Dec 4, 2014
Revenue Commissioners: Chairman Josephine Feehily called and examined
Deputy John Deasy: I welcome the witnesses. The authorised officer in this case would have been a source of information for Revenue and would have assisted Revenue's investigations as a matter of course. If Revenue, as an organisation, settled with somebody, would he have known that?
Ms Josephine Feehily: No, apart from the 58 cases which we have published. We have no way of advising him of same and I referenced that fact in one of my earlier answers.
Deputy John Deasy: This is a critical issue because to a great extent, we are talking in the dark here. He would not have known because Revenue would not have divulged such information to the authorised officer at any point because, as Ms Feehily has said several times, Revenue does not divulge personal information relating to the tax affairs of any citizen. If Revenue had pursued an individual, even someone who was identified in the reports of the authorised officer, and had settled with that individual, the authorised officer would not know about that, even today, would he?
Ms Josephine Feehily: No, he would not have known unless it came into the public domain through our defaulters' list. He would have known that we were making progress with the class because we regularly published updates but not at case level.
Deputy John Deasy: So, the individual who has pursuing this issue for many years has no information with regard to how Revenue has pursued prosecutions or made settlements. If Revenue made settlements with individuals, some of whom are named in the dossier, he would not have that information.
Ms Josephine Feehily: That is correct. He would not know what we did in individual cases.
Deputy John Deasy: So we really are talking in the dark here.
Not to beat around the bush, the accusation has been made that the Revenue Commissioners and other organisations did not complete investigations into particular Ansbacher accounts appropriately or properly. Accusations have been made of political interference. As Deputy Ross said, the main accusation relates to things Revenue did not do. Were there things that Revenue could not do, under legislation?
I refer in particular to the ten-year rule mentioned by Deputy Ross which was introduced in the 1997 Taxes Consolidation Act. Did Revenue have an opinion on that? Ms Feehily said that Revenue was given special powers in 1999 which really assisted it to prosecute. When it came to the ten-year rule, did Revenue have reservations? That rule obviously prevented Revenue from pursuing some cases.
The Revenue Commissioners are the administrators of the tax code. They are not the policy makers but it is fair to say that they have views and opinions on legislation that affects the tax code and they give those views and opinions to the Department of Finance regularly. It is expected that the board of the Revenue Commissioners would have an opinion on legislation, both formally and informally. Was a view presented by Revenue to the Department of Finance on the ten-year rule?
Ms Josephine Feehily: First, I am not entirely sure, without checking, in what year that provision was introduced because the Taxes Consolidation Act was a consolidation of the tax code. Deputy Ross said it was introduced in 1992 and he is probably the best source on that, subject to checking. I would have to check the papers around the drafting of that section to see what view was expressed. That said, my strong understanding on the basis of recent explorations of this issue, is that in the common law, even if we did not have that section in place, a prosecution for an offence committed more than ten years ago in this regulatory space, as opposed to other forms of jurisprudence, would be likely to fail the justice delayed - justice denied test.
Our role in a prosecution is to prepare cases and bring them to the Director of Public Prosecutions, DPP. Certainly, engagement with the DPP would confirm the view that such a time period is an impediment, regardless of the section that is in place. I can say that based on my own discussions in Revenue in recent years because I have explored it. I would have to research and get my officials to check the papers from the year that the section was drafted to see what view Revenue may have expressed then. I was not even in the Revenue Commissioners at that time.
Deputy John Deasy: Ms Feehily made reference to the fact that when a criminal investigation would not pan out, her office turns to civil action. Does the ten-year rule apply in those circumstances too?
Ms Josephine Feehily: Yes, in fact in civil actions, the common law view would be that the time period is even shorter. We have a four-year rule, generally speaking, vis-à-vis our authority to go backwards and that is considered relatively long.
Deputy John Deasy: I ask this because for the public looking in, this is the main issue. The public want to know why Revenue cannot go back 20 or 30 years in the course of an investigation. It would be helpful if Ms Feehily spelled out why that is the case. Is it because Revenue cannot get its hands on the original documentation, some of which may date back to the 1970s? Is it because of common law and the ten-year rule under the Taxes Consolidation Act that Revenue is prevented from doing so? It would be useful if Ms Feehily spelled out the various reasons Revenue cannot pursue an investigation after a certain period of time.
Ms Josephine Feehily: When one has two huge reasons, one tends not to go looking for three, four or five more. One needs original documents and evidence first.
One needs to be able to prove a connection between these documents, the person involved and tax evasion done knowingly, willingly or negligently. There needs to be a criminal standard of proof which is beyond reasonable doubt in respect of connections of this nature. This must all be done within ten years. We are talking here about events which took place in the 1970s and 1980s. That is a real difficulty. That was codified, so to speak, in law in the form of the ten-year rule.
Those are the reasons. They are common reasons which are not confined to Revenue, they apply across processes relating to the legal system and in terms of natural justice and fairness. In general law they have been commented on several times by judges in the context of fairness, the due process to which people are entitled, in the context of how far back regulatory bodies are permitted to go and so on. If it would be helpful, I can send a note to the committee in which I will set out all of the background considerations. However, it will come down to the issues to which I refer, namely, evidence beyond reasonable doubt, original documents and the ten-year rule.
Deputy John Deasy: I return to the reason we are here, that is, the accusation that Revenue did not investigate this matter properly. I would like Ms Feehily to provide information on the special projects team that was appointed to investigate the Ansbacher accounts, the number of people who were involved and the expertise they possessed.
Ms Josephine Feehily: The team was led by a very senior and experienced principal inspector of taxes who had previously carried out many investigations. He had available to him 20 staff, including half a dozen experienced investigators and research and clerical support staff. We invested in computer technology - the file magic system - we never had before and this proved to be an incredible asset to the team in sifting through all of the documentation. As the 2000s progressed and as I mentioned to Deputy Ross, other investigations were taking place. The investigation into bogus non-resident accounts ran in parallel in 2001.
We were also dealing with matters relating to High Court orders, offshore assets and tribunals. During those years, Revenue received sanction for 300 additional staff. We increased the number of people dealing with this group of cases from 20 to 30. The number of people on the team reached 30 in 2001. We maintained that number of people working on these cases until 2005. The ratio of people to cases was extraordinarily high by Revenue or any other standards. By the time the case base reached 289, there were 30 officers involved.
There was also a structure in place for the first couple of years of the process whereby very regular meetings were held. These were led by very experienced assistant secretaries who were all qualified inspectors of taxes in their own right and one of whom was a qualified barrister. There were also regular meetings with the then chairman, at which direction, strategy and decisions were continually questioned. The matter was taken extremely seriously.
Deputy John Deasy: Ms Feehily referred to the ten-year rule being a serious impediment. Were there other impediments? The legislation underpinning the 1993 tax amnesty was introduced. Did the then board of Revenue or any senior officials give an official opinion to the Department of Finance with regard to this amnesty? Some people, including a number of academics, remain of the opinion that the tax amnesty in question was unnecessary. There were massive differences between the 1988 amnesty, which was operated on the basis that all outstanding taxes be recouped, and the 1993 amnesty, which was known as the "15% incentive amnesty".
There is a theory - I have heard it outlined on a number of occasions - that as the investigations into the Ansbacher accounts proceeded in the period 2003 to 2005, plenty of people in senior positions in Revenue had major misgivings with regard to the way in which the legislation relating to the 1993 amnesty was drafted. Some Ansbacher account holders availed of the 1993 tax amnesty and when they were pursued, they had the certificates they had obtained as a result of that and these made them immune from prosecution.
This is a really important point. Some 20 Ansbacher account holders availed of the tax amnesty and there is a suggestion that the legislation under which that amnesty was established was politically motivated. I accept that Ms Feehily cannot comment on that matter to a certain extent. However, I am going to ask her about the kinds of reservations which continued to be expressed in Revenue while the investigations to which I refer were ongoing.
Ms Josephine Feehily: To be clear and as the Deputy stated, I must be careful not to comment on the policy area. I joined Revenue at the end of 1993 as the closing date for the amnesty approached. It was common currency among senior officials in Revenue that we were not exactly excited about this matter.
Deputy John Deasy: It is fair to say Revenue does not like amnesties at all.
Ms Josephine Feehily: Exactly.
Deputy John Deasy: It particularly did not like the one to which I refer.
Ms Josephine Feehily: No, we particularly did not like it and that is well known. Without reviewing the relevant files, I cannot inform the Deputy as to whether that was ever written down in a letter. However, it is well known - information in this regard has been placed in the public domain in the past - that the then board of the Revenue Commissioners was not in favour of it. I recall there being some criticism of the then board because the amnesty yielded a lot of money.
The board had stated that it was not necessary and should not be done because there would not be very much money forthcoming. I remember that aspect of a conversation taking place after the yield emerged. Revenue was not in favour of amnesties in general and would not have liked this one at all. The committee will be aware that in the past there have been various voluntary disclosure schemes, which are incentivised.
However, the Revenue position would always be that we should get the tax. That is just a general position of revenue organisations across the globe. We do not like to walk away from tax. I do not think I am commenting on policy when I say that the general position of Revenue and similar organisations elsewhere is that we do not favour amnesties which let people off paying tax. The amnesty was a huge impediment.
Deputy John Deasy: Specifically, what were the impediments involved?
Ms Josephine Feehily: The amnesty was designed to create a brick-solid Chinese wall between everybody and the office of the chief special collector, which was specially established. The chief special collector and his staff handled all of the amnesty declarations. On foot of those declarations - they were not allowed to examine them and they had no access to the tax files of the declarants - they issued the declarants with certificates. In law, those certificates were sufficient evidence to the rest of Revenue to the effect that, at any time in the future, we could not look behind them.
A special unit was established. Those present from the Office of the Comptroller and Auditor General will recall that Revenue had to suspend its internal audit function because of the difficulty of finding officials who had never seen tax files. An assurance had to be given that such officials would never see such files in the future and this meant that their careers had to be managed. I recall this because I worked in human resources, HR, at the time. We were obliged to suspend the internal audit function in order to find people who we could state were in compliance with the law because they had never been involved - as tax inspectors within the Collector General's office or anywhere else - in cases in the past. There was a logistical dimension involved which I do remember. An impervious wall - behind which the amnesty declarations are to this day - was put in place.
To this day we have a chief special collector and if a taxpayer produces an amnesty certificate to an inspector in the context of any investigation, the inspector, once he or she has it, can verify by asking the chief special collector whether the certificate is authentic and that is all that can be done.
Deputy John Deasy: Let us stick with the 20 Ansbacher account holders who availed of the tax amnesty in 1993. While Revenue was investigating this in 2003, 2004 and 2005, the Chairman had been there for ten years. For example, Revenue was not able to trace the source of moneys, which I understand to have been a major bugbear within the Chairman's organisation.
Ms Josephine Feehily: Yes.
Deputy John Deasy: At that time, when Revenue had made its considerations regarding its difficulties with the legislation that had been drafted and had been availed of by 20 particular Ansbacher account holders, did Revenue make its displeasure known to the Department of Finance?
Ms Josephine Feehily: Yes.
Deputy John Deasy: How did Revenue do that?
Ms Josephine Feehily: We wrote to it.
Deputy John Deasy: What was the response?
Ms Josephine Feehily: We wrote in the context of looking for additional powers and we got most of what we looked for. However, as for the response with regard to the amnesty legislation, it was not revisited.
Deputy John Deasy: Was the reason given for that? Revenue obviously spelled out serious concerns with regard to particular individuals because it was precluded from pursuing them.
Ms Josephine Feehily: We spelled out concerns with regard to the process and the difficulties it created for us. I have not been able to find a reply to the letter but I know that the other powers in the letter were secured. This one was not.
Deputy John Deasy: Which one?
Ms Josephine Feehily: Revisiting the amnesty legislation.
Deputy John Deasy: Did the Chairman state there was no reply?
Ms Josephine Feehily: I have not been able to find it in the time allowed.
Deputy John Deasy: Can the Chairman remember what the Department of Finance said to Revenue?
Ms Josephine Feehily: No. I certainly cannot remember but the fact it did not happen I guess is the answer.
Deputy John Deasy: It is an important question. The Revenue Commissioners are and at the time were the administrators of the tax code. They had one hand tied behind their backs with regard to particular individuals. Revenue made its opinion clear that it was not appropriate and that the legislation underpinning all of this needed to be changed but that was ignored.
Ms Josephine Feehily: I am reviewing a piece of paper to make sure I am giving the Deputy the complete answer. Our final paragraph stated that when the Department had had an opportunity to peruse the contents of this, it probably would be appropriate to have the views of the Attorney General and that we were available to discuss it with the Department and with that office, if required. This would not be an unusual process for us.
Each year, we write submissions to the Department of Finance and then certain results are achieved. That Department does not usually write back to say it is not doing X. That is not usually the way it works. What it tends to do in a normal year, and I imagine this was no different, is that it feeds into a tax strategy group paper and then the decisions emerge from a process, rather than in an itemised reply. We would not have got a reply in respect of the answers that were positive either. It is not that kind of process. We make our submissions and make known our views, analysis gets done and a finance Bill emerges. Policy decisions get made by the Government and a finance Bill emerges. However, we did try.
Deputy John Deasy: The Chairman outlined the profile of the people who were Ansbacher account holders. Of the 20 people who availed of the tax amnesty and who were Ansbacher account holders, can she tell me what was their profile?
Ms Josephine Feehily: No.
Deputy John Deasy: That is not possible, no?
Ms Josephine Feehily: No.
Deputy John Deasy: Is that a reason-----
Ms Josephine Feehily: I do not know who they are. I cannot know who they are.
Deputy John Deasy: Okay.
Ms Josephine Feehily: They are behind a wall.
Deputy John Deasy: The Chairman knows the profile of the overall group of Ansbacher account holders but she does not know the profile.
Ms Josephine Feehily: What I have said to the Deputy earlier, because I am in danger of getting close to classes and breaking confidentiality, I referenced the profile of the cases that were published as being the most suitable source of information for the committee and the profile there was of very wealthy people, the occupation largely being company directors and the behaviour as being about sheltering wealth. I need to be safe.
Deputy John Deasy: That is fair enough and I totally appreciate that. However, I must clear up something in this regard. The inference is that of those 20 people who availed of that tax amnesty in 1993, there was political pressure or a political motive behind the drafting of the 1993 legislation. My question is whether Revenue ever expressed a concern related to that.
Ms Josephine Feehily: I doubt very much if Revenue in 1992 or 1993 would have expressed a view-----
Deputy John Deasy: I am not talking about 1993. I am talking about ten tears later as Revenue was investigating this matter.
Ms Josephine Feehily: -----about a political motivation. No. I want to narrow it and that is the Deputy's question.
Deputy John Deasy: This is clear. It is important this is said.
Ms Josephine Feehily: Revenue did not express a view nor would ever express a view about the motivation of a policy decision taken by the Government.
Deputy John Deasy: That is fair enough.
Ms Josephine Feehily: A policy decision validly taken by the Government and passed into law by the Oireachtas. Revenue would then simply operate that law. The independence works both ways. While we have our independence we have our - incidentally, in the context of the amnesty, 38,000 people availed of it. The frustration that perhaps caused us to write letters was not related to Ansbacher. The 20 people were not the issue; it was the 38,000 people and it was a bigger issue for us.
Deputy John Deasy: A lot of money was raised but the argument is that a lot more should have been raised because it was only a 15% tax. That is a view expressed by the Chairman's organisation at the time.
Ms Josephine Feehily: Yes.
Deputy John Deasy: That is fair enough.
Mr. Seamus McCarthy: Another observation that is worth making is that 145 people did settle who could have availed of the amnesty at 15% but did not.
Deputy John Deasy: I have a couple of quick questions. I refer to the two reports under discussion today and acknowledge the Chairman does not have them to hand. Can she tell me whether they identified new cases?
Ms Josephine Feehily: No, and perhaps I can explain why. We are talking about the two dossiers that Revenue received from the relevant Ministers in 2008 and 2011. The reason is I am saying they were not new cases but there were new documents. There was supporting evidence and there was validation. However, there had been highly significant engagement with the authorised officer right through the period before that.
Deputy John Deasy: That is important and let me ask the Chairman a different question. Did that new information or those new documents cause Revenue either to bring a case to a conclusion or to reopen a case?
Ms Josephine Feehily: They certainly did not cause us to reopen any cases. They would have been helpful in advancing cases because the Deputy saw the graph and we really were in settlement mode there. However, I must repeat that by then, we had secured substantial documents, definitely more numerically, than those to which the authorised officer ever had access. As we had our own sources and our own documentation, what we were getting largely was validation and supporting documentation and that always is helpful.
Deputy John Deasy: I think that is it but if I may comment, I believe the first question I asked is very important and the response that was given is critical to this entire episode and that is that if Revenue actually have settled, for arguments sake, with individuals who have been named in a particular dossier, the authorised officer would not know about it. The authorised officer would not have any details with regard to the settlement, would not know how it was pursued or whether prosecution was pursued. The authorised officer would not have that information. We are talking in the dark and it is critical that this information be made known.
PAC Meeting | Nov 27, 2014
Chairman (Deputy John McGuinness): I will move to correspondence from Accounting Officers and Ministers ... There is correspondence, dated 26 November, from the Minister for Jobs, Enterprise and Innovation, Deputy Richard Bruton. It is regarding correspondence received from the committee regarding a protected disclosure dossier. We agreed to write to the Minister last week and we are now scheduled to discuss with representatives of the Revenue Commissioners next week its investigation into the Ansbacher accounts. This is the issue that was raised in the protected disclosure. After this, the committee can review whether any further examination is required on its part. Our first port of call is with the Revenue Commissioners and we can decide from that point what is required next. Is that agreed? Agreed.
Deputy John Deasy: Who is coming in?
Clerk to the Committee: It is the Accounting Officer of the Revenue Commissioners.
Deputy John Deasy: Will there be somebody from the Department of Finance?
Chairman: We can ask.
Clerk to the Committee: We can ask if the Deputy wishes somebody from the Department to attend.
Deputy John Deasy: It might be useful. I do not know who drafted the regulations or legislation followed by the Revenue Commissioners at that time. Was it the Department of Finance?
Chairman: It might be useful to complete the investigation.
Deputy John Deasy: It might be useful to delve into the area of constraints under which the Revenue Commissioners operated.
Clerk to the Committee: One of the constraints would probably be the tax amnesty.
Deputy John Deasy: That is really what I am getting at.
Clerk to the Committee: That is fine. I can ask the Department to send somebody. It is not a problem.
Chairman: We can have somebody here to explain it. After we hear from the Revenue Commissioners, we can decide on our next step...
Nov 27, 2014
Re: Legal opinion on the protection afforded a would-be whistleblower on Revenue matters under the protected disclosures legislation.
Clerk to the Committee: We discussed this issue last week. There are two conflicting opinions, but both are simply opinions. We will not get a definitive answer until the issue is tested in the courts. One of the key concerns last week was the scope of the protection. It was decided a risk analysis, covering both the committee and [a whistleblower], would be carried out before any decision was made on bringing [the whistleblower] before the committee. This was the decision taken last week and it still obtains.
We will hear from Revenue next week and we have the letter from the Minister on the information Mr. Ryan gleaned from the Companies Acts, which has all gone to Revenue. Therefore, Revenue should have all the information. It is for the committee to decide if it wants to or not. In looking at the risks, which is what the committee decided to do last week, we will have to see what the Protected Disclosures Act 2014 protects this individual from. This is especially so in the context of the Companies Acts because they have specific penalties in terms of giving information to anyone other than designated people.
This is my understanding of the situation. I have had just a preliminary discussion with those in the Office of the Parliamentary Legal Adviser. When the Parliamentary Legal Adviser was here, we asked if we could forward the dossier to Revenue. We were told we could not. The Chairman then wrote to the Minister about this. It is information gathered under an investigation under section 19. The Act offers very limited scope on where it can be sent. All of this will have to be thrashed out with our legal people. Whether the Protected Disclosures Act 2014 applies and whether it protects the individual will have to be examined again.
Deputy John Deasy: Sometimes I feel like it is groundhog day in here. We made decisions as a committee last week. It seems that when a decision is made, we come back the following week and question that decision and find ourselves on a completely different course. Some of us raised the point that, regardless of how the legislation is written, there will always be different opinions on different laws. We received one opinion. The senior counsel acting on behalf of the whistleblower gave a completely different take on the legislation. There might be two other completely different takes on both those legal opinions if a person tried hard enough to find them.
We should wait and see what the Revenue Commissioners have to say on this issue before spending taxpayers' money on getting a second opinion. Ultimately, it will come down to the interpretation of the Act. I thought we had made a decision last week; we cannot continue coming back and redrawing decisions that have already been made. My understanding of what happened last week was that the legal advisers were to be here today to reiterate their advice on the specific issue of the whistleblower's attendance and the implications for him personally.
We did it that way because the Comptroller and Auditor General made the point that if we had the whistleblower before the committee it might compound things negatively. For that reason, we wanted clarification from our legal advisers and the parliamentary legal advisers. It is like Groundhog Day here. I am experiencing a bit of déjà vu and I do not know why we are turning back on decisions we made last week.
Chairman: We are not turning back on decisions. We are just trying to clarify the position on this legislation by requesting an opinion from the Attorney General.
Deputy John Deasy: My point is that we are never going to get definitive opinions on a piece of legislation that is entirely up to someone's subjective interpretation.
Chairman: We have to try and get the best advice on this because it is the first case. The person in question has made what appears to be a significant disclosure and his position is now in difficulty. There is no harm in asking the Attorney General if we do not want to ask the legal advisers.
Deputy John Deasy: That is fine, but I do not think our job here is to interpret legislation. Our primary role is to deal with entities such as the Revenue Commissioners and question them on this issue and their investigation of it. We should make decisions after the Revenue Commissioners have been at this committee and let members decide then.
PAC Meeting | November 20, 2014
Brendan Ryan [CEO, Courts Service]; Joyce Duffy [Principal Officer, Courts Policy Division] called and examined.
Deputy John Deasy: I have some brief questions, the first of which has to do with Circuit Court sittings leading to civil Circuit Court sittings. I understand in the past 24 hours nominations have been made for seven vacancies on the Circuit Court.
Mr. Brendan Ryan: Yes.
Deputy John Deasy: If we take my constituency as an example, this month's proposed sitting of the civil Circuit Court was abandoned at the last minute. As far as Waterford generally is concerned, the last civil Circuit Court sitting was in May and the next one will be March. Can Mr. Ryan tell me how many sittings of the civil Circuit Court have been postponed around the country because of the vacancies that have occurred in the past six weeks? I checked with the Garda, and when it comes to criminal Circuit Court sittings, the opinion of one fairly senior garda was that they had not been disrupted, but can Mr. Ryan tell me how many sittings have been disrupted?
Mr. Brendan Ryan: I do not have that information. I know the Waterford position because I got correspondence from one of the legal practitioners in Waterford about it. The Deputy is correct that the eight vacancies in the Circuit Court have had an impact. The president of the court decides on the sittings and who should sit where and the cases.
Deputy John Deasy: I understand that. I am asking about the sittings nationally.
Mr. Brendan Ryan: I will have to get back to the Deputy.
Deputy John Deasy: Mr. Ryan must have some idea. This is what he deals with every day. Were there other sittings-----
Mr. Brendan Ryan: The Deputy can take it that if there are seven vacancies at the moment there could be-----
Deputy John Deasy: There are 40 Circuit Court judges-----
Mr. Brendan Ryan: No. There are 38 Circuit Court judges.
Deputy John Deasy: -----there or thereabouts.
Mr. Brendan Ryan: One of them is on long-term sick leave. We are working off 30 judges at the moment. The president prioritises criminal matters, and after criminal matters it is family law matters.
Deputy John Deasy: I understand all that. I understand the process. Does Mr. Ryan have no idea of the number of sittings that have been postponed because of the vacancies?
Mr. Brendan Ryan: The representations I have got are about Waterford. I have no doubt there have been other cancellations, but I do not have those figures. It depends on the scheduling of cases in any Circuit Court in Ireland. They are scheduled a year in advance. They are scheduled either for criminal court, the civil court or the family court. If most of those scheduled sittings this month were criminal court, the impact on the civil court would be minimal because the judges are still dealing with criminal matters. If the scheduled sittings were for the civil court, as was the case in Waterford, unfortunately, the president has directed that criminal matters have to take priority because, as the Deputy will appreciate, people may be in custody.
Deputy John Deasy: Mr. Ryan cannot answer that question.
Mr. Brendan Ryan: No, unfortunately, but if the Deputy wishes I can come back to him on it.
Deputy John Deasy: No. I believe the issue will be dealt with now that the nominations have been made. I am trying to find out how this occurred procedurally and make the point to the Department that it should not occur again. We are in an unusual situation with the creation of an entirely different court, but at the same time, these things happen on occasion because of retirements, deaths, promotions and elevations of a kind, and always have done. In this particular case, seven vacancies were created as a result of one retirement, one elevation to the Court of Appeal and the elevation to the High Court of five individuals. The Government promoted judges from the High Court to the Court of Appeal and it promoted judges from the Circuit Court to the High Court, but what it did not do was make new appointments to the Circuit Court or the District Court in their places. That occurred in the past 24 hours, but there was a gap.
Mr. Brendan Ryan: There is a gap.
Deputy John Deasy: There is a gap.
Mr. Brendan Ryan: There was a gap, yes. I am not trying to defend the Department of Justice and Equality or the Government, but this was unprecedented. I have worked in the courts since 1981. This was unprecedented.
Deputy John Deasy: That is fine. I know that; I just said that. Even when it comes to civil Circuit Court issues, they are fairly serious.
Mr. Brendan Ryan: Yes.
Deputy John Deasy: When we talk about criminal Circuit Court issues we are talking about very serious crimes.
Mr. Brendan Ryan: Yes.
Deputy John Deasy: When we talk about civil Circuit Court sittings, those are serious issues.
Mr. Brendan Ryan: Yes.
"If seven principals of primary schools were being promoted from the ranks there would not be vacancies for the positions they left because teachers would be in place..."
Deputy John Deasy: If seven principals of primary schools were being promoted from the ranks there would not be vacancies for the positions they left because teachers would be in place. Yet when it comes to this area, it appears to be acceptable. It is a political process. I know it should not be, and it is something this Government probably has fallen down on when it comes to judicial appointments. In our programme for Government we promised that we would look at this, and I believe it is a failing. People such as Mrs. Justice Susan Denham have commented that it is a miracle our Judiciary has maintained its independence so well considering it is so political.
That aside, what we can do at the very least - I understand this is not Mr. Ryan's role - is to have a reasonable transition when something like this occurs to ensure there are no gaps and that sittings are not postponed.
I know Ms Duffy does not set policy, but she deals with it within the Department of Justice and Equality. I can raise this with the Minister, but it is a simple question. The suggestion I am making and that I will make to the Minister - I am raising it with Mr. Ryan now because he is the person dealing with policy in the Department when it comes to the courts - is that when this occurs, the appointments to the Circuit Court and the District Court should happen at the same time. They should happen in tandem or, at the very least, within a specified period. That is a simple suggestion.
Mr. Ryan makes a good case about the Courts Service's efficiency and talked about a 16% reduction in its staff. Some would state it is too efficient, while plenty of communities nationwide would suggest it has stripped down courthouses and so on. The service has done a good job in cutting costs and, at the very least, it is possible to have sittings take place. While one part of the Government system may be working well, another is not and has failed in providing judges to preside over sittings in the Circuit Court.
This is something that could be rectified easily. I do not know whether the witnesses have a comment to make on this. I again acknowledge to Ms Duffy that I am aware departmental officials do not set policy. I do not know whether this issue has been raised in the past, but it appears to be a reasonable suggestion that when something like this occurs - retirements and deaths take place all the time - this could happen in tandem.
Ms Joyce Duffy: I am certainly happy to take back the Deputy's comments to the Minister who probably will make the point that she has moved speedily to appoint judges and assist in the process of appointing them. In the past four to six weeks she has brought a series of memorandums to the Government on appointing ten judges to the Court of Appeal, the subsequent replacements to the High Court and, this week, on appointments to the Circuit Court. As Mr. Ryan stated, this has been unprecedented.
This is the first new court jurisdiction established since 1961. It has been a long time since we went through such a major change to the system. As for the nominations to the Circuit Court announced by the Government yesterday, the process was completed in as speedy a manner as possible. As the Deputy is aware, names are submitted via the Judicial Appointments Advisory Board which conducts its process. The Government then has its part to play in evaluating the names and considering serving judges for the position. However, I appreciate that there has been a consequence, of which the Minister will certainly be made aware.
Deputy John Deasy: I take Ms Duffy's point. The situation was unusual. I received a reply to a parliamentary question on this matter a few days ago and what has happened in the past couple of days is miraculous, considering that the last line of the reply indicated that the Government would be dealing with the matter in the coming weeks.
What role does Mr. Ryan play when something like this occurs? Obviously, the presidents of the different courts have a major role to play in this regard, but as far as rostering is concerned, the issue about court sittings taking place on Monday afternoons or Fridays has come up repeatedly. Is this something in which the Courts Service gets involved in any way, shape or form?
Mr. Brendan Ryan: No, it is entirely a matter for the presidents of the courts. The Deputy will appreciate that we support sittings as they occur.
Deputy John Deasy: It may be an old jurisprudential cliche, but justice delayed is justice denied. Perhaps Ms Duffy might take the suggestion back to the Minister. While I can raise it directly with her, it is reasonable to avoid such delays because, as Mr. Ryan is aware, practitioners could not believe people had not thought about the gaps that there would be as a result of these appointments or elevations.
Ms Joyce Duffy: Absolutely.
PAC Meeting | Oct 23, 2014
Re: Sudden suspension of Waterford IT and IT Carlow merger discussions
Deputy John Deasy: At the risk of clogging up the work programme I shall raise something else, a matter concerning the Waterford Institute of Technology and Carlow Institute of Technology. Both bodies come under the remit of the committee and have been in here recently.
An abrupt announcement was made a couple of days ago that the amalgamation or merger of the two organisations was ending. A joint application was being worked on by those two bodies with a mind to ultimately putting together a successful application for a technological university in the south east. Similar applications by a number of different educational institutions in Dublin are ongoing.
I have a question for the Comptroller and Auditor General. It is my understanding that when it comes to a restructuring like this one, which has gone on for many years, there is a significant cost for restructuring. Those on the boards of these two organisations have a responsibility to account for the money that has been spent on the process of restructuring which I believe could be reasonably significant. They need to answer for that. The suspension of this amalgamation or merger, as abruptly as it has occurred, needs to be questioned because of the cost that has been incurred by the State over the past few years.
I ask the Comptroller and Auditor General the following. Is it the case that a significant amount of money accrues when it comes to this kind of restructuring? Does the Committee of Public Accounts have a remit to ask both of these organisations to come in here to explain the amounts of money that have been expended and find out why they decided to abruptly end the merger or amalgamation?
Mr. Seamus McCarthy (C&AG): Certainly there is expenditure in regard to restructuring. That is not just a question for Waterford and Carlow because there are other organisational restructurings in the offing. My recommendation to any institute of technology would be to disclose exceptional expenses of that nature in the financial statement. It is the Higher Education Authority that dictates the format of accounts and the type of analysis that is done on expenditure. If there was expenditure incurred it is in the financial statements that have been presented. Therefore, for anything that is an expenditure item, one would certainly be entitled to ask and to try to go behind if the-----
Deputy John Deasy: Mr. McCarthy is saying it should be itemised for the special cost with regard to restructuring.
Mr. Seamus McCarthy: That would be my recommendation because it is exceptional expenditure. Normally, one would expect a restructuring to be on a slightly shorter timescale. In a way, it has become embedded in the institutions because this has been going on for quite some time.
Deputy John Deasy: I think what the Comptroller and Auditor General is saying is that the HEA should also be asked to come in to the committee, if we were to ask WIT and CIT to account for this. Time is of the essence here. I do not want to clog up the work programme any further but there is an imperative to ask these organisations to come in quickly. This has been going on too long. Depending on who one asks, one gets different answers as to why this occurred. It is unacceptable. Representatives of both boards need to be asked now what exactly has happened here.
Chairman (Deputy John McGuinness): In order to be able to focus on this directly, we should write to WIT and CIT and ask them to extract from their accounts over the years the exact amounts of money that were spent in regard to the project so that we get the figures. Otherwise, we will be looking at accounts and the figures will be wrapped up in some other figure for one thing or another. It is likewise with the HEA. We can bring in the three bodies and we will insist on it being done as quickly as possible.
Deputy John Deasy: Will you make it clear to them that the expectation is that they come before the committee in the short term?
Chairman: Yes, and they should bring these figures because we do not want a job of work to dig out the figures. They should have them on hand and we will then know the exact cost over the years since this began of the merger negotiations or discussions, or the project itself.
Deputy John Deasy: I think I speak for a lot of people in the south east, not just in Carlow and Waterford, who, when they look at this situation, view it as being messy. They are tired of it. It has gone on too long. They can reasonably expect a reasonable degree of governance when it comes to these two bodies and this joint application. I am coming to the conclusion that the governance of this application has not been adhered to. We need to get to the bottom of this sooner rather than later.
Chairman: I agree. We will set it up as soon as possible. We will ask for the figures beforehand because we need to see them.
PAC Meeting | Thursday, 10 July 2014
An Garda Síochána: Road Traffic
Deputy John Deasy: I welcome the acting Garda Commissioner. My first question relates to notices issued for speeding offences which arrive in the post. In many of the cases that come before the courts, the reason for the summons is that no payment was received for the fine. In many cases, however, people state that they have not received the notice. Would it not be better for everyone involved if notices were sent by registered post, given that people take notice of registered post? This is a common sense measure which would save court time and has been suggested to me by serving gardaí several times in the past year.
Acting Garda Commissioner, Noirín O'Sullivan: This is one of the areas we are very conscious of. We mentioned it earlier when talking about the non-delivery of fixed charge notices. The criminal justice working group has been established to look at the recommendations from the fixed charge processing system inspectorate report, and that is a matter that has been prioritised by the working group in terms of the registered delivery of fixed charge notices. The change would be the introduction of a presumption of delivery via enactment of Part 3 of the 2010 Act. This would help address the issue and enable a speedier service.
John Deasy: Ms O'Sullivan expects that people will receive notices by registered post in the medium term.
Noirín O'Sullivan: Yes, I think so. Mr. O'Sullivan from the Department of Justice and Equality co-chairs the working group, so he could update the Deputy on the position in that regard.
Doncha O'Sullivan: The working group is looking at a provision in the 2010 Road Traffic Act which changes the presumption with regard to delivery. This would mean that if there was a certificate of delivery, the presumption in court would be that a person received it. He or she would then have to be able to provide active, positive evidence that he or she did not get it. The context is that at the moment the Garda must essentially prove that a person received the notice, which is impossible.
John Deasy: The working group is changing the burden of proof.
Doncha O'Sullivan: Yes; essentially, we are changing the burden of proof. The road tax office tells us that very few people contact it to say they did not receive a road tax disc in the post. It uses the same address that is used for serving fixed charge notices. The hope is that the burden will shift. The working group is looking at other reforms aimed at trying to address and improve this matter. The registered post issue can be considered in that context, but it is one of a number of issues that are being looked at.
John Deasy: What is the timeline for making this change?
Doncha O'Sullivan: The main timeline is linked to the introduction of what is known as the third payment option, an issue that will also be helped here. We hope we will be able to agree a plan to roll out the information technology required to implement the third payment option. While we might reach agreement on that this year - I hope it will be soon - there is a long lead time to deliver this IT plan. It would take at least a year to do that.
John Deasy: My next question relates to the number of road deaths, which are the main reason the witnesses are before the committee. The number of road deaths has increased in the past couple of years.
I want to bring the witnesses back a few weeks to when the Secretary General of the Department of the Transport, Tourism and Sport and representatives of the Road Safety Authority appeared before the committee. Perhaps this a question for the assistant Commissioner Mr. Twomey also. I asked a question about analysing causation and the reasons for road deaths. The example I used was the lowering of the maximum allowed blood alcohol level a couple of years ago in legislation. I was surprised that no analysis had been done by an organisation such as the Road Safety Authority when it comes to road fatalities. In the meantime, the committee has contacted the Road Safety Authority a few times. Given the increased number of checkpoints, more random breathalysing, more GoSafe cameras and the lowering of the blood alcohol limit, it seems obvious that one would analyse these measures and link them with road fatalities so that we can know what works and what does not. I am amazed that an organisation such as the Road Safety Authority does not conduct that kind of analysis on an ongoing basis. We pass legislation all the time, but in some cases I do not believe the evidence is behind it completely. I think the witnesses know where I am coming from. I wonder what kind of analysis the Garda Síochána conducts when it comes to an issue as serious as this.
Noirín O'Sullivan: Absolutely. There are a lot of complexities involved in the whole area of serious or fatal injuries in road collisions. If it would be helpful, I will invite Superintendent Con O'Donohue, who deals with the RSA on a regular basis in respect of this matter, to explain some of the issues I am raising.
Con O'Donohue: From 1 January 2014 we improved the data that is provided to the Road Safety Authority. A number of changes to the data that it had requested were rolled out as part of a project on 1 January 2014. This also means the RSA is getting the data in a more timely fashion than previously. Allied to that, on a regular basis, about every three or four years, the Road Safety Authority and its predecessors have come to look at a sample of Garda files. They get down and dirty in terms of the actual investigation files to see what they can elicit from those files in terms of the causation factors. Recently I met the RSA's research manager. There is a proposal to start another research project within the next couple of months. Our files are open at all times to the Road Safety Authority to come in and analyse them. It will be going to tender, as the RSA does not have the resources to carry out this significant job, which is exactly what the Deputy is saying - getting down and dirty into the files to see exactly what were the causation factors for particular accidents, whether it was a combination of sleep deprivation and alcohol or drugs, speed, or the condition of vehicles. Currently, the RSA gets data from our PULSE system; essentially, the PULSE system records that a collision occurred and gives the headline issues. It always has that.
John Deasy: Let me break it down somewhat. Let us say there were 200 fatalities - I think the number was 190 in 2013. How many of those fatalities related to excessive blood alcohol? Is that information tracked by the organisation? It is fairly basic. I appreciate Mr. O'Donohue's response and what is being done. Of those 190 fatalities, how many of those were related to alcohol?
Con O'Donohue: Off-hand, I cannot tell the Deputy about the alcohol-----
John Deasy: Do you track that?
Con O'Donohue: It is recorded. In regard to seatbelts, I am aware that in 20% of the fatalities people were not wearing seatbelts.
Deputy John Deasy: Does Mr. O'Donohue know where I am coming from with this? This is basic stuff. I have been around here for 12 years, and I always think that some people legislate blindly because they do not have a clue. If the Garda Síochána and the Road Safety Authority do not know, how do legislators know what legislation to pass if it is not evidence-based in terms of what works and what does not work?
Con O'Donohue: I understand.
John Deasy: There is a big gap here.
Con O'Donohue: We certainly-----
John Deasy: It is clear from the number of road deaths ten years ago compared to the number today that there has been a massive drop, so some things definitely work and improvements have been made across the board. I still do not get why more analysis is not done when it comes to causation.
Noirín O'Sullivan: In terms of blood alcohol count, as I said at the outset, sometimes it can be difficult, particularly if people have been fatally injured in road collisions or require medical intervention very early on. That is a priority. Research is done by the Medical Research Bureau, also which has responsibility for analysing the blood alcohol content of samples. As Mr. O'Donohue has said, we see that speed is cause of many fatal road collisions and serious injury collisions; also, non-wearing of seat belts and the use of mobile phones. Coming into the autumn period, there is a lack of awareness by pedestrians in terms of dark clothing and stepping off footpaths. Sometimes cyclists wear earphones and iPods. There are many causation effects other than blood alcohol content, but that is being monitored.
John Deasy: I thank the acting Garda Commissioner for her response. Maybe I could ask Superintendent O'Donohue another obvious question. The number of road deaths increased from 162 in 2012 to 190 in 2013. What is the reason for the increase, given that we have made all these improvements? We are here to discuss the GoSafe system. More checkpoints have been put in place, as mentioned by the Road Safety Authority. What is the reason road deaths have increased by almost 30 in the year?
Con O'Donohue: There are a variety of contributing factors to most collisions, as alluded to by the acting Garda Commissioner. Some of them are very unusual. The Deputy mentioned that legislation was passed. The reduced blood alcohol limits, mandatory alcohol testing, the safety camera project and all the various initiatives taken in recent years have reduced the very high level of road deaths that obtained ten years ago.
John Deasy: I accept that.
Con O'Donohue: We are now at a stage at which the number of fatalities will bottom out. The best countries in the world, unfortunately, still have road fatalities. At some point the number will bottom out.
John Deasy: Fair enough.
Con O'Donohue: There will always be a blip. Sometimes they cannot be explained in terms of an overall trend. We were surprised that in 20% of the fatalities last year people were not wearing seatbelts. That is one that jumped off the page, with everyone asking, in this day and age, why 20% of people were not wearing seatbelts. Speed is still a factor. With the change in the economy, as things start to improve we are getting more vehicles on the road. I spoke to Road Safety Authority about that issue and asked if it is an issue we need to research. Would fuel sales indicate that we are getting more vehicles on the road and more mileage travelled? As a consequence, there is likely to be an increase in the number of deaths and serious injuries. The Road Safety Authority, which has a research function, has not come back to us on that yet, but it will. Certainly, we are working with the Road Safety Authority and the National Roads Authority on the engineering issues. All the time we are sharing and trying to get information. As to 2013, whether it was a blip or whether the number of fatalities is beginning to level out, we still have to keep striving the reduce the number. We are aware of the tragedy for families with one fatality, so we will never be satisfied. At the same time, we all know we will never reach zero, although that should be the ultimate aim.
John Deasy: I thank the superintendent.
The last set of crime figures showed that homicides had risen by 22.5%. The acting Garda Commissioner made a comment at the time in which she said the increase was not attributable to organised crime. Can she explain? To what does she attribute the increase?
Noirín O'Sullivan: Unfortunately, no more than for road deaths, any death is a death too many, no matter how it is caused. The increase in the homicides is not attributable to organised crime.
It is certainly attributable to a greater propensity to violence and "familial" interactions - I do not like using the term "domestic" - as opposed to other types of interactions such as organised crime. There is something to be done here in regard to responsible behaviour and awareness.
While the homicide rate is up this year, there is a detection rate of 67%, which I see as positive. I do not like to talk of homicide in these terms, because even one death is a death too many. We want to prevent deaths rather than detect them.
John Deasy: The acting Commissioner is basically making the case that society is becoming more violent.
Noirín O'Sullivan: Certainly there is more of a rush to violence not just in terms of deaths, but in terms of serious injury and people acting without thinking.
PAC Meeting | June 19, 2014
Department of Transport, Tourism and Sport
Mr. Tom O'Mahony (Secretary General) and Ms Moyagh Murdock, right (CEO, Road Safety Authority) called and examined.
Deputy John Deasy: I have an issue which is not directly related to the discussion but it is pertinent to the Department. A couple of years ago legislation was passed to reduce blood alcohol limits for drivers from 80 mg to 50 mg. Has any analysis been carried out on the effectiveness of that measure? Has anyone in the Department looked at causation or levels of effectiveness in the reduction of blood alcohol limits from 80 mg to 50 mg?
Tom O'Mahony: The RSA carries out the research but it might be a bit soon.
Moyagh Murdock: Is the Deputy is referring to the effectiveness of the ability to drive with a lower alcohol level?
John Deasy: No, I am talking about prevention of death.
Moyagh Murdock: I will need to revert to the Deputy with more specific analysis. Over the past 12 months, mobile checkpoints and detections for breath tests have shown a significant reduction in the level of detections with the new levels in operation. Lowering the levels has raised awareness and there are fewer people taking chances. The figures over the past 12 months have demonstrated a 3% reduction in the number of detections, even though the number of mobile checkpoints has increased.
John Deasy: The number of checkpoints has increased.
Moyagh Murdock: Yes, by 9%.
John Deasy: There has been a 3% reduction. It is not possible to say because the RSA has not done an analysis.
Moyagh Murdock: There has not been any major analysis but I can give the Deputy some of the top line figures for the number of detections and the number of checkpoints-----
John Deasy: No, that is okay.
Moyagh Murdock: There has been an increase of 9% in mobile checkpoints over the 12 months and a reduction of detections on alcohol issues by 3%, so a combination of the two would indicate that there has been a reduction in risk-taking. However, there are still too many getting caught, having taken the chance.
John Deasy: What kind of analysis is carried out by the RSA as a matter of course to determine whether legislation is effective or ineffective? Surely this is pretty landmark legislation when it comes to road safety. An appreciable period of time has passed since the enactment of that legislation. Is there a set period of time for the RSA and the Garda Síochána to determine its effectiveness?
Moyagh Murdock: Over recent months we have been working with the Garda Síochána and interfacing with the PULSE system to collect the statistics. There was much work done and significant investment by the RSA to get that information in order that our own research section can now utilise it. The system is now working. We receive excellent information on a daily basis. It will take some time to build up some statistical analysis but we are happy to come back with information on the effectiveness of the legislation. A raft of new legislation is being rolled out in the coming months and points are being increased from two to three over a number of offences.
John Deasy: In short, Ms Murdock is saying there has been no analysis as such.
Moyagh Murdock: The analysis we have done in the past would be more of a manual analysis. We did not have the capability until more recently to do the type of database interrogation about which the Deputy is talking. There certainly was analysis done in the past, but we will have a much more interrogative analysis in future that will allow us to produce information on a more scientific basis.
John Deasy: When will that analysis be available?
Moyagh Murdock: We are using the information as we go along. It is a question of setting the parameters of the investigation and deciding what information we want to find out. That process is under way and we have the capacity to come back with specific results on specific queries and set out an analysis of them. The Garda Síochána issues monthly statistics on fatalities, collisions, checkpoints, and the number of detections of speeding, driving while intoxicated and other offences under the road traffic legislation. There is a whole raft of queries on which we will be able to work with the Garda.
John Deasy: I have a related question in regard to drug driving. Given that the number of checkpoints is up by 8% or 9%, has there been a corresponding increase in the rate of detection of drug driving?
Moyagh Murdock: I do not have that information to hand. Our research and education section is working very closely with the Garda on this issue.
John Deasy: Does Ms Murdock have any idea of the numbers? This issue has been knocking around for some years now.
Moyagh Murdock: It is a work in progress. I will come back to the Deputy with information.
John Deasy: Does Ms Murdock not have any sense as to the effectiveness of the current regime?
Moyagh Murdock: I do not have that information to hand. We are working with the Garda on the effectiveness of detection and, in particular, the challenges in terms of on-the-spot detection. There is a working group engaging with the Garda on that issue. I will get back to the Deputy with more details.
John Deasy: I am not sure whether the Comptroller and Auditor General's office has done any work on this. I would like some type of analysis to be done with regard to blood alcohol levels, drug driving, increased checkpoints and the effectiveness of measures that are taken legislatively and by the Garda. It is important that such an analysis be done.
Moyagh Murdock: Absolutely.
John Deasy: We are all striving to improve road safety, but if we do not know what is effective, we are shooting in the dark. The weakness in the system for years has been that some of the measures that were taken were introduced by legislators who were not tuned in to what really needs to happen. The only way of finding out what is required is by doing the type of indepth analysis to which I referred. I am surprised it has not been done given the time that has passed since the enactment of the legislation. The issue of drug driving has been spoken about endlessly.
Moyagh Murdock: The technological advances we have implemented, with the PULSE system now interfacing with our own systems, will facilitate what the Deputy is talking about. I agree 100% that we should be able to produce that type of information, not just in regard to drink driving but also drug driving. I am optimistic that we will be able to get information for the Deputy in the near future. That project has just come to fruition. It involved a significant amount of development work and an investment of more than €400,000 in developing the IT interface.
Deputy John Deasy, Public Accounts Committee chairman, John McGuinness TD, and Comptroller & Auditor General Seamus McCarthy prior to this morning’s private meeting with John Muwanga, Auditor General of Uganda, who uncovered a fraud which included €4 million of Irish aid money in 2012. As a result the Irish Aid programme was suspended and the money subsequently repaid in full. The PAC examines the controls on the Overseas Development Aid budget with the Department of Foreign Affairs on an annual basis, with delegations to two programme countries — Mozambique and Ethiopia — having looked at how risks can be mitigated.
PAC Hearing | April 3, 2014
Mr Robert Watt, Secretary General Department of Public Expenditure & Reform, called and examined.
Deputy John Deasy:
First I’m going to ask you about what I regard as the largest, potentially, public-private partnership that this country has seen in many years, and possibly has ever seen. And that is something I know your Department is involved in: that is the Irish Strategic Investment Fund. It’s not listed here in your opening statement or dealt with, but I think it’s something your Department might be leading on with regard to the inter-departmental committee with Finance and the NTMA (National Treasury Management Agency).
As much as I know about this, it’s a €6.8 billion fund which comes from the National Pension Reserve Fund, which is being turned into an Investment Fund, that is looking for commercial investments from the private sector. That €6.8bn hopefully will be matched by another €6-7bn of private money, and the Government’s idea — well, it’s started already — is that it’s being farmed out to private equity funds in Dublin, in London, to look for those commercial investments. And that’s fair enough.
What I am interested in is: has any thought been given to where this money is going to be spent, or is this random with regard to commercial investments coming into the Government; the equity funds taking a look at these and some kind of process within Government — is there any sense, or has any thought been given to parts of this country that frankly are stagnating?
We’ll say, for argument’s sake, there’s some truth to the idea that Dublin, for example, has seen some kind of a recovery. But other parts of the country have not. Surely because this is the largest stimulus fund this country has ever seen, or will see for years, has anybody in Government thought about diverting some of this money, as a critical policy measure, towards those parts of the country that are stagnating, that are regressing in some cases when it comes to unemployment. And that have seen no recovery.
Has any thought been given to that considering the amount of money that’s involved here? Going through your statement, you talked about the PPPs in the past, and I’d make the point to you that many of these PPPs were targeted, they were infrastructural projects, and they would have been strategic projects that were targeted around the country for various reasons — infrastructural reasons. There was a different mindset and thought process involved in targeting that money, those billions, to those different parts of the country.
In this case I have a suspicion that the €6.8bn and the money on top of that, that may come in from the private sector investments, is not targeted around the country at all.
"This is the largest stimulus fund this country has ever seen, or will see for years. Has anybody in Government thought about diverting some of this money, as a critical policy measure, towards those parts of the country that are stagnating?"
Robert Watt: You’re right in terms of the investment fund. It’s €6.8bn. It previously was the NPRF, I suppose a passive investment fund which was global, which invested in property and equities and bonds across the world. The fund is in the NTMA. The Department of Finance has a role, we have a role — we’re not leading: we are part of a group ... we are absolutely involved. The fund is being reoriented towards investment in projects in Ireland that can provide a return, an economic impact, a jobs impact; also that are commercial, that provide a commercial return to fund. And they have to get the balance right between projects that for whatever reason the market won’t fund ... maybe because there’s more uncertainty about the project or because it’s a start-up activity. So it won’t be delivered by the market yet it’s commercial. It’s going to be tricky for them to identify projects.
There is legislation being drafted, a Bill is being prepared. The Minister for Finance, Mr Noonan, will be publishing it I think after Easter, around Easter time, which will set out the mandate: they’ll be obliged to set out an investment strategy, and that investment strategy will have to reflect or listen to the views of Government.
Based on what I’ve seen there’s no regional angle or perspective to this. So their job is to invest in projects that have an economic impact, a jobs impact, and which are commercial. But as far as I’m aware at this stage there’s no regional impact.
John Deasy: And I suppose what I’m asking is, should there be?
Robert Watt: Should there be? Well, this is something to debate. You know, we look at exchequer funding or PPPs [and] we have regard to spread. Naturally, the political world and the way monies are allocated, reflects the spread.
John Deasy: That’s been the case in the past.
Robert Watt: That’s been the case in the past. So, a commercial fund, an investment fund investing in projects, is there a role for it to take account of a regional remit? That there’s regional balance? It’s something that I haven’t thought about. It’s something that could be debated. You know, clearly that there is, based on the evidence that we have, a two-tier economy emerging, that the Greater Dublin area is different — I think all the evidence suggests that it’s out of recession, and growing. You might say, well, that suggests there are greater opportunities elsewhere in parts of the country that haven’t moved as quickly out of recession: for example property values are lower or opportunities might be cheaper. But it’s something that I, Deputy, to be honest, haven’t reflected on. I don’t see any reason why a fund which is being orientated to jobs and economic activity in Ireland, why in theory it can’t have regard to a regional spread or a regional balance.
John Deasy: You know the basic figures with regard to, for example, Foreign Direct Investment: Dublin, Cork, Galway — it’s about 82%. It’s an inordinately huge number when you consider the country as a whole. And the disparity between those three urban areas and the rest of the country is... it’s immense. So here we have something that could amount to €12-13bn, and nobody’s given any thought to any regional aspect at all. And I think it’s a deficit, potentially.
Robert Watt: I may be doing them a disservice but from what I’ve seen, in terms of the legislation, I don’t see that, but that’s not to say...
John Deasy: This has started already. [The Dept of] Finance has given the presentations. He [the Minister] has said we’re open for business, bring it on. As you know, and you’ve been around the financial worlds long enough, equity funds don’t really take into consideration public policy that much. And what we’ve done is, we’ve actually given them the job to find these commercial investments. And I don’t believe that anyone has actually taken into account the fact that we may be looking at not only a two-tier economy, but a two-tier recovery. And that’s what I want to avoid. And that’s what I think this legislation should try to avoid. Now, someone might say to you, if you do that, and if you go down that line, well it makes some sense. But with regard to commercial investments, would you be actually negating, or would you be blocking some decent investments, if you made the case that a lot of that money, or some of that money, be earmarked for the areas that were suffering the worst from the recession. At the very least I think we need to start talking about that.
Robert Watt: My understanding of the legislation is that the Minister for Finance, the Government, would input into the overall strategy, the focus, but obviously the individual decisions are commercial decisions then for the body then, the ISIF set up within the NTMA. So there is a role for public policy and there is a role for Government... as you mentioned it, Deputy, no, I don’t see any reason why you can’t have regard to the regional impact of the investment, have regard to exactly the types of projects and the impact they might have. And that would have to be reflected back in some sort of mandate then to the people who are responsible for making the decisions.
PAC | March 13, 2014
Department of Justice
Secretary General, Mr Brian Purcell, called and examined.
Deputy John Deasy: With the indulgence of the Chairman, I will ask a further question on training, education and development programmes for former prisoners and the reintegration of former prisoners in the community. One such programme, U-Casadh, is located in Waterford. How much money is the Probation Service allocating to these organisations? Does the Department intend to increase funding for these groups? Do these programmes work and would it be worthwhile investing more money in them?
Brian Purcell: What is the name of the project in Waterford?
John Deasy: It is called U-Casadh and one of many such programmes aimed at reintegrating former prisoners into the community.
Brian Purcell: There are obviously significant benefits from having schemes that facilitate the reintegration of prisoners into the community. One can only do so much work in terms of rehabilitation within a prison setting. As I know only too well from my time as head of the Prison Service, when offenders are going back into the community, the early stages after their return are the key period. Whatever progress can be made while they are in custody, it is important that supports are available on the outside. The Probation Service has a budget for these projects and in 2012 expenditure on community based organisations was approximately €10.3 million. The Department intends, in so far as our budgets allow us, to continue to support community based projects for offenders returning to the community.
John Deasy: The focus of the committee is on saving money and obtaining value for money. Does investment in rehabilitation programmes for offenders save money in the long run? The Department obviously has conducted cost-benefit analyses in this area and of some individual projects. What is Mr. Purcell's opinion of the investment it is making in rehabilitation projects? Do they pay dividends and would it be worthwhile investing more money in them? Has the Department carried out an analysis?
Brian Purcell: I believe the projects are paying dividends. To be honest, some of them are better than others and the Probation Service examines, audits and analyses the various projects to find out which ones it considers are delivering the greatest benefits. This will continue to be done on an ongoing basis.
"We have all read reports on the success the Scandinavian countries have achieved in this area."
John Deasy: Does the Probation Service make a case to the Secretary General for additional budgets if it finds they are needed?
Brian Purcell: While the Probation Service would look for extra budgets, obviously the Department's budgets are limited by the amounts allocated to us by the Department of Public Expenditure and Reform. We fund 45 community based organisations that are funded by the Probation Service throughout the country, which represents 28% of the entire Probation Service budget allocation. These organisations provide a range of services, depending on the areas in which they operate. I certainly believe one can obtain a significant benefit from investment in community run and community based programmes for prisoners. One of the measures we have introduced that has been quite successful has been the community return scheme where we have taken suitable prisoners and put them into the community. In other words, the prisoners concerned are able to serve the tail end of their sentences in doing community service. This project has proved to be very successful since it was introduced in late 2011. I see the way forward as continuing to invest as much as possible in those services in which the Probation Service is involved because this investment is showing benefits. For the first time in a long time we have seen a reduction in the number of people coming into custody. The investment we have made in this type of project in the community and through the Probation Service has been instrumental in that regard. I am not saying by any means that it is the only reason, but it is-----
John Deasy: Mr. Purcell has made a significant statement. He has said he believes these schemes are effective and that it is worth investing money in them. I do not know if the Comptroller and Auditor General has ever examined this issue or if his office has a role in analysing the expenditure the Department and the Probation Service allocates to these organisations in terms of its effect and the end result for the Exchequer in reducing the level of reoffending and the recidivism rate among those who enter these programmes compared to that among those who do not do so. Would it be worthwhile examining this issue? Would such an examination be helpful to the Probation Service or the Department?
Seamus McCarthy: We looked at the Probation Service in considerable detail, but, again, it was probably about ten years ago. I think one of the aspects we looked at was how they assessed which programmes worked and perhaps which were less successful. While it is something we could certainly return to at some point, it is not an easy process. One could end up case-making if one wanted to support this approach or one could end up making a case to abolish these organisations if one wanted to do this. There are so many variables in the equation that it is a significant challenge for the Department. However, it is something that needs to be done.
John Deasy: Mr. Purcell has stated these programmes have had a considerable effect on the recidivism rate. Given that a study of the programmes in which we are investing €10.3 million has not been conducted in the past ten years, surely we need to analyse them to ascertain how effective they are? All of these organisations keep track of the people who avail of their programmes and each of them will, therefore, have statistics. We have all read reports on the success the Scandinavian countries have achieved in this area. I do not know if there is anything more scientific that could be done to bolster our belief and faith in investing in this area.
Seamus McCarthy: The point about my office having looked at it about ten years ago is beside the point. The Department would be obliged, in terms of its spending on an ongoing basis, to do that type of evaluative work on a routine basis, not waiting for my office to come and do it.
Brian Purcell: We do that. We have a very close engagement with the Central Statistics Office. We have two members of staff from that office in the Department, one of whom has done a great deal of work with the Probation Service and would focus on the type of thing that works and the type of thing that does not. What I am saying is based on what we have seen ourselves. I would make the point, the Comptroller and Auditor General touched on it, that this is a very broad area and it is not always easy to pinpoint exactly what works and what does not work. In relation to the problem and the individuals one is dealing with, it is not necessarily one particular intervention that delivers the result. It depends on a myriad of different issues, most of which do not fall within the remit of the Department of Justice and Equality, or the Probation Service or the Prison Service. It also depends on a wide range of societal issues but also on a wide range of services provided by a wide range of other agencies.
John Deasy: Sure.
Brian Purcell: We try to evaluate what works best and what does not. That is something we will continue to do although, at the same time, I have to point out that we only have a limited amount of money that we can spend on these projects and we spend whatever we can.
John Deasy: That is what I am getting at. Notwithstanding the intangibles the Comptroller and Auditor General has mentioned - I accept all that and what he has said - I do not know if it is within his remit to take another look at this issue and, perhaps, assist the Department, notwithstanding the work those two individuals do within the Department, to see if this money is being well spent or if more money would result in a lower recidivism rate.