Oireachtas Joint and Select Committees
Tuesday, 25 October 2016
Public Accounts Committee
Business of Committee
10:00 am
Seán Fleming (Laois, Fianna Fail)
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We are joined by the Comptroller and Auditor General, Mr. Seamus McCarthy, who is a permanent witness to the committee. He is accompanied by Mr. John Riordan, who is a deputy director of audit. I am now dealing with the agenda. No apologies have been recorded today.
Are the minutes of the meetings of 18 and 20 October 2016 agreed? Agreed.
I want to raise a point arising from the minutes. We dealt with the Social Insurance Fund and the large issue of outstanding insolvency and redundancy payments last week when officials from the Department of Social Protection were before the committee. I propose that we write to the Secretary General of the Department to get a breakdown of the companies or businesses that owe money to the Department and ascertain how many of them are still registered with the Companies Registration Office. I accept there will be difficulties in the case of companies that have gone bust and no longer exist because it will be impossible to collect the funds. I suggest we should seek the details of companies that are still trading after being restructured and are profitable, but owe money to the Exchequer in respect of statutory redundancy payments that have not been repaid. We know we will not get the names of the individual companies but we want to get an analysis of the companies that are still alive and could possibly be pursued to get some of the almost €500 million that is still outstanding. We will send that letter and will get a reply back in due course. I just wanted to raise that issue arising from the minutes.
The next item is correspondence received. This morning we received the opening statement from today's witnesses. Is it agreed to note that? Agreed. With regard to correspondence from Accounting Officers, correspondence has been received from NAMA regarding the release of communications with Lazard on the loan sale process as requested by the committee.
We will consider the matter in a moment as part of the work programme because Lazard will attend soon.
The next item of correspondence is 114B(i) and (ii), a letter received from Siún Ní Raghallaigh, chairperson of the board of TG4 regarding contract details of the director general as identified in the 2015 financial statements. This issue appears to be resolved with a new director general in place in accordance with legislation. Is it agreed to note it? Agreed.
Item 115B is correspondence received from NAMA in follow up to a request for information. It will be added to our folder on Project Eagle correspondence. NAMA was here on 29 September. We wrote to it the following week seeking correspondence and item 115B is the reply. We sent NAMA a subsequent letter a week later for further information. The reply will be received today and the members will get it when it is received during the course of the day.
The next item is 102C, an e-mail from Deputy David Cullinane enclosing correspondence from Nua Healthcare regarding concerns about public sector tendering for residential disability services. We deferred the matter last week due to the absence of the Deputy. Does he wish to comment? No. I propose that we write to the HSE on the matter and the Office of Government Procurement for a response, and come back to it when we get a reply. Is that agreed? Agreed.
The next item is 116C, an e-mail from Ms Fay Buckle, clerk to the Welsh Public Accounts Committee, regarding the hosting of an inaugural public accounts network meeting on 10 June 2017. If members are interested in attending, please contact the secretariat.
The next item is 117C, correspondence received from an individual regarding this committee's discussion on Caranua on the presentation of its accounts and governance questions. The letter refers to comments made by the Comptroller and Auditor General but it is unclear to what the individual is referring. I propose that we ask the Clerk to write to the individual to seek clarity. We will come back to the matter. We will consider Caranua as part of our work programme but we will not put a date on it. I propose that we consider including it in our work programme. Is that agreed? Agreed.
The next item is 118C, correspondence received from Deputy Mick Wallace that includes documents released under freedom of information pertaining to NAMA's interactions with Lazard. I appreciate the correspondence that he sent to us for our information. Is it agreed to note it and include it in our files? Agreed.
The next item is 119C, an e-mail received from Mason Hayes & Curran on behalf of Cerberus confirming attendance of representatives of Cerberus before the committee. We have added them to the schedule and agreed the date of 17 November for Cerberus to attend here in public session. Earlier, I mentioned that Lazard has agreed to attend as well and I will come to that when we discuss the work programme.
We have received a very considerable amount of documentation from the HSE on our hearings on sections 38 and 39 organisations. With the committee's agreement, I will ask the Clerk to look at the correspondence before circulation. It is very voluminous and we want to get it in a manner that will be helpful to us. Following a little bit of work on it by the secretariat, it will be sent to us. Is that agreed? Agreed.
The next item is reports, statements and accounts of bodies received since the last meeting. Members can see them on their screens. Bord Bia has a clear audit account, Waterways has a clear audit account and the Credit Union Restructuring Board, ReBo, has a clear audit account.
The next item is the Health Service Executive's patient private property accounts. There is a statement here from the Comptroller and Auditor General that states, "The statement of internal financial control discloses weaknesses in the HSE's control over the management of patient private property accounts and the steps taken by the HSE to resolve these". I note that there appears to be a turnover of €83 million, which is a big amount of funds. Perhaps the Comptroller and Auditor General would like to comment.
Mr. Seamus McCarthy:
The turnover on the account is quite sizeable because it represents, effectively, State pensions that are payable to persons in care, that are paid into the account, and then a deduction is made for their upkeep leaving them with a certain amount of their own funding. The bulk of the funding is managed through a central account operated by the HSE but there are accounts separately, if one likes. They refer to it sometimes as pocket money accounts in the individual care centres and there are very many of those, possibly 100 or so care centres, where there are separate accounts. In fact, for these particular financial statements, this is the first time the HSE has included a specific statement on internal financial control. We did quite a considerable amount of additional work there to look at the controls. The controls are being tightened up. It is something perhaps that the committee might wish to examine at some point.
Seán Fleming (Laois, Fianna Fail)
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Will we bring in that account as part of the HSE's visit whenever it comes next? Is it part of the remit of the HSE?
Seán Fleming (Laois, Fianna Fail)
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How many of those patients-----
Seán Fleming (Laois, Fianna Fail)
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-----have passed away?
Seán Fleming (Laois, Fianna Fail)
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Perhaps we should write to the organisation seeking a note of explanation. The Comptroller and Auditor General talked about patient accounts. I presume there is not a separate bank account for each patient.
Seán Fleming (Laois, Fianna Fail)
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I presume there is one account for the institution-----
Seán Fleming (Laois, Fianna Fail)
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-----and that somebody has a logbook of whose money is in the account.
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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Are properties, houses, land or anything like that involved?
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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Cash?
Seán Fleming (Laois, Fianna Fail)
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Is it all cash?
Seán Fleming (Laois, Fianna Fail)
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In all the nursing homes?
Mary Lou McDonald (Dublin Central, Sinn Fein)
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The matter merits separate consideration, not least because it is the first occasion on which we have had visibility of the issue. The Chairman has made the wise suggestion that we write to the HSE seeking further information. Somewhere on our programme of work we need to give a dedicated focus to this issue that has not been without public controversy.
Mr. Seamus McCarthy:
The statement on internal financial control, which is about three or four pages at the front of the financial statements, is actually quite useful. What we have been trying to do with public bodies is to get them to put more relevant information about the controls, risks and so on into the financial statements.
Josepha Madigan (Dublin Rathdown, Fine Gael)
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Having a separate meeting will depend on what the HSE says in response.
Seán Fleming (Laois, Fianna Fail)
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Yes. We will get the response.
Josepha Madigan (Dublin Rathdown, Fine Gael)
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We should get its response first and then see where we go from there.
Seán Fleming (Laois, Fianna Fail)
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We will write first, get a response and then decide our work programme.
Members can see on the next page that the Sea-Fisheries Protection Authority also had a clear audit report. We can move on except that we will write to the HSE for further information.
The next item on our agenda is our work programme and Members can see it on the screen in front of them. Today, as part of our Project Eagle work, we will have officials from NAMA and they will be here in a few moments. We will have Mr. Alan Stewart, who is a senior divisional solicitor working for NAMA. He is one of the persons who was involved in the phone call. He is not here as an independent legal adviser. He is not a legal adviser but one of the people who works in NAMA who has a legal background. He was involved in some of the phone calls that people have inquired about.
On Thursday, 10 November, we will have officials from the Department of Finance. On Wednesday, 16 November, we will have the First Minister Martin McGuinness, MLA. On Thursday, 17 November, we will have former members of the NAMA board who were members of the board at the time of Project Eagle but are not current members and have agreed to come back to us. On the same afternoon, we will have Mr. Mark Neporent, Chief Operating Officer, General Counsel and Senior Managing Director of Cerberus Capital Management.
On the following Tuesday, 22 November, we will have Mr. Patrick Long from Lazard & Company that was the selling agent, commissioned by NAMA, to deal with this issue. As I have said, we have been in contact with PIMCO and we await word on our invitation for PIMCO to attend.
On Thursday, 24 November, we will have NAMA officials. I wish to say briefly, to the Comptroller and Auditor General, that at our private meeting this morning a request was made for a meeting with him before we go into the final round of meetings to clarify some issues before we meet the board members and chairman of NAMA again. We will set a date for the meeting. Members have requested that we have the meeting soon.
Catherine Connolly (Galway West, Independent)
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Was there a request, before the end, that we do so? That before we go back to NAMA again that we will meet-----
Seán Fleming (Laois, Fianna Fail)
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That is exactly what I said.
Catherine Connolly (Galway West, Independent)
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Sorry, I beg the Chairman's pardon.
Seán Fleming (Laois, Fianna Fail)
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There have been a request to meet the Comptroller and Auditor General early before the meeting.
Catherine Connolly (Galway West, Independent)
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That is okay. I apologise.
Seán Fleming (Laois, Fianna Fail)
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It has been sought before we get to the final meeting. We will get the secretariat and members to schedule a date. The Dáil is not sitting next week so the meeting will probably take place the following week when we are back, but that is subject to agreement all around. As there is no other business, I propose that we suspend for a few moments to allow the witnesses to take their seats. Is that agreed? Agreed.