Mr. Seamus McCarthy:

This relates to Fáilte Ireland and its financial statements for the year ending 31 December 2014, in respect of which I have given a qualified audit opinion. The background to this is that Fáilte Ireland does not recognise a deferred pension funding asset for one of three defined pension schemes it operates. Its argument for this is that it has not been provided with a guarantee in regard to the future liabilities of that scheme. Fáilte Ireland recognises there is a liability that will have to be met, which, I understand, is of the order of €240 million in total. That is the body's estimate of benefits already accrued. Fáilte Ireland is recognising that the State will provide it with funding to meet some but not all of that liability. It recognises some €100 million of future funding as an asset on its balance sheet, which leaves it with a net liabilities position on the balance sheet of €100 million.

In most semi-State bodies, there is full recognition that the State will meet liabilities as they arise in the future and, on that basis, the full value of the asset is recognised. That would change the look of Fáilte Ireland's balance sheet, putting it in a net assets position, as at 31 December 2014, of approximately €42 million instead of that net liability. It would also have an impact on its income and expenditure account whereby it would be showing a surplus of €6 million for the year instead of a surplus of €4.2 million. Prior to its financial statements for 2013, Fáilte Ireland did recognise that asset, but the board has decided this is a more appropriate way to account for it.

I am giving a qualified-audit opinion on this matter. The practice of operating pay-as-you-go pension schemes has an implicit, as opposed to an explicit, commitment. There is also the fact that the employees of Fáilte Ireland and many other State bodies are paying contributions into a pension scheme in the expectation they will receive benefits in the future. The Department and the Minister have the difficulty that the funding for Fáilte Ireland comes by way of Estimate, which is voted every year by the Dáil. The Minister cannot bind the Dáil to a commitment in this regard, which presents a technical difficulty. However, there is no evidence the Department would seek to avoid meeting those commitments as they arise.