Mr. Robert Watt:

The Comptroller and Auditor General mentioned this before and there is a reference to the NRA in the most recent report. We have communicated with Departments about the need to minimise the amount of money that is in accounts. When it comes to issues from the Exchequer to the Departments, money is only issued when it is needed and it is spent fairly quickly. However, there is a problem when one goes outside Departments, into agencies and further afield, in terms of cash balances. We have made it very clear to Departments that this is inefficient, given the opportunity cost of raising funds. I know that cost is down to 3% now but the last time we debated this issue, it was at 5% or 6%. That is a cost and it can be significant. We have made it very clear that it should not happen now.

We did an analysis of the possibility of moving to a shared services banking system whereby, rather than issuing money from the Central Fund into accounts, we would have a single account and a much more consolidated banking approach. We looked at that for Government Departments and the in-scope bodies that are close to the centre. We found that there would not be enormous efficiency or gains because there was not that much money sitting around. Funds were only in accounts for a day or two. The Department of Finance is now looking at the potential of consolidated banking outside the core Departments involving, for example, local authorities, State agencies, universities, the HSE and others. There is the possibility of some solution there which will save money. The Department is working on that at the moment and doing an analysis of the potential. In the meantime, we have made it very clear that there should not be cash balances lying around. If any Department sees evidence of this, it should reduce the grant-in-aid. It should tell the relevant bodies that it will reduce their grant-in-aid and that they should not look for more money until they have spent the money they already have.