Oireachtas Joint and Select Committees

Thursday, 22 June 2017

Public Accounts Committee

Dublin Institute of Technology and Cork Institute of Technology: Financial Statements

Ms Colette Drinan(Direct of Audit, Office of the Comptroller and Auditor General) called and examined.

Professor Brian Norton(President, Dublin Institute of Technology) and Dr. Brendan Murphy(President, Cork Insitute of Technology) called and examined.

9:00 am

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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I apologise to our witnesses for the late start this afternoon. The morning session took quite a bit of time, and then the voting session in the Dáil took much longer than expected. We will proceed with this afternoon's business. We will continue with our follow-up on the third level education sector. For this session, we are joined by Professor Brian Norton, Dr. Noel O'Connor, Mr. Colm Whelan and Dr. Philip Cohen from Dublin Institute of Technology; and by Dr. Brendan Murphy and Mr. Paul Gallagher from Cork Institute of Technology. We are also joined by Ms Colette Drinan, director of audit at the Office of the Comptroller and Auditor General, in substitution for Mr. Seamus McCarthy.

I ask Ms Drinan to make a brief opening statement on Cork Institute of Technology, since representatives from it were not here at the last meeting. Then I will ask Professor Norton and Dr. Murphy for opening statements, if they have statements.

Ms Colette Drinan:

The financial statements before the committee in this session relate to Cork Institute of Technology's financial year ending on 31 August 2015. The institute's consolidated income for the year amounted to €97 million, of which State grant funding accounted for €37 million. Tuition fee income of nearly €31 million included fees of €5.6 million paid by the State and student contribution income of over €18 million. Research grant income was €15 million. A percentage breakdown of income is shown in the diagram on-screen. Expenditure in the year was nearly €98 million. Approximately 68% of this was accounted for by staff costs. A detailed analysis of expenditure is given in note 12 of the accounts. The institute incurred a deficit of €1.2 million for the year, and had an accumulated deficit of €1 million on 31 August 2015.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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I ask Professor Norton to make a brief opening statement. This is for Dublin Institute of Technology, DIT, so I ask him to distinguish between the two organisations here today.

Professor Brian Norton:

Arising from discussion at our last appearance before the committee, we were asked to provide additional information and clarify some issues that were raised, and we have done so.

Regarding the delivery of DIT programmes in partnership or through third-party providers, this type of delivery is in keeping with national strategy for higher education. Such arrangements represent a very small proportion of DIT provision and are entered into where there is clear student demand and where, for reasons of resources, we cannot deliver the programme in-house. Students registered on such a programme are recognised as full DIT students with access to services, from the medical centre and counselling, to sports, clubs and societies. The DIT commercial modern music degree, delivered through the British and Irish Modern Music Institute Dublin, BIMM Dublin, is an example of such a programme which has run very successfully for five years. The future delivery is currently under public tender.

We also provided further information concerning the library subscription service, Swets UK. This company had been procured through a national public tender in 2012 but went into bankruptcy in 2014. DIT has provided an additional document to the committee that relates to an investigation undertaken by DIT and conducted by an external consultant, Ernst & Young, EY, into the processes that gave rise to the payment by DIT to Swets UK. The issues raised in this report are also addressed in the final management report, which was submitted in July 2016 to this committee. I regret that the EY report was not specifically included. There were press reports this morning in The Irish Times that the report was not provided to this committee, but we have a receipt from the secretariat for the Committee of Public Accounts dating to 31 May 2017 that it was received. I would like that to be in the record for the avoidance of doubt, since there seems to be a public view that it has not been submitted. It has been.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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I want to confirm that we received it and the committee considered it this morning. If there is any confusion, that is regrettable, but we have the report.

Professor Brian Norton:

The EY report also identified payments of €29.5 million over a three-year period, which were deemed not to have gone through appropriate levels of approval.

DIT assures the committee that these payments for a range of services had full budgetary approval and had been appropriately procured. For example, they included annual rental for DIT buildings, utilities and energy costs, catering contracts, audit by the Comptroller and Auditor General and library resources. These payments now go through the levels of formal approval required by our finance system for all payments under our authority to bind.

A loss of €718,000 was incurred by DIT as a result of the Swets UK bankruptcy. We subsequently procured the required services through another supplier at a cost of €760,000. While the cost is higher, the terms of the new contract do not require full prepayment and therefore reduce the exposure to potential commercial failure. DIT has been excluded from IReL, the Irish Research electronic Library which is funded by the HEA and to date has only been available to universities. Access to this resource would reduce our exposure to the viability of commercial provision. I am pleased to inform the committee that we yesterday received notification that a process is under way to grant DIT access to it.

The scale of the loss incurred by the Swets bankruptcy reflects the scale of the library service in DIT, which accounts for approximately 6% of our annual non-pay expenditure. The service provides access to relevant and current texts, research and related findings for our student population of 20,500 who are pursuing courses at levels from apprenticeship to PhD and our academic staff of over 1,200. The library's extensive resources include 286,000 books, 18,500 dissertations and updated subscriptions to approximately 35,000 online journals, periodicals and databases to support students across a wide range of activities and disciplines and support our research activity.

We currently operate six libraries, which are located in Aungier Street, Kevin Street, Bolton Street, Cathal Brugha Street, Rathmines and Grangegorman. Their dispersed nature adds to costs. This will be alleviated by the development of a single library on the new single DIT campus.

I am delighted to say that despite some recent setbacks, by late 2019 DIT will have 10,000 students on campus at Grangegorman. There are currently 1,200 students, researchers and entrepreneurs on campus and it is already making a very significant contribution to Dublin’s north inner city. Over the next five years, the development of the campus will assist in transforming this part of the city through contributing to the renewal of neglected areas and creating opportunities for educational access, community engagement and economic vitality. Served by the new cross-city Luas line, it will change the map of Dublin.

Finally, I would like to briefly mention technological university legislation. Since the publication of the Hunt report on higher education in 2011 and its adoption as national policy, DIT has been working closely with our partners in IT Tallaght and IT Blanchardstown towards creating a technological university for Dublin. We have successfully gone through stage three of the four-stage application process. We understand that the proposed legislation to enable us to move to stage four may come before the Houses of the Oireachtas in the very near future. We ask members to support this legislation in order that, building on our combined strengths, we can create our new institution to serve the Dublin region.

I thank members for this opportunity to answer any questions they may have. My colleagues and I will endeavour to do so fully and frankly.

Dr. Brendan Murphy:

I thank the chairman and members of the committee for the invitation to attend this meeting to discuss the financial statements of Cork Institute of Technology, CIT, for 2015 and the KPMG reports conducted into anonymous allegations made in 2014. I am joined by the vice president for finance and administration, Mr. Paul Gallagher. Given that it is our first appearance before the committee, perhaps I could outline what CIT is all about. It is one of the largest, most progressive and successful institutes of technology in the country with approximately 11,000 higher education students, 3,000 craft and junior music students and a staff of 1,400. It operates on four major sites in Cork city and county. CIT’s Bishopstown campus comprises 38 ha, including major sports facilities, research centres and the Rubicon innovation centre. The CIT Crawford College of Art and Design and the CIT Cork School of Music are both based in the city centre, and the National Maritime College of Ireland is based in Ringaskiddy, County Cork, close to the naval base in Haulbowline. CIT is a major national provider of STEM education and research. Its annual income and expenditure is approximately €100 million and research activity constitutes 20% of its total budget. CIT, in partnership with IT Tralee, has successfully completed three of the four stages of technological university designation.

CIT enjoys a national and international reputation for the quality of its education and research and the professional capabilities of its graduates. It leads Irish higher education in the recognition of work-based learning and prior learning and the development of joint degrees, which is done in conjunction with UCC and universities in Europe. The quality of its education programmes and research is overseen by Quality and Qualifications Ireland, QQI. Its governance is provided by its governing body and through its three committees: audit, finance and strategic development. Its internal audit, while tendered for on a sectoral basis, operates on an independent basis in each institution. It operates under the Institutes of Technology Acts 1992 to 2006 and the HEA has a regulatory oversight of the institutes of technology.

Higher education in Ireland has been operating in a very challenging financial environment since 2008, with significantly increased higher education student numbers, reduced staff numbers and reduced State funding. Even though CIT has continued to be successful in this period, it is not immune to these financial challenges as may be seen in our 2015 financial statements. CIT incurred deficits in the academic years 2013 to 2014 and 2014 to 2015. I apologise because the figure of €126 given in the briefing in this regard should read €126,000. The representatives of the Comptroller and Auditor General will be glad to know that we both agree that the deficit was €1.2 million rather than €1,216. It is amazing that one can read something and miss a vital detail. A break-even position was recorded in the 2015 to 2016 academic year and, following an extensive review and planning process in conjunction with a HEA process, forecasts for the next four years demonstrate the ability of the institute to remain in a sustainable financial position. The forecast for the academic year 2016 to 2017 is in line with expectations.

The reason for the deficits in the academic years 2013 to 2014 and 2014 to 2015 relate, in the main, to the STEM and apprenticeship areas. In terms of STEM, the funding model has negatively impacted on the weighting of funding in this area following the introduction of the flat-rate student contribution of €3,000 per annum. In terms of apprenticeship, CIT had approximately 100 staff working in this area in 2008 and carried the cost of maintaining these staff during a period of collapse in provision. Fortunately, the area of apprenticeship is now experiencing significant growth and is contributing directly to the recovery in CIT’s financial position.

CIT has always been prompt in the submission of its financial statements to the Comptroller and Auditor General for audit. With a year end of 31 August and deadline for submission of 31 December, CIT has consistently submitted its accounts in late October or November. CIT's last set of financial statements for the year ended 31 August 2016 are expected to be signed off by the Comptroller and Auditor General this month. No outstanding issues of a high rating are expected.

The committee has indicated that it wishes to revisit the issue of the KPMG report. This report relates to two anonymous letters received by the Comptroller and Auditor General in 2014 in regard to CIT. As for the first anonymous letter received in March 2014, a total of 175 allegations were made. Many of these were grossly defamatory. The anonymous letter was referred by the chairman of governing body to the audit committee, which was authorised by governing body to obtain independent legal advice. Based on this advice, the audit committee, again with the agreement of governing body and via the independent legal advisers Arthur Cox, tendered for and engaged KPMG to carry out an independent review of the allegations.

KPMG’s engagement was structured on a phased approach to ensure that the audit committee could retain oversight of the investigation while ensuring KPMG had sufficient freedom to complete its work. KPMG’s remit was to investigate the allegations as presented and was not limited to the handling of the process by CIT. Indeed, KPMG noted in its report that it did not note any material limitations of scope as part of the review which prevented it from completing the scope of work as set out.

The phased approach included a review of the anonymous letters and management responses; a corporate governance review and review of internal policies and procedures and CIT’s compliance; a review of expenditure documentation in CIT and its subsidiaries; consideration of whether each allegation had been addressed; and production of a comprehensive report of findings.

The results of the KPMG review were as follows: 32 of the allegations contained insufficient evidence to allow further review; 35 were responded to sufficiently at the outset by CIT management and no further action was deemed necessary; 52 were deemed repetitious to other allegations in the same letter; and 56 allegations were identified for additional information and documentation. This was facilitated and of those 56 allegations, 47 were deemed to require no further action as they had been adequately addressed by the institute; three were considered to contain no evidence and therefore needed no further action; and six allegations were deemed repetitious to other allegations and required no further action.

In respect of the second anonymous letter received in December 2014, another 21 allegations were made. Again, many of these appeared to be grossly defamatory and all were considered by the audit committee of CIT. The audit committee engaged KPMG to carry out a further independent review, which determined that two of the allegations had been previously addressed by KPMG and did not require any further action; three were sufficiently addressed at the outset by CIT management and no further action was deemed necessary; one was deemed repetitious to previous allegations; and 15 of the allegations were identified for additional information and documentation. This was facilitated and those 15 allegations were then deemed to require no further action as the allegations had been adequately addressed by the institute.

In summary, the outcome of the KPMG independent reviews was that of a total of 196 allegations, 35 were deemed to have insufficient evidence to allow further review, 102 were deemed to require no further action as the allegations had been adequately addressed by the institute and 59 were deemed repetitious to other allegations and required no further action.

The governing body received updates from the audit committee during the process. A final report issued from the audit committee was considered by the governing body at its meeting on 26 March 2015. It concluded that after two intensive external investigations, all individuals and-or agencies identified within the letters had carried out their professional duties highly diligently and with total integrity. The governing body concluded that no further response or action was required from the institute’s executive.

During the course of the extensive KPMG reviews, a small number of issues were found aside from the 196 allegations contained in the anonymous letters. As is the case with any audit report, these matters and management responses were considered by the audit committee and controls were changed or strengthened as appropriate. A full copy of the audit committee’s final report to the governing body and the KPMG reports have been provided to the HEA, the Department of Education and Skills and the Comptroller and Auditor General. The chair of the governing body also provided the HEA with a full written account of the process undertaken to address the matter. The matter was also addressed at a meeting of the Committee of Public Accounts on 10 December 2015 and extracts from the relevant statements of the Comptroller and Auditor General, the HEA and the Department of Education and Skills are attached in the appendix provided today. All attest to the satisfactory manner in which CIT dealt with the matter.

We remain at the disposal of the committee to answer any questions it may have on these and other matters.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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I thank Dr Murphy. The first speaker for this session is Deputy Catherine Murphy. She will be followed by Deputies Alan Kelly, Marc MacSharry, David Cullinane, and Mary Lou McDonald. The first speaker has 20 minutes, the second speaker has 15 minutes and everyone else has ten minutes. There will be a second chance to come in. It is the normal procedure.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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I want to address my remarks to Professor Norton. Did he watch the "RTE Investigates" programme? Was there anything in it that surprised him or on which he would like to comment?

Professor Brian Norton:

As I said in the opening statement, two aspects need to be clarified. The impression was given that the loss from SWETS UK was of two amounts. The bankruptcy loss was €718,000 but the service that was subsequently procured was a budget amount that applied to that. There was only one sum of money lost yet the impression was given that there were two. Additionally, the impression was given that the review by Ernst & Young had identified sums of money that were not properly approved through our processes and that somehow, some money had gone amiss. The approval process in its transaction had not been appropriate and we amended that subsequently. However, those monies were budgeted for, approved and procured.

The other observation I would make is that the Ernst & Young report itself had been provided to the Comptroller and Auditor General and the HEA and fully discussed with the latter. This was alluded to in the covering report we supplied to the Committee of Public Accounts. It is to the regret of our governing body and my own personal regret that we did not provide it here. We did not do so because the issues and what we have done about them were covered in the management report we provided. Again, there is a suggestion that in not providing the Ernst & Young report we were not giving the full information to the committee or that we were misleading the committee. I can assure the members that this was not the case.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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Professor Norton was with us on 6 April last. Subsequently, we received the Ernst & Young report. I have just dug out the transcript of our meeting from 6 April. Professor Nolan told us that the service had been contracted for the previous 15 years. I asked if the controls would be as robust as if a new service was being contracted. Essentially, the response was that the kind of due diligence carried out would have been as if it had been a first-time contract. It is very interesting to compare that transcript to the content of the Ernst & Young report. The system that it seems to have gone though really consisted of somebody in the library signing off on it. It was assigned at director level and did not go through the Agresso system, which would have provided checks and balances at either end. This was a very large amount of money. It looks to me like due diligence was not performed as I was led to believe it was when I asked the question on 6 April.

Professor Brian Norton:

The Deputy is certainly correct that the transaction was not in Agresso and would not have come to me for approval. It should have done and we have amended our process to ensure that this happens in future. In respect of the exact due diligence that we undertook previously, I will defer to my colleague, Mr. Colm Whelan.

Mr. Colm Whelan:

To clarify the point the president has just made, the transaction did go through Agresso. The references in the Ernst & Young report are to the effect that it did not go through our standard workflow process in Agresso.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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It only went through Agresso when generating the payment. That is the only aspect that seems to have gone through Agresso.

Mr. Colm Whelan:

Correct. The transaction was approved by the head of library services and the payment was approved by me.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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It did not escalate to the finance section. It seems to be have been signed off by the person in the library service instead.

Mr. Colm Whelan:

I signed it for finance.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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Only at the very end.

Mr. Colm Whelan:

Yes. The point is that our standard processes did not apply in as much as the particular transaction did not go to director level for approval.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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What we are trying to establish is whether this loss could have been prevented if there had been robust due diligence done on the company in advance of the transaction being placed.

Mr. Colm Whelan:

On the due diligence point, we made the point the last time we appeared before the committee that the education procurement service conducted the procurement exercise which contained certain standard due diligence checks on the tenderers. The winner of that process was the Swets UK company. Those checks were standard checks involving three years worth of clean accounts-----

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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When did this happen?

Mr. Colm Whelan:

At the time the tender was awarded, about 2012.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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We were told the last time Mr. Whelan was here that services had been contracted for the previous 15 years. Were they contracted with the same company for the previous 15 years? In 2012 there was a new tendering process. This company came through that tendering process in 2012 and then it was just a repeat in 2013 and 2014.

Mr. Colm Whelan:

I will defer on the details to my library colleague who knows the history better than me. The tender exercise was concluded in 2012. It resulted in a contract for a three-year period and in the course of that three-year period, Swets UK and its parent company failed. The loss came from the failure of Swets UK and our exposure to that company in the magnitude of the pre-payment we had made.

Professor Brian Norton:

May we add some relevant information?

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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I have a very limited amount of time. I do not need a history lesson. The witness may add something if it is a very short response.

Professor Brian Norton:

In order to present complete information, I will defer to Dr. Philip Cohen.

Dr. Philip Cohen:

It is true there had been contracts with Swets UK for 15 years. There was a tender exercise in 2012. There had been a previous tender exercise in 2006.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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The witnesses are telling us things have changed since. I hope they have. We got some information about that the last time the witnesses appeared before the committee. It is a very large amount of money and if anything could have been done to prevent it I think it is incumbent on us to make sure it is scrutinised. There seems to be quite a small number of very large payments that go through annually. I think 60 or 70 is the figure mentioned. Why would something of this size not be signed off on? Why would it not have been signed off on at the appropriate levels in advance so that all the checks and balances kicked in?

Professor Brian Norton:

I will ask my colleague to give details on that but it should have been and now is. I stress that it is not to say the amount was not scrutinised and known. The amount was budgeted for and was known to all the senior managers in the institute, including me, because we benchmark our library spend against other institutions. We knew how much we were spending and we budgeted for it. The transactional process was not as it should have been; that is a fact. It now is. Does Mr. Whelan want to add anything?

Mr. Colm Whelan:

That is the point.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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The Ernst & Young report is a very short report. The committee was circulated a very extensive report which was generated on foot of the Ernst & Young report. The Ernst & Young report was the independent report. It was the one we should have been provided with. It should have been obvious to provide us with it in advance of the meeting. Why was that overlooked? Why was it decided not to give it? Tell us what happened.

Professor Brian Norton:

I regret it was not provided. The report we provided to the committee in July last year dealt with all the issues. We were asked a specific set of questions on the issue. That report dealt with all those questions and with what we have done subsequently whereas the Ernst & Young report only partially deals with that. As the Deputy said, it is a short report. It was not the comprehensive report that was sought. We provided that. Looking at it now-----

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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Can I just say-----

Professor Brian Norton:

Could I-----

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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Very quickly.

Professor Brian Norton:

Could I finish so I do not mislead the committee because this is important? The report was provided in full to the Comptroller and Auditor General. It was provided in full to the HEA. It was provided last year after an FOI request to RTE, which is why it had it. We certainly were not concealing the report. We should have provided the report but all the issues are in the report we provided.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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I have heard Professor Norton talk about regrets several times and, to be perfectly honest, it is almost annoying at this stage because it would have been self-evident to send in the Ernst & Young report, which was the independent report. It would have been self-evident that it should be the report provided to us. It is after the event. It would have been very helpful to us while going through this if we could match it against the much longer report that was internally generated as a consequence of this report. Having an independent pair of eyes on this is what we wanted. I have a question mark in my mind about managing the fall-out from this on the information that was provided to us. I do not know if Professor Norton agrees with me on that but that is certainly what it feels like. What management arrangements have been put in place on due diligence, specifically for very large amounts? Are the witnesses just sticking with the rules that were already in place? Are there other controls?

Professor Brian Norton:

I will let Mr. Whelan answer with the details in a second but, essentially, we have an authority policy that sets the levels of authority to sign which is rigorously enforced. Anything I sign comes with a recommendation from a director to sign it having checked all due diligence beforehand. We are all in a clear workflow process and all major contracts come to us in a leadership team meeting and are signed off there. There are very thorough policies on double checking all the due diligence on all major contracts and making sure we look at multi-annual values, because it can creep into higher values by looking at a particular year's value. We look at both contracts that come to us and contracts we pay out.

Is there anything else I have missed?

Mr. Colm Whelan:

It is in the various reports. We apply the same rules to all transactions. We have fully rolled out our Agresso system so with regard to the list of payments alluded to in the Ernst & Young report - it is in The Irish Timesthis morning - virtually all of those transactions are processed through our standard workflow process. Utilities are-----

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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I have very limited time.

Mr. Colm Whelan:

Okay.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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Just conclude that response.

Mr. Colm Whelan:

Utilities is the principal area - there are one or two others - in which, historically, we pay those transactions by direct debit. We do not do prepayments. Prepayments was the principal exposure that led to the loss, aside from the failure of the company.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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Given the response I got to a very straight question about whether the controls would be as robust if a new service was being contracted, I feel I was misled on the last occasion the witnesses appeared before the committee. On the issue of the loss-----

Professor Brian Norton:

Could I answer that question?

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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Yes.

Professor Brian Norton:

The answer I gave referred to the controls we now have in place. They are very robust. A contract of this value would come to us in a leadership team meeting-----

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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That was not the question I asked Professor Norton. I asked whether the controls would be as robust as if a new service was being contracted. I was specifically asking about the loss. That was the context of the question.

Professor Brian Norton:

Maybe I misunderstood. If a new service was contracted today, it would be on our current system.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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No, Professor Norton is not putting it into the future.

Dr. Noel O'Connor:

Would it be helpful to the Deputy to outline what has changed with the new service that is being provided by the replacement of Swets UK?

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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No. I accept that DIT has changed the regime since this occurred. We are examining why it occurred and whether it could have been avoided. That is the context.

Professor Brian Norton:

There is a suggestion that I misled the committee. I am acknowledging, and I will not use the word "regret" again because it may be tedious, that the transaction approval was not appropriate. It is now and my answer to the question previously – maybe I misunderstood the question – was related to a new provision and a new process that would apply to that. If I misunderstood the question, I apologise, but I never claimed that the system we have now applied at that time. It did not.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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I have the Official Report of the meeting but I am not going to waste my own time reading it out. I know the context the question was asked in.

Were college services affected by the losses? For example, the library in Mountjoy Square was closed down. Was that a casualty of the losses?

Professor Brian Norton:

There was no diminution whatsoever of the library service. The programme provision that was in Mountjoy Square and in Portland Row in Temple Bar moved to the Grangegorman campus, and the library in Mountjoy Square moved to Grangegorman with that provision. There was no loss of library provision.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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The governing body has expressed concerns about procurement issues relating to a subsidiary of the college which provides computer services, which I think was called An Cheim. It has been wound up and replaced by a company called EduCampus Computer Services Limited. Are there potential conflicts of interest in respect of this company? If so, will the witnesses outline them and what has been done about them?

Professor Brian Norton:

Let me first set the context and then I will hand over to Dr. O'Connor to give the detail of An Cheim. It was set up many years ago at the behest of the Department of Education and Skills and the Higher Education Authority, HEA, to provide computer services to the institutes of technology, ITs. It was hosted by DIT as DIT's legislation enabled it to host a subsidiary company and I understand the legislation for the other institutes of technology did not allow that to happen. The company is funded directly by the HEA and has a board which is chaired by the president of another institute of technology, usually in rotation or a senior figure from an institute of technology, and has a membership drawn from representatives of the Department of Education and Skills and the institutes of technology, including DIT. It is a body that provides services across the sector. Now I will hand over to Dr. O'Connor.

Dr. Noel O'Connor:

An Cheim is in the final stages of being wound down and it might be timely to dwell on that process and give a bit of background and context. Accounts for the company have been approved by the board of An Cheim and by the auditors for the company, the Comptroller and Auditor General, earlier this month.

A full overview of the wind-down is contained in the statement of internal control in the accounts which will be posted by the end of this month on the Oireachtas website, and they relate to 31 August 2016. With the permission of the committee and in the spirit of absolute transparency, I will go through some of the summary of the statement of internal control. The company was established as a shared service support to the institutes of technology. The main focus of the company was to deliver on a range of technology related systems, management information systems, MIS, to support human resources, student records, library management and finance needs across the ITs, for approximately 100,000 students and 7,000 staff. It covered everything from registration, examinations and data management to all staff related systems. The company was incorporated in 2006 with its own board of directors and a chief executive officer, CEO, with an annual budget from the HEA. In 2013, as part of the consolidation of State agencies and also to provide an opportunity for greater synergies within the wider higher education sector, it was agreed to transfer the services of An Cheim to a new company, EduCampus Computer Services Limited, to be formed as a subsidiary of HEAnet and to wind down An Cheim. There was a logic to that and it was a wise decision.

The process of gaining all the necessary governance approvals to establish EduCampus with charitable status and to transfer An Cheim services and assets to it was undertaken through 2014 and 2015. A key objective of all parties was to ensure the continuity of service for core business applications across the ITs. Accordingly, the smooth transfer of activity, staff and resources from An Cheim to EduCampus was seen as being very important.

On 1 October 2015, the HEA transferred all funding of activities from An Cheim to EduCampus and all suppliers and clients of An Cheim were informed. Five of the eight An Cheim staff transferred to EduCampus and three returned to DIT. The CEO of An Cheim remained as CEO to direct the contract novation process and to wind down the company. An Cheim retains-----

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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If we see the detail of this in the next few weeks, we can come back to it. I am conscious that time is short and there are other things I want to explore. Will the Chairman put my name down for further questions?

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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My first question is to the clerk to the committee. This committee wrote to the Secretary General of the Department to ask several questions. I was not a member of the committee at the time. Was there any answer from the Department? I do not need an answer now but I would like the clerk to check it out, and if there was no reply, to ask why not.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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When did the committee write the letter?

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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There was a meeting in December 2015, and as a result, I understand questions were asked of the Department. I have not seen any correspondence come back.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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We will check with the former committee. It might not have transferred to this committee since the election.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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This will be a quick-fire round of questions to Cork Institute of Technology, CIT, the HEA and the Department. How much did 46 Grand Parade cost?

Dr. Brendan Murphy:

It cost €1.25 million.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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What was the guide price?

Dr. Brendan Murphy:

I am not quite sure.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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My understanding was that the guide price was quite a bit lower than the price paid, so why did CIT end up paying €1.3 million?

Dr. Brendan Murphy:

As for any acquisition, we had an evaluation undertaken.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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What did the valuation say it was worth? Who did the valuation? Dr. Murphy can write to me with the response. Is it true that only the ground floor can be used for teaching because of fire or health and safety regulations?

Dr. Brendan Murphy:

No. In order to bring it into public use, in particular for accessibility, as it was being used previously by a bank which was not a public building, various-----

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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I ask Dr. Murphy to write into us on those questions. Is all going well with regard to the merger and the new technological universities?

Dr. Brendan Murphy:

With IT Tralee, we await the passage of the legislation.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Is it all going well from the point of view of the HEA and the Department?

Dr. Graham Love:

Outreach with the TUI has gone well and that should facilitate the passage of the legislation.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Are the Department and the HEA supporting the process?

Dr. Graham Love:

I believe so, yes.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Was there a special meeting of the board of the HEA on 10 October to discuss this?

Dr. Graham Love:

I will have to check with my colleague. It was before my time.

Mr. Andrew Brownlee:

Was that 10 October 2015 or 2016?

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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2016.

Mr. Andrew Brownlee:

A special meeting?

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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A special meeting.

Dr. Graham Love:

I do not believe so, but I ask the Deputy to allow us to check and come back.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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The witnesses can come back to me.

Dr. Graham Love:

I may be able to get it during the meeting.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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What I want to know, and I am not worried about the date, is whether a meeting was specially convened on this issue. Were the minutes of the meeting published? I do not believe so because they are not on the website. Was it recorded at the meeting that the majority of the members of the board of the HEA actually opposed the creation of this university and the merger? The meeting definitely took place and there are minutes, but unlike all the other minutes they are not published. Why?

Dr. Graham Love:

If the Deputy will allow us, we will check it and we may even be able to get an answer during the meeting.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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I would appreciate if Dr. Love did so because it is pretty serious stuff if the majority of the members of the board disagreed with it and the minutes are not even published.

With regard to the Maritime College in CIT, tell me about SEFtec offshore training company. Who owns it?

Dr. Brendan Murphy:

It is a private company.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Does CIT own any of it?

Dr. Brendan Murphy:

No.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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What is the difference between SEFtec offshore training and SEFtec Global Training? Is it the same company?

Dr. Brendan Murphy:

I do not know. Certainly, we have a joint venture company.

Dr. Brendan Murphy:

What is it called?

Dr. Brendan Murphy:

It is usually referred to by its acronym, SNO.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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What does it stand for?

Dr. Brendan Murphy:

I will revert to the Deputy if I may.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Dr. Murphy does not know what SNO stands for, and CIT owns half of it.

Dr. Brendan Murphy:

As in many areas in education things are referred to by their acronym.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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What does the company do?

Dr. Brendan Murphy:

It provides training.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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For whom?

Dr. Brendan Murphy:

Normally for mariners.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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It is a joint venture between CIT and whom?

Dr. Brendan Murphy:

SEFtec-----

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Okay.

Dr. Brendan Murphy:

-----which is a private company.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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So SEFtec has nothing to do with CIT.

Dr. Brendan Murphy:

Not as a private company.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Who owns SEFtec? Does Dr. Murphy know?

Dr. Brendan Murphy:

I know there are a number of directors.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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SNO is owned by CIT and SEFtec.

Dr. Brendan Murphy:

Yes, it is a joint venture.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Is it 50:50?

Dr. Brendan Murphy:

Yes.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Are any of the people who work or have worked in CIT shareholders in SEFtec?

Dr. Brendan Murphy:

I do not know. It is a private company.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Dr. Murphy's answers are very strange. Surely, as the president of CIT, which is in a 50:50 joint venture with a company where taxpayers' money is being used, he would want to know whether people he employs are part of the shareholding of that company, to make sure there are no conflicts of interest. There may be no issues, but it is alarming, to say the least, that Dr. Murphy has not investigated this and does not know it.

Dr. Brendan Murphy:

Deputy Kelly asked me straight whether I knew and I do not know.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Does Dr. Murphy's colleague, Mr. Gallagher, know?

Dr. Brendan Murphy:

I know due diligence was done at that time the joint venture was set up.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Does Mr. Gallagher know?

Mr. Paul Gallagher:

Certainly I am not aware that any employee of CIT is a director in SEFtec.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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So nobody involved in CIT is in any way involved in SEFtec.

Mr. Paul Gallagher:

That would be my understanding, but the Deputy is catching me off guard so I would have to check.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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I ask the witnesses from CIT to go back and diligently check this.

Mr. Paul Gallagher:

Absolutely.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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When it comes to the arrangement in the Maritime College, does this company, SNO, pay for its presence at the Maritime College? Does it pay for everything it uses at the Maritime College? I presume it pays rent. I presume it pays to use facilities. I presume it uses assets of the Maritime College.

Dr. Brendan Murphy:

SNO itself has no physical assets in the National Maritime College.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Does it pay rent to use the facilities?

Dr. Brendan Murphy:

How do I describe it? We take a 50% dividend. If the company, through training, generates a profit we take 50%.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Has it made a profit?

Dr. Brendan Murphy:

Yes.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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That meeting was in 2014, by the way. Does SNO pay rent? If not, why not?

Dr. Brendan Murphy:

It is not renting anything.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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It uses the facility.

Dr. Brendan Murphy:

Yes.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Call it whatever.

Dr. Brendan Murphy:

The profits are split 50:50.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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It does not pay anything to use the facility, versus any other training company.

Dr. Brendan Murphy:

It is not the same as any other training company.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Why?

Dr. Brendan Murphy:

Because this is a joint venture company.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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I know, and frankly that is irrelevant. My point is there is a facility, and I understand the Maritime College has a 25 year arrangement. Is that correct?

Dr. Brendan Murphy:

It is a PPP.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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It is a PPP with a 25 year arrangement, and the building is in pretty bad order at present I understand. I do not understand how a company that is a joint venture, and it does not matter that it is a joint venture, is using the facility and is not actually paying to use the facility.

Dr. Brendan Murphy:

It does in the sense that we actually take half the profits generated.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Dr. Murphy might supply us with documentation on the profits.

I want to get onto the process of what happened with regard to the report. I am particularly interested in the Department of Education and Skills and HEA. Pretty serious allegations were made. Under the licence agreement the HEA has with colleges it has the right to investigate, so what happened here? I am not happy about it, to be honest.

Dr. Graham Love:

I will ask Mr. Brownlee to answer as he was there at the time, if that is acceptable?

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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That is no problem.

Mr. Andrew Brownlee:

The Minister for Education and Skills has the power to appoint an inspector. It is different from the universities.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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I understand.

Mr. Andrew Brownlee:

We do have that power.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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What happened here?

Mr. Andrew Brownlee:

I understand a series of anonymous allegations were received by the Comptroller and Auditor General in March 2014.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Yes.

Mr. Andrew Brownlee:

They were then passed to CIT and the HEA. CIT then wrote to the HEA, stating KPMG was to be appointed by the audit committee following a competitive tendering process to look into all of the anonymous allegations.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Then it went through the audit committee.

Mr. Andrew Brownlee:

It went through the audit committee. Further allegations were received in December 2014.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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The audit committee obviously went through a tender and got KPMG and hired a firm of solicitors. Some of the allegations were made about the same company that was hired to do the work.

Dr. Brendan Murphy:

That is not the case.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Fine. Does Mr. Brownlee believe that if this investigation were being done now he would do it any differently? Does he believe improvements could be made?

Mr. Andrew Brownlee:

It was a robust review undertaken by a professional firm of accountants.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Mr. Brownlee might just answer the question. We are under time pressure. Would he have done anything differently?

Mr. Andrew Brownlee:

No, I do not believe so.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Is Mr. Brownlee happy that KPMG - and I am not casting aspersions on that or any other company - went about its business and conducted this in a robust way, that evidence was taken in writing and that everything was done appropriately and investigated 100%?

Mr. Andrew Brownlee:

I am satisfied that a robust investigation was undertaken, yes.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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This has come back in front of the committee because we still have lots of questions. There are issues. Who set the terms of reference?

Mr. Andrew Brownlee:

I believe it was the audit committee of CIT.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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The audit committee of the college set up the terms of reference to investigate the college.

Dr. Brendan Murphy:

They were based on the legal advice provided by Arthur Cox.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Fine. Let me just say the following, because this is why I asked about any lessons. The audit committee of the college, with, granted, legal advice, set up the terms of reference for the investigation into the college. Is that not bananas? If Mr. Brownlee cannot see that, I am sorry but there is something wrong. This is just insane.

Mr. Andrew Brownlee:

Well, I suppose-----

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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It is like any company being told to go off, take legal advice, set up its own terms of reference and, if it finds out it did anything wrong, come back and say so. That is crazy stuff.

Mr. Andrew Brownlee:

We were provided with the terms of reference and we felt that allowed KPMG to conduct a robust and independent review.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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The whole foundation of the investigation falls if the terms of reference are not robust enough, but the HEA just accepted them.

Mr. Andrew Brownlee:

If the terms of reference were insufficient, we would have challenged them. As the Deputy mentioned, there are other steps we could have taken if we were not satisfied.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Legally, it is the HEA's role to investigate. Surely, it should have set the terms of reference instead of having the people who were being investigated doing it themselves. Is that not just common sense? Am I missing something? Do any of my colleagues believe otherwise? This is extremely strange, unusual and, frankly, wrong.

Dr. Graham Love:

If I could come in, as the funder and regulator of the institutions, we are trying to support a system whereby institutions can, in fact, account for themselves. If they set out terms of reference, publish them, publish the process by which the investigation takes place and publish the report itself, we support that and seek to develop that within the institutions so that it is not necessary for us in all cases to go in. While we should be capable of and willing to go in when necessary, we are trying to develop a system that will do that.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Okay, fine. Dr. Love is kidding me. This is a rapid-fire round, but this is just wrong. I am sorry but that is my opinion. It is not a reflection on the witnesses individually. Can I just say how wrong I think this is? The HEA is going to have to start over in respect of CIT and do it all over again. That is my belief.

I am stuck for time so I will move on. As this is a rapid-fire round, I would appreciate it if the witnesses would write to us because they are not going to get to answer all of the questions. I have to give a fair time to answer. The amounts for professional fees, travel and subsistence are very high. Can the witnesses provide a spreadsheet for the past five years on the amounts of money involved and set out why they were so high? On the document that was sent in, how could a document redacted to that extent have been accepted? How does one know what is behind the blacked-out portions?

Dr. Brendan Murphy:

If I may, the unredacted document was provided to the Comptroller and Auditor General, the Department of Education and Skills and the HEA.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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We do not know. This is a judgment call. We are guessing here. I have a number of questions in respect of which the witnesses might write back. How much has been spent on PR firms in the past five years? Were any pictures or portraits commissioned in the college during Dr. Murphy's tenure and, if so, how much did they cost? He might also get his organisation to write in about the terms of the retirement package he will be receiving. I would also like to know about the subsidiary accounts of the student services company which are not auditable by the Comptroller and Auditor General. Will Dr. Murphy agree to an independent review and audit of those accounts for the past five years? He can come back to us in writing.

Dr. Brendan Murphy:

They are audited every year and the Comptroller and Auditor General has access to that audit. The accounts are consolidated in the overall.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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I thank Dr. Murphy. Legally, they do not have to be provided so the fact that they are is, actually, a good thing. I thank Dr. Murphy for clarifying that. Can a breakdown of the payments - even if they were appropriate salary payments - to the former head of the National Maritime College of Ireland be provided? I will not mention the man's name.

Dr. Murphy was on the board of FÁS.

Dr. Brendan Murphy:

I was, yes.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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He is aware of the public sector rule for people who serve on boards and who are also State employees, which is "One person, one salary". Did Dr. Murphy receive any payments from FÁS while he was president of CIT?

Dr. Brendan Murphy:

Speaking from memory, I did until the rule the Deputy described came into being.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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After that rule came in, Dr. Murphy received no payments.

Dr. Brendan Murphy:

I cannot remember.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Will Dr. Murphy check and come back to us?

Dr. Brendan Murphy:

Yes.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Will he provide us with the names, reasoning and amounts paid to any staff member who retired from the organisation during his time and who was then rehired as a consultant? This seems to be an ongoing issue. There are retirement parties, people leave and the following Monday, they walk back in as consultants. To be fair, Dr. Murphy can provide details of instances where the total payments involved were over €10,000. He does not necessarily need to be going through everyone. However, this seems to be prevalent, which is deeply concerning.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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We will move to Deputy MacSharry. Does Dr. Love wish to comment first?

Dr. Graham Love:

I have two very quick responses to Deputy Kelly. We are still trying to get an answer in respect of October 2014. If we do not get it, we will write in just to get that clarified.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Publish the minutes.

Dr. Graham Love:

Okay. On the issue of investigations, it is critical that we create a system of governance in each of the institutions whereby they have the capacity to credibly investigate themselves.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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However, this was not credible.

Dr. Graham Love:

We believe the terms of reference were good enough. We reviewed them, we reviewed the process and we reviewed the output of the report. I am trying to make a system point that it is important that this exists in the institute and that it does not rely purely on and default to the idea of the HEA coming in.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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That is Dr. Love's opinion and he is entitled to it, but my opinion is that this failed. No college should be writing its own terms of reference when it is, effectively, investigating itself. The HEA is going to have to do it all over again.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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I welcome the delegation. For my few minutes, DIT is off the hook because my focus is on CIT. At the outset, I have a proposal as a new member who was not here the last time CIT was before the committee and there was a possibility to consider some of these matters. With the onset of the election, it was impossible for the previous committee to continue its work and we now only have a two-member overlap in the membership of the current committee. As such, I propose that the KPMG report, the whistleblower report or whatever was provided to the last committee be provided to all members of the current committee. While we are doing a report on our hearings of the last few weeks, I propose that we schedule an early meeting after the recess to recommence the consideration by the new committee and perhaps do a complete job. Due to the calling of the election, the previous committee was not in a position to do that.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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All of the documentation is available.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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If it is available, I propose-----

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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That it is sent on to us.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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----that it be a formal action on the work programme that we recommence the work which the previous iteration of the committee did not get to finish.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Put it on the list for the work programme.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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That is fine. In that context, who decided on the redactions to the report?

Dr. Brendan Murphy:

We were asked, if memory serves me right, by the HEA and by the Department of Education and Skills if CIT had any concerns with providing, with the Department and-or the HEA, a non-redacted version. We expressed that we had what we would describe as grave concerns about the publication. Once it comes to this committee, it has entered the public domain. We had grave concerns that the publication of the KPMG report would damage the good name and reputation of CIT and, perhaps more importantly, the large number of individuals and organisations who were basically the subject of false allegations.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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That is why rather than who. Who decided what was to be redacted?

Dr. Brendan Murphy:

Legal advice.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Legal advice. Who would that be? Is that an internal legal officer in CIT, in the HEA, in the Department, Arthur Cox, other solicitors or who?

Dr. Brendan Murphy:

The legal advisers to CIT provided it.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Is that an independent legal firm or inhouse lawyers?

Dr. Brendan Murphy:

It is an independent legal firm.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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What is its name?

Dr. Brendan Murphy:

O'Flynn Exhams.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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O'Flynn Exhams. How much did it charge for that?

Dr. Brendan Murphy:

For these reports, it was, in round figures, €9,500.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Who advised that firm?

Dr. Brendan Murphy:

I am not sure, but I think if it needs to seek counsel advice-----

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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I have a lawyer who I have had to use for different things. If I wanted him to undertake some work, I would give him a brief. Was O'Flynn Exhams provided with a brief in advance?

Dr. Brendan Murphy:

We asked it what its advice was on the full KPMG report going into the public domain, given that it identified a large number of individuals and organisations. The results of the KPMG report indicated that there was no substance to the 196 allegations.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Except the 35 requiring further review.

Dr. Brendan Murphy:

No, Deputy, as I read in the opening statement, all of them were gone through.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Maybe I heard Dr. Murphy wrongly that 35 required further review.

Dr. Brendan Murphy:

I said that, "In summary, the outcome of the KPMG independent reviews was that of a total of 196 allegations, 35 were deemed to have insufficient evidence to allow further review, 102 were deemed to require no further action as the allegations had been adequately addressed by the institute and 59 were deemed repetitious to other allegations". A feature of some of the allegations was that they were quite vague. One was trying to guess what they were about.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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I misheard Dr. Murphy. Would his understanding of the redactions be that they were the taking out of names to protect the identity of an individual?

Dr. Brendan Murphy:

Names and positions that would identify them.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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So it may just say "a person" rather than identifying the department or role, because that would identify that person.

Dr. Brendan Murphy:

Yes.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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My understanding is that the report provided to members of the Committee of Public Accounts was missing 53 pages. Is that reasonable?

Dr. Brendan Murphy:

Missing pages? I will certainly-----

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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It amounted to 53 pages not being included. Those are pages 14 to 45, appendix letter one, and pages 47 to 67, among others. I have seen redacted material. I was involved in the Committee of Inquiry into the Banking Crisis. It seemed like an extraordinary number of omissions.

Dr. Brendan Murphy:

My colleague has just mentioned that some appendices might include the list of organisations. We will certainly check it.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Would it be standard procedure? Was this the first ever whistleblowers' report that arose in-----

Dr. Brendan Murphy:

It was the first anonymous one.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Why was KPMG employed? Why was an accountancy firm employed?

Dr. Brendan Murphy:

Arthur Cox, the independent legal adviser, undertook an independent tender. The institution was careful to try to put as much distance from it as possible.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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What was the tender for? What did the EU tender site say? Did it say: "We have had an anonymous allegation and want to investigate it"?

Dr. Brendan Murphy:

It would have the terms of reference as referred to previously, requesting institutions that believe that they could carry out an investigation based on those terms of reference.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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How many current staff of CIT are shareholders in third-party companies that are in receipt of revenue from CIT?

Dr. Brendan Murphy:

How many staff of CIT are shareholders-----

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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How many staff of CIT are shareholders, in whatever capacity, in companies in receipt of revenue from CIT?

Dr. Brendan Murphy:

I do not think there are any.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Is Dr. Murphy certain?

Dr. Brendan Murphy:

Fairly certain, answering the question off the top of my head.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Is public relations, PR, work carried out by anybody who happens to be on staff who gets paid independently for that?

Dr. Brendan Murphy:

Not to the best of my knowledge.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Dr. Murphy might check that, have a close look, and report back to us.

Dr. Brendan Murphy:

We have tendered for a PR company and an individual, but the person is not an employee.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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We will include former employees in that as well, following on from Deputy Alan Kelly's question.

Dr. Brendan Murphy:

On the PR question or-----

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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On services generally. As we are going to restart this process, there is a whole series of issues that I would like to raise, but I do not want to waste all my time today. A prior year account adjustment was done in 2013 and 2014 for €483,000 that was classified as "buildings". Can Dr. Murphy recall what it was reclassified as?

Dr. Brendan Murphy:

I think it was an apprenticeship building that never proceeded.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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There seems to be an extraordinary level of professional fees. Would they tend to be legal actions, PR, or accounting?

Dr. Brendan Murphy:

Certainly not PR, and I would not have thought legal actions either.

Mr. Paul Gallagher:

If I could take this question, we work to a common format of accounts within the institutes. The professional fees as stated include various types of payment. In the main, a large part of it is payments under research contracts. There are payments to other organisations for research activity, so they are not strictly speaking professional fees in the sense that we might expect them to be legal, accounting or other services. We provide a breakdown of that to our finance committee on an annual basis and we can provide a copy of that to the Committee of Public Accounts.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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To put on record for the HEA, I agree entirely with Deputy Kelly. It was wholly inappropriate for somebody to allege, anonymously or not, and without prejudice to its validity or not, that the fox had attacked the henhouse and to allow the fox to set the terms of reference for the investigation into the alleged incident.

Dr. Graham Love:

It is the same point again, but I stress that there was a robust process, as I understand it.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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That is Dr. Love's determination of it. The Committee of Public Accounts received a doctored version of the report to protect people's identities, which, to my mind, seemed to have an extraordinary level of redactions. The Comptroller and Auditor General saw it and he was satisfied. That is fine and is his prerogative. The committee cannot be satisfied, without prejudice to anybody, as is. I will ask a question of Dr. Murphy and Mr. Gallagher. They probably will not answer it, but I have to ask it. Was anybody mentioned or implicated, however outrageous, in the allegations made in the two letters that was, for example, on the audit committee?

Dr. Brendan Murphy:

No, to the best of my recollection.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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I cannot test that.

Dr. Brendan Murphy:

I know.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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It is something I would like to test. Were there allegations against Dr. Brendan Murphy and Mr. Paul Gallagher, for example?

The witness should not answer that. If there was, how could they oversee and be-----

Dr. Brendan Murphy:

We did not oversee.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Fine. If they were implicated, how could they be party to that and concurrently be heads of an organisation within which the terms of reference were set? There is an inherent governance problem there. Maybe legislative change is needed to ensure that when these types of things happen, they can be dealt with. Representatives of the Garda have been attending this committee this week. I am sure the witness saw some of it. Without prejudice to the outcome of the issue, there is a problem with people investigating themselves. Everyone might be innocent but there is a problem. To say that there was a robust process, the boxes were ticked, everything was gone through and nothing was found is fine. Maybe the outcome would be no different if the terms of reference were set by the HEA or the Department of Education and Skills and the review were carried out independently. Maybe the outcome-----

Dr. Graham Love:

Possibly approved by the HEA would be------

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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I disagree with the witness on that point - approved by the HEA. It is a box-ticking exercise. What is the HEA doing? Why is it the licensing authority and funder? This is what it is there for. It protects my interests as one of the people contributing €37 million to this institution, and I have a problem with that €37 million being given over by the HEA saying it looked at the institute's examination of itself and was delighted with what it saw.

Dr. Brendan Murphy:

We did not investigate ourselves. There was an independent investigation.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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There was.

Dr. Brendan Murphy:

The audit committee-----

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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I know nothing about it because I have not seen the internally set terms of reference or the full report because it is heavily redacted to protect people who may have been implicated. That is not transparent or robust by any objective analysis. How could it be robust, regardless of and without prejudice to the outcome?

Dr. Brendan Murphy:

The HEA-----

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Just to move on------

Dr. Brendan Murphy:

The HEA, the Comptroller and Auditor General and the Department of Education and Skills all had sight of the terms of reference and the full unredacted report.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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They did. I am criticising them, not the witness specifically, although he does not escape all criticism. Those bodies should not have accepted that. It was inappropriate governance for them to accept a set of guidelines set by the witness's organisation. People, however innocent they may be, who were potentially implicated by a whistleblower's report were party, albeit with a couple of degrees of separation, to setting the terms of reference. That is wrong and it stinks to high heaven. In terms of people's innocence and good standing, it does nothing for the good name of those implicated that the HEA had a look and concluded that it looked great. In their interest, we will start again in September. One thing that jumped out and bothered me was that, as Deputy Kelly said, a portrait of the witness was painted. I have seen it and it is very good. Is there an art college in CIT?

Dr. Brendan Murphy:

There is.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Prior to the witness's portrait being painted, was it the practice to get students from the art college to paint portraits of the president of the institute?

Dr. Brendan Murphy:

No.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Never?

Dr. Brendan Murphy:

Not to the best of my knowledge.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Is that the case?

Dr. Brendan Murphy:

I am not aware of any portrait being done by-----

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Perhaps that might be checked. My information is that it was. Was it always put out to tender for artists to indicate their interest in painting the portrait?

Dr. Brendan Murphy:

The general practice, which will now be changed, was that the artist was chosen.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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The artist was chosen?

Dr. Brendan Murphy:

Yes.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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And the artist would send in a bill and an invoice which would be paid?

Dr. Brendan Murphy:

Yes.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Was the artist a Mr. Magee?

Dr. Brendan Murphy:

The artist was Mr. Mick O'Dea.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Mr. Mick O'Dea. Apologies. I looked at his website and saw some good stuff. It costs around €4,000 apiece. Why was the bill for the portrait €22,000?

Dr. Brendan Murphy:

There were two portraits painted.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Two portraits were painted?

Dr. Brendan Murphy:

Two portraits.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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The KPMG report only mentioned one.

Dr. Brendan Murphy:

I cannot say if that is so. There are two portraits that are in the grounds-----

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Would the witness not have asked one of the art college's fine people to paint the witness's portrait or that of an outgoing chairman or president to support it and as an opportunity to promote its students and the great work done by its teachers?

Dr. Brendan Murphy:

That has not been the practice.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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The witness might review the practice, bearing in mind the financial deficit in the institute over several years, in one of which there was a loss of €126,000. That loss might only have been €104,000 had the portraits not been paid for. It niggles at people that a portrait of the college president is commissioned at a cost of €22,000 but the college is teaching artists in whom it does not have sufficient confidence to ask them to do the portrait.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Who carried out the independent report?

Dr. Brendan Murphy:

KPMG.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Who paid KPMG?

Dr. Brendan Murphy:

CIT, ultimately.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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How much did it pay KPMG?

Dr. Brendan Murphy:

Slightly over €21,000.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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It was put to the witness that the review was carried out independently. In reality, it was carried out by an organisation whose services were procured and paid for by CIT. To whom did KPMG then report? When the report was completed, to whom was it given?

Dr. Brendan Murphy:

It was given to the audit committee.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Which audit committee?

Dr. Brendan Murphy:

The audit committee in CIT.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Is the witness satisfied that was an independent process?

Dr. Brendan Murphy:

It was an independent process.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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One of the issues that we examined in the context of all the institutes of technology is the same names coming up over and over again, such as Deloitte, KPMG, Ernst and Young, Arthur Cox and many more. All these organisations were well paid to do work for the institutes. I want a ten-year look-back, broken down by year, institute and what work each organisation did for the institutes and how much they were paid. It strikes me that he who pays the piper calls the tune. Perhaps Mr. Love can explain why the HEA exists at all if all this money is being handsomely earned by these organisations? He has mentioned self-regulation, self-investigation and self-examination by the institutes on several occasions today and sees that as a good thing. Ireland does not have a good history of self-examination or self-investigation. The HEA exists for a reason. Why does it exist and why does Mr. Love, a well-paid public servant, head up that organisation? What is his role in regard to the process when complaints are made and examined?

Dr. Graham Love:

In answer to the Deputy's first question, we undertake to provide those data to the committee. To answer his second question, our functions are threefold: first, to fund the system and allocate State funding to the institutions in a transparent and clear manner; second, to provide oversight, and I will return to that topic in a moment; and third, to act in an advisory capacity to the Minister, assist with policy development and so on. Our second function, oversight, has been beefed up significantly since the Hunt report in 2013 in terms of helping to develop the system, technological universities, clusters and so on. I do not want to give the committee the impression that we think the only reliance should be on self-investigation. It is a good thing that we get the level of governance and capacity to assess things at a considerable level in an individual institute------

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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There is an outsourcing of oversight by the HEA to KPMG, Deloitte, Ernst and Young and so on. Why does the HEA not have the in-house capacity and experience to do that work itself? Why is further money being spent on these organisations? The institutes are hiring and paying them over and over again. That the organisations benefit from being hired by the institutes must have some impact on their work. I am not satisfied that that is truly independent. That view is shared by some other committee members. There is a practice of outsourcing of governance and oversight and that is not good enough. Mr. Love has said he will revert to the committee with the breakdown. However, I am concerned that that is what I am hearing from him today and it is also my experience from dealing with these matters over recent months in this committee.

Dr. Graham Love:

We would not be in a position staffing-wise to be able to service those kind of requirements, both in sheer volume as we would need a staffing of many orders of magnitude larger than we have but also as it happens that there are peaks and troughs in these kind of things. Having a State agency staffed to that level would be difficult and I am not sure it would even be appropriate in some cases.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Is Dr. Love aware of the methodology that was used by KPMG to carry out the examination in this institute?

Dr. Graham Love:

Not in the specific case.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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That is my point. Dr. Love is not even aware of the methodology that they used.

Dr. Graham Love:

I would have officials who are, sorry. There would be others. As I explained, I am not familiar with all of them.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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I am asking. When I say, "Dr. Love", I mean the HEA. Sorry, is the HEA aware?

Dr. Graham Love:

Sorry, yes, we would be. Apologies.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Are any of those officials who can answer my question here?

Dr. Graham Love:

I am not sure. I will ask. Andrew, would you be familiar with it? If not, we will find out and submit a reply to the committee.

Mr. Andrew Brownlee:

I would need to check to get the details but I understand it was a robust USI review of, I think, 175 allegations in the first one and then subsequent allegations.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Would Mr. Brownlee be aware of whether allegations were answered on a verbal basis and where documentation, for example, in evidence, was not requested? Would that be something that Mr. Brownlee would be aware of?

Mr. Andrew Brownlee:

I understand that was a substantially desk-based review.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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A desk-based review?

Mr. Andrew Brownlee:

Yes. A review of all of the documentation that was available.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Will Mr. Brownlee describe what a desk-based review would be?

Mr. Andrew Brownlee:

It would not involve direct consultations with individuals. Perhaps the IT could advise on that.

Dr. Brendan Murphy:

If I may, Chair, I know that people were interviewed. As in what one would describe as normal audits, there was sampling carried out depending on the nature of the allegation. It was not a desk review as such.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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It was not?

Dr. Brendan Murphy:

It was not. There was a portion of it where the institute-----

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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The HEA said it was but Dr. Murphy is saying it was not.

Dr. Brendan Murphy:

I am saying there was also an element of interviewing with people, of sampling. If there was, let us say, an allegation about expenses, there would be a sample, not only looked at there but of the processes surrounding those.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Were members of management interviewed? Was Dr. Murphy interviewed?

Dr. Brendan Murphy:

Yes.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Dr. Murphy was. Would management have been?

Dr. Brendan Murphy:

Yes.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Who was the Accounting Officer? Who signs the cheque for KPMG?

Dr. Brendan Murphy:

Ultimately, I am the Accounting Officer, as the president.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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I thank Dr. Murphy.

In relation to O'Flynn Exhams Solicitors that was mentioned, did Dr. Murphy state that CIT paid them over €10,000?

Dr. Brendan Murphy:

It was €9,461.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Were they at the centre of any of the allegations that were made?

Dr. Brendan Murphy:

I would be reluctant to start naming who was because, Chair, we are now heading down the avenue of-----

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Dr. Murphy is reluctant.

Dr. Brendan Murphy:

I said I myself was interviewed. As the Accounting Officer, I have no problem saying that.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Dr. Murphy is reluctant, I would say, because my understanding is that they were. If they were, why were they one of those firms that were then paid €10,000 in the course of this work? If they were - Dr. Murphy will not answer - one of those who were at the centre of the allegations and then they were hired and paid almost 10,000, is that not a conflict of interest?

Dr. Brendan Murphy:

That is why Arthur Cox was brought in as independent legal advice - so that in the legal advisers of the institute there would not be that conflict, if there was a conflict.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Is it correct that the Comptroller and Auditor General's office has stated that it received an unredacted copy of the report?

Ms Colette Drinan:

Yes.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Did the HEA receive an unredacted copy?

Dr. Graham Love:

I think so, yes.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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The Department would have received an unredacted copy. It is only the Committee of Public Accounts that received a redacted, heavily redacted, copy of the report. Are we the only ones who received the redacted version of it?

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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All I know is that the copy the committee received was heavily redacted. I myself saw the document this morning.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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What I am saying is that-----

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
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It is illegible.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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What I am saying is that everybody else has full unredacted copies of it, except this body. We are the public representatives, the democratic oversight. We are kept pretty much in the dark.

Dr. Brendan Murphy:

I repeat what was redacted were the names of individuals and organisations or their particular job titles that would have readily identified them. After all, there were 196 allegations-----

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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But they were identified, I am sorry, Dr. Murphy.

Dr. Brendan Murphy:

-----none of which stood up to investigation.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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That is irrelevant. In the unredacted version, those names and their titles were given to the HEA-----

Dr. Brendan Murphy:

Yes.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

-----they were given to the Comptroller and Auditor General, they were given to the Department-----

Dr. Brendan Murphy:

Yes.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

-----but they were not given to us. Why not us?

Dr. Brendan Murphy:

I do not know. I did not supply the report. We supplied a redacted version to the HEA and to the Department.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Maybe Mr. Gallagher can answer.

Mr. Paul Gallagher:

We did undertake legal advice in terms of who we should provide the report to. The advice was that information coming to the Committee of Public Accounts would be public in nature and available publicly and that that was a threat to the individuals who were named and the organisations who were named in those allegations. The advice was that we should not be providing that.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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For Mr. Gallagher's benefit, and probably the benefit of viewers, in relation to that particular issue, documents coming to the Committee of Public Accounts are not necessarily published. I can think of one quite recent one in relation to the HSE internal audit into Console. That entire document was presented to the committee. We decided to note it and not to publish it because it was not our document, and not one syllable ever leaked. Others, outside of the Oireachtas, who had copies of that document chose to put it into the media.

I would ask - this is a comment across the board for all Accounting Officers - if documents are being sent here in a redacted manner in future that Accounting Officers consult with the committee secretariat regarding the use of the document. I fully understand there was a belief that we would be publish it and I can understand that concern, but that need not always be the case. We can make arrangements and we have successfully done that and protected the identity of those included, and specifically chose not to publish a report. That is a general comment to all Accounting Officers.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

If it is in order, I have a few quick questions for Professor Norton. In relation to Swets UK-----

Professor Brian Norton:

It is a Dutch company.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

-----is it correct it went bust owing its customers €9 million?

Professor Brian Norton:

Yes.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Is it correct that there was a €1 million loss across 37 libraries in Ireland?

Professor Brian Norton:

Yes.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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How much of that €1 million would have been attributed to Professor Norton's organisation?

Professor Brian Norton:

We lost €718,000.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Some 71.8% of the €1 million loss. It is quite shocking for Professor Norton that it was 71.8%. It was described in the past as quite shocking by his organisation. What did Professor Norton do about that when it happened? Did the institute itself commission a report into this?

Professor Brian Norton:

I see what the Deputy means. The report which the committee has, the report we were discussing earlier on-----

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Who carried out this report?

Professor Brian Norton:

I was answering the question. That was commissioned by our governing body independently. I was not involved, nor was any of the management team. It was a fully independent report to the governing body.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Who carried it out?

Professor Brian Norton:

Ernst & Young.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Ernst & Young, here we go again. How much did it get paid for that?

Professor Brian Norton:

It is in the order of €27,000.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Twenty-seven thousand euro for that. When Professor Norton was here at the previous meeting, did he inform the committee of the existence of that report?

Professor Brian Norton:

In the correspondence with the report, we did submit-----

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

No, no. That was after. I am talking about-----

Professor Brian Norton:

No, no, let me finish the answer, please. We did indicate in the correspondence there had been an internal review. We did not supply the internal review because the report dealt with all the issues in that internal review, but in our covering letter we indicated such a review existed and that was supplied to this committee in July of last year. We also supplied the report to the Comptroller and Auditor General and to the HEA. So there was no attempt to conceal it. As I said earlier on in my response to Deputy Catherine Murphy, I do not want to use the word again and be tedious, but I think we should have provided it. We provided it to everybody else but we felt that the report we provided - because we were not asked for a report; we were asked to answer the specific questions - answered fully all those questions that we were actually asked in the request from the Committee of Public Accounts.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Is it correct that the report found - it was quite critical in some areas - that there was a lack of management oversight?

Professor Brian Norton:

That is correct.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Who was responsible for the lack of management oversight?

Professor Brian Norton:

I am the Accounting Officer, so I am.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Professor Norton is the Accounting Officer. Does he take responsibility for that?

Professor Brian Norton:

Yes.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Was it a failure on Professor Norton's part? Was he in charge at the time?

Professor Brian Norton:

Yes. I have been the Accounting Officer. I am accountable for that and have taken measures subsequently to make sure that everything is in place.

I should point out that it is a very particular failing. The items were, as I indicated, budgeted for. I knew the amounts, I mean, the actual amounts of the transactions, but the actual approvals for the transactions were not correctly done. It is a very specific thing.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Is it correct there was no formal contract?

Professor Brian Norton:

The negotiation of the Swets contract was undertaken as a national tender. It was undertaken by the educational procurement service-----

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Was there a formal contract-----

Professor Brian Norton:

Can I?

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

-----because I am seeing in front of me a long-winded answer to a straightforward question. Was there a formal contract or not?

Professor Brian Norton:

I do not wish to be long-winded but I do not wish to mislead the committee and it is not simple. There is a national framework agreement that is negotiated by the education procurement service unit in the University of Limerick. That, as part of the national overall contract, is manifested in service level agreements in the institutions. Dr. Cohen wishes to pick up on how that operated.

Dr. Philip Cohen:

The additional tender exercise was conducted by the Education Procurement Service, EPS, in Limerick. Our understanding was it passed on the result of that exercise to the individual institutions.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Deputy Cullinane's time is up but I will give him two or three more minutes.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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That is the benefit of asking the Chairman and his forgetting.

Dr. Philip Cohen:

The results of the exercise were then passed on to the individual institutions. A service level agreement was then issued by Swets, which we then signed.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Was a risk analysis carried out?

Professor Brian Norton:

No, because it was a national procurement exercise. The risk analysis is part of the due diligence exercise, which applies to everyone. The due diligence is the responsibility of the organising-----

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

But was that not a critique in the report?

Professor Brian Norton:

We now undertake risk analysis, but the -----

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Can I stop Professor Norton there?

Professor Brian Norton:

Can I please answer?

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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No, I am going to ask Professor Norton to stop.

Professor Brian Norton:

It is important to answer the question.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

I am asking Professor Norton to stop and he can come back in.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

Professor Norton can come right back in.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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I merely asked if a risk analysis was done. That was a critique in the report. He has acknowledged that no, there was no risk analysis done. I know he is going to tell me that all of that will be reviewed and changes will be made but either a risk analysis was done or it was not.

Professor Brian Norton:

That was not going to be my answer. This was a national tender, which was done across the country. As part of the due diligence for the national tender, EPS would, as part of that, have done a risk analysis. On whether we did any additional risk analysis in DIT, the answer is "No".

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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And that was part of the critique, is that correct?

Professor Brian Norton:

Yes, that is correct.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Was there any form of approval by anyone regarding making the pre-payment?

Professor Brian Norton:

Yes.

Dr. Philip Cohen:

I signed the invoice.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Dr. Cohen did.

Dr. Philip Cohen:

I did.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Was that a mistake on his part?

Dr. Philip Cohen:

It depends on what the Deputy means by mistake.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Was there a loss of €718,000?

Dr. Philip Cohen:

There was.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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That would be a fairly big mistake, would it not?

Dr. Philip Cohen:

If the Deputy is asking me if I feel personally responsible for that loss, then yes, I do.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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A further €760,000 then had to be spent on a second supplier, is that correct?

Professor Brian Norton:

On a replacement supplier.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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How did that go?

Professor Brian Norton:

I am not quite sure of the question.

Dr. Philip Cohen:

As part of the EPS tender exercise, a number of companies tendered for the contract. The successful tenderer was Swets and the second tenderer was EBSCO, a big company based in the US. We contracted with them to supply the journals for 2015.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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I will make a general point, which I have made already. This committee is going to produce a report on the third level institutes. The HEA's role in examinations and investigations should form part of it. The committee needs to consider whether it is satisfied with the use of these external companies and the handsome money they are paid to do work, and whether that is truly independent, given that the institutes themselves pay and write the cheques. Hopefully, when that work is done we might tease out some of these issues with Dr. Love and his team.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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I think Dr. Love wants to come in here.

Dr. Graham Love:

I do not want to waste the committee's time except to point out the growing regulatory role of the HEA. That comes out of the Hunt report. We have started down that road and we need more and we will do more. I want to stress that even where we have an oversight and the capacity to go in and investigate, we should not let institutions off the hook for the capacity for a certain capability of that themselves. It is important that they have that capacity through their audit committees and otherwise. Yes, we should sit above that and be capable of going in when necessary. That is a culture that we want to improve in the institutions.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Deputy McDonald.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
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I will not reiterate any of the points that have been made already. Can Dr. Love say whether the HEA or the Department had sight of the whistleblowers' complaints?

Dr. Graham Love:

Which ones?

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

The anonymous ones.

Dr. Graham Love:

In CIT?

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Yes, in CIT.

Dr. Graham Love:

I will check with my colleague.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
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I just want to know was the Department and the HEA -----

Dr. Brendan Murphy:

It is my understanding that they went to the Comptroller and Auditor General and the Comptroller and Auditor General sent it on to the Department, the HEA and ourselves.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
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So they had been in the HEA's line of sight. I will return to CIT.

The issues regarding DIT have been well rehearsed. I want to welcome DIT to Grangegorman. It is within a stone's throw of where I live. The campus is stunning and I wish the DIT well there. It will be a big opportunity for the inner city and for educational opportunity in our neighbourhoods, which is much needed. I would like to talk with them about that at some stage. I hope they will take this in the spirit in which it is intended, because it is mildly critical, but I do not find its staff very engaging with the community. It is a problem and I will talk to Professor Norton about it on another occasion. I have been very frustrated in trying to make it happen and I hope he will hear that message.

It was December 2015 when Dr. Murphy was here last, so it was on the brow of a general election. Does he remember I asked him what was going on? He had a whole series of anonymous allegations that came in two waves. I felt at the time he had been a little dismissive; he wondered who was to get into the mindset of someone who would bring forward these allegations and I suggested to him that perhaps he might look at the culture in CIT and what was going on. It is quite something for people to come forward, albeit anonymously, with such a comprehensive critique of the organisation for which Dr. Murphy is in charge. I do not know if Dr. Murphy is still active or has he retired?

Dr. Brendan Murphy:

I am still the Accounting Officer.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
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Is Dr.Murphy about to retire?

Dr. Brendan Murphy:

I will do so on 31 August.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
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So Dr. Murphy is finishing his tenure. I do not know if he has availed of the opportunity to consider the cultural issue but I listened to him today and what I hear that there were 196 allegations, none of which stood up and there is nothing to see here, move on.

Dr. Brendan Murphy:

We have yet to receive a protected disclosure under CIT's protected disclosure policy.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Is Dr. Murphy absolutely sure about that?

Dr. Brendan Murphy:

Yes.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Dr. Murphy knows that the legislation is retrospective in terms of its definition of protected disclosures. Is he absolutely sure about that?

Dr. Brendan Murphy:

We have not received a protected disclosure.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Because I am aware of a case outside of the two anonymous disclosures that I believe falls under the category of a protected disclosure.

Dr. Brendan Murphy:

We have not received a protected disclosure.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Does Dr. Love wish to say something here?

Dr. Graham Love:

For the committee's information, we received one recently on the CIT through the Department. It is on our desk in the HEA now. We are looking into that as we speak. It has just arrived.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
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So the HEA is in receipt of a protected disclosure in respect of CIT. Can I ask the Department if it is in receipt of a protected disclosure?

Mr. Tony Gaynor:

Yes, we got it and referred it on.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Thank you for that clarification, Mr. Gaynor. Yet, Dr. Murphy is insistent that he has had no protected disclosure. I want him to bear in mind the legislation governing and defining protected disclosures is relatively recent but it is retrospective in terms of the definitions and the protections that it affords. Does Dr. Murphy wish to revise his response to me?

Dr. Brendan Murphy:

My remembrance is that the Act came into effect in the middle of 2014. Since then -----

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Dr. Murphy is not hearing me when I say "retrospective".

Forget the legislation. How many disclosures has Dr. Murphy received, these anonymous ones which he says have been comprehensively disproved?

Dr. Brendan Murphy:

We did not receive the anonymous allegations. They went to the Comptroller and Auditor General.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Leave aside the anonymous disclosures. Has Dr. Murphy received any other disclosures?

Dr. Brendan Murphy:

No.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

None.

Dr. Brendan Murphy:

No.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
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I do not believe that is accurate testimony. Is Cork Institute of Technology currently in litigation with any employee or former employee in respect of any complaint brought forward which could be described as a disclosure?

Dr. Brendan Murphy:

As in any large organisation, there would be a small number of cases which have gone into the legal arena. I do not think any of those could be described as a protected disclosure.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
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I believe they could be. The one that I am thinking of relates to, I imagine, the same information which has landed with the Department, and now with the HEA.

Dr. Brendan Murphy:

I do not know what has landed with the Department.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
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We could do cat and mouse here all day. I have no interest in doing that. There is another disclosure. It is not new. It is known to Dr. Murphy. The matters contained therein are very serious. I am not in a position to adjudicate as to the accuracy of any of these matters or to verify them. I am not casting myself in that role.

Dr. Graham Love:

In respect of the disclosure that recently landed on our desk via the Department, we are going through the process in the HEA first. We have not yet contacted the institutions, so they would not be aware of it yet. We are doing due diligence internally first.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
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When the HEA has done its due diligence, it will discover that CIT is very well aware of the situation. I say that as a word to the wise.

Dr. Graham Love:

I am sorry. We are fresh to it.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

That is fine. I thank Dr. Love. My point is made. There is no doubt we will have to return to CIT. We only had a very cursory look at it back in December 2015. There is no doubt in my mind, for all the reasons that other members have set out, that we need to come back and do a comprehensive piece of work. Dr. Murphy will be enjoying his retirement at that stage, but I hope he will come back and appear before the committee and assist us with that investigation.

Dr. Brendan Murphy:

I will see.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

I would hope that he would make himself available. May I just ask Dr. Murphy about KPMG and Arthur Cox? Who from KPMG was involved? Is there an office in Cork or did they come from Limerick?

Dr. Brendan Murphy:

We think it was the Cork office.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

What about Arthur Cox? Likewise, I assume it has a fairly big presence. Does it have a Cork office?

Dr. Brendan Murphy:

No, to the best of my knowledge. It is based in Dublin.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
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Its staff came from Dublin. Although it lays claim to being the real capital, Cork is quite a small city. What are the interactions between boards, boards of directors and the movers and shakers in CIT and KPMG?

Dr. Brendan Murphy:

I do not think we have used KPMG as a-----

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

Is there any crossover in terms of membership of any of CIT's boards or so on?

Dr. Brendan Murphy:

Is the Deputy referring to members of the governing body?

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

The governing body or any of the organisational apparatus.

Dr. Brendan Murphy:

To the best of my knowledge, none of the members of the governing body has been or is connected with KPMG.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
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It is something we should investigate. This is not to put anyone on the defensive necessarily but it occurs to me that we live on a small island and we have a relatively small population. Once one starts getting into circles of people, people know people who know people. We, as the oversight body, have to be sure that no one allows themselves unthinkingly to be in a position of conflicted interest. Does Dr. Murphy take my point?

Dr. Brendan Murphy:

Yes.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

We need to check that out. When Dr. Murphy was before the committee the last time, 10 December 2015, we asked questions about staff retiring and then returning to work. Interestingly, after Dr. Murphy's appearance, we received a letter from the Cork colleges branch of the Teachers Union of Ireland, TUI. In that letter, the information which Dr. Murphy gave to this committee was contradicted. Does he recall the evidence he gave to the committee on the previous occasion?

Dr. Brendan Murphy:

No.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

I will help Dr. Murphy. The question was put. Dr. Murphy was asked if people had retired and come back to work and he said:

Up to this academic year, we did not. However, in the context of industrial action by the Teachers Union of Ireland, under which it basically instructed its members to engage in no overtime whatsoever, there have been a number of cases in which, because of the specialised nature of the expertise being sought and the difficulty of operating at short notice ... we have had occasion to look to retired staff. A note I have in front of me says that four lecturers who were retired have been brought back on a part-time basis.

He then went on to elaborate on this topic. The TUI told us that his response is contradicted by information that CIT provided to the teaching union under a freedom of information request. That response said that 15 retired staff members have been re-engaged by CIT. There is quite a discrepancy there, is there not?

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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We are on time at the moment. The Deputy will get back. I wish to let Deputy Connolly in.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

I use that by way of example of the need for a proper investigation of these matters.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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I call Deputy Connolly. I believe Deputy Murphy has gone to the Chamber for a few minutes. She will be back.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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I have only a few practical questions, and the question raised by Deputy McDonald is one of them. We have all been notified about the discrepancy in respect of the number of staff who had left the college and who have come back. Can that be clarified? It is a practical question.

Dr. Brendan Murphy:

Certainly. However, we do not have the details with us today. We certainly were not copied with-----

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
Link to this: Individually | In context | Oireachtas source

I understand that. It is like being ambushed in a sense. I do not wish to do that. If I just stay general for a moment and then I will ask my three or four specific questions. I have noticed over recent engagements that we are dragging things out of institutions. The HEA is reliant on the institutions to be more or less self-managing. We have all these independent outsiders coming in, such as EY. At the same time, every single third level institution tells us that it has no money. We need money for all these third level institutions.

For me, the worst thing, and the most worrying thing, is the blurring of the boundary between industry and education. It is jumping out. A question was asked earlier in respect of some company, the name of which I did not quite catch. One of my colleagues asked whether it paid rent, as they were based on the campus. The answer was vague, that it does not pay rent because it is not really based there. They pay dividends. The National University of Ireland, Galway, which is not here today, has a foundation which operates from an office in the university but which does not pay rent. There is all this language around the situation being very good for the institutions. In the guise of education, we are being told what is good for us with very little accountability. Regarding the two institutions here today, I presume there are no foundations or trusts in question. Is that right?

Professor Brian Norton:

DIT has a foundation.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Okay. DIT has a foundation. Does it have an office on its campus?

Professor Brian Norton:

It does indeed, yes.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Does it pay rent for that?

Professor Brian Norton:

It does not.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Why not?

Professor Brian Norton:

The sole role of the foundation is to provide funds to DIT, so the transaction would be for it to pay rent and then to give funds to DIT. It is a net contributor of philanthropic gifts to DIT. If it were a policy decision that it should pay rent, we would obviously abide by that, but it is of net benefit to DIT.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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It is something I have asked to come back to. If I take the case of NUIG, its foundation does not pay rent, as Professor Norton is saying of DIT's foundation, because they give money. They give money under conditions, however. We do not know what the conditions are. I am just taking it as an example. It builds many buildings as opposed to looking at poverty or putting in a professor of Irish, a vacancy which has existed for a long time.

The money is coming with conditions and with a corporate tinge because we have a list of who is on the foundation in New York. I will come back to this separately in respect of all the foundations on another occasion. Goldman Sachs, Coca Cola and so on make contributions with no discussion over control. All we are being told is the DIT has no control over the foundation. The relevant question is what control the foundation has over education in those colleges. That is just a comment.

Professor Brian Norton:

A comment was made earlier about misleading by not giving the fullest answer. The DIT foundation is a small operation. It operates to the benefit of DIT. The gifts come directly to DIT and the foundation has a particular function for particular activity. It follows all charity commission guidelines. Its accounts are audited and they will be consolidated with those of DIT so there will be full disclosure.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Am I correct that DIT is the first institution to agree to consolidate their foundation accounts with its own accounts?

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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NUIM does as well.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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It has minor foundations. The bigger foundations have not been consolidated by the colleges.

Dr. Noel O'Connor:

I reassure the Deputy that they are a great asset and resource.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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I do not want reassurances. That is for another day. I only want to know about accountability.

Dr. Noel O'Connor:

In terms of accountability, there is a clear connection between the foundation and the institute. The president and I, as directors and senior members, sit on the foundation board. In our case, the board is working towards the new code of practice for foundations and charities. All the accounts are on the website. Everything is accessible.

On the point relating to restricted and unrestricted funding for certain projects, there has been a strong emphasis in DIT on a balance around scholarships for students, targeting disadvantage and channelling the funding obtained through the foundation towards improving participation in higher education. A good example of that recently, albeit with a corporate element, is the new access apprenticeship programme trying to improve gender in apprenticeships. It is entirely funded through the foundation.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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I welcome that clarification and it is something to which I would like to return. I look forward to getting more information on it. That contrasts with the Galway foundation, which is the richest foundation in the country.

I have a number of questions for Dr. Murphy regarding his college. I put the first question to the UCC delegation earlier. Is it correct that CIT, UCC and the Naval Service are behind IMERC?

Dr. Brendan Murphy:

Yes.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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UCC and CIT co-commissioned a review, which was completed in May 2016.

Dr. Brendan Murphy:

I believe so.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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It is important that Dr. Murphy would know because governance issues keep coming up in the context of all third level institutions, some of which are worse than others. IMERC is only a few years old but when the review was carried out, serious governance weaknesses emerged. Is that true?

Dr. Brendan Murphy:

They were raised. There was-----

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Did the review find serious governance weaknesses? "Yes" or "No"?

Dr. Brendan Murphy:

Yes.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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I understand the review highlighted major weaknesses and made recommendations. It stated the recommendations should be monitored to ensure their implementation within a number of months. Has that happened?

Dr. Brendan Murphy:

Following the review, both organisations, rather than continuing with IMERC, which was brought together under an MOU-----

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Have the recommendations been implemented?

Dr. Brendan Murphy:

They have been superseded. Rather than implement those recommendations-----

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Who carried out the review and how much did it cost?

Dr. Brendan Murphy:

As to the details of the review, there was a chairman and, to the best of my recollection, four or five international members.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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How much did it cost?

Dr. Brendan Murphy:

Our 50% was approximately €8,000 so the review cost €16,000.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Will the Chairman seek in writing the details of the review, including who conducted it and the cost, and a copy of the review?

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Okay.

Dr. Brendan Murphy:

The committee was promised it this morning.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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I am not sure about that because that part of the meeting was rushed.

Dr. Brendan Murphy:

I was present.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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That is fine. We are in a position where people come to us. We do not with to ambush Dr. Murphy. The purpose of the committee is to ensure better accountability. It is frustrating for both sides but it is particularly frustrating on this side on behalf of the public.

How many PR companies does CIT have?

Dr. Brendan Murphy:

We have one.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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We are getting information, which states there is more than one PR company. Is that information incorrect?

Dr. Brendan Murphy:

I am sorry. My colleague has reminded me that the MTU, which is the coming together of IT Tralee and CIT to form a technological university, has a PR company.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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I have been told there are at least three PR companies, which I will not name. How many PR companies has CIT used over the past two years? Why are they necessary? How much have they been paid?

I have a final question on policy, which Dr. Love might help me with. When someone makes an anonymous allegation and it leads to a huge review such as this, who decides how to act on that? What is the policy on an anonymous complaint?

Dr. Graham Love:

If it is submitted to us or if it comes to us via another entity such as the Department, we take it to our governance and accountability team, assess its veracity, and go back to the institution, very often, to see what its response. We may deem it acceptable or not acceptable. These are also the steps that we go through even for a protected disclosure and we are going through them increasingly at the moment. The legislation is gaining acceptance and knowledge in the sector. If we deem a complaint acceptable, we go back to the discloser or the person making the allegations or it may, in some cases, give rise to further investigation, as we have seen.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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I specially refer to an anonymous complaint.

Dr. Graham Love:

We would still go to the institution-----

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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So the HEA would assess its credibility.

Dr. Graham Love:

-----and seek a response on it.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Did that happen with the anonymous complaint involving CIT?

Dr. Brendan Murphy:

Yes, we received the anonymous letters from the Comptroller and Auditor General's office.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Was their credibility assessed?

Dr. Brendan Murphy:

No, we were requested by the Comptroller and Auditor General to respond to the two letters.

Mr. Paul Gallagher:

Could I clarify that?

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Yes.

Mr. Paul Gallagher:

Our disclosure policy specifically includes mention of anonymous correspondence. It is not so much about credibility but about the seriousness of the allegation. If we deem it to be at a serious level, we undertake----

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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The quality and quantity of the allegations, therefore, were serious enough for the college to set up a review.

Mr. Paul Gallagher:

Absolutely. The allegations were serious in nature.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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I have a few questions for Dr. Love because we have different people working for State organisations before the committee such as those in the section 38 organisations under the HSE.

Will he talk me through the roles of president, the chairperson and those in other full-time employment positions in the institutions? He can start with UCC and Mr. O'Shea.

Dr. Graham Love:

He is full-time employed and president.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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He would not be expected to have any employment outside the college which might eat into his time.

Dr. Graham Love:

We understand he is devoted fully to that job.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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What is the situation with the Dublin Institute of Technology? This has full-time courses and one would not expect any other involvement to eat into those.

Dr. Graham Love:

Yes.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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In the Cork Institute of Technology, Dr. Murphy is full-time. In the University of Limerick, the position is full-time and the president of Waterford Institute of Technology also holds a full-time post.

Dr. Graham Love:

Yes, they are all full-time posts.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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In the HSE, we found people were managing public hospitals but devoting some of their time to other activities. I do not want to be personal but what is the range of salaries being paid?

Dr. Graham Love:

It is public knowledge. In the institutes of technology, I think the salary range is between €130,000 to €140,000, although I am shooting from the hip in this matter.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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What about the universities?

Dr. Graham Love:

The range is around €180,000. We can give the Chairman the exact figures in due course.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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I will return to Dublin Institute of Technology and the library issue, specifically the contract with Swets UK for the electronic journals. Dr. Love said steps were taken to make sure services to students were not affected as a result of the loss of that contract.

Dr. Graham Love:

Yes.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Tell me about the access and international programmes. What category of students are in those? An access programme suggests students do not have a high level of educational qualifications but need assistance.

Professor Brian Norton:

DIT operates six libraries in the city. What is in those libraries changes with courses and locations. There was a library in Mountjoy Square but it moved, along with the visual communications and product design facility, as well as the centre in Temple Bar and the Portland Row centre for fine art and photography, to Grangegorman.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Were these for access students?

Professor Brian Norton:

No. The facility in Mountjoy Square was concerned with fine art, art design, visual communications and product design. In Portland Row it was fine art and in Temple Bar it was photography. We have the building in Mountjoy Square on a long-term lease and we want to continue to use the property. It is close to our campus in Cathal Brugha Street but we do not provide libraries at all our sites. We only provide libraries at six sites and students move between them. We have a range of access programmes in Mountjoy Square and the students there use the library in Cathal Brugha Street. We keep this under review, because if there is a particular need for a subset of library stock, we will provide that.

There are a number of access programmes, such as mature access programmes as well as more traditional programmes, which are offered as taster programmes for a range of things. These exist in Mountjoy Square and other campuses.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Tell me about the access programmes.

Dr. Noel O'Connor:

We have a number of access programmes. There are two distinct programmes in Mountjoy Square. One is a mature student access programme targeting students aged 22 or over, of whom there are 100. It is a very important one-year programme for individuals who want to come back into higher education. There is also an international foundation programme targeting students coming to Ireland from abroad who have to make up a gap in their education before entering into higher education, very often involving adjusting to another country, city and language. Both programmes run side by side and have been very effective. The mature students access programme targets the Dublin city region and the north inner city in particular, and it is funded through philanthropy. The students do not pay fees and can pick up their entire grant when they start third-level programmes. Along with the international students, when they successfully complete the programme and meet the requirements they automatically move into mainstream undergraduate programmes.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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How many are there in total?

Dr. Noel O'Connor:

There are approximately 250, maybe 300.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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These are students who would not have had the required education to go straight into third level.

Dr. Noel O'Connor:

Yes. It is a bridging programme.

Professor Brian Norton:

They might have the requirements for other opportunities but not for third-level education.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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These seem to be the more educationally disadvantaged students in DIT.

Dr. Noel O'Connor:

Yes.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Yet, it is the one location in which there is no library.

Dr. Noel O'Connor:

I accept that entirely.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Dr. O'Connor understands what I am saying.

Dr. Noel O'Connor:

I understand and accept it.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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There was a library until-----

Dr. Noel O'Connor:

2014.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Dr. O'Connor probably knows the paper, The Edition. It is one of DIT's publications.

Dr. Noel O'Connor:

Yes. It is a very good publication.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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An article of 4 May 2016 states that DIT Mountjoy Square access students were being left out when it came to opening hours and library facilities due to a lack of funding. This was three months after the Swets UK contract issue blew up and went wrong.

Dr. Noel O'Connor:

I accept that.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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In July 2014, the contract for online journals went belly-up and within three months one of the libraries closed - the one in Mountjoy Square, which has the 250 most educationally disadvantaged students in DIT. The witnesses are now telling me that the students can go down to Cathal Brugha Street to look at the books there. If we investigate this further, will we find a proper series of books in Cathal Brugha Street suitable for the students on the access programme?

Professor Brian Norton:

I will come back to the question but I wish to deal with another issue because the question has a misdirection which I wish to clarify.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Yes.

Professor Brian Norton:

No library was closed; a library was moved. Let me finish because this is important.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Mountjoy Square library was closed.

Professor Brian Norton:

No, the same library that services the students who were in Mountjoy Square moved with those students when they moved.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Okay.

Professor Brian Norton:

Let me finish. There were six libraries and there are six libraries and we are still spending 6% of our non-pay budget on libraries. There was no diminution in the resources available to those libraries and, historically, in the 130 years of the Dublin Institute of Technology students in DIT, which has many more than six sites, have moved to other sites to access library provision. Increasingly, library provision is actually online. That is actually what the Swets UK contract is for but Dr. Cohen can talk about the actual provision on Mountjoy Square.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Before Dr. Cohen does so, I cannot buy what Professor Norton has said. It is the equivalent of the Health Service Executive telling the committee that it had not closed a health centre on Mountjoy Square but moved it to Grangegorman. It is meaningless to tell people in Mountjoy Square that the facility has not been closed. The centre that was on the square no longer exists and has moved miles across the city. I do not buy that it was a transfer because it was a closure as far as the students on Mountjoy Square were concerned.

Dr. Noel O'Connor:

I accept the Chairman's point.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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It has been stated that steps were taken to ensure the service to students would not be affected as the result of the Swets contract. We find, however, that this happens within a very short period. Is Dr. O'Connor about to tell me that was a total coincidence?

Dr. Noel O'Connor:

I do not dispute that. The first thing is-----

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Can Dr. O'Connor see the connection?

Dr. Noel O'Connor:

I can see it. Can I say for the record that the answer to this is to move the students from Mountjoy Square to Grangegorman and to complete the campus as quickly as possible. We are working on that.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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I have asked Dr. O'Connor about the figures. There are still 250-----

Dr. Noel O'Connor:

There are still 250 students there.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Since 2014, students on Mountjoy Square, including the 250 students in this academic year and the 200 students in the previous academic year, have had no library on site.

Dr. Noel O'Connor:

There is no library on site but they have access. Just to be clear, in Mountjoy Square originally and in the surrounding areas, including Portland Row, there were nearly 1,300 students. We had students in the department of photography in Temple Bar who had a lot further to travel to get access to a library. Portland Row students had to do the exact same. Those students have now moved up onto the campus and they are thrilled and delighted. We would want the same level of service for those students, as the Chairman rightly said.

Before I hand over to my colleague, can I just say that DIT has fully supported the mature student access programme. We are getting no funding from the State for it. We are funding that ourselves through our own philanthropy. That is a huge commitment. In both cases, we have put in designated full-time co-ordinators to work on those programmes. We have two individuals, which is very unusual, we have 1,000 access students spread across the rest of DIT and we have 1,200 students with disabilities spread across the rest of DIT. We are hugely committed to this. I accept entirely that what is happening in Mountjoy Square is not ideal. We are desperately trying to balance the fact that, through no fault of our own but through a legal challenge, all of those students who should be moving into brand new facilities, that move has been pushed back to September 2019.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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The contract that went wrong was for online journals. Did that contract exclude books?

Dr. Philip Cohen:

It excluded books.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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How much was spent on old-fashioned library books in each of the past three years? If Dr. Cohen does not have the figures, perhaps he will send them to me.

Dr. Philip Cohen:

In round figures, it is about €400,000 a year.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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On books.

Dr. Philip Cohen:

On books alone.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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That is separate from the contract of approximately €700,000.

Dr. Philip Cohen:

Yes. In round figures, the library budget on library information resources in 2017 is about €2.4 million.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Will Dr. Cohen send us a breakdown of that figure? The impression may have been given that the original contract had implications for all library services. It was for the online journals only. While the witnesses are fully aware of that, it gets lost in translation.

Professor Brian Norton:

Let me be clear; we spend 6% of our non-pay budget on library services, not pay. That has remained pretty much constant and has not changed up or down. We have maintained that even though financial pressure on the institution, etc., made that challenging to do. We are committed to providing a full library service to all students. I should say from my direct personal experience - I have the pleasure of meeting students regularly - students from all sites go to all other sites. So, there will be students who are in Mountjoy Square who I will meet in Aungier Street or Bolton Street. They use the other facilities and libraries. They are not that far apart and that is the reality of the DIT experience. Because they are often involved in clubs and societies with other students, etc., there is a lot of moving around. That is just the reality of DIT. They are not kinetic to a location in any way.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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How concerned was Professor Norton about the "Prime Time Investigates" programme?

Professor Brian Norton:

In relation to the part about DIT, I was concerned, although, as I said earlier, there were two impressions given. One is that we lost two amounts of money. There was a budget for this. We lost one amount of money which was budgeted for but that subsequently was spent on another contract. There was one amount of money lost. Secondly, certainly the inquiry that was done, which identified that there were procedures that should be tightened up, and they have been, but that does not mean that any of those items identified were not properly budgeted for or properly procured or indeed that we knew about them. That impression was given which impinges on the reputation of the institute and a lot of hard work by a lot of colleagues in a time when we had an employment control framework and a moratorium on appointments, particularly at administrative level, which meant a huge reduction in administrative staff who were working very hard. Speaking personally, the loss of Swets was heartbreaking.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Professor Norton believes the "Prime Time" programme had a serious impact on the reputation of the institute.

Professor Brian Norton:

Yes.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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I believe it was broadcast on a Thursday night and at 15.51 on the following day, Friday, Professor Norton issued an email to all staff.

Professor Brian Norton:

Yes.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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How regularly does he issue emails to all staff?

Professor Brian Norton:

Weekly, and sometimes more frequently than that. There would be regular emails to staff.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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I will read from the email issued as a result of the "Prime Time" programme, which can be circulated. It states that all issues identified and the steps taken subsequently were included in the information provided by DIT to the Committee of Public Accounts. They specifically did not say that. The email gave the impression that all documents - people knew about the Ernst & Young report - had been given to the committee. Professor Norton issued that email the day after the "Prime Time" programme.

Professor Brian Norton:

Correct.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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The email stated that DIT had always maintained a balanced budget and is required to do so. The collapse of Swets UK, it continued, was unavoidable but the loss was very significant. In the short term, it continued, the loss was absorbed by DIT's financial reserves and savings were made through postponement of some senior appointments and some areas of capital expenditure. It added that steps were taken to ensure that services to students were not affected. A couple of weeks later, we saw the Mountjoy Square library closing or, as Professor Norton described it, transferring miles away. He will understand, therefore, that people took a wry view of that. The email issued on Friday and at a meeting of the governing body on the following Tuesday, Professor Norton, according to media reports, was essentially told to send the Ernst & Young report to this committee, which he did the following day.

Professor Brian Norton:

Yes

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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The governing body must not have been happy that the committee was in possession of the Ernst & Young report even after-----

Professor Brian Norton:

Not only-----

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Will Professor Norton explain what happened?

Professor Brian Norton:

Neither the governing board was happy, nor was I happy. As I said earlier, we had provided the Ernst & Young report to the Comptroller and Auditor General and Higher Education Authority. We had fully discussed it with the HEA. It was the external review that is alluded to in the covering letter signed by myself that was sent with the report we sent last July to the committee. With hindsight, because it gives an impression that things were being concealed, we should have provided it. That is self-evident now but we were not actually asked for a report. We were asked the circumstances and what measures we have taken.

The EY report does not discuss the measures we took. What we have provided is the fullest report of the issues and what we have done about them. That is actually what we were requested to provide. With hindsight, frankly, I agree. I have no problem in making sure that was supplied. We had supplied it previously. Incidentally, we supplied it over a year ago as an FOI request to RTE. We have made no attempt whatsoever to conceal it but we should have provided it here. I accept that totally.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Okay. I have one final issue to ask the witness about. That is why I asked Mr. Love to give us an understanding of the presidents of the various third level institutions and whether their employment was full time or whatever. Obviously, at the salary being paid, we would expect full-time service and not something else. Professor Norton might talk to us about something that is public knowledge. I think he is chairman of Action Renewables. That is a Northern Irish company that was the principal adviser to people who applied for the cash-for-ash scheme or the renewable heat incentive. The witness has stated he was not responsible for designing or delivering the scheme, which is undoubtedly the case. However, I think his company processed at least 30% of all applications - that seems to be the accepted figure - under the renewable heat incentive. Some people felt that that organisation - I do not know whether it has claimed some charitable status - should have advised the State in some way, because of that possible charitable status, that this scheme was not good for the people. I think Professor Norton or executives of his company would say that it was not their job to do that, that their job was to assist applicants and that it would have been wrong of them to assist applicants to apply for funding under the cash-for-ash scheme while at the same time recommending to the Government that the scheme was not a good scheme. The witness might talk to us about his commitment to the Action Renewables company, his involvement and any remuneration he receives from that company, because we have had this with the HSE and other organisations to which the State is paying full-time salaries. We would like to be sure that we are getting a full-time commitment in return. I ask him to talk to us about that.

Professor Brian Norton:

Indeed. Action Renewables is a charity established in Northern Ireland. My technical expertise is in renewable energy. I am involved in charitable work - it is a charity - in a private personal capacity outside of work to promote renewable energy. I previously worked with the University of Ulster and had a link through that university to the promotion of renewable energy in Northern Ireland. Action Renewables is, as I say, a charity. Its activity is to develop and assist in policy measures and interventions with those who want to promote renewable energy, such as developing capabilities. For example, the renewable energy training academy in Northern Ireland, which was an INTERREG activity, came through Action Renewables. The all-Ireland grid study has enabled electricity that goes North-South throughout the island and it came out of a study done by Action Renewables. It is about enabling measures for renewable energy. If there are particular schemes that are introduced, and the renewable heat incentive was such a scheme, Action Renewables will advise those who want to avail of those schemes on how to do so. There are a number of schemes. There are schemes for photovoltaics, wind energy and others. Around 20% of the applicants came to Action Renewables. That is actually quite a small proportion of the overall whole. It was a small part of the organised activity. I chair Action Renewables as a charitable activity as part of the public good. I receive £2,000, which I donate to charity.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Say that again.

Professor Brian Norton:

I receive £2,000 a year, which I donate to charity. I do it in my own time. It is a charitable activity. I do not play golf, for example. I would use the analogy that it is-----

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Did I see a figure that the income generated as a result of the fees charged for processing these applications were substantial seven-figure sums - over £1 million and more - and were put through that organisation?

Professor Brian Norton:

One is confusing the grants that are received by-----

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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I am sure the organisation charged a fee for processing the applications.

Professor Brian Norton:

Yes, but we are looking at very modest fees for each individual application of the order of less than £100. That is being confused with the grants. The organisation does not receive any of the grants.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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We know. We are talking about the organisation's fee for processing the applications. Nobody is ever suggesting the grants went to the organisation. They went to the applicants.

Professor Brian Norton:

The fees would be modest.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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The reason I asked as Chairman of the Committee of Public Accounts is, and I am sure members agree, that when salaries of the scale of €130,000 or €170,000 are being paid, the taxpayer would expect a full-time commitment. I am pleased Professor Norton is saying that it is not a substantially remunerated position. I accept what he is saying about it being a very modest amount.

Professor Brian Norton:

For want of an analogy, as I said, I do not play sport. My colleagues might smile at this. This is my interest.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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This is the witness's outlet.

Professor Brian Norton:

It is a charity. In my own time, I am involved in chairing the charity-----

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Professor Norton can understand why I sought clarification there.

Professor Brian Norton:

It is not a commercial entity. It is a charity.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Charities can be commercial too. An organisation can be a registered charity and be a multi-million euro business.

Professor Brian Norton:

It is not of that scale.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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I understand. The last question I want to ask of DIT I will also ask of CIT. I should have asked it earlier. Can the witnesses send us a note on the organisations' total legal costs incurred in each of the last three years or whatever? We will take the last three years and-----

Professor Brian Norton:

Excuse me, Chair. One important point I need to state about Action Renewables in order not to mislead the committee is that when I was invited to be chair, I sought and gained the formal approval of the governing body of DIT to do so.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Okay. So it is documented.

Professor Brian Norton:

Yes.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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That is fine. I appreciate that.

Professor Brian Norton:

That is just so that is understood.

Dr. Noel O'Connor:

I might intrude for a moment. I will confirm as a colleague of Professor Norton that nobody gives more to DIT than our president. I wish to put that on record.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Very good.

Dr. Noel O'Connor:

We are very fortunate to have somebody of his calibre and work ethic.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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And he is very fortunate to have Dr. O'Connor too. The last thing I ask is for both organisations to send a note on legal fees and how much of those fees relate to staff issues of protected disclosure, allegations of bullying or the settling of cases. I am leaving it to the witnesses to work out the information so that it reaches the committee in an understandable manner from our perspective.

Are they are any final questions? I am sorry, I have to call Deputy Murphy. She went out and missed her opportunity. She is now back.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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I thank the Chair. I had raised a Topical Issue in the Dáil and so had to leave. Going back to the procurement, it was a national tender with regard to the online library service. The provider was EPS and it did all the due diligence and organised the process. The Ernst & Young report stated that it could not find any documents indicating that there was a formal decision to commit to the process. Was there a formal decision to commit to the process?

Mr. Colm Whelan:

I will defer to library colleagues. Library colleagues engaged with EPS. As far as a formal decision to commit to the process, does the Deputy mean to procure-----

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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I am just reading what the Ernst & Young report stated. It stated that it had not been provided with any documentation indicating that there was a formal decision to commit to the process. It precedes that by stating that a third-party organisation referred to as EPS ran the tender process on behalf of a number of universities and institutes of technology.

Mr. Colm Whelan:

On the overall point, DIT's senior leadership team decided to engage with the EPS as a matter of policy. We were encouraged to do so by the HEA and probably by the Department of Education and Skills as one of the national emergency measures to engage in shared services and procurement specifically. DIT was committed to try to engage in collaborative tenders with national procurement-----

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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I can understand that when many more are involved, better value can be had and so on. EPS did the work, looked at the background of it, ran the tendering process and did the due diligence on the various people who put in tenders.

It was a three-year contract, spanning 2012, 2013 and 2014. Is that right?

Dr. Philip Cohen:

It was negotiated in 2012 and the contract covered 2013, 2014 and 2015.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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EPS would have had the knowledge of what the due diligence was. The witness did not have it.

Dr. Philip Cohen:

No.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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What would the witness have used in subsequent years to evaluate the company or to do due diligence on the company?

Mr. Colm Whelan:

The point is a valid one and it was also made in the Ernst & Young, EY, report. Perhaps it was in between the lines in that report. The DIT relied on the due diligence that was carried out at the time of the procurement exercise. That resulted in a three-year contract, and we continued with the practices that we had had for several years in terms of deciding what to purchase and when to prepay.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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It was carried out by an outside organisation in 2012 and it was accepted that it was a three-year contract and that there was very limited oversight other than paying when the fee was due. It was due in advance.

Mr. Colm Whelan:

To address the Deputy's issue I would say that we should have had a more comprehensive due diligence exercise annually in advance of making a substantial prepayment.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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Collaborating in that way has negatives as well as positives. Were lessons learned by the HEA or DIT on that particular aspect?

Dr. Philip Cohen:

It might be useful for the librarian to talk about what has happened since then under the new system and the changes that were made.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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It does not just relate to the library but also to the process.

Dr. Philip Cohen:

Perhaps I am missing the point then. I apologise. I would make a couple of observations. In a national procurement one is more vulnerable to that sole supplier failing. It also tends to take other suppliers out of that marketplace and so it can entrench monopolies. I would also say that subscription-based models are increasing. On what is referred to as "the cloud", that is, software as a service, we are moving from buying the software and having it as something that can be put in a machine to subscribing to it and paying for it beforehand. If we take those two tendencies together, there is an increased risk of exposure to the system of major contracts that require----

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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That is not really the point I was making. The point is that EPS did all the work of evaluating the tenders and the companies. The witness did not then have sight of that and took it as a three-year contract. The work had already been done, and there is increased exposure by doing things in that particular way.

Mr. Colm Whelan:

It is a fair point.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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I want to move to something else entirely, which is the issue of a building near Hammond's Corner in Dublin 7 that I understand has been purchased by DIT. Is that the case? I can name the building if necessary.

Professor Brian Norton:

We are in a process and it would probably be to a commercial disadvantage if we discussed it too much.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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Has there been a robust inspection of that building? Has it been done or will it be done in advance of any conclusion?

Dr. Philip Cohen:

We are in the process of exploring the possibility of acquiring such a building, and as part of that process, there is in the first instance quite a rigorous requirement, through the HEA, in terms of completing a capital acquisition business case. That is one part of it. The other part of it is in terms of getting technical advice on the quality of the building, which we have undertaken.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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I will not press it any further if it is not concluded. I would make the point that I had concerns that that is going to happen, and the witness has just said that it will happen.

The witness said in his opening statement that one area that received attention was the delivery of DIT programmes through third party providers. It was said that this is in keeping with national strategy and will increasingly become a feature into the future. I understand that a language institute has been contracted to deliver core modules on the international foundation programme and that the company is owned by an English language course provider. Whatever is done in terms of partnerships is something that must be evaluated by the college, but how does that impact on the people who are directly or potentially employed? I have been told that people are now on a year-to-year contract rather than on a longer-term contract or are employed on foot of the outsourcing of some of the teaching elements.

Professor Brian Norton:

I will explain the context and will ask Dr. O'Connor to give more details. We offer an international foundation programme. People take a foundation programme to gain the qualification to join a regular level 7 or level 8 programme. Part of that may be a gap in their English language ability, which needs to go to a particular level to meet the necessary entrance requirements. To do that we need to draw on English language teaching provision which is IELTS accredited, so it actually meets the accreditation requirement for the relevant qualification they need to pass at the relevant level to gain entry. That provision goes through the whole year, including the summer. We do not have colleagues who deliver that type of provision. Indeed, our colleagues deserve their summer holidays. It goes through the entire year. We went out to tender, to procurement, and we have a supplier of that service. The nature of the foundation programme is about the gap in what students have and what they need to progress.

We get different intakes, and the nature of that will change. We do not know whether English language ability is going to be a feature in the future, so we could invest in a large amount of infrastructure and then find that the next year involves no requirement for it because the school systems in those countries have improved. It is contacted and it goes through the whole year.

Dr. Noel O'Connor:

It is probably a unique partnership because it is not something that we do in-house, although we have a very fine school of languages, but the IELTS element is essentially a level 5 in terms of the overall qualifications framework. Using academic staff within the institute to deliver such programmes would not be the most cost-effective way of delivering them. What has worked to date has been a very strong partnership with the third party. The staff in question are located on site as a part of the team. What has happened is that the company that has been providing the service to date has been bought out, and we are looking at the implications of that ourselves.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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Is it disenfranchising or does it have the potential to disenfranchise staff that are there? Increasingly we are seeing, not just in DIT but across the university sector, that people are being employed on short-term contracts. We are hearing that people are being given one research hour for one contact hour, which hardly adds to the credentials of the university sector.

While it might be cost effective in the short term if people are not on long-term contracts and their hours are reduced its sustainability does become a problem.

Dr. Noel O'Connor:

The Deputy is correct. We all want a sustainable programme team. We want to ensure that we have continuity, that what we have learned from working with a group last year is transferred to the group this year and that the programme evolves and develops. To date, we have achieved that. There has been a very strong emphasis on trying to create that strong partnership and ensuring we have that continuity. We will have to work with this new company to explore how we can ensure that the quality is maintained and that we do not have any slippage in terms of staffing.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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Are there potential industrial relations issues in this?

Dr. Noel O'Connor:

I do not believe so because, traditionally, this subject area has been procured through this route. It is not displacing an internal, in-house, DIT provision that we have always had.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Did the report on DIT go beyond the money spent on the library? Did it go deeper than that?

Professor Brian Norton:

Yes, it considered all systems.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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In addition to the matters discussed earlier about the lack of management oversight, no formal contract and no risk analysis, it also found €29.5 million spent over three years that did not pass through proper internal approval processes. That was a claim in the programme, is it correct?

Professor Brian Norton:

It did not go through the approval process that we currently have, which is the authority to buy it. They were correctly budgeted for, they were procured and we were aware of how much was spent on those items but the actual transactions were not properly approved and we have now remedied that so they are.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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This is physically arranging the electronic payment transfer.

Professor Brian Norton:

The actual transfer was not properly done but they were properly budgeted for and we knew what they were. We knew what the expenditure was. I knew what it was because they are major items but the transfer was not done correctly and we have remedied that.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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The point is that they were not put through the proper internal approval processes.

Professor Brian Norton:

Exactly.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Procurement issues often come up in the opinions of the Comptroller and Auditor General, mainly in respect of the HSE but also in the third-level sector. Can Dr. Love tell me whether there has been a recent review of that overall issue by the HEA?

Dr. Graham Love:

Yes, in fact our first rolling governance review took place last year, 2016, on the topic of procurement in direct response to the type of issues that need improvement.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Was a report done?

Dr. Graham Love:

A report was done and published.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Was it furnished to this committee?

Dr. Graham Love:

If we have not done that, we will.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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That would be useful for our work and report.

Dr. Graham Love:

We went even further and recently held a procurement summit and brought in the institutions and said "This is what the report found, these are typical weaknesses". To go back to Deputy Connolly's point about how due diligence radiates outwards, these are the types of thing we need to learn, not only from reviews but through shared practice. It comes into the cultures of the organisations that there is constant improvement.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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That is very helpful. I thank Dr. Love for his reply. We would like a copy of that document.

Did CIT ever procure the services of PR firms?

Dr. Brendan Murphy:

Yes.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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For what purpose?

Dr. Brendan Murphy:

One would be general PR to promote the institution.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Would it be one firm or multiple firms?

Dr. Brendan Murphy:

For that function, there was one. There was a second one for MTU.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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What is MTU?

Dr. Brendan Murphy:

That is the coming together of IoT Tralee and CIT to create the Munster Technological University, MTU.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Would any PR firms be hired to train staff on how they perform in the media or when they come before Oireachtas committees?

Dr. Brendan Murphy:

Apart from those two, we would not have hired any other companies, I think. Did the Deputy mean training for today's meeting?

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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No, but it could be today's meeting or previous sessions.

Dr. Brendan Murphy:

There was none for today's session.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Was there training for previous sessions?

Dr. Brendan Murphy:

Yes, I think there was for the 2015 session.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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What happened? Whose services did CIT procure?

Dr. Brendan Murphy:

I think the name of the company was Communications Clinic.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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For what purpose was it hired?

Dr. Brendan Murphy:

It was our first time appearing before the Committee of Public Accounts. It took us through what was to be expected.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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CIT hired a consultancy company to train the witnesses before they appeared before the Committee of Public Accounts. Dr. Murphy is the Accounting Officer. What is his salary?

Dr. Brendan Murphy:

Unlike Dr. Love's, it is somewhat higher than-----

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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What is the amount?

Dr. Brendan Murphy:

Off the top of my head, I think it is €146,000.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Dr. Murphy gets paid €146,000 a year to be Accounting Officer and come before the Committee of Public Accounts and he has to spend taxpayer's money to hire consultants to coach him before appearing before us. Would Dr. Love see that as an acceptable expenditure of taxpayers' money by an institute?

Dr. Graham Love:

Yes, if it assists the Accounting Officer in providing good information in a concise fashion, if it is good value for money and if it is procured properly. Not if it is done regularly and excessively but, yes, if it assists the committee and the institution in getting at the answer. I have heard here the difficulty at times of getting concise-----

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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I see it as a waste of money. I would expect that somebody who is paid a very generous salary, who is the Accounting Officer, and who is in the job because he is qualified to do that job - one of the functions of which is to come before the committee - should not require training. I do not know about Deputies McDonald or Catherine Murphy, but I never received any formal training to put questions and I am amazed and outraged that an IoT would have to hire a consultancy firm to coach its officers coming before the committee. How much did that cost?

Dr. Brendan Murphy:

I cannot say but we will revert.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Does Mr. Gallagher know how much it cost?

Mr. Paul Gallagher:

I am afraid I do not but we can-----

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Did Mr. Gallagher receive this training as well?

Mr. Paul Gallagher:

I would have accompanied the president, yes.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Did Mr. Gallagher receive the training?

Mr. Paul Gallagher:

Yes.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Was it him and Dr. Murphy alone or were there others?

Mr. Paul Gallagher:

It was the two of us, jointly.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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I do not see that as acceptable.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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It is a point of view. Dr. Love has a different point of view. I am not disagreeing. It sounds very weird.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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It is more than weird.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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A busy Accounting Officer would not be spending his Thursdays watching this meeting and maybe he needs to know what is the format, what happens. Dr. Love said that if it helped assist the Accounting Officer in marshalling his facts and being a bit more concise in his presentation to communicate effectively to the public through us, perhaps it was acceptable. I do not have as closed a view on it; there could be a benefit.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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I could pass judgment-----

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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We will discuss it in private session next week.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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-----on the performance and whether it was value for money but I will refrain from doing so.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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We could go there.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
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I trust that the training was to assist the witnesses in being concise and accurate rather than in evading questions.

Dr. Brendan Murphy:

Of course.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Dr. Love will be aware of that. Very extensive questions were put to the president of Waterford Institute of Technology. The issue centred around potential conflicts of interest. At all times, as Dr. Love knows, there were never any allegations of wrongdoing by any individual but issues of concern were certainly raised in regard to the extent and number of conflicts of interest.

I should disclose to the committee that I met Dr. Love and presented him with a synopsis of a number of protected disclosures that I received from people inside and outside Waterford Institute of Technology that back up many of the questions I put. I also suggested terms of reference for a review. What we were looking for was what Dr. Love described in the past as a "deep dive" to examine not only the single issue that the internal review in Waterford considered but also all the wider issues. Can Dr. Love explain to this committee what is planned, the terms of reference for this review and who is conducting it?

Dr. Graham Love:

For the record, the document I have to hand was submitted to the committee a number of weeks ago. I will not read out both pages but give a quick summary and read the five bullet points of the terms of reference. Would that be acceptable?

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Yes.

Dr. Graham Love:

We accepted the request from the institute and, for the reasons the Deputy explained, "The HEA agrees that an external validation of the review is appropriate and that it should extend beyond the current case [the FeedHenry case] to the governance, policies and procedures for commercialisation activities of the TSSG [the Telecommunications Software & Systems Group located within the institute of technology] particularly as they relate to spin-out companies." That was the sort of extension beyond the initial remit.

May I read the five bullet points of the terms of reference to the committee?

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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Yes.

Dr. Graham Love:

The document states:

The following terms of reference will apply:- Having regard to the national guidelines and policy applicable over the period, examine whether appropriate policies and procedures were in place and implemented in respect of activities related to FeedHenry and other spin-out companies from the TSSG;

- Consider the adequacy of the decision-making structures regarding IP commercialisation in WIT in respect of FeedHenry and other spin-out companies from the TSSG [the software group], including remit, membership, reporting and their links to the wider Senior Management Team and governance of the institution;

- Assess whether conflicts of interest were appropriately managed throughout the creation of the IP which underpinned the establishment of FeedHenry, the spin-out of that company and the subsequent rewards secured by WIT staff upon its sale to Red Hat [the company that purchased it]. These issues will also be examined in respect of other spin-out companies from the TSSG.

- Having considered the above issues, assess whether the WIT internal review identified and appropriately considered all issues of relevance to the development of IP and spin-out and subsequent sale of FeedHenry;

- Having reviewed the issues set out above, the reviewer will consider the matters of concern that have been raised and prepare a report that shall make findings and/or recommendations for TSSG, Waterford Institute of Technology, relevant national agencies and government departments. This might include issues related to IP policies and procedures, governance, HR, financial and other administrative processes and procedures.

We have appointed Mr. Michael McLoone to be the investigator. The investigation is kicking off next week. We are targeting the end of October for delivery, and the HEA is providing the support, etc. We are also hoping to borrow information from another rolling governance review that emerged from this committee when I was here in March and April. It is on the general implementation of intellectual property policy across our higher education sector. We are going to select Waterford Institute of Technology as one of the institutions that should be able to borrow the expertise related to this review appropriately.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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I have seen in the past reviews that considered the processes in place in terms of conflicts of interest and they stated the processes were actually quite good. Rather than just considering the process, one needed to consider how it was applied. That is the important part because there was one critical element of the policy in Waterford to be born in mind. It refers to one having a conflict of interest or business relationship with an individual and to where one reports to an individual. Therefore, it is very important that that be part of it. One can say the process is robust but it is a matter of how it is applied and works.

Dr. Graham Love:

It is the implementation of the policy that applied at the time that we are targeting.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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I thank Dr. Love for that. It is well-----

Dr. Graham Love:

As a general comment, I hope the Chairman and Deputy will have noticed that the HEA has been listening. This is the third review we have kicked off since I have been in here 12 weeks ago. I have been in here on three days. As the HEA beefs up its regulatory role, I hope it is listening.

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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That is three gold stars.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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I want to clarify this. There is a school of languages in DIT.

Professor Brian Norton:

Yes. It is part of another school but we have provision in European languages.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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Is this a partnership in respect of the English language module or is there outsourcing of core work?

Professor Brian Norton:

It is an outsourcing of level 5 work. DIT, under the national qualifications framework, offers qualifications from level 6 to level 10. Here there is level 5 work in English language tuition, which involves students gaining competence in the English language to be able to pursue another course, whereas our language provision in our school is at levels 6 and 7. These are advanced levels in the language. It is not core to what we do, not in the sense the Deputy described.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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Would somebody who can tutor between levels 6 and 10 be able to tutor at level 5?

Dr. Noel O'Connor:

They could. It was an issue that we considered and discussed at the time. It was felt that English language tuition for international students was delivered well using a third party like the one we have been using to date. It has been very successful. Students move up in terms of the scores and it has worked very well.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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Is Dr. O'Connor saying absolutely that this is not about outsourcing core work?

Dr. Noel O'Connor:

It is not.

Professor Brian Norton:

To be clear, it would not be a matter of just asking, "Could someone do this?". We would actually have to have IELTS-accredited provision that would satisfy the requirements of the test that students are going to take. That is something that must be set up formally.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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Does the institute not have an accreditation responsibility or function?

Dr. Noel O'Connor:

Yes, but in the case of English language tuition there is very clear international accreditation. Certainly from the point of view of DIT, the notion of moving into that realm would actually require us to have to reflect on whether it would be appropriate.

Professor Brian Norton:

It is very different from what we do. It is a level 5 provision in basic English language tuition in which we would have to invest substantially. It is very different from what our model is. As a prerequisite to allowing students to fulfil opportunities for entry, we want to be able to facilitate that. This arrangement does that but we decided not to do it as a core activity. It does not fit within the levels 6 to 10 spectrum of what we do.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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Are there people in the institute who believe this is core work?

Professor Brian Norton:

I do not believe so but I am sure that if the Deputy asks someone, he or she might say "Yes". I have not asked that question.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Might the level 5 work be done at ETB level rather than-----

Dr. Noel O'Connor:

It could. To some extent, it is not the realm that we want to move into, but we would definitely like to put on record that staff engaged as a part of the programme teams on the international foundation programme, in the particular case, are staff whom we regard as part of the programme team. They are making a very important contribution. They have done so to date. It has been very successful. We have looked at progression rates from the international foundation programme into our mainstream education and they are the exact same as our normal progression rates at undergraduate level. Those are students who are coming in from abroad. There is a huge amount of energy and resources going into it. The teams involved have been in place for some time. I accept the Deputy's point in that we want that to continue, and we have to sit down with the new providers to see how we might achieve that.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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I believe we are finished.

If any witnesses feel there is something they needed to say that they did not, I ask them to please do so, in case there was a point they wanted to make that they did not get to make. Do the witnesses from the Department of Education and Skills wish to add anything?

Mr. Tony Gaynor:

No.

Dr. Graham Love:

I call on the committee as Oireachtas Members and their colleagues for support. The Department is strengthening our legislation to enable a firmer regulatory role for us in the Higher Education Authority and I call on the Oireachtas to help to get that through to give us those additional powers.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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The witnesses from Cork Institute of Technology, CIT, have no final comment. Do witnesses from Dublin Institute of Technology, DIT, have any final comments?

Professor Brian Norton:

I was not expecting questions on my role as chairman. It came up in this meeting, so I think it is important to contextualise that here. As chairman, there would be ten meetings a year of about an hour. That is the level of commitment we are talking about, as well as some reading around that and telephone conversations with the managing director. It is a very small commitment. It is charitable and it is fully approved by a Government body.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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As the Chairman who raised it with Professor Norton, I am happy with the response I got. It is a very minor role and very minor issue. I was not aware of it, but I wanted to know the extent of it. Professor Norton has answered it satisfactorily from my point of view.

On behalf of the Committee of Public Accounts, I thank all our witnesses from the Department of Education and Skills, the Higher Education Authority, DIT and CIT for the information they supplied. We want any information that we asked for within the week, because we are meeting next Tuesday to commence preparation of a report that we intend to issue in July.

The witnesses withdrew.

The committee adjourned at 6.15 p.m. until 11 a.m. on Tuesday, 27 June 2017.