Committee Reports > List of Committees > Dáil > 1997 > Committee of Public Accounts > Report No. 03 - Value for money examinations

Minute of the Minister for Finance in Response to the Committee of Public Accounts’ Second Report on Value for Money Examinations

GAS INTERCONNECTOR

The Minister notes the comments on the Gas Interconnector Project, linking the Irish and U.K. natural gas transmission grids, in the report and acknowledges the credit due to the Department of Transport, Energy and Communications (now the Department of Public Enterprise) and Bord Gais Eireann (BGE) on the completion of the project so close to the budgeted cost. However, the Minister shares the Committee’s concern that the economic analysis of the likely return from investment in the project was not as comprehensive as it might have been. His Department has repeatedly stressed the importance of applying rigorous appraisal criteria in evaluating all capital projects so as to ensure that resources are used in a manner that obtains the best value for money.

Security of Supply

The Minister notes that the Committee urges the Government to take the necessary steps to ensure the long term security of natural gas supplies, and points out that in its Statement of Strategy the former Department of Transport, Energy and Communications included the ensuring of security and reliability of energy supply as one of its sectoral objectives for the energy sector. Strategies being pursued to achieve this objective include the completion of a feasibility study of a natural gas interconnector between Belfast and Dublin to ensure security of supply in the event of a disruption in the Ireland/UK Interconnector and examining the potential of the Kinsale Head Gas Field to serve as a storage facility and to contribute also to peak day requirements. It is understood that a report on the study of the proposed Dublin-Belfast interconnector has been received and is being examined in the Department.

Evaluation of Effectiveness of Interconnector

Nineteen ninety six was the first full year of operation of the Interconnector and it was used to import 18% of BGE’s requirements. The Minister is informed that with its increasing use, the Department of Public Enterprise will take the necessary steps to evaluate the effectiveness of the Interconnector, in conjunction with BGE.

REGIONAL DEVELOPMENT MEASURES

The Minister takes note of the Committee’s comments on the importance and benefit of Regional Development Programmes under the Community Support Framework (CSF) to the Irish economy and endorses its view on the obligations on Departments to set and monitor appropriate targets for all spending programmes. His Department’s role in the evaluation of operations assisted by the Structural Funds was evident during the recent Mid-Term Review and by the establishment of the CSF Evaluation Unit in February 1996. The Department of Finance’s role in ensuring appropriate financial control and management is also acknowledged. To this end the Department takes regular initiatives to ensure that standards of financial control are maintained and improved where appropriate.

MEANS TESTING

The Minister is informed that the number and variety of means tests has been a matter of concern to the Department of Social, Community and Family Affairs (DSCFA) for some time and that a review of all of the Department’s means tests has been carried out. Progress has been made in the context of the 1997 Social Welfare Act on some aspects of means testing procedures, including standardisation in the treatment of capital. It is proposed to revisit this issue in the context of the next budget.

Public Service Identifier and Data Sharing

The Minister takes note that it is intended to bring forward proposals for the 1998 Social Welfare Bill to give effect to the adoption of the RSI number as the unique public service identifier, and for the sharing of personal data within and between public service organisations. It is also intended that the proposed legislation will be discussed with the Data Protection Commissioner. These proposals were recommended by an Inter-Departmental Committee on the development of an Integrated Social Services System. It has also been decided that all application forms for income support service should include a statement/form of consent to the effect that data supplied may be shared with other stated organisations.

Central Means Database

The above legislation would enable data from the Department of Social, Community and Family Affairs’ central means database (the Means Recording System) to be made available to all State agencies involved in the provision of income support services. This should reduce duplication and the costs of means testing within the public service.

Management Group

An Inter-Departmental Management Group has been set up to implement the recommendations in the ISSS Report, of which means testing is a key element. The Minister for Finance notes that the recommendations in the report of the Comptroller and Auditor General are being considered in this context. Of particular importance is the question of linking of schemes so that qualification for one would be treated as a passport to others. This matter is closely related to the data sharing and common identifier issues mentioned above. The Minister considers that possible adverse effects on work incentives (by creating severe poverty traps where several “linked” entitlements are lost at a certain income level) would also need to be considered.

FEOGA BORROWING

The Minister for Finance shares the view of the Comptroller and Auditor General and the Committee that the Department of Agriculture and Food had managed FEOGA borrowing reasonably well.

He wishes to inform the Committee that arrangements for transferring responsibility for managing FEOGA borrowing to the NTMA are close to finalisation. There are still some technical and procedural matters to be settled and discussions to that end are continuing between the parties involved.

GULLIVER: THE IRISH TOURISM INFORMATION AND RESERVATION SYSTEM

The Minister is advised that the Government, in approving the implementation of the Management Consultants’ recommendation that the management of the Gulliver system be out sourced, fully recognised that the system, as currently managed and operated, had failed to meet its objectives and to provide the intended service either to the tourism industry or to visitors.

Following a full tender process, a private sector partner was identified and the Government, in April 1997, gave its approval to a proposal for a commercial partnership arrangement. Final details have yet to be concluded between all the parties involved, and until such time as this has been done, the confidentiality required by those involved must be respected.

Given under the official seal

of the Minister for Finance

this 15th day of October 1997

P.H. Mullarkey

Secretary General