Mr. Seamus McCarthy:

Let me make a couple of points. It would not be normal for an audit committee such as the one in the HSE to look in detail at the financial statements of an individual grantee. The role of the audit committee is to ensure there is adequate financial and performance reporting in respect of the entire body of grantees. Around 2006 my office reported on the systems in place in the health boards - as they were before the HSE was established and with the establishment of the HSE - the adequacy of supervision and the oversight of grantees. One of the matters we identified was that there was not adequate financial reporting and that there was not adequate analysis within the HSE. Steps were taken after this to improve the position. To my thinking, that is really where the impetus originated from for the development of the service level agreements. It took some time to put them in place. As Mr. Healy outlined, there are still problems regarding the receipt of financial statements from grantees and the analysis and following up of these statements. When the financial statements for the HSE for 2013 were presented to the committee, one of the issues highlighted in my certificate was the HSE's own recognition that more needed to be done in the oversight of grant-aided bodies. The normal thing one expects with a set of financial statements when one examines them is that if there are donations, they are identified separately in the statements. What one might not be sure of is from where these donations came or the route through which they came. There is a difference between section 38 bodies and other organisations in receipt of substantial amounts of public funding in that they are not required to comply with the code of practice for the governance of State bodies.

Some of the things that specifically are not required of them would be such matters as confirmation by the chair to the relevant Minister that public pay policy is being observed, and that the remuneration and terms and conditions of chief officers be disclosed in the financial statements. That is something I suggested the committee might like to consider suggesting to the HSE: that the fundamental requirements that are imposed on semi-state bodies also be applied to the section 38 agencies in future.