Mr. Feargal Ó Coigligh:

Táim thar a bheith sásta a bheith anseo ar son na Roinne agus chun aon cheist atá ag an gcoiste a fhreagairt.

The policy goals of the Department of Culture, Communications and Sport in relation to arts and culture are to enhance access to and participation in the arts, culture and film sectors in Ireland and support those sectors in the delivery of their social and economic contribution to Irish life. In recent years this has seen a strong policy focus on increasing support for professional arts practice, with significant increases in funding for the Arts Council, Screen Ireland and Culture Ireland and the introduction of the basic income for the arts research programme. Governance, oversight, resourcing, management of grants, policymaking and legislation for arts and culture are therefore core responsibilities for the Department. The Department takes these responsibilities seriously and commits significant resources, and has established procedures in place, to support compliance with the code of practice for the governance of State bodies, the public spending code and public financial procedures.

Notwithstanding these arrangements, the Arts Council annual report for 2023, published in February of this year, revealed that the council's business transformation project, in respect of which expenditure of €6.675 million had been incurred, had failed and that there was an estimated loss in value in respect of the project noted by the Comptroller and Auditor General amounting to €5.3 million. Last July, on receipt of the annual report, I initiated an examination of the business transformation project by a senior official, and former head of the internal audit unit of the Department, to establish the full facts around this failure. The Department published her report in February in conjunction with the Arts Council annual report and accounts. The report, which runs to 97 pages, contains 17 main findings and 36 recommendations. The findings point to a range of failures of governance by the Arts Council but also, critically, to failings by the Department in its oversight role in respect of the project.

Subsequent to publication, the Minister established a review of governance and organisational culture in the Arts Council, chaired by Professor Niamh Brennan. In parallel, the Department has put in place a review of its own governance and oversight functions, building on the work carried out by the Institute of Public Administration, IPA, over the past year.

By way of background, the intention of the Arts Council in seeking to upgrade its IT systems was and remains an entirely worthy objective. Its current systems are cumbersome, offer a poor user experience for artists and do not allow the council to gather the data necessary to adequately assess the impact of its funding decisions. In upgrading this system to gather such data, the council was seeking to address the conclusions of a value-for-money study of the Arts Council conducted by the Department a decade ago. In some instances, the governance failings of the Arts Council were mirrored by oversight shortcomings in the Department. The examination found that the council lacked the capacity to properly assess its requirements as it embarked on the project. The Department similarly lacked the IT capacity for the lifetime of the project to properly assess the technical and financial feasibility of the council proposals. The Arts Council failed to seek or obtain sanction for increases in the budget and resources it was applying to the project in 2021, 2022 and 2023.

In this period, the Department received regular updates from the council on its plans to increase the budget for the project. However, the Department failed to require the Arts Council to meet its obligations under the sanction which was provided. No process was in place in the Department in this period to ensure that the information obtained relating to the cost overrun on the project, either directly through correspondence or in quarterly liaison meetings, was escalated to the Secretary General or the Minister.

The Department has since put in place new monitoring arrangements around compliance to ensure that this could not happen again in respect of an ICT project sanctioned by the Department in an agency under its remit. The Arts Council and the Department are committed to the implementation of the recommendations set out in the report on the examination of the business transformation project.

Equally we are engaging with the review being undertaken by the advisory committee led by Professor Niamh Brennan and will ensure that all recommendations emerging from the review are delivered, including those that are relevant to the Department.

The work of the Arts Council is fundamental to the development of the arts in Ireland for the benefit of all the people of Ireland. It is a matter of profound regret that this project has failed and that such a significant amount of public money has been written off. The report on the examination of the project, which I commissioned and which the Department published in full, sought to establish the facts and provide the greatest level of transparency on the circumstances behind the failure of the project. The further review is now being undertaken seek to ensure that there is confidence in the governance of the Arts Council and in the Department’s own oversight and governance arrangements. In this regard I have recently established a specialised governance unit within the Department to embed one consistent high-quality approach to our oversight function across all our agencies.

As the Department takes on its new functions as the Department of Culture, Communications and Sport, I can assure the committee that we will place the highest emphasis on fulfilling our oversight responsibilities in relation to all our bodies over the coming years.

Táim sásta aon cheisteanna a fhreagairt.