Ms Ita Mangan:

I thank members for the invitation to address the committee on the matter of the restructuring of the Money Advice & Budgeting Service, MABS. As members are no doubt aware, the Citizens Information Board, CIB, is the statutory authority responsible for the delivery of MABS services and the use of the State resources for MABS services. I think I should also point out that CIB is also the statutory authority for the provision of information services and advocacy services. It provides some of these services directly; for example, it is directly responsible for the Citizens Information website which receives 17 million hits annually. I realise that today's discussion is about the organisation of MABS but it is important that the context is recognised and that the staff of the CIB have many other responsibilities.

MABS services are entirely State funded. There are 51 MABS companies, each of which is subject to company law and is required to use the resources provided by the State, that is, by the people of Ireland, in the manner agreed between that company and the CIB. As the chair of the CIB, I am required to sign off on the annual accounts. When I do that, I state that I believe and know that the allocated money was spent in the manner outlined. I am similarly required to sign off on the use of State funds by 42 Citizen Information services' companies. Within the resources available to the CIB, the many other tasks which it is required to undertake, and the requirements of the Comptroller and Auditor General in terms of State funds, it is very difficult for the board or for me as chair to so satisfy ourselves.

The issue of reorganising the delivery of MABS and Citizens Information services, CIS, has been on the CIB agenda for some time. In fact, since 2009 when MABS came under the remit of the CIB. It is regrettable that it has taken so long to reach the point which has now been reached. While the decision to restructure MABS and the CIS was taken in 2014 by the then board of the CIB, the decision to restructure MABS into eight regional companies was only taken at the most recent board meeting of the CIB last week on 15 February. The executive of the CIB is now beginning the process of developing the detailed operational project plan for the restructuring.

I wish to emphasise that this decision is about governance, accountability, value for money and using the skills of the employees of the MABS and CIS companies to provide the best possible service to the people who need those services. The service users will not see any change in the services they receive. When this decision is implemented, people in need of mortgage advice or struggling to meet a utilities bill or needing advice about any choices they may have about social welfare payments will go to the same place, be looked after by the same people and get the same level of service they currently receive.

In the longer term, the changes will almost certainly result in a better level of service but in the immediate term, there will be no change from the service user's point of view. The governance of the service providers will have changed but the person in need of the service does not care about the governance. If one has a serious mortgage problem, one needs the sort of help that MABS can provide and one does not care who is delivering the service. Similarly, employees of the services – approximately 2,800 people - will continue to work from the same place and provide the same services. Nobody will lose his or her job or be moved. This is a governance issue. Given that the employees will be relieved of administrative duties, they should be able to provide services to more people or more intensive services than they currently do.

There will be changes for the approximately 800 members of the current local boards. They will no longer be the employers of the people providing the services but they will have the opportunity to continue as local advisory boards if they wish so they can use their expertise to help their local communities but shed their current administrative burdens.

I would like to give the committee some history about how the current decision was reached. I do not intend to read out the entirety of the statement, which goes into all the detail, because I recognise that everybody can read and can follow what happened.

A feasibility study was carried out in 2014, and that was the point at which the basic decision to regionalise the structure was taken. A design group considered the recommendations of the study and in 2015 the design group carried out its work and identified a preferred option for a new regional model for CIS and MABS. This model was seen as the best solution to the difficulties being experienced by CIB in the delivery of services. Unfortunately, there was a hiatus while there was no board of CIB and no decisions could be implemented because there was not a quorate board in existence.

In October 2016, the board, having met all the representative bodies, took the decision to go ahead with the restructure on a regional basis. We set up a restructuring committee, which I chaired. It was in place for a period of three months and consisted of three members of the board, four representatives of CIS and MABS and three members of the CIB senior management team. The decision to regionalise had already been taken so the committee’s mandate was to come up with the most appropriate design for a regional structure. The committee reported back to the board at its meeting last week. At that meeting, the decision was taken to proceed with the structure as recommended by the restructuring committee. I emphasise that there is no one perfect structure that will meet all requirements. We are not suggesting that this is the perfect structure but it is the best we could come up with in the circumstances. It will involve eight MABS companies and eight CIS companies. They will each be responsible for a number of counties but there will be roughly equal resources and work involved for each company. That was the basis on which the decision was made.

In terms of regionalisation in Ireland, nobody has ever quite agreed on what should be the appropriate regional structures apart from the provinces and, for example, the GAA in the provinces. We have had regional assemblies and various forms of regional administration but no one perfect model has emerged. We have decided on this particular model. That decision was made last week. The restructured governance arrangements are being implemented at local company board level. There will be no job losses, no closure of services and no change to the location of any services during the lifetime of the restructuring programme. There will be no change to the terms and conditions of serving staff and, most importantly, there will be no disruption to service users who need to use the services.

A more streamlined governance structure will result in a more targeted use of valuable staff resources. At present, we have a very large number of companies, all of which have to be administered and involve a certain level of bureaucracy. That will be removed and the people who have skills - the information givers and money advisers - will be able to spend their time actually providing information and money advice. That is the objective of this. It will improve the service user experience and allow for the development of additional specialist roles where required. The MABS organisation has, at the request of the Government, taken on a greater role in helping people with mortgage arrears. It is a specialised area of activity that needs to be further developed. There are still an awful lot of people in mortgage arrears who are not availing of the service and we want to extend the service to as many people as possible. It requires skilled staff and we are building up that core of skilled staff to provide the service.

In 2017, CIB is set to receive State funding of €54 million, of which €15 million is allocated to CIS services and €24 million is allocated to the network of MABS services. The governance requirements of State boards and voluntary organisations, which the MABS companies are, have all become much stricter and more demanding in recent times. The feasibility study we carried out recognised, among other things, the need for consolidation of the services in order to provide effective governance and management capability. The management of and accountability for grants from Exchequer funds is the subject of a 2014 circular from the Department of Public Expenditure and Reform. The main principles required of companies in receipt of grants are clarity, governance, value for money and fairness. A comprehensive checklist for grantees, coupled with an increased focus on compliance via reporting requirements is an unsustainable burden for the CIB at present in the context of 93 boards, many of which do not have the capacity or desire to focus on these aspects of their roles. That is not a criticism of them because their primary role is to provide services to people. Their primary role is not to be accountable for public money. The CIB has to be accountable for public money. A new code of practice for the governance of State bodies came into effect in September 2016, with an associated robust performance agreement with which the CIB needs to comply.

Recent reports of the Comptroller and Auditor General have requested the CIB to review its financial control arrangements for MABS companies and to request compliance statements for each MABS company supplemented by on-site visits in order to ensure adequate controls are in place across each funded company. This task will be impossible to fulfil unless the number of funded companies is significantly reduced. I emphasise that we are amalgamating companies. We are not changing the level of service but are hoping to improve the level of services.

One of the most important considerations in the case for change is the potential to improve the services available. Potential improvements could include greater availability of services in areas where services are not currently available and greater access to a wider range of expertise and services. The need to ensure that all citizens can access a high-quality, consistent and accurate service throughout the country is critical for both CIB and the services. Recent developments in quality standards have been progressed in both the CIS and MABS services. While acknowledging that much has been achieved and that there are some really high-quality services being provided, there is still serious concern and evidence, including direct complaints to CIB about service in some companies, that not all the services are delivering a quality service. MABS, like most other services in Ireland, provides services that range from extremely good, to average and quite poor. Very many of them are extremely good, which I acknowledge, but there is no such thing as a service that cannot be improved. There are significant areas of the country that are not covered by the services. All of these are factors in all our considerations.

Under the current structure, there is little that can be done to address these problems because of having to deal with 93 companies. This lack of a co-ordinated approach can have a detrimental effect on service users. It also creates risks for services such as leaving them open to complaints relating to poor quality, inaccurate advice and even litigation. Recent research commissioned by the CIB has confirmed there are variations across services in the level of accuracy and relevance of the advice provided. While CIB will continue to develop tools to assist services, there are no economies of scale to be derived from having to implement the standards across 93 separate companies. If the CIB was to carry out all the requirements of the Comptroller and Auditor General in the 93 companies, we could say goodbye to providing a decent information service which we currently do. We could also say goodbye to providing a decent advocacy service, which we currently do. It would not be a good use of resources to keep an eye on all the 93 companies, even if those resources were made available to us. Instead those resources should be directed towards the provision of better-quality services in information and the money advice services.

The boards of management and service managers have expressed concerns in recent years about the considerable amount of managerial time being directed into administration with a consequent negative impact on the management of service delivery. In addition, boards vary in their level of engagement and buy-in to national service developments and in their capacity to oversee the manager’s role in implementing these. Many managers are managing very small numbers of staff and are duplicating the same administrative responsibilities associated with reporting to the board of management and CIB as much larger companies. The new structure will remove much of the administrative burden and duplication and will free managers up to promote skill development and resulting service improvement. The existing managerial resources within the networks could potentially be assigned as dedicated service development-delivery managers, business managers and quality managers within the new regions. Local managers would be asked to focus on quality assurance tasks and could get involved in projects at a regional level such as public personal insolvency practitioner, PIP, services, which deal with insolvency matters, and administration of bankruptcy services. These are areas in which the CIB and MABS are trying to provide better services in which developments are progressing at present.

In each region, a dedicated management team approach could be taken rather than individual managers working independently within silos. This team will be managed by a senior manager who will hold responsibility for board and CIB reporting, finance and overall staff management. Ultimately, this will have more direct benefits to service users as the quality of the service provided is supervised and assured.

At present, boards vary in their ability to fulfil their role in overseeing operations. The level of engagement with CIB as the funding body is also variable. The responses of some boards to audit reports is concerning. Oversight of the operations of companies and performance management of managers does not happen consistently. A reduced number of services will enable more regular auditing and a more effective follow up by the CIB on the implementation of these recommendations. Improved governance within a smaller number of companies will mean that time and resources can be better directed to the provision of high quality services.

The Citizens Information Board, CIB, is in receipt of Exchequer funding for which it must account to the Department of Social Protection. As I said initially, I personally have to sign off on all the accounts. The board of the CIB has to be satisfied that everything has been done properly. At present, the Comptroller and Auditor General is not satisfied that all of the necessary steps are being taken to ensure the proper use of resources, and we have to operate within his recommendations.

The CIB must also operate to a strict employment control framework. There is nothing unusual in that respect in that all Departments and bodies are subject to employment control regulations. In order to continue to meet the governance and compliance demands created by 93 companies, the CIB will be forced to redeploy staff into these roles. However, as I said, that would not be a good use of resources.

An important issue is the need to ensure that during any change process the service users will not be adversely affected. It is our intention to ensure that the service users will not be adversely affected during the change. They should see no disruption in the service being provided. As I said at the outset, they will still go to the same place, they will looked after by the same people and they will get the same level of service. It is only the backroom aspects of the delivery of services that will be affected.