Mr. Seán Ó Foghlú:

In respect of the system, there are a number of elements to that. Obviously, this is an issue that the committee asked us to reflect on when we were here last year talking about this. We are confident in the robustness of the system of the systems we have in place but we have been seeking to enhance them and we are open to further enhancements. There are a number of different elements.

One could probably break down school transport into three elements for the sake of discussion and an overview. We have the contracted out services that are between €100 million and €110 million. We have the delivery by Bus Éireann of services, which is €30 million to €35 million. We have the administration charge, which I think is €15 million or so. We have different elements to assure us about each of the different parts. The overall approach is that we have an arrangement in place with Bus Éireann that we feel provides good value for money. We had a serious value for money review in place into which Bus Éireann fed information but was not part of and we had a wide range of recommendations arising from that in respect of the rules of the scheme and to bring about efficiency. Arising from those arrangements, while demand has gone up, particularly for special education needs services and particular routes, the costs have come down. State expenditure peaked at €186 million in 2008 and is now down around €171 million. The savings have been bigger than that although we have increased charges. The savings are bigger because there are additional services and there is a high number of services in place for children with special educational needs.

In reflecting on enhancing the assurances available in respect of each of the three areas, we must go back to what we concluded in the value for money review that the vast majority of the provision should be outsourced but that there should be a certain proportion retained by Bus Éireann partly for a reserve partly to ensure that the competition would maintain and partly because it brought down the costs as a whole for Bus Éireann as a transport organiser if it was providing some of the services. We requested Bus Éireann to maximise the amount that is outsourced in the scheme and that has been gradually increasing. We have asked Bus Éireann to put in place review procedures to ensure that all of the procurement arrangements are in line with appropriate national and EU requirements. It updated its tendering arrangements in 2011. We can provide the committee with details about this. This was discussed in detail by Bus Éireann with Oireachtas Committee on Transport and Communications. It updated its procurement arrangements in 2011. In addition to that, we are looking at increased assurances via its internal audit that it is taking the appropriate approaches.

This committee had a concern about the Comptroller and Auditor General's access to expenditure under our Vote. We reflected on that and discussed it with our partner Departments. We understand that there were ongoing parallel discussions at the Committee of Public Accounts. We concluded that we could see no reason the Comptroller and Auditor General would not be fully free to follow the school transport money into Bus Éireann if he so wished. Bus Éireann has agreed to that so there is no difficulty with Bus Éireann. Clearly, there has never been an issue about Bus Éireann coming or not coming to this committee because as far as I am aware, it was not asked but it would certainly be more than willing to engage in that regard. There has been an opening up of the arrangements. We have written to the Comptroller and Auditor General about this and discussed the arrangements with him in advance of concluding on them.

In respect of the administrative charge, the committee will clearly be aware that we undertook a particular review of this and got external consultants to undertake it for us. It raised issues. The decision we made arising from that was to focus on the rebate element of that. We are focusing on having annual discussions with Bus Éireann and getting a rebate in respect of the charge. We have had a rebate of over €10 million over a number of years. That is among the savings about which I have spoken. We have a three-yearly independent review of the nature of the administrative charge. We will put in place arrangements for the first of those reviews in the near future. There was much discussion about profit and we had a discussion about that at the last meeting. Bus Éireann has assured us that it does not make a profit. It does keep a reserve, the expenditure of which it discusses with us. It has provided more details on that reserve and how it is being spent to the Oireachtas Committee on Transport and Communications. We would be happy to talk that through but there is no money returning to central Bus Éireann for expenditure on other areas. The money within the school transport scheme is sealed and its annual accounts demonstrate that. Those are different elements to ensure that overall, a value for money approach is undertaken.