Mr. Seamus McCarthy:

The Irish Prison Service is formally part of the Department of Justice but is funded and accounted for separately through Vote 21. While the Secretary General of the Department is the Accounting Officer for Vote 21, the Prison Service is headed operationally by its director general.

The 2019 appropriation account for Vote 21 - Prisons records gross expenditure of €358 million. More than two thirds of the expenditure, totalling €255 million, relates to pay. The remainder is spread across a range of areas, including maintenance and improvements to the prison estate, equipment purchase, education and services for prisoners and other operating costs.

I issued a clear audit opinion in relation to the account. However, I drew attention in my report on the audit to material instances of non-compliance with national procurement rules that occurred in respect of contracts operating in 2019.

I will turn now to the report on catering and ancillary services in prisons. Catering in prisons is a significant operation involving the preparation and provision of meals every day to an average of nearly 4,000 prisoners at 12 locations across the State. A number of related services also operating within prisons are not funded by the Irish Prison Service. These include mess committees operating staff catering services and prison shops whose profits are transferred to a separate fund for the benefit of prisoners. The report examined the controls over all of those services.

With regard to catering, our focus was on controls over food purchases and food stocks. The Irish Prison Service has devised a 28-day menu plan which is used in all prisons. In 2019, the Irish Prison Service incurred expenditure of €8.2 million on catering purchases. We found that the cost of providing prisoner meals ranged from a low of €4.54 per prisoner per day in Wheatfield Prison to a high of €7.27 in Portlaoise Prison, a variance of 60%.

A review of items charged to prisoner education and training budgets noted some non-standard high value food items repeatedly purchased in one prison. These items were not called for in the standard prisons menu plan. I understand the governor of the prison in question has been investigating the circumstances surrounding that expenditure.

The scope of the examination also included a review of the operation of voluntary mess committees in most prisons, which co-ordinate the running of canteen facilities for prison staff. The committees use kitchen facilities provided in prison premises free of charge. The food is prepared under a training regime for prisoners. The committees can purchase food from approved suppliers at prices agreed under Irish Prison Service contracts. The prices charged for staff meals are set by the committees with the aim of recouping the costs of the inputs.

The relationship between the Prison Service and the mess committees is not covered by a written agreement. While the Irish Prison Service has issued some governance guidance to the committees, it did not seek formal assurances that the guidance was being followed. Overall, we found that the Irish Prison Service did not have adequate processes in place to ensure there is no unintended subsidisation of food costs for the staff committees.

Each prison operates a shop facilitating the purchase by prisoners of a range of items, including confectionary, cigarettes, soft drinks and toiletries.

With a small number of exceptions, stock items are procured from an approved central supplier at wholesale prices. Payment for shop sales is deducted electronically from funds held in the respective prisoners' personal money accounts, which are managed by the Prison Service. Until April 2019, staff were also allowed to make cash purchases from the shops, which resulted in cash handling and additional control needs. In 2019, gross profits of just over €1 million were generated from sales of nearly €7 million in the shops across all prisons. Gross profit margins ranged from 8% in the Midlands Prison to 21% in Castlerea Prison.

The examination raised a number of issues in respect of the operation of the prison shops, including weaknesses in controls over stock and cash purchases and delays in the submission of accounts and bank reconciliations. Profits from shop sales in each prison are transferred to dedicated funds, known as prisoner assist programme funds. These are intended to be used only for the benefit of prisoners. Our examination found some examples where expenditure from the funds was not in accordance with procedures set out by the Prison Service. This included a number of payments for the benefit of staff and some payments related to the operation of the prison that should instead have been charged to the Vote.

I made a number of recommendations for improvements in controls, all of which have been accepted by the Prison Service.