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NATIONAL LOTTERY GRANTSREPORT1.In considering paragraph 7 of the 1991 Report of the Comptroller and Auditor General the Committee made reference to the procedures followed by different Departments for the distribution and control of National Lottery funding. 2.The Committee recognised that a perception existed that National Lottery grants are less rigorously controlled than other Exchequer moneys. It appeared that no standard procedures for processing applications existed and the reasons for selecting certain projects for grant-aid and omitting others were not obvious. In the circumstances it was agreed that the Comptroller and Auditor General should be asked to undertake a comprehensive examination of National Lottery grants paid in the previous two years to establish whether adequate controls exist. He was asked to report by December 1993. 3.The Comptroller and Auditor General submitted an interim report which highlighted several cases in the Department of Health which did not appear to have been evaluated departmentally. In other cases no definitive application had been made, although the documentation suggested that there may have been informal contact with the Minister. Furthermore there was no system of follow-up to establish that the grants were used on the projects for which they were allocated. 4.This interim report of the Comptroller and Auditor General (which is published in Appendix I hereto) was considered by the Committee, on 9 December 1993. 5.The Committee found that it bore out the public perception that the distribution and control of Lottery funds was haphazard and it highlighted the need for a system of control that would ensure that National Lottery funds were as rigorously controlled as other public moneys. 6.The Committee decided to invite –The Accounting Officer for the Department of Health, –the Accounting Officer for the Department of Finance, and –Dr. John O’Connell who was Minister for Health for the period in which the incidents referred to occurred to appear before it to discuss the issues involved. 7.Dr. O’Connell wrote to the Committee regretting his inability to attend and explaining the situations pertaining to the cases mentioned in the Interim Report of the Comptroller and Auditor General. Dr. O’Connell was at pains to exonerate the officials of the Department of Health from any blame arising out of lack of documentation of these cases which he, as Minister, handled personally, leaving the “paperwork” in abeyance. Dr. O’Connell’s letter is published in Appendix II of this Report. 8.The Committee discussed the findings of the Interim Report with the Accounting Officers for the Departments of Health and Finance on 16 December 1993 and agreed on the urgent need for a transparent system for processing applications for Lottery funding at all stages and on the need to monitor the expenditure of the funds granted. It also asked the Comptroller and Auditor General to complete his examination of the procedures adopted in other Departments. 9.The final report of the Comptroller and Auditor General was considered by the Committee at its meeting of 21 April 1993. This report concentrated on Lottery grants paid by the Departments of Social Welfare, Education, Environment and the Taoiseach as these were seen as a representative cross-section of Departments which have discretion in the award of Lottery grants. This examination established that while some Departments show a high level of adherence to the regulations, with cases, in general, being comprehensively documented, deficiencies to varying degrees exist in other Departments. By far the most common weakness is in the follow-up procedures to ensure that the grants have only been used for the purposes for which they were provided. 10.The Committee agreed that a recurrence of the performance in the Department of Health in 1992 could not be tolerated. It noted with concern that the Department of Finance instructions to Accounting Officers on the issue of National Lottery funds are out of date in that they do not correspond to the current arrangements for the channelling of Lottery moneys to Departments. The instructions as they stand are scanty and clearly inadequate and need to be revised, updated and expanded as a matter of urgency if they are to meet acceptable standards of public accountability. 11.RECOMMENDATIONS OF THE COMMITTEE OF PUBLIC ACCOUNTS The complete report confirms the need for the early introduction of a transparent and equitable system for all stages of the Lottery grants cycle and the Committee requests that the Department of Finance draw up and issue, as a matter of urgency, revised guidelines which would incorporate the following conditions: (i)Applications shall be submitted on a standard form which shall, inter alia, set out -the purpose for which the grant is being sought -the number and status, or special situation, of people likely to benefit from the project to be grant aided -the sources of the organisation’s funding (separately identifying sources of State funding to prevent possible overlap or duplication). (ii)Criteria for qualification for funding shall be drawn up and a structured process shall be followed to ensure objectivity in evaluating competing applications. (iii)The recommendations of the line section in the Department shall clearly show the justification for the grant and the amount of grant proposed. (iv)Should the decision of the Minister on who and what to pay differ in any respect from the recommendation, the Minister shall be invited to give in writing, his reasons for making such change. (v)Departments shall set up a monitoring system to satisfy themselves that moneys have been used for the purpose for which they were granted. Such follow-up system shall be operated for all individual grants exceeding £5,000 and steps shall be taken to recover moneys granted in any case where it has been established that they were expended on purposes other than those for which they were granted. (vi)Random checks to establish whether value for money has been obtained in the expenditure of the funds shall be carried out. 12.Finally, the Committee recommends the setting up of an independent monitoring group with the remit of assessing on an ongoing basis whether there is fair and reasonable geographic and demographic spread in the allocation of Lottery grants. This would in no way detract from or cut across the prerogative of the Government in deciding on the award of Lottery grants but rather would be a desirable complementary feature of the scheme which would provide an extra degree of transparency and would help to assure the public that the system is equitable.
JIM MITCHELL T.D. Chairman. 28 April 1994. |
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