John McGuinness (Carlow-Kilkenny, Fianna Fail)
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Are the minutes of the meeting of 6 November 2014 agreed to? Agreed.

We will deal with correspondence received since our meeting on Thursday, 6 November 2014. No. 3A is correspondence received from Accounting Officers and Ministers. We have received correspondence from Mr. Tom O'Malley, Secretary General, Department of Transport, Tourism and Sport, regarding a briefing on the development of greenways. The correspondence is to be noted, published and forwarded to Mr. Liam O'Malley and Mr. Michael Murphy.

No. 3A.2 is correspondence, dated 6 November 2014, from Ms Niamh O'Donoghue, Secretary General, Department of Social Protection on the insurability of employment and the insurability of couriers. The correspondence is to be noted and published.

No. 3A.3 is correspondence, dated 11 November 2014, from Mr. Denis Leamy, chief executive of Pobal, regarding the national child care investment programme 2006-10. The correspondence is to be noted and published.

No. 3A.4 is correspondence, dated 12 November 2014, received from Mr. John Tracey, chief executive of the Irish Sports Council, regarding a follow-up on correspondence received. The correspondence is to be noted and published. Part of it relates to Millstreet. We will write to ask that we be kept informed between now and the end of the year of progress made on the issue.

The next item of correspondence is dated 4 November 2014 from Deputy Mary Lou McDonald regarding Amnesty International. The correspondence is to be noted. The clerk will prepare a note on the matter and forward it to members.

No. 3B.2 is correspondence, dated 3 November 2014, received from Mr. Seán O'Callaghan, Cork County Council, on including Irish Water within the remit of the Committee of Public Accounts. The correspondence is to be noted. This is a policy matter which we will refer to the Department of the Environment, Community and Local Government and the Department of Public Expenditure and Reform. We had agreed that we would discuss the set-up costs met directly from the Exchequer. This can be done in the context of the Accounting Officers appearing before the committee in due course.

No. 3B.3 is correspondence, dated 10 November 2014, from Mr. John Wolfe regarding a fraud complaint related to a former Taoiseach not being properly investigated. The correspondence is to be noted. My understanding is that the matter was investigated and that the terms and conditions associated with the allowance were matters for the Department of Public Expenditure and Reform. I understand there is also a note on the matter from An Garda Síochána.

No. 3B.4 is correspondence, dated 12 November 2014, received from the HSE on the possible misuse of public moneys at Positive Action. The correspondence is to be noted.

Clerk to the Committee:

We will be raising the matter with the HSE.

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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Are we getting a report from it?

Clerk to the Committee:

I understand the Garda was keen that we would not receive the report because a criminal investigation was ongoing. That is what we were told last week.

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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Therefore, we will not be investigating it.

Clerk to the Committee:

We will not be investigating Positive Action, but we will be examining systemic issues within the HSE.

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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No. 3B.5 is correspondence, dated 14 November 2014, received from Dr. Michael Murphy, President of UCC, regarding the dispute about subcontracting works. The correspondence is to be noted. Direct payments by the university to a subcontractor are not a matter for us to consider. Is that correct?

Clerk to the Committee:

It is not possible to consider the matter. Deputy John Deasy raised the issue.

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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Does the Deputy wish to comment on the matter?

John Deasy (Waterford, Fine Gael)
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Let us run through it. The university is effectively repeating the line that it can avoid this issue because of the contract. Is that the case?

Clerk to the Committee:

That is effectively it. I am unsure what we can do. We will have representatives of the Higher Education Authority before the committee in January. We might examine the matter then.

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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We could probably bring it up then. We could give representatives of the HEA notice of the issue to be discussed when they come in January.

John Deasy (Waterford, Fine Gael)
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Technically, under regulations and legislatively, there may not be an onus on UCC to pay the subcontractor in this case. It is, however, a question of fairness. It is a question of a large entity knowing that works were carried out well and that given amounts of money are owed, yet it has effectively ignored this on the basis of the contract drawn up. It is fair enough that there is a legal issue involved. We should, however, put UCC on notice that the matter will certainly come up for discussion. I asked about the legislation on subcontractors which I understand has not yet been enacted. Is it in any way relevant to this case?

Clerk to the Committee:

We will check with the sponsoring Department and obtain a note on the matter. That is probably the best thing to do. I am not aware of the subcontractors Bill, but I will obtain a note from the Department on it because it could be important.

John Deasy (Waterford, Fine Gael)
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Let us think it through. Is the legislation specifically geared towards Departments, State agencies or entities funded by the State? If it covers entities funded by the State to a certain degree, does it kick in when it comes to such companies?

Clerk to the Committee:

It probably should.

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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I understand it does.

John Deasy (Waterford, Fine Gael)
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If that is the case, UCC has a problem. It cannot simply ignore the matter based on the contract because the legislation will supersede the contract.

Mr. Seamus McCarthy:

It probably will not have retrospective effect.

Clerk to the Committee:

That is the trouble.

John Deasy (Waterford, Fine Gael)
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I have not read the legislation.

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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We should consider the spirit of the legislation. It is to sort out this and similar problems.

John Deasy (Waterford, Fine Gael)
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Surely there are many such outstanding bills, although I am not altogether sure whether that is the case.

Mr. Seamus McCarthy:

I am not familiar with the legislation, but obviously that is an issue that needs to be borne in mind.

John Deasy (Waterford, Fine Gael)
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One consideration is whether there is a grandfather clause.

Mr. Seamus McCarthy:

It is a question of changing the terms of an existing contract.

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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We will obtain a note on the matter. We will have an opportunity to discuss it with the representatives of the Higher Education Authority in January.

John Deasy (Waterford, Fine Gael)
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Thank you, Chairman.

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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Nos. 3B.6 and 3B.9 are copies of replies sent from the Local Government Audit Service directly to the correspondent. They were sent to the committee for its information. We have received correspondence, dated 7 March 2014, from the Local Government Audit Service regarding Sligo County Council debt. The correspondence is to be noted. Can we publish it?

Clerk to the Committee:

We can publish it.

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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We have received correspondence, dated 1 August 2014, from the Local Government audit Service on a site at Sunnyside Villas, Drogheda. The correspondence is to be noted and published.

We have received correspondence, dated 11 July 2014, from the Local Government Audit Service on dog pound tenders. The correspondce is to be noted and published.

We have received correspondence, dated 9 October 2014, from the Local Government Audit Service regarding Midleton Town Council. The correspondence is to be noted and published.

We have received correspondence, dated 14 November 2014, from the Revenue Commissioners regarding wards of court. The correspondence is to be noted. We can deal with this issue in the course of today's proceedings. We should publish the documentation.

Clerk to the Committee:

Yes.

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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Next we deal with correspondence relevant to today's meeting. We have received correspondence, dated 14 November 2014, from the Courts Service enclosing briefing material. The correspondence to be noted and published.

No. 3C.2 is correspondence received on 18 November 2014 from the Courts Service enclosing opening statement. The correspondence is to be noted and published.

We will return to an issue raised by Deputy John Deasy regarding the cost of the proposed merger of Carlow Institute of Technology and Waterford Institute of Technology. A considerable amount of correspondence has emerged since our meeting which we do not have listed for the meeting today, but which I intend to pass on to the committee. The correspondence raises many issues in respect of Waterford Institute of Technology generally. Correspondence on Cork Institute of Technology has also been received by the Comptroller and Auditor General and me which we should circulate.

Clerk to the Committee:

I can circulate it.

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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We still have received no reply from the Department. The matter has continued for six months. If the Department had any respect for the committee, it would reply in detail.

John Deasy (Waterford, Fine Gael)
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We are up-to-date on what has happened in the case of WIT and Carlow Institute of Technology.

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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We are not up to date on the merger.

John Deasy (Waterford, Fine Gael)
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To all intents and purposes, the merger is dead. An announcement was made by the board of governors in Waterford to the effect that it no longer wished to pursue the application jointly.

What is the substantive point of the correspondence received so far?

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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I am raising it here because Deputy Deasy asked about the cost so far last week. There is an issue in regard to the cost and we want to get a note from the Department.

Clerk to the Committee:

That is correct. We have written to the HEA about that.

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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Arising from that, I understand that when Carlow began to carry out due diligence in regard to Waterford IT, the matter stopped. That has raised questions about governance in the institution, funding and so on. The documentation I have just received refers to all of that and provided copies of documents from the institute that show that. I do not want to prejudge the matter. It is not specific to the actual merger, but it has come about because of the questions about due diligence.

John Deasy (Waterford, Fine Gael)
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The point of this was-----

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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To get the costs.

John Deasy (Waterford, Fine Gael)
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Yes. We asked the Comptroller and Auditor General about the costs and the answer we received was there are substantial costs involved with a joint application. It is something over which the committee has jurisdiction. People in Carlow and Waterford are really interested in finding out about who knew about the process while it was not evolving, at what point was it, in effect, a broken process, and if money was spent after the fact. The HEA and the Department of Education and Skills know what was going on over the past two and a half years with regard to the point the Chairman made on due diligence being started, and that is when the process began to fragment. That needs to be explored further, because if we find out that it was clear at a very early date that this was not going to work and some kind of charade was entered into, the process pursued and money spent after the fact, that is serious.

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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Okay. As I said, we are still following up on that and we will report back to the committee as soon as we have a reply from the Department. No. 4 is reports, statements and accounts received since our meeting on 6 November 2014. They are listed from No. 4.1. Is there an issue in regard to the Institute of Technology, Tralee?

Mr. Seamus McCarthy:

I am drawing attention to note 12, which discloses that the institute spent a total of €339,000 on design team fees related to the proposed development of a sports academy building. The concern is that the building may not proceed unless sufficient non-State funding is generated, because it will not be supported by State funding.

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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Again, there is an issue with a sports complex in Waterford. There are serious questions about money and the completion of that project, and how it reached the stage of commitments being given and so on. That issue was also raised in the documents which were sent to me.

Mr. Seamus McCarthy:

The committee will also recall that there is an inspector's report about Waterford Institute of Technology.

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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There is.

Mr. Seamus McCarthy:

My recollection is that there was a Committee meeting, but there was not one subsequent to the inspector's report. Matters that we raised initially were subsequently investigated by the inspector appointed by the Department. An extensive programme of work needs to be done in Waterford to resolve issues which came to light in our report and that of the inspector.

John Deasy (Waterford, Fine Gael)
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The timeline here is important. Everybody wants a particular entity to come before the committee yesterday, but there is a schedule and there are only a certain number of weeks available. The last time I spoke to the clerk about this he suggested that Carlow and Waterford could come before the committee in January. The situation, as it lies now, is that the Minister has appointed Mr. Michael Kelly, a former head of the HEA, to try to get the merger back on track. One of the parties involved has said it is not co-operating with that. There is a bit of a stand-off. The committee could do some useful work by bringing all entities in here sooner rather than later, based on the correspondence the Chairman has received, to get to the bottom of this. The meeting could include the sports centre to which he referred.

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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No. 4.3 refers to University College Cork and is a qualified audit opinion arising from a disagreement on future pension funding.

Mr. Seamus McCarthy:

Yes. The financial statements recognise a total deferred pension funding asset of €915 million, but one element of that is €8.3 million related to professional added years liability, and there is a dispute between the university and the Department about that. The Department has indicated that it will not meet that liability and, therefore, it fails the test for inclusion in the balance sheet of the university. I have qualified the opinion and made the point that the deferred pension funding asset, the net assets and the revenue reserves at 30 September 2012 should be reduced by €8.3 million.

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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We will come back to that. Nos. 4.4 and 4.5 are okay. No. 4.6-----

Mr. Seamus McCarthy:

This relates to a pension-related dispute between the Irish Blood Transfusion Service and the Department, and I have reported separately on that in more detail in Chapter 13 of the report on the accounts of the public services for 2013. It is scheduled for hearing by the committee in due course.

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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No. 5 refers to the Pre-Hospital Emergency Care Council, where the council paid the director an allowance of €17,400 without sanction.

Mr. Seamus McCarthy:

Again, it is a payment without sanction.

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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That is the only issue. There is also a question mark over some of the public procurement. No. 5.2 refers to Bord Bia.

We will examine the issue of the pension liability with the HEA in January and we will seek a note in resect of this spend. Maybe we should ask for a note from the Institute of Technology, Tralee and Cork Institute of Technology regarding their merger and the costs involved. We will deal with the Irish Blood Transfusion Service in 2015, and these accounts are noted.

Our work programme is now on the screen, and the changes have been put in since last week. Next week we will deal with Bord na gCon, depending on whether the Revenue Commissioners is available. There may be a change.

Clerk to the Committee:

I will manage it.

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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We will take into account the request from Deputy Deasy. Is there any other business? We dealt with everything earlier on. Can we agree the agenda for Thursday, 27 November, will be the report of the Comptroller and Auditor General on the development of Limerick greyhound stadium, subject to clarification with the Revenue Commissioners?

Clerk to the Committee:

Okay.

John McGuinness (Carlow-Kilkenny, Fianna Fail)
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I request that the witnesses attend the meeting.