I take it the Department of Finance are continuing to examine the matter and will go to the OPW with queries and perhaps come back to us with queries, so that they can satisfy themselves in relation to all aspects of the expenditure.

239. Deputy Naughten.—Am I correct in my understanding of the situation that in fact the embassy in Jeddah is being or has been transferred to Riyadh?

Mr. Donlon.—Yes, you are correct.

Deputy Naughten.—When was it transferred?

Mr. Donlon.—The transfer was finally completed approximately ten months ago.

240. Deputy Naughten.—So the £233,000 spent on this embassy is lost so far as the Irish taxpayer is concerned?

Mr. Donlon.—No. It the first instance, that money related to accommodation which was provided for the period approximately 1977 to 1985. We are talking about accommodation extending over an eight year period. Secondly, although again I do not have the information, I imagine that the building at Jeddah was taken on a fixed lease and that we knew exactly what the period of the lease was and we were putting the building in order for that period but not for an additional period. Again I must explain that this is not a matter for which I am the Accounting Officer and in regard to any requests put to me I in turn have to seek the information from the Accounting Officer of the Office of Public Works.

241. Deputy Naughten.—You will appreciate that there appears to be some confusion between your office and the Office of Public Works because in 1983, in paragraph 28, the Office of Public Works seemed to convey that their expenditure on preparing plans for an embassy at Riyadh was because of misunderstandings, or misinterpretations, or lack of precise detail as to what the Department of Foreign Affairs wanted. That was the impression given by the OPW to this committee with regard to their expenditure of upwards of £500,000 in preparing plans for an embassy out there?

Mr. Donlon.—You will recall that this particular topic was the subject of a special meeting of the committee at which I provided the information, and I am happy to do so again. I do not think that was the interpretation either of the Office of Public Works or of the Department of Foreign Affairs. The central issue there was that we sought a particular type of accommodation which was accepted as reasonable by the Office of Public Works and approved by the Department of Finance. But then in changed economic circumstances, following the Government’s decision to curtail public expenditure, we were asked to go back to the drawing board and see if we could devise a cheaper alternative, and that was what was done. But, again on the detail, it was entirely a matter for the Office of Public Works, the matter of hiring of consultants and payment of fees.

Deputy Naughten.—But in between the Irish taxpayer picks up the bill? That is the bottom line on it. We are talking here of upwards of £^1/4 million spent on an embassy together with rent. Have you any idea what the rent on that embassy was?

Mr. Donlon.—I am afraid I do not know, but I could ask——

Deputy Naughten.—Together with rent on an embassy which had been rented and in respect of which all of the expenditure now is no longer relevant, that is no asset to the Irish taxpayer?

Mr. Donlon.—With respect, we knew when we incurred the expenditure, precisely the number of years we were covering. It was not expenditure undertaken with a view of being there for 20 or 25 years; it was expenditure undertaken to meet the identified and predicted needs of an eight year period.

Deputy Naughten.—Would you not consider that expenditure of this type on a rented building for an eight year period was excessive?

Mr. Donlon.—Not by reference to the local costs in Saudi Arabia. Again, I should say that, while we request that space, it is a matter for the Office of Public Works to accept the arrangements as reasonable, and a matter for the Department of Finance to approve it; and in respect of the bulk of this expenditure all those procedures were complied with. In other words, we identify the need and the Office of Public Works comes up with what they regard as a reasonable solution in the circumstances. That is put to the Department of Finance who approve it.

Deputy Naughten.—But who have not approved it though?

Mr. Donlon.—Who have approved all except approximately £87,000.

Deputy Naughten.—That is a sizeable amount of the expenditure involved?

Mr. Donlon.—I accept that.

242. Deputy Naughten.—Chairman, could we have the Department of Finance’s view as to why approval has not been granted in this particular case?

Mr. Furlong.—If I may refer to what I said earlier on this morning that, as the Accounting Officer for the Department of Foreign Affairs has pointed out, there are two separate interests involved. Responsibility in the Department of Finance, is split between that section of the Department dealing with the Department of Foreign Affairs, which approves in outline plans for accommodation and that section of the Department dealing with the Office of Public Works which is responsible for detailed implementation. The dispute in the case of the Jeddah Embassy arose, I think, because of a misconception or misunderstanding between the Office of Public Works and the Department of Foreign Affairs as to what exactly was involved. The Department of Finance section dealing with the Office of Public Works has been attempting to establish the facts of the situation and, as the Accounting Officer has pointed out, the lengthy minute of November 1985 provided by his Department was an attempt to clarify information which was in dispute between the Office of Public Works and the Department of Finance. Following the receipt of that information the section of the Department of Finance dealing with the Office of Public Works is now satisfied that, if all of the items in dispute had been separately identified at the outset, they would have been approved by the Department of Finance. Secondly, the Office of Public Works accepts that the expenditure is properly chargeable to their own Vote and this position has been only established relatively recently, in the last month or two. The reason why formal sanction has not issued — and formal sanction will in fact go to the Office of Public Works, not to the Department of Foreign Affairs — is that in the context of what has happened there have been discussions between the Department of Finance and the Department of Foreign Affairs about procedures generally for controlling and monitoring expenditure on embassies overseas, and the formal sanction which ultimately issues will be based on a clear understanding of the position of the Department of Foreign Affairs relative to Finance and Office of Public Works for the future. It has been done, if I may say so, in the context of procedures which were developed and formalised by the Department of Finance sometime after this issue first arose. I refer in particular to the procedures for controlling and monitoring expenditure on investment projects covered by the Department of Finance circular 1/83.

Deputy Naughten.—When did this issue first arise as far as the Department of Finance is concerned?

Mr. Furlong.—I cannot give you very detailed information on that because I do not have Vote responsibility in Finance for the Office of Public Works. I can say that the detailed information provided by the Department of Foreign Affairs and by the Office of Public Works enabled my colleagues dealing with the Office of Public Works to satisfy themselves on the facts of the case in July of this year. Since then there have been discussions between Finance and Foreign Affairs on procedures for controlling expenditure on these projects.

Deputy Naughten.—Are you not happy with the control that was there prior to that?

Mr. Furlong.—My basic concern is to ensure compliance with the procedures that have been outlined in the Department of Finance circular 1/83 for controlling expenditure on all projects. This particular project was initiated long before these procedures were codified. What we want to do is to ensure that there is a clearer understanding between Finance, Office of Public Works and the Department of Foreign Affairs of what procedures ought to be for the future in the light of the guidelines that have been specified in circular 1/83.

Deputy Naughten.—When this overrun occurred, or additional expenditures, as the case may be, who approved it then? Who said “yes, carry out that work”?

Mr. Furlong.—The formal sanction would have issued from Finance to the Office of Public Works.

Deputy Naughten.—Since that they are questioning it and refusing to approve it?

Mr. Furlong.— No, I think it would be wrong to say they are refusing to approve it. There was a fair degree of clarification required and the minute that the Accounting Officer of the Department of Foreign Affairs has referred to was part of the process of clarification. Essentially, what it boiled down to was establishing to the satisfaction of the Department of Finance that the additional works that were undertaken, if they had been separately identified and specified at the outset, if they would have been approved as part of the overall project and it has now been established that they would have been.

243. Deputy G. Mitchell.—Perhaps we should get a note from start to finish of what exactly happened in this situation because there is a certain mystification. I think it would be a good idea if we got a note of what exactly has happened right up to the concluding stages step by step. I think we should get that.

244. Chairman.—From whom?

245. Deputy G. Mitchell.—We are going to recall the Accounting Officer from the Office of Public Works, but we are examining the Foreign Affairs Vote and I think it arises on the Comptroller and Auditor General’s remarks on this Vote.

246. Chairman.—If we get it from Mr. Donlon to the point as far as he can go and we will take it up then with the Office of Public Works.

247. Deputy Naughten.—I think it is quite possible that we may also have to recall Mr. Donlon at the time we have the case back there.

Mr. McDonnell.—Perhaps I should explain why it is in my report under the Department of Foreign Affairs rather than under the Office of Public Works. When the Department of Foreign Affairs disbursed the funds initially in regard to the work, it charged them to a suspense account. In effect, it is a debtor on the Department of Foreign Affairs account. It was an unrealised debt, if you like, as far as the Department of Foreign Affairs were concerned. That is why I raised the matter.

248. Deputy G. Mitchell.—I would like to ask the Accounting Officer if he has ever been in our embassy in Peking?

Mr. Donlon.—I have not.

249. Deputy Mitchell.—Could you tell me the number of staff we have in the embassy in Peking?

Mr. Donlon.—We have three diplomatic officers, two administrative staff and five local employees, making a total of ten people.

250. Deputy Mitchell.—You are aware that the total estimate of £645,000 was voted for the fitting out of the Peking embassy. I presume the Office of Public Works took your Department’s advice before incurring this expenditure. Could the Accounting Officer tell the committee what sort of expenditure would that involve? I presume £645,000 would buy a lot of things in Peking.

Mr. Donlon.—Again, I am afraid I am in some difficulty because the expenditure has not arisen in the Vote for the Department of Foreign Affairs and while the Office of Public Works consult us as to what the needs are, the decisions in these matters are taken by people in the Office of Public Works.

Deputy Mitchell.—I would presume you would be asked what your requirements would be in the embassy. What would you require that would cost that sort of money?

Mr. Donlon.—That is not the way it is handled. What happens is that the Office of Public Works would send someone out to Peking to have a look at the property. They take the decision on the basis of their knowledge and in consultation with us as far as what is needed, how many rooms for what purposes, that sort of thing, but not in relation to whether we will have this type of furniture or that type of furniture. That is entirely a matter which is handled by the Office of Public Works.

Deputy Mitchell.—Did we buy this building freehold or whatever the equivalent to freehold is in China?

Mr. Donlon.—That is something which does not arise within the Vote of the Department of Foreign Affairs. I can seek the information from the Office of Public Works.

Deputy Mitchell.—The Office of Public Works will tell us they take the advice of the Department of Foreign Affairs and the requirements of the Department of Foreign Affairs, but it seems to me — perhaps I am missing something but I am trying to elicit information as we will be recalling OPW — that £645,000 is a lot of money to spend fitting out an embassy for ten people in Peking. Who advised on the contents of the embassy? Is it security? Is it just carpets? What is it?

Mr. Donlon.—It is the furnishing, equipping and decoration of buildings sufficient to accommodate the office and residential needs of the non-locally employed diplomatic staff and the locally employed staff as far as office purposes are concerned.

Deputy Mitchell.—Does it seem excessive to you?

Mr. Donlon.—I am not in a position to give you an informed comment on that. I would have to point again to the fact that this is a matter for the Accounting Officer of the Office of Public Works.

Deputy Mitchell.—Maybe when we have OPW back we might invite Mr. Donlon back.

251. Chairman.—May I refer you back to the Appropriation Accounts for 1983? The Office of Public Works deal with that paragraph. It stated:

The particular Accounting Officer explained that the size and layout of the embassy was based precisely on requirements furnished by the Department of Foreign Affairs.

Mr. Donlon.—That is correct.

252. Chairman.—Just to follow up on that. If that expenditure has been incurred, you have instructed the Officer of Public Works to carry out such expenditure on your behalf?

Mr. Donlon.—Unfortunately we cannot instruct the Office of Public Works to carry out any expenditure.

253. Chairman.—Sorry, I will rephrase my question. You have instructed the Office of Public Works to do certain works on your behalf at the various embassies?

Mr. Donlon.—No. We outline the needs of the situation, that we are opening an embassy, that we estimate the following number of square feet will be required for office purposes and the following arrangements will be required for residential purposes. Then they come up with a proposal to meet those needs. In formulating the proposal, of course, they have extensive consultations with us. In the last analysis however, it is they who, with their professional advisers, whether from within the Office of Public Works or sometimes people who are hired from outside, take the final decision in relation to what is or is not appropriate and how those needs can be met.

254. Deputy Mitchell.—I certainly believe that a certain amount of prestige is involved in regard to our embassies abroad. Ambassadors cannot be expected to go around on push bikes. They have to be accommodated in proper——

Mr. Donlon.—Some of them do, Deputy.

Deputy Mitchell.—I am aware of that. Even some of the Secretaries go around on push bikes and even some of the Deputies go around on push bikes. Some Deputies are more on their bikes than others. We have to satisfy ourselves about this expenditure. It seems a great deal of money. It is obvious that the Office of Public Works have carried out these works on the requirements requested by your Department. The committee will have to see what those requirements are because it is a lot of money. I am not going to pursue this matter any further at the moment, except to say that it may be necessary to talk to you again when we have OPW in. The same applies to the £95,000 spent on the development co-operation office in Dar-Es-Salaam. Fitting out a Third World co-operation office seems to be extraordinary. There are other questions I want to ask, but Deputy McGahon wants to ask on this particular area.

255. Deputy McGahon.—I do not begrudge any money spent on our embassies abroad. We cannot export traditional Irish cottages to Peking and other places like that. There is an element of prestige. When I was in Bonn in May, I was pleased to see what we had available there. It has to be on a par with what other countries provide. It is the involvement of the Office of Public Works that I am a little dismayed at. Could I ask you, on a point of information, when you inform that body that you want a requirement, do they ferry people out to the location to make assessments? How is the work completed? Who does the work?

Mr. Donlon.—The practice varies from country to country depending on the circumstances. The Office of Public Works may send someone to the spot to assess the needs and to evaluate premises, contractors, etc. If it is possible to do the work with Irish materials or by using Irish building firms, then that is done. For example, in the case of the recent building of an Embassy in Saudi Arabia, it was an Irish contracting firm that was used. On the other hand, in some countries there might be no Irish firm with experience of the local conditions. In those circumstances, OPW would use a local firm.

256. Deputy McGahon.—Can I say, while that is a laudable policy, is it realistic to ferry Irish people out to the various locations? Could the work not be done more cheaply and more effectively by a firm in the country?

Mr. Donlon.—Not necessarily. If one is working with Irish materials very often the best and, indeed, the cheapest way of doing it is to have it done by people from Ireland. I am aware of instances in the United States, where I have served, where it proved most cost-effective to have the work done in Ireland and then have people come out with the goods to instal it. In that way you are ensuring that you are getting the best possible use out of Irish equipment and goods and furnishings and that you were also doing it in a cost effective manner.

Deputy McGahon.—I find that surprising. I criticised only last week the workings of the Office of Public Works in relation to the Valentia Island radio extension. It was suggested at that meeting that there was a lack of liaison between the sponsoring bodies and the Office of Public Works. Does this happen in your area?

Mr. Donlon.—No. I would make two comments on our relationship with the Office of Public Works. Firstly, we work very closely together. I am not aware of any problems arising from a lack of consultation. Secondly, it is appropriate to make the point that the work carried out abroad by the Office of Public Works has received the highest commendations. I am aware, for example, that their work in Australia has won the highest award of the Australian architectural profession and has, therefore, brought Irish workmanship, Irish design, Irish quality control to the attention of a totally new market in a way which has to be beneficial in the long run to our export effort in Australia. That is but one recent example of the quality of work provided by the personnel of the Office of Public Works.

Deputy McGahon.—I accept that. I would like to suggest that at future appearances of Mr. Donlon at this meeting in relation to that type of exercise it might be beneficial if a representative from the OPW was here.

257. Chairman.—Right. We will turn now to the Vote, page 164.

Deputy G. Mitchell.—What are the requirements to be appointed an Irish Consul or Consul General abroad and does this cost the State money?

Mr. Donlon.—There are two types of consular appointment, a career officer and a non-career officer. I take it your question refers to the non-career.

Deputy Mitchell.—I am referring to honorary consuls.

Mr. Donlon.—In the appointment of honorary consuls the Minister first of all has regard to the local need to have such a person. That need can arise, for example, on the consular front, on the trade front and the public relations front. It may be felt necessary to engage in some efforts in one or other of these areas. Nevertheless, because funds are not available, the decision may be taken not to send a career officer to the area to carry out the work. The question then arises as to whether we can get someone in the local area to help us with the work. If we have identified areas of activity that we feel might usefully be filled, then we seek out in that particular area people whose appointment as honorary consuls or honorary consuls general, could be recommended to the Minister.

258. Deputy Mitchell.—and the cost?

Mr. Donlon.—The cost to the State is almost nothing. The normal payment is about £250 per annum, per appointment.

259. Deputy Mitchell.—Could I ask you what is done to keep these honorary consuls up-to-date with what is happening here? It occurs to me that one or two of them do not know very much about Ireland. They do not know very much about what is happening here now. What is your observation on that?

Mr. Donlon.—I think that in the case of Irish honorary consuls or consuls general most of them are quite well informed. We send them appropriate material. We brief them when they are on visits to Ireland. We avail of opportunities, if Ministers are travelling in the area, to have them briefed by Ministers. But I do accept that occasionally one can find an Irish honorary consul or consul general who is not as fully briefed on all aspects of Irish life as one would like. But bear in mind that his function is usually related to the local circumstances. What we would look for more than anything else is his ability and willingness to work in that area. We would require him to have good local contacts so that if a problem arises he will be able to deal with it.

260. Deputy G. Mitchell.—I can accept some of them are very good. Some that I have met abroad have been very good but others of them do more damage to the country than help it, in my view, because they are given a position which would indicate that they know something when they do not. There are a couple of them who could do with a few lessons. I do not say that malicously. I genuinely say it. I think it is rather damaging to have somebody in that position who is not kept informed of what is happening in the country. The last question I want to ask you is in regard to the use of official cars. What is the policy with regard to official cars abroad and at home other than the well advertised use by the Minister and Minister of State? What are the uses by Ambassadors and other public servants within your Department, where it would arise, I presume, more than in most Departments.

Mr. Donlon.—Each Ambassador is provided with a car for his official use.

Deputy G. Mitchell.—And the driver, presumably?

Mr. Donlon.—Not always, no. Sometimes he would use the messenger or the caretaker to double up. In normal circumstances the car is provided, but rarely is a driver provided round the clock seven days a week. It is left to the Ambassador’s own discretion to make the arrangements appropriate to the needs of his post.

Deputy G. Mitchell.—What about the domestic use of official cars by your Department?

Mr. Donlon.—There are no official cars available to the Department of Foreign Affairs other than the car made available to the Minister.

Deputy G. Mitchell.—Is there a car hire company used?

Mr. Donlon.—There are contract arrangements with car hire companies to provide cars as appropriate for official use.

Deputy G. Mitchell.—What did that cost in 1984?

Mr. Donlon.—I am sorry, I do not have the breakdown but I can certainly get one and provide it to you through the Chairman, if that is acceptable.

Deputy G. Mitchell.—How is the company selected? Is it tendered or is it the same company from year to year?

Mr. Donlon.—There is a number of companies used. It ranges from taxi companies with whom we maintain accounts to companies which can provide chauffeur drive services. As in all other matters of Civil Service expenditure, all possible options are looked at and the most competitive one is selected.

261. Deputy McGahon.—Could I ask on subhead I — North-South and Anglo-Irish Co-operation — how is that money spent? Is it Co-operation North?

Mr. Donlon.—Yes, the precise figures for 1984: Co-operation North received £40,000, the Glencree Centre for Reconciliation received £20,000, the Irish School of Ecumenics received £20,000, an organisation called Between received £10,000, and the Northern Ireland Voluntary Trust received £10,000.

262. Deputy Naughten.—With regard to the question of the aid that is now being made available from the USA, what direct input will the Department of Foreign Affairs have into how that is going to be spent?

Mr. Donlon.—Both the British and Irish Governments have together jointly appointed a board of directors to administer the fund— the International Fund for Ireland, which has now been approved by Dáil Éireann. The board of directors will be assisted by an official level advisory committee which consists of officials from Government Departments in Dublin and Departments in Belfast. An officer of the Department of Foreign Affairs will chair that advisory committee, so that the role of the Department in relation to the International Fund will be confined to providing advice to the board of directors. It will be entirely a matter for the board of directors to take decisions in relation to expenditure.

Deputy Naughten.—The chairman of that advisory board will be an official from the Department of Foreign Affairs? Is that right?

Mr. Donlon.—The chairman of the advisory committee is an official of the Department of Foreign Affairs, but the chairman of the board which administers the fund is an independent personality jointly appointed by both Governments.

263. Deputy Naughten.—How many embassies have we abroad?

Mr. Donlon.—We have a total of 40 offices abroad, some of which are embassies, some of which are consulates-general, some of which are called permanent missions to the United Nations or to the EC, and then we have the Development Co-operation Offices. So in total we have approximately 40 offices, of which I would say 27 or 28 are embassies.

VOTE 45—INTERNATIONAL CO-OPERATION.

Mr. S. Donlon further examined.

No question.

The witness withdrew.

The Committee adjourned.