Committee Reports > List of Committees > Dáil > 1995 > Committee of Public Accounts > Interim Report No. 01 - Appropriation Accounts 1994

AN COISTE UM CHUNTAIS PHOIBLÍ

COMMITTEE OF PUBLIC ACCOUNTS

Déardaoin 26 Deireadh Fómhair 1995

Thursday 26 October 1995

The Committee met at 11 a.m.

MEMBERS PRESENT

DEPUTY DENIS FOLEY IN THE CHAIR

Mr. John Purcell (An tÁrd Reachtaire Cuntas agus Ciste) called and examined.

Mr. Liam Drain, Mr. Michael Cunniffe and Mr. Robert Bradshaw, Dept. of Finance representatives, in attendance.

APPROPRIATION ACCOUNTS 1994

VOTE 15 - VALUATION & ORDNANCE SURVEY

Mr. James Rogers, Commissioner of Valuation, Valuation and Ordnance Survey, called and examined.

Chairman: Mr. Rogers, you are very welcome, perhaps you might introduce your officials?

Mr. Rogers: Accompanying me is Mr. John O’Callaghan, Assistant Principal in the secretariat of the Valuation and Ordnance Survey Office.

Chairman: Paragraph 28 of the Report of the Comptroller and Auditor General reads:

Excess Vote

The Appropriation Account shows excess gross expenditure of £42,248 over the gross estimate and a surplus of appropriations in aid of £1.774m.

In the course of audit of the Valuation and Ordnance Survey Appropriation Account, it was noted that a posting error had occurred in the manual recording system in July 1994 whereby the expenditure under one subhead of the Vote had been understated. This error had remained undetected until after the year-end when the Appropriation Account was being prepared and it was then discovered that the total expenditure of the Vote had exceeded the Gross Estimate. Normal bank balancing, carried out on a regular basis throughout the year failed to detect the error and it was not until a complete balancing had been done after year-end that the error came to light.

As it appeared that the failure to detect the error in the course of regular checking throughout the year was an indication of deficiencies in the internal control system, I sought the observations of the Accounting Officer. He informed me that the error arose and remained undetected due to human error and the fact that checks which were an integral part of internal control were not carried out during a period in the middle of 1994. He was of the view that the necessary checks were not undertaken because of a situation where there had been a doubling in the volume of payments handled, a high level of staff turnover and additional work created in relation to the introduction of a new computerised financial management system. He stated that the Accounts Division was now operating as intended and that the error which resulted in the excess Vote in 1994 could no longer occur.

Mr. Purcell: Paragraph 28 refers to an Excess Vote for the Valuation and Ordnance Survey Office. The amount involved is quite small in relation to the total expenditure of the Vote. What is disturbing is that the circumstances surrounding the incurring of the excess expenditure point to a serious flaw in accounting controls. The original error occurred in July 1994 and the normal checking procedures should have detected the error when the reconciliation for that month was being carried out.

According to the Accounting Officer these checks were not carried out for a period in the middle of 1994 due to pressure on staff arising from a doubling in the volume of work, a high staff turnover in the accounts branch itself and the introduction of a new financial computer system. These are valid mitigating circumstances but the fact remains that the lapse did occur and in a sense the Office may have been lucky to get away with a minor Excess Vote.

Chairman: Mr. Rogers, you stated that the circumstances which resulted in the 1994 excess expenditure could no longer occur. How can you assure the Committee that the system has changed in such a way that something like this can never again happen and that an increase in the workload or a high staff turnover can never again jeopardise internal controls?

Mr. Rogers: I can assure the Committee of this because we have introduced a new financial management system. The fundamental difference between the system we used formerly under which this error occurred and the new system is that in the older system there was a system of multiple entry. Transactions had to be entered several times in different records. This was the genesis of the error in 1994. In the new system there is single entry and once a figure is entered once there are no further entries. Therefore, the error could not occur in the new system.

Chairman: What functions and features does the new computerised financial management system have? Has it been fully installed and is it fully operational? Are you satisfied that all staff are adequately trained to use it to its full potential?

Mr. Rogers: The system is installed, it is up and running and all staff have been trained in its use.

Deputy Byrne: Hearing the Comptroller and Auditor General say that there was a serious flaw in the accounting procedures gives us cause to worry. Some of the difficulties were due to human error in certain cases. It is difficult to guarantee that humans will never err. However, if the Office was presented with an immediate doubling of its work requirements, would the new accounting system hold up and can you avoid a repeat of the difficulty which appeared in the 1994 accounts?

Mr. Rogers: Apart from the payroll, which is one of the major functions of the accounts branch, it also makes all payments for goods and services purchased by the Valuation and Ordnance Survey Office. This amounts to about 6,000 transactions a year. The doubling in the volume of work which occurred in 1994 resulted from a further 6,000 transactions which were refunds of payments made by farmers for CAP maps and which amounted to about £120,000. No matter what system is used, if the Office is presented with an extra workload like that, there is no question that it would have serious implications for resource allocation. Given the sort of system we were using in 1994, it was a particularly serious setback for the Office to have to take on this work. In the new system there is no question but that this would have implications but it would be much easier to handle.

Chairman: The incurring of expenditure in excess of that provided by Dáil Éireann is a serious issue. However, in light of the Accounting Officer’s assurances, I propose that the Committee make a report on the excess expenditure in which it states that it sees no objection to the sum being provided by Dáil Éireann by way of Excess Vote. Is that agreed? AGREED.

VOTE 15 - VALUATION & ORDNANCE SURVEY

Deputy Byrne: On page 130 of the report of the Comptroller and Auditor General, under the heading dealing with the exceptions to general accounting policy, I note that motor vehicles have been depreciated by a 20 per cent per annum reducing balance. Could Mr. Rogers interpret this statement? Does it mean we are depreciating vehicles at the rate of 20 per cent per annum?

Mr. Rogers: Yes.

Deputy Byrne: How does this conform to the average general rate of depreciation?

Mr. Rogers: We have a professional accountant on our staff and he advises that this is standard practice in depreciating motor vehicles.

Deputy Byrne: Extra receipts payable to the Exchequer are dealt with on page 140. This concerns a payable order to the sum of £22,140 which was issued to a company in 1985, not presented for payment and lodged to a suspense account. The company subsequently ceased to trade and in 1993 the directors were offered the sum involved provided certain conditions were met. They failed to do so and the sum was lodged as an Exchequer extra receipt. Mr. Rogers, could you give the Committee some background information on this? Although the money was offered to the directors, for some peculiar reason they seemed incapable of accepting it.

Mr. Rogers: There was one director remaining. We required a tax clearance certificate which he was unable to provide. Therefore, we were unable to make the payment to him.

Deputy Byrne: I congratulate you for raising so much money through the sale of Ordnance survey maps. It is remarkable that nearly £5 million was raised in this way. Matters related to the Common Agricultural Policy resulted in this. It is worthy of comment and congratulation that royalty fees have increased to £1.345 million. Fees for contract mapping raised almost £1.5 million. We are often critical of Accounting Officers who appear before us but these accounts indicate that your Office is engaged in marketing and selling to the general public and to industry. I congratulate you on this success.

Do you agree that there seems to be an increasing number of deaths and serious accidents in mountainous regions? I am thinking particularly of Luggala where there was the sad death of a young student. For the last few weeks we have been hearing accounts of people being lost on mountains and found injured. A German tourist was injured in Glendalough recently. This week there was an incident on Howth Head. There was criticism in the past that Ordnance survey maps were not up to date. Does it concern you that there has been an apparent increase in accidents and deaths? Do you feel that the maps which are produced clearly indicate dangerous locations? I am a hill walker and I know that there are dangerous locations which should be marked. There are dangerous walks overlooking St. Brendan’s Bed and Glendalough. On a misty day one could easily slip down and not be able to get back up. Are you happy about the way cliffs and other dangerous locations are indicated on maps? Do you think there is room for improvement?

Mr. Rogers: I thank the Deputy for his kind words about the expansion of our Survey marketing operations. I warn that I will not be able to repeat the performance in map sales indefinitely because this was a once-off opportunity.

I would be concerned if inadequacies in maps were linked to walkers’ deaths on the mountains or hills. I do not think that was an issue in the recent unfortunate deaths. I presume we are talking about the new Discovery series of 1:50,000 maps. This is our primary leisure product at present. We are approximately half way through the programme and of the 71 maps in the programme, approximately half of them have been produced. There is always room for improvement and we take on board comments and suggestions from users of these maps. That is an important part of the process. The fact that the maps are produced from a computerised database allows us to incorporate changes, amendments and improvements. The maps adequately highlight dangerous cliffs and falls and their contouring is quite good. They are designed primarily for walking and leisure activity so this would be one of the key parameters in designing the maps.

Deputy Byrne: I accept that in general the maps are explicit. There has been a huge growth in outdoor pursuits and activities on the mountains. We all know of danger areas such as the Glenmacnas waterfalls and the area around Glendalough. Given the number of young people, students and those from scouting organisations who go walking in the hills and use these maps, perhaps a dramatic indicator, such as a skull and crossbones, should be used to highlight dangerous locations. Urban children feel a sense of freedom when they climb mountains and cliffs, but these are dangerous. Many accidents and deaths occur during such activities. I suggest that a sign, such as a skull and crossbones, should be included on the maps to make people more aware of the real dangers.

Mr. Rogers: I will take up that point with our map designers.

Chairman: I note that there is income accruing to the value of £1.286 million in respect of Appropriations-in-Aid. Why was there such a large amount awaiting collection? Are you satisfied that your system for collecting these moneys is adequate?

Mr. Rogers: I am.

Chairman: You can send on a copy if you so wish.

Mr. Rogers: That would probably be the best thing to do because there are a lot of figures in the list.

Chairman: Incidental expenses arose from £581,000 in 1993 to £1.119 million in 1994. Can you explain what is included in this subhead and the reason for such a large increase?

Mr. Rogers: The incidental heading includes training, development, uniforms, cleaning services, advertising, laundry, newspapers, etc. The main item in it in 1994, which needed a supplementary, was a payment of £538.000 for Teagasc which was involved on our behalf in the provision of the maps to farmers. The function of Teagasc was to assist the farmers in identifying the particular sheet or sheets they needed and to pass that information on to us.

Deputy Upton: You spoke earlier about one of your leisure products. How many of these products are available?

Mr. Rogers: The two main products are the 1:50,000 series which is replacing our one inch and half an inch to the mile maps which we have had for a long time. This is a new series and its scale is better than an inch and a quarter to the mile. It is designed for walking and leisure activities. There are 71 sheets in the series and we are about half way through it. We hope to complete it in the next two to three years.

The other main product we sell to the public, which is more than a leisure product, is the Dublin City Street Guide which we published last year. We have sold more than 30,000 copies. It is a supplement to the existing map of Dublin. Its scale is 1:15,000 and the city centre’s scale is 1:10,000. It also includes a lot of tourist, leisure and historic information.

Deputy Upton: Are you working on new products?

Mr. Rogers: We work on new products and look at markets, but we have a commitment to the Government to complete the 50,000 series. Our resources are primarily devoted to this area. However, we look at developing our markets in this area.

Deputy Upton: How much profit do you make on these products?

Mr. Rogers: The 1:50,000 series is a loss leader because there is a large social dimension to this series. It is seen as an underpinning of the tourism industry. We do not make a profit on the production of the 1:50,000 series maps. I would find it difficult from the figures I have here to isolate the cost of producing the 1:50,000 series as distinct from the other series we produce. However, if it is required, we could do some work on identifying the cost of the 1:50,000 series.

Deputy Upton: Would the market accept a higher price for these products which are attractive?

Mr. Rogers: It is an attractive product and a balance could probably be struck. If a commercial price is charged, will people buy them? Their primary purpose is to underpin the tourism industry. The sequence in which the maps are produced is dictated by Bord Fáilte depending on the main tourism need.

Deputy Upton: I presume you are also responsible for producing maps of the city, particularly new estates. How up-to-date are these maps?

Mr. Rogers: The street guide I mentioned is fully up-to-date. A new edition of the Dublin city map, as distinct from the street guide, is due next year. The main urban mapping we do is at the large scale of 1:1,000 and it is used for utilities, etc. We update those on a rolling basis once every three years.

Deputy Upton: If someone moves into an estate which has just been built, will it be three years before it is on the map?

Mr. Rogers: It could be.

Deputy Upton: Is there any way of speeding up that process? It is troublesome for people to get to new estates, particularly those with unusual names such as the Downs, the Court and the Lawns.

Mr. Rogers: These new estates are developing at such a rate that it would be impossible to keep pace with them. Our new technology permits faster updating. For example, we are producing the second edition of the Dublin City Street Guide and we are taking on board comments, suggestions and corrections which have been conveyed to us. We can do it faster than we used to do it, but not at a rate which would keep pace with developments.

Deputy Upton: What problems do you have with estates which change their names?

Mr. Rogers: It is not a major problem.

Deputy Upton: How many streets would change their names per year?

Mr. Rogers: I do not have any information on that.

Deputy Upton: There seems to be a delay in making the agricultural maps available. Can you indicate how long people had to wait for those maps and how many of them were produced?

Mr. Rogers: We received 95,000 orders for those maps and were required to produce 210,000 copy maps. We had agreed a deadline with the IFA and the other farming organisations and bodies as to when these maps would be produced. The farmers had to meet an EU requirement deadline. We made our deadline.

Deputy Upton: How much of a profit or loss were made on them?

Mr. Rogers: We collected an extra £3 million.

Deputy Upton: What has become of the extra staff that were needed to produce these maps?

Mr. Rogers: We did not employ extra staff.

Deputy Upton: Mr. Rogers is to be congratulated on his efficiency.

Mr. Rogers: It was done primarily through overtime.

Deputy Ellis: We all appreciate that the production of the Dublin city maps is a loss leader but approximately what profit is made in producing ordinary Ordnance Survey maps?

Mr. Rogers: The Valuation and Ordinance Survey does not make a profit. We collect about 40 per cent of our administrative expenses through sales and contracts etc. That figure was 70 per cent in 1994 but as I explained earlier, that was an exceptional non-repeating event.

Deputy Ellis: What is the position with regard to upgrading the Office on a national basis? I recently looked at some Ordnance Survey maps and they seem to me to be outdated. For instance, buildings which are long gone were marked on the map while others that have been in existence for up to 30 years were not shown.

Mr. Rogers: Is the Deputy talking here about the 25 inch rural mapping series?

Deputy Ellis: Yes.

Mr. Rogers: That is largely out of date. Areas like Counties Meath, Kildare, Laois and Carlow, which were updated continuously between 1980 and 1992 and the new national grid series, which commenced in 1979, and cover parts of Counties Limerick, Tipperary, Waterford, Kilkenny, Wexford, Galway and Louth would be reasonably up to date but the older 25 inch series would date from 1888 up to 1975.

Deputy Ellis: When will the Office hope to have all those maps revised or is there any plan to revise them? A number of farmers who got these maps for area aid purposes discovered there were major problems with them. A number of them were checked and found to be erroneous. Where does Valuation and Ordnance Survey stand with regard to that because it supplied the documents?

Mr. Rogers: There is a plan to replace that series but it is a long-term plan. There are 25,000 maps in that series and we are currently tooling up for it. Staff are being trained to use this apparatus and we hope to get the programme underway by late 1996 or early 1997. It is a 25 year programme to complete the whole country at this scale.

Deputy Ellis: In other words, will people only be getting what they would class as an up to date map in the year 2020?

Mr. Rogers: It is not entirely as bleak as that. We are updating it on a strip basis under the programme of contract work we do for the utilities. Obviously, this work is mostly around towns, cities, motorways and places like that. We are building up the database was we go along but there is no question but that it is a long-term programme.

Deputy Ellis: Has the office at any stage considered using the satellite used by the EU for checking set aside to do this. Has that prospect been examined as a way of speeding the whole process up?

Mr. Rogers: We have looked at that. This work is done photography but the photos are taken from airplanes flown at 2,000 feet. The definition of the satellite imagery is not good enough at the moment but it will be. It is getting better all the time. The technology has advanced and we are keeping abreast of it.

Chairman: We can note the Vote.

The witness withdrew.

THE COMMITTEE ADJOURNED.