Oireachtas Joint and Select Committees
Thursday, 9 November 2017
Public Accounts Committee
2016 Annual Report of the Comptroller and Auditor General and Appropriation Accounts
Vote 29 - Communications, Climate Action and Environment
9:00 am
Seán Fleming (Laois, Fianna Fail)
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I welcome Mr. Mark Griffin, Secretary General of the Department of Communications, Climate Action and Environment. He is joined by Mr. Matt Collins, assistant secretary, and Ms Finola Rossi and Ms Rebecca Minch, principal officers. They are also joined by Ms Mary Austin from the Department of Public Expenditure and Reform. I remind members, witnesses and those in the Public Gallery to turn off mobile phones. It is not enough to put them on silent, they must be put on airplane mode, as it interferes with the recordings.
I wish to advise witnesses to the fact that by virtue of section 17(2)(l) of the Defamation Act 2009, witnesses are protected by absolute privilege in respect of their evidence to the committee. However, if they are directed by the committee to cease giving evidence on a particular matter and they continue to so do, they are entitled thereafter only to a qualified privilege in respect of their evidence. They are directed that only evidence connected with the subject matter of these proceedings is to be given and they are asked to respect the parliamentary practice to the effect that, where possible, they should not criticise or make charges against any person, persons or entity by name or in such a way as to make him, her or it identifiable. Members of the committee are reminded of the provisions of Standing Order 186 that the committee shall also refrain from inquiring into merits of a policy or policies of the Government or a Minister of the Government or the merits of the objectives of such policies.
I call on the Comptroller and Auditor General to make his opening statement.
Mr. Seamus McCarthy:
The appropriation account for Vote 29 - Communications, Climate Action and Environment, had total gross expenditure of just under €439 million in 2016. This was distributed across six expenditure programmes, including a new programme in 2016 reflecting the additional responsibility for environment policy transferred to the Department as part of the restructuring of portfolios following Government formation. As part of that transfer, the Department also took on responsibility for management of the environment fund, which had a budget of around €35 million for 2016.
The expenditure under the Vote was divided between the various programmes is as follows. The largest expenditure programme - accounting for €241 million, or more than half of the total spent – related to broadcasting. That programme was substantially funded by television licence fee receipts, which totalled just under €214 million in 2016. Most of the expenditure under the programme was in the form of grants of just over €179 million paid to RTÉ, and €35.4 million to Teilifís na Gaeilge. €13.7 million was paid into the broadcasting fund, and €11.5 million was paid to An Post in respect of its costs of collecting the broadcasting licence fees on behalf of the Department.
The Department spent €86 million on the energy programme in 2016, €66 million of which was committed for energy efficiency programmes promoted by the Sustainable Energy Authority of Ireland.
The Department spent just over €43 million on the environment and waste management programme in 2016. More than half of the programme spending in 2016 was to support the operations of the Environmental Protection Agency. In addition, the Department had a budget under the environment fund in 2016 of around €35 million for environmental projects and initiatives. That expenditure is accounted for separately.
The voted provision for the communications programme in 2016 was €34.7 million, but the expenditure outturn was just over €19 million, an underspend of €15.7 million, or 45%. Almost three quarters of this arose because of unexpected delays in the procurement process for the roll-out of national broadband.
The Department spent just over €30 million under the inland fisheries programme, mainly in grant support for Inland Fisheries Ireland and the North-South Loughs Agency. Spending on this programme was over €2 million higher than originally provided, mainly due to additional funding provided for the fit-out of a new national warehouse and the purchase of new equipment for Inland Fisheries Ireland. The Department spent almost €20 million on a range of services covered by the natural resources programme. About half of the expenditure related to the specialist functions and services of the Geological Survey of Ireland.
The net expenditure on the Vote was around €32 million less than was provided for in the 2016 Estimate. The Department got the agreement of the Department of Public Expenditure and Reform to carry over €12 million in unspent capital funding to 2017. The balance of the surplus of €20 million was due for surrender.
This brief outline of the Vote expenditure indicates that the Department oversees and funds a broad range of public sector bodies. It also has responsibility for oversight of a number of major commercial State bodies that do not receive ongoing grant funding. These include An Post, EirGrid, the ESB and Bord na Móna.
I have provided the committee with a diagram that aims to summarise the public bodies within the Department’s aegis, indicating those which I audit and those that are outside my remit.
Seán Fleming (Laois, Fianna Fail)
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Mr. McCarthy noted that the environment fund is a separate fund of €35 million and is not before us today. The environment issue is part and parcel of what we are examining and I consider this a gap in today's proceedings. Will Mr. Griffin tell us the position on the plastic bag levy?
Seán Fleming (Laois, Fianna Fail)
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We will be here for a while yet. Would it be possible for someone to contact the office and have the most recent accounts on the environment levy emailed to the committee in order that we can take the environment fund into our considerations?
Seán Fleming (Laois, Fianna Fail)
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That would not be adequate.
Seán Fleming (Laois, Fianna Fail)
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I ask that somebody contact the Department now and ask for the 2015 accounts to be emailed over to us so that we can circulate copies of them.
Seán Fleming (Laois, Fianna Fail)
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We do not need to know the exact figures for 2016 but it would be remiss of us not to discuss the environment fund. I would like to deal with all of this in one go, if Mr Griffin could arrange that.
Seán Fleming (Laois, Fianna Fail)
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Yes. We will ask to liaise on this. Over the course of the meeting then we will-----
Seán Fleming (Laois, Fianna Fail)
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I will ask a member of our staff to liaise with a member of staff from the Department and find the most convenient way for us to acquire it and circulate it in hard copy.
Seán Fleming (Laois, Fianna Fail)
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I am sorry about that but Mr. Griffin can understand that I want to complete the task now that we are here this morning.
Seán Fleming (Laois, Fianna Fail)
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I now call on Mr. Griffin to make his opening statement.
Mr. Mark Griffin:
The Chairman introduced the front row of the Department's team in his opening remarks but I also have a very effective back row behind me here. I will introduce them now: Orla Ryan, principal officer; Triona Quill, principal officer; Brian Walsh, assistant principal; and Frank Groome, assistant principal. As the Comptroller and Auditor General mentioned at the outset, our Department has changed in formation since the last time I appeared before the Committee of Public Accounts. We are now the Department of Communications, Climate Action and Environment, whereas the last time I appeared here we were the Department of Communications, Energy and Natural Resources. I ask the committee not to be fooled by the name change because the Department obviously still holds the energy and natural resources functions. Our remit, then, expands significantly beyond functions relating to communications, broadcasting, postal, energy, natural resources and inland fisheries to encompass responsibility for the areas of climate change, waste management, resource efficiency, air quality and environmental policy. These new structures have been in place since May 2016.
The Department made significant progress in 2016 on a range of commitments set out in the programme for Government and in the Department’s statement of strategy 2016-19. Total gross expenditure under the Vote in 2016 amounted to just under €439 million, some €42 million or 8.7% below the budgetary allocation of €481 million. The underspend related primarily to lower than expected expenditure on the national broadband plan, energy research projects and the demand-led sustainable energy schemes, the delayed commencement of landfill remediation projects and reduced broadcasting expenditure due to lower than forecast TV licence receipts.
I will set out briefly the key strategic priorities supported from the Vote in 2016. Delivering a “connected” economy and society where every citizen, company and community can realise the full social and economic potential of the digital world is a policy priority. Some €14 million was spent on communications, multimedia developments and the information society. The Department continued to progress the procurement process under the national broadband plan. The plan has been a catalyst in encouraging investment by the telecoms sector so that to date approximately 1.5 million or 65% of the 2.3 million premises in Ireland can get access to high-speed broadband and this footprint is expanding. By 2020, through a combination of commercial investment and State intervention, about nine out of ten premises in Ireland will have access to high-speed broadband.
The Department continued to support digital entrepreneurship and to promote engagement by small businesses with the digital economy. To date, some 4,000 businesses have been awarded grant assistance under the Department’s trading online voucher scheme, while 9,000 businesses have benefitted from advice and peer-to-peer support under the scheme. A new digital skills for citizens scheme was launched in 2016 under which community and voluntary organisations will provide 25,000 people annually with ten hours of free digital skills training.
Expenditure in 2016 in the broadcasting area amounted to almost €240 million. Of this, some €179 million was paid in grant aid to RTÉ in respect of revenue from the sale of television licences. Exchequer funding of €26.1 million and TV licence fee funding of €9.3 million was provided to TG4 to deliver on programme commitments. Licence fee funding of €13.65 million was provided to the Broadcasting Authority of Ireland to support the audio and audiovisual media sector in the production of new television and radio programmes on Irish culture, heritage and experience, as well as programmes in the Irish language.
Some €80 million in Exchequer funding was spent in the energy area in 2016. Using less energy, and using it more efficiently, is the most cost-effective and accessible way for us all to take action on climate change. Expenditure of just under €58 million under the better energy programme, which is delivered by the Sustainable Energy Authority of Ireland, SEAI, supported energy efficiency upgrades to approximately 25,000 homes and 385 community and commercial buildings in the drive to reduce CO2 emissions.
The warmth and well-being pilot scheme to provide deep energy efficiency upgrades to people suffering from acute respiratory conditions who live in poor quality homes has grown from a base of 72 home completions following its launch last year to approximately 400 this year. To date, Government investment in energy efficiency has supported the upgrade of more than 350,000 homes, or one in every five homes in the country.
The purchase of more than 600 new electric vehicles was grant-aided in 2016. This will need to increase significantly in the coming years and the decisions taken in this year’s budget and Estimates will allow us to ramp up support for low-emissions vehicles. Renewable transport, renewable heat and renewable electricity generation all must significantly increase over the coming years as we move progressively towards the national objective of a competitive, low-carbon, climate-resilient and environmentally sustainable economy by 2050.
Some €9.8 million was spent on various geoscience projects, including INFOMAR, the national seabed mapping project, and the Tellus programme, which is updating the State’s geological mapping data sets.
Just over €29 million was paid to meet the administration and operational costs of Inland Fisheries Ireland, and the Loughs Agency in 2016. This funding enabled Inland Fisheries Ireland to undertake some 188,000 patrol hours and 36,000 inspections. The Department provided €24.9 million to the Environmental Protection Agency, EPA, in 2016 to support the delivery of its core functions. In the area of waste management, funding of €7.8 million was made available to local authorities in respect of landfill remediation projects.
In conclusion, the Department continued during 2016 to oversee and implement a wide range of policies and programmes which have a significant strategic national importance and which are essential to our national economic and sustainable development. I look forward to assisting committee members with any questions they may have today.
Seán Fleming (Laois, Fianna Fail)
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I thank Mr. Griffin. Speakers have indicated in the following sequence: Deputy Connolly, Deputy Aylward, Deputy Cullinane, Deputy MacSharry and Deputy Catherine Murphy. The first speaker will have 20 minutes; the second will have 15 minutes and all speakers after that will have ten-minute slots.
Catherine Connolly (Galway West, Independent)
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Cuirim fáilte roimh na finnéithe. Faoi dheireadh, tá cothromaíocht inscne le feiceáil ag an mbord, comhghairdeas leis an Roinn. At last we have some gender equality here and it is welcome to see. It is the first time for me to see this after almost two years in the Oireachtas. I also offer my congratulations on the clear accounts, with the exception of the procurement account to which we might come back later. The Department covers such a broad range of areas. Climate change is obviously major. The Chairman might tell me when I am halfway through my allocated time because I want to start with some practical questions and then come back to climate change at the end. In its air quality report for 2016, the EPA confirms that the European Environment Agency, EEA, estimated that 1,510 premature deaths took place in Ireland in 2014 because of poor air quality. The EEA is obviously basing this on World Health Organization, WHO, standards, which are thankfully very high. We will come back to this.
My first question concerns details on landfill remediation given on page 21 of the accounts. Perhaps Mr. Griffin could clarify some things for me here on this remediation. The Estimate provision was substantial but the outturn was much less. There is also a note here stating the reason for the delay. The report also refers to a consultant's report. Can Mr. Griffin explain that to me? There was a delay because of a consultant's report and there was a delay because of complexity. How many remediation projects are we talking about in total? How many of those were delayed? I would appreciate it if Mr. Griffin could just give me the answers.
Mr. Mark Griffin:
I will be guided by Deputy Connolly herself in this regard.
When one focuses on 2016, one gets one part of the picture. When one broadens it out, one gets a different perspective. I will be guided by the Deputy in terms of the amount of information she wants.
There was an underspend of approximately 41% in 2016 in the context of the amount we had expected to expend. When one looks at the nature of the beast with which one is dealing - Deputy Catherine Murphy will be very familiar with this regarding Kerdiffstown - one realises that these are very complex projects. They require statutory consent before proceeding. They must meet the relevant procurement rules. They may also involve complex legal cases and that is the case in terms of a number of them. There is a need for a technical assessment to be undertaken on each project that we are proposing to fund in order to ensure that we understand: the nature of the problem and the options available; that stakeholder engagement has taken place; that funding is available; and the position on the scope of works we are proposing to fund.
Looking at 2016 specifically, there were six projects that we had proposed to fund to a greater extent than actually occurred in 2016. The first was Kerdiffstown in County Kildare. The delay there arose because of time taken to prepare the planning application, the EIA and the waste licence application. Fingal Harriers in Timoole, County Meath, was the subject of ongoing legal action. Stackallan in Slane, County Meath, was the subject of ongoing negotiations between the site liquidator and Meath County Council. The progress anticipated in respect of Portlaw Cotton Mill in County Waterford was not made. The site is in private ownership and it has a complex character involving environmental, heritage and social interests. The final one that did not progress to the extent that the local authorities and ourselves expected was that relating to Shannon Vermicomposting.
One can see that there are delays. From our perspective, we want this to happen as quickly as possible in terms of the remediation action that is required because this has very significant impacts on the local communities, significant impacts on the environment and potential significant impacts on watercourses. As I said, if one takes 2016 in isolation, we would not be satisfied with the level of progress made. However, there are justifiable reasons why matters did not progress in the way we had foreseen.
The picture is probably a lot better when one looks at it in its broadest sense. If one goes back to the genesis of this, which is a European Court of Justice case in 2012 whereby the court found against Ireland in respect of systemic problems with aspects of our waste system, including the extent of legacy local authority dumps and illegal landfills in particular. A commitment given by the Government at the time to the effect that a programme of measures would be put in place. One of those measures would be to provide funding for the remediation of these landfills. Of the 58 to which that case related, I would say that in excess of 40 have now been completed. We are left with a number that have yet to be addressed, albeit some of them quite complex.
In the context of the six that we have identified, we would expect that progress will have been made during the course of this year. Money has been provided in the Vote for that and, indeed, we have provided money into 2018 to continue the programme of works.
Catherine Connolly (Galway West, Independent)
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There are 58 legacy sites.
Catherine Connolly (Galway West, Independent)
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At that point.
Mr. Mark Griffin:
That is a very important statement to make because if one looks at the work that was done in 2015 as part of the regional waste management plans, which were updated at that point, the local authorities did a further assessment in respect of whether there were additional landfills that would fall into this category. Each of the three regional waste management plans have identified legacy landfills of high, medium or low-risk categorisation. The ones that fall into the high-risk categorisation come to 70 or 71 - I am not sure of the exact figure. They are spread right across the country. In the Deputy's county, one has South Park in Galway city, Gort, New Inn, Glenamaddy, Tuam, Rinkippeen and Portumna. That level of problem is still reflected across the State. While our initial focus was on dealing with the cases that were the subject of the European Court of Justice finding, we will have to continue a programme of remediation works for the foreseeable future.
We are working with the local authorities, the CCMA-----
Catherine Connolly (Galway West, Independent)
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I just want to get this right. There were 50 identified.
Catherine Connolly (Galway West, Independent)
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Separate from that, there is an ongoing process of looking at old landfill sites. Is that right?
Catherine Connolly (Galway West, Independent)
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That is okay. The Department goes forward from there and works with the local authorities. Mr. Griffin mentioned South Park.
Catherine Connolly (Galway West, Independent)
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How many have been identified so far?
Catherine Connolly (Galway West, Independent)
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Those are of a high priority.
Catherine Connolly (Galway West, Independent)
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Is Mr. Griffin saying that South Park in Galway is included in that?
Catherine Connolly (Galway West, Independent)
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That is in the high-priority list for a former-----
Catherine Connolly (Galway West, Independent)
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There are 71 in the high-risk category.
Catherine Connolly (Galway West, Independent)
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How many are in the medium and low-risk categories?
Catherine Connolly (Galway West, Independent)
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There are 500.
Catherine Connolly (Galway West, Independent)
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So this is a major problem.
Catherine Connolly (Galway West, Independent)
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I understand.
Mr. Mark Griffin:
The area that we will want to focus in on is the 70. What we are trying to do with the CCMA and the EPA is to develop a roadmap for undertaking the technical assessment that will be required on those additional 70 and then developing a risk ranking in terms of the remediation that will be required and the funding that the State will have to commit to it.
Catherine Connolly (Galway West, Independent)
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I am speechless regarding South Park in Galway. I certainly was not aware it was on a high-risk list. There are 70 in that category.
Catherine Connolly (Galway West, Independent)
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South Park is a park. It is on a high-risk list as a former dump.
Catherine Connolly (Galway West, Independent)
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That is okay.
Catherine Connolly (Galway West, Independent)
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Are the ones the Department has identified public or private?
Catherine Connolly (Galway West, Independent)
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Would Mr. Griffin be able to get that breakdown?
Catherine Connolly (Galway West, Independent)
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Does Mr. Griffin have an update on the ongoing remediation on the major former site on the Headford Road in Galway?
Catherine Connolly (Galway West, Independent)
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Someone else could have the number of landfills currently in use in Ireland.
Catherine Connolly (Galway West, Independent)
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That is okay.
Catherine Connolly (Galway West, Independent)
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There are two questions there. How many existing landfills are there? What is the status of the former landfill in Galway? Where will that appear?
Catherine Connolly (Galway West, Independent)
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No, in Galway city.
Catherine Connolly (Galway West, Independent)
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That is okay; we will come back to it.
Catherine Connolly (Galway West, Independent)
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There is major remediation required on the landfill at Silvermines. It is envisaged that funding will become available to complete the final phase. What is the extent of the remediation works that are necessary there?
Catherine Connolly (Galway West, Independent)
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Is that to date?
Catherine Connolly (Galway West, Independent)
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What is the cost of ongoing monitoring in respect of the site?
Catherine Connolly (Galway West, Independent)
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What is the cost?
Catherine Connolly (Galway West, Independent)
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They are two things.
Catherine Connolly (Galway West, Independent)
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To date, the Department has spent €11.2 million on remediation works.
Catherine Connolly (Galway West, Independent)
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What is the cost of the ongoing monitoring? I will leave those practical questions with the Secretary General.
Catherine Connolly (Galway West, Independent)
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Let me put a number of practical questions. One is on the cost to date, which he has given me. The second relates to the cost of the ongoing monitoring. The third one is why the work is not being completed. Why is it subject to funds available?
Catherine Connolly (Galway West, Independent)
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Yes.
Mr. Mark Griffin:
For Silvermines, the cost of the final work relates to the Garryard tailings site. It is a distinct and separate phase and is not deemed critical to the overall success of the work completed to date. Approximately €10 million is required to carry out that work. We do not have a budget agreed yet to complete the work and we need to undertake a review of the works required to remediate Garryard to get a final figure on that. That is the Silvermines site. We have done the bulk of the work that was required on the Silvermines site.
Catherine Connolly (Galway West, Independent)
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However, there is work remaining to be done at a cost of €10 million.
Catherine Connolly (Galway West, Independent)
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When will that be done?
Catherine Connolly (Galway West, Independent)
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I will leave it to my colleagues to come back on that. Regarding RTÉ, the funding provided to it, and An Post, the sum collected in respect of the licence fee was much lower than anticipated. Is that right?
Catherine Connolly (Galway West, Independent)
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Some €6.4 million.
Catherine Connolly (Galway West, Independent)
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Why was that?
Mr. Mark Griffin:
First, it is very difficult to predict in any given year the likely level of sales. Looking at the trends between 2008 and 2016 - to give the Deputy a few figures to illustrate the variability in the level of sales that occurs in any given year - we had a reduction of 64,000 in the number of licences sold between 2008 and 2012. We had a reduction of 18,000 between 2011 and 2012.
Catherine Connolly (Galway West, Independent)
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Just a minute. Is Mr. Griffin saying that when one looks back, the level of sales is always variable?
Catherine Connolly (Galway West, Independent)
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Did An Post give any reason for this decrease?
Mr. Mark Griffin:
No. Looking back at the figures, I think part of this is probably down to the economic downturn and people not buying TV licences. The variability is one reason. The other reason we would expect to have seen an increase is the efforts An Post has taken to tackle evasion. There was a major advertising campaign and an increase in recruitment of temporary inspectors. Another factor we would have programmed in during 2015 when we were doing the Estimate was the expectation that legislation would have been introduced in 2016 to allow the Minister hire procurement agents. We saw what happened in the UK when it outsourced its collection of TV licences: the evasion rate went from approximately 13% to 7%. A number of things were factored in that we expected would have had an effect. One can add to that the economic growth that was expected during 2016. When there is economic growth, people start to invest more in household goods, including televisions.
Catherine Connolly (Galway West, Independent)
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I have had enough. I will conclude on climate change, which has come under Mr. Griffin's Department's remit. We are aware of all the reports on climate change. We have seen the most recent recommendations from the Citizens' Assembly begging us for leadership and pointing out that all sorts of measures could be taken. The members of the Citizens' Assembly are happy to pay increased taxes and consider carbon tax and so on. What leadership has Mr. Griffin's Department shown regarding the challenge of climate change? Where can I identify the money set aside in this regard? I see the expenditure on measures relating to energy and I see underspends in respect of various items.
Mr. Mark Griffin:
The Deputy will see partial underspends in some areas relating to climate research and so on, but what we have seen in the area of energy efficiency, for example, is an almost doubling of the level of investment between 2016 and next year. There has been a considerable increase in the number of homes that have been the subject of energy retrofit work that has been completed. As stated earlier, 350,000 properties have been retrofitted by the State. We are doing a lot of work in the Department on the renewable energy front as well. We are seeing good progress being made there. We had a very ambitious target of 40% of electricity from renewable energy by 2020; we are now up to over 27%. I will talk about a number of things the Department is doing that are very relevant to the climate agenda but then I want to say something about other Departments because-----
Catherine Connolly (Galway West, Independent)
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I would appreciate that, but let us start with Mr. Griffin's Department. Where is it based?
Catherine Connolly (Galway West, Independent)
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Is it a rented premises?
Catherine Connolly (Galway West, Independent)
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What actions have been taken on the Department's premises?
Catherine Connolly (Galway West, Independent)
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Yes.
Mr. Mark Griffin:
We have put in a new heating system over the last number of years which is much more energy-efficient. I cannot recall what the reduction in energy usage is, but it has made a difference in terms of the energy cost to the Department. Looking at the public sector more broadly, we had a 33% target for energy-----
Catherine Connolly (Galway West, Independent)
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I would just like to look at Mr. Griffin's Department for one moment because, ultimately, it comes back to all of us and the Department is in the lead position. I see some very welcome initiatives. I see some that I wish I had more time to discuss. I refer, for example, to community ownership of renewable energy, a matter to which I hope to return later. However, let us start with Mr. Griffin's Department. What changes have been made, what leadership has been shown and what are the results?
Catherine Connolly (Galway West, Independent)
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Yes.
Catherine Connolly (Galway West, Independent)
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I ask Mr. Griffin to go back to the changes the Department has made regarding energy and to be specific. The Department has changed the heating system. What are the results-----
Catherine Connolly (Galway West, Independent)
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I ask Mr. Griffin to give me the specifics on that. What have been the results?
Catherine Connolly (Galway West, Independent)
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Will Mr. Griffin come back to me on that?
Catherine Connolly (Galway West, Independent)
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Lovely. The next thing, on a more general level, is the Department's leadership role in the context of the other Departments. What-----
Mr. Mark Griffin:
We have put in place a public sector energy efficiency action plan. It has been in place for a number of years. It was updated this year. Regarding the impact across the government sector, we have a target of 33% in energy efficiency savings by 2020. We are now at 21%. In 2015, we avoided an energy spend of €154 million in the public sector by virtue of the measures that have been put in place right across the system. What we have introduced is a fairly novel approach to the spend on energy efficiency in Departments, which are allowed to retain the savings they accrue by virtue of investing in energy efficiency measures and to invest it in other measures. That has been agreed with the Department of Public Expenditure and Reform. We have asked each Department to appoint an officer at senior level, generally someone at assistant secretary level, to be an energy advocate within his or her Department or agency. We co-funded upgrades of ten national schools with the Department of Education and Skills in 2017, we co-funded - with the OPW - deep retrofits of ten public buildings in 2017 and we set aside funding in our own Vote in 2018 to double that. This amounts to 20 schools and 20 public buildings, and they will act as demonstrations for what can be done if the money is invested.
Catherine Connolly (Galway West, Independent)
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What percentage is that number of all the schools?
Mr. Mark Griffin:
I do not know. I do not have a figure as to what percentage that is of the number of national schools, but it is a very small percentage. One must walk before one can run. I listened very closely to the Citizens' Assembly and its recommendations last week. Many of the recommendations that came out of the Citizens' Assembly we are either doing or planning to do. One of the issues it raised was peat, for example. The support for peat in Edenderry was phased out in 2016 and the support for peat in west Offaly and Loughrea will be phased out in 2019.
Regarding investment in electric and low-emissions vehicles, we have a low-emissions vehicle task force in place.
Catherine Connolly (Galway West, Independent)
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How many people in the Department have such vehicles?
Catherine Connolly (Galway West, Independent)
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Mr. Griffin has stated we must crawl before we can walk. Climate change presents a major challenge. I do not wish to put Mr. Griffin on the spot, but I wish to see leadership on this issue permeating into every Department.
Catherine Connolly (Galway West, Independent)
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The Chair will give Mr. Griffin as much time as he likes.
Catherine Connolly (Galway West, Independent)
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I ask Mr. Griffin to let me finish because I do not have enough time to go through the issue in detail. I wish I did, but I will return to it in the second round of questions.
Mr. Mark Griffin:
There is a suggestion in the Deputy's question that leadership is not being shown. I do not accept that. There has been a focus on what we are doing in the building, which is a minute element of what it is that the Department and the system are doing. If one looks at the national mitigation plan that was published during the year, we have listed 60 measures that are under way which will have a very significant impact on our emissions profile in the State. We have an emissions trading scheme in place. We have a carbon tax in place and the Minister for Finance, Deputy Paschal Donohoe, has committed to reviewing it next year before the next budget is announced. We have renewable electricity support schemes. We have financial supports available through the Sustainable Energy Authority of Ireland which I have mentioned for energy efficiency improvements. There is a lot of investment in the social housing programme in energy efficiency upgrades. We support large industries with expert advice on what they can do on their own energy efficiency programmes. There is investment in public transport, a smarter travel initiative and a biofuels obligation scheme.
That is just what is under way. If one looks at what is planned, it includes a new renewable electricity support scheme, a new renewable heat incentive, smart metering, further incentives for low emission vehicles and further investment in public transport. There is an array of things that are happening right across the system. If I had a blank cheque, I would spend a lot more on climate action, but I do not. Like every Department, we have to compete for funding with health, justice, education and water services. We are comfortable that the strategic approach being taken to addressing this issue is sound. I mentioned the national mitigation plan. We are doing work in the national adaptation framework and expect to see a substantial and visible ramping up of activity to tackle climate action in the next couple of years.
The other thing I did not mention, one linked with the work of the Citizens' Assembly, is the fact that we have established a national dialogue on climate action to try to have engagement with the public to effect behavioural change across the State on the issue.
Catherine Connolly (Galway West, Independent)
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People are way ahead of us on this issue. Government policies pay lip service to public transport. To take the example of Galway, there is no provision for light rail in the national planning framework and absolutely no recognition that we need public transport services. That is, however, an issue for another time.
Catherine Connolly (Galway West, Independent)
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Great.
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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I welcome Mr. Griffin and his team. The Department will be very important in the years ahead.
I will start on the issue of broadband, in particular, the provision of high speed broadband in rural areas for the benefit of the country. I am disappointed to note that only €5.4 million of the €16.8 million allocated in 2016 under subhead A3 was spent. This is surprising considering that the country is crying out for the roll-out of broadband, on which we have report after report. The development of rural areas is being held back by the lack of access to broadband. I ask Mr. Griffin to explain the reason only €5.4 million or one third of the €16.8 million allocated was spent last year, given the need for broadband.
Mr. Mark Griffin:
There are a number of components to that subhead. However, the Deputy is right that the bulk of the underspend in 2016 was in relation to the national broadband plan. I do not see this as a reflection of a delay in the plan or a lack of commitment on our part in this being a priority for the State. In fact, what one sees is that the bulk of the money underspent in 2016 on the national broadband plan will be spent in 2017. There is a timing delay more than anything else.
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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It is not very efficient, is it?
Mr. Mark Griffin:
I would much prefer to spend money efficiently than just to spend it. The view was taken on the work that was to be funded from the Vote in 2016 that we had not progressed aspects of it by the end of the year. However, the spend would have been recouped at the start of 2017. I take the Deputy's point on this issue. I have a brother who lives in Kilcreevanty outside Tuam who berates me about this project every time he sees me and another fellow who lives in Ballycommon outside Nenagh. Both of them work in the information technology sector and both are without access to high speed broadband once they leave their workplaces. However, we are seeing progress.
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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It is slow.
Mr. Mark Griffin:
One has to look at the national broadband plan in its entirety. We have always made the point that the broadband plan comprises commercial investment and also the State-led intervention which is progressing. We reached an important stage in September with the submission of detailed proposals from the two remaining bidders, eir and enet. We will go looking for final tenders in the first part of next year. We will also appoint a preferred bidder next year.
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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Why is the project taking so long? We have been hearing about it being put out to tender since the most recent general election. Why is it taking so long to place the tender and get the project up and running? Why is it always next year? We heard that it would be rolled out in 2017-18. Then the date was put back to 2019 and we now hear it will be 2020. The date keeps being pushed back when we are crying out for broadband services.
Mr. Mark Griffin:
I will deal with that issue in a second, but first I will give the Deputy some figures. It is important that I do because I do not want people to be under the impression that things have not been happening in the past few years. In 2012 some 700,000 properties were connected to high speed broadband. By April 2016 the figure had increased to 1.2 million or 52% of premises. In September 2017, 1.5 million or 65% of premises had access to high speed broadband. By the end of next year the figure will be 1.8 million or 77% of premises and by the end of 2020 it will be 2.1 million or 90% premises. A huge amount is happening and what one is seeing is a significant ramping up by the commercial sector. We had eir 300,000, which was launched in April this year and on which the Minister signed a commitment agreement. We had SIRO, which agreed to invest €450 million in 51 towns, providing 500 connections across the State. Virgin Media has agreed to extend its footprint, while enet decided to invest €100 million in 115,000 premises in nine locations in the west and north west.
I have heard Deputies across the House refer to the national broadband plan as the next rural electrification scheme. Back in 1927 those involved in the rural electrification scheme did not have to deal with public procurement procedures. If they did, it might have been delayed a lot longer and some of us might still be in the dark. The reality is that we have to comply fully with public procurement procedures. I would much prefer to have a process that was robust and that stood up to scrutiny should any party involved in the procurement process decide to take the State to court by way of a judicial review at the end of it.
We actually put the project out to tender in December 2015. After the first phase, the pre-qualification questionnaire, we had five consortia, comprising 32 companies. All of them had to be evaluated. We had to enter into detailed dialogue with the companies that were still part of the process. We are talking about a contract that runs to about 1,500 pages. It is a very complex procurement process. While I understand the frustration, I would be much more comfortable in having a robust procurement process over which the Minister, the Department and I could stand at the end, having delivered a preferred tender or tenderer in a position to hit the ground running to deliver high speed broadband to the 542,000 properties without high speed broadband.
There was also an intention to establish a mobile phone and broadband task force - a clear commitment of the Minister when he came into government - and that has taken place. It has done a lot of work on the intermediate steps that could be put in place to remedy some of these inefficiencies, especially around mobile phone signal issues across the State. The Minister has optioned the additional spectrum at 3.6 GHz, which will provide spectrum to private sector companies to roll out broadband. The Minister has also facilitated RTÉ by way of providing €8 million in the Vote in 2016 in order that it can exit-----
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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Mr. Griffin is giving the committee a lot of information and it is hard to keep up with it all. I just want to come to the brass tacks of the situation. We are aware that the dark blue areas on the plan are economically sorted, the light blue areas is where there are 300,000 extra homes with 2,000 being done, but then we have the amber areas that are marked for State intervention and are not commercially viable. I would like to know more about that area. We have had all the reports, the Switcher.iereport and the Vodafone Ireland report; I have them all here with me and I could keep on reading them for another ten minutes but they basically say that 37% of rural businesses are being forced out of their localities because they cannot rely on the current broadband service and that jobs and SMEs are basically walking away. Businesses in the survey have said they will leave the rural areas where they are currently situated in order to get high-speed broadband because they want to be economically viable and be able to take on their rivals. These are the questions I want the Secretary General to answer. I have all the reports. I want to know whether 180,000 people still will not have access to high-speed broadband in 2020 or what does Mr. Griffin envisage the situation will be in 2020, that is, in three years' time?
Mr. Mark Griffin:
Once the tender award has been completed, we expect the completion of the roll-out within three to five years, based on what the industry has told us. We expect it to be closer to three years than to five years. The reason I gave detail to the Deputy earlier was because I want the committee and members of the public to understand a huge amount of activity is ongoing both around the procurement process in which we are involved and in the work that has been undertaken by the private sector around the commercial aspect. That is why the committee can see us shifting from 700,000 in 2012 with high-speed broadband to 1.5 million premises now, and more to come. With regard to the 536,000 or 540,000 properties that are still waiting for high-speed broadband, we will provide that by way of-----
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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What does Mr. Griffin envisage will be the position by 2020? What about the 180,000 people that have none?
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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It is 180,000, according to the figures I have here, who will still not have broadband.
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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That is what I have in front of me. High-speed broadband to 180,620 homes by 2020, but there would still be 180,000 homes that will not have access to high-speed broadband.
Mr. Mark Griffin:
The committee can be rest assured that as soon as the contract is awarded we will do everything in our power to make sure it is rolled out as quickly as possible. We are working very closely with the Minister, Deputy Ring's Department, which is working with the local authorities and the local enterprise boards to put in place roll-out strategies at local level. We have a very clear prioritisation programme and the mandate for the company or companies that are awarded the tender is to hit the ground and do it as quickly as possible.
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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My time is limited and I want to move on to other issues.
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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How does Mr. Griffin see the State intervention working and what way would the State have to intervene to make the amber areas viable? How will that roll-out be done?
Mr. Mark Griffin:
There will be a prioritisation plan agreed between the companies and the Department of Rural and Community Development. The input from that Department is vital because this is a bottom up approach. They are already talking to the local authorities and the local enterprise offices to ask about priorities in their counties and to ascertain whether a particular type of business, the schools or the business parks need to be hit first. We will have that input into the prioritisation programme. Once the contract is awarded the company will be in receipt of a subsidy from the State to make this commercially viable for them. When the contract is awarded I do not see any blockages to a quick mobilisation and a speedy roll-out to those parts of the State that have yet to receive it.
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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When will the contract be awarded?
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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Reference was made to the Citizens' Assembly and the recommendations that came up there. I am a farmer from rural Ireland and I am worried about the recommendations around carbon tax or fines. Ireland's largest indigenous business and some 90% of exports are agricultural. I am worried about how the recommendations can be married with our produce such as cattle, beef, bacon, lamb, other meat, dairy and grain products etc. The Citizens' Assembly talks of bringing in a carbon tax that will affect farmers. We are aware of the viability of agriculture at the moment and the profit margins are very small. Will Mr. Griffin clarify how the taxes and the sector could be married? Ireland exports some 90% of its agriculture produce into Europe. Are we then going to subsidise beef, for example, coming from Brazil or South America? What about the carbon footprint of transporting that across the Atlantic? How will all of this be married together to keep agriculture viable in the State if carbon taxes are being considered? I do not believe that Ireland is getting recognition for the trees it has or for the amount of grass that is grown here. The Citizens' Assembly did not consider these factors. Speaking from an agriculture point of view, I would like Mr. Griffin's view on how all of this will be reconciled?
Mr. Mark Griffin:
As I understand the process of the work of the Citizens' Assembly, the key function of the assembly is to make recommendations on the topics it was asked to discuss. Climate action was one of those topics. The Citizens' Assembly will provide a report to the Houses of the Oireachtas. The Houses of the Oireachtas will assign that report to a relevant committee of both Houses - I do not know if that will be one committee or several committees - depending on the issue being discussed. I presume it is several committees. I imagine that the agriculture recommendations will come to the Oireachtas Joint Committee on Communications, Climate Action and Environment. The matter may also be debated in the Oireachtas Joint Committee on Agriculture, Food and the Marine.
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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As the Secretary General of the Department of Communications, Climate Action and Environment, what is Mr. Griffin's personal opinion?
Mr. Mark Griffin:
I am reluctant to speak for the Minister for Agriculture, Food and the Marine on this particular issue. The objective for the agriculture sector for 2050 is carbon neutrality, while ensuring the things we need to do in respect of food security and food sustainability are reflected in any decisions that are taken.
There has been huge investment in afforestation over the last decades. That is recognised at EU level in how the effort-sharing regulations are being structured. The EU is making allowances for the possibility of netting off some of the obligations by factoring in the changes that have been made on the afforestation programme. There is a lot of work ongoing under the GLAS scheme and the targeted agricultural modernisation schemes, TAMS. There has been huge investment in the beef data genomic project.
When I listen to colleagues in the Department of Agriculture, Food and the Marine talk about this particular issue they are strongly of the view, in respect of the approach being taken in the Food Wise 2025 strategy to increase dairy output and the national herd and so on, that it is being done in a climate-friendly fashion. They say that the dairy and beef sectors are two of the most climate-friendly sectors when one considers similar such sectors at EU level.
Much work is being done in the agricultural area in this regard. I do not doubt that more will have to be done but I would not express a view one way or another on what the assembly has specifically proposed in this area. I take the Deputy's point about carbon leakage. This is when industries are vulnerable to the impact of industries in third countries, such as our agriculture sector and the industry in Brazil and Argentina for example. Particular consideration needs to be given, from a climate change perspective, in how we manage that.
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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How am I doing for time?
Seán Fleming (Laois, Fianna Fail)
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The Deputy has one minute remaining.
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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Inland fisheries come under the remit of Mr. Griffin's Department also. I have experienced that.
We have three good rivers where I come from - the Suir, the Barrow and the Nore - but they are all closed to salmon fishing at the moment because of scientific evidence that there are not enough fish to sustain such activity. We have to get it up to a certain standard before we can go back fishing again. I have asked the Minister on several occasions about the buy-out scheme that was in place approximately ten years ago for various forms of fishing, including rod fishing and the traditional forms of fishing like snap-net, draft-net and drift-net fishing that are found in my locality. All of these fishermen have been off the river for the past three, four or five years. Some of them have been off the river for longer. Many people were able to make a partial living out of fishing when they were in their 30s and 40s. They made a lot of money out of salmon when they were plentiful. Small farmers and people living in labour were able to use this activity as a back-up. Could another buy-out scheme be considered? Many of these people are getting old now. They are gone beyond fishing for reasons of age. Could a new buy-out scheme be introduced to give some reward to people who were fishing all their lives, and getting some income from it, until the rivers were closed. Now they are getting no income from it. Could there be a buy-out scheme?
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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Yes.
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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This would be the second one. I hope the possibility of another buy-out scheme can be examined.
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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It would be for a different group of people. They are still there. They have done no fishing for three, four or five years because scientific evidence will not allow them out on the rivers. I am not just talking about my local area; I am talking about the whole country.
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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I could have mentioned the River Moy in County Mayo and many others.
Mr. Mark Griffin:
The scientific rationale is that each river has its own defined salmon stock, which leaves from and migrates back to the same place. We have to ensure the salmon stocks for the Suir, the Nore and the Barrow are above the conservation limits. They are not above those limits at present.
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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No.
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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I know that.
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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I have raised it today so that it can be taken into consideration.
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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That is right.
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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I have raised it with the Minister. I know he is doing some research on it. He is looking at the overall picture with regard to salmon, eels and the whole lot.
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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He is looking at a buy-out scheme in general. He is putting costings on it. As Secretary General, would Mr. Griffin be in favour of what I am proposing? Would he support it?
Mr. Mark Griffin:
If it is a policy that is pressed by the Minister, it will be considered. Ministers settle policy and we do what they tell us to do. I will see what emerges from this part of the process. At that stage, as Accounting Officer I might ask the Minister what other parts of the Department he would like to cut.
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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If one does not look for these things, one does not get them.
Seán Fleming (Laois, Fianna Fail)
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One of the three rivers that have been mentioned - the River Nore - passes by my front door.
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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The three sisters.
Seán Fleming (Laois, Fianna Fail)
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Deputy Aylward is not the only person with an interest in this matter. Can Mr. Griffin explain what he meant when he said the river is below the conservation level? Can the Department work with fishing clubs to try to restock rivers? If the Department thinks a river is below the conservation level, does it walk away from it?
Seán Fleming (Laois, Fianna Fail)
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I ask Mr. Griffin to explain what this means.
Mr. Mark Griffin:
If no fishing is taking place on a river, the stocks should start to regenerate naturally. Fishing bans have been in place on a large number of rivers in recent years on the basis of scientific advice from the standing scientific committee that most of them were below the conservation limits. We want to see them regenerate naturally. If a salmon river is restocked with salmon that do not come from that river, from a scientific point of view I do not know whether those salmon return to that river post-migration. I cannot answer that aspect of the question.
Seán Fleming (Laois, Fianna Fail)
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When no fishing is taking place on a river in order to allow it to restore its salmon stocks naturally, how long does the process generally take? Does it take five years, ten years or 30 years?
Seán Fleming (Laois, Fianna Fail)
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I understand if Mr. Griffin does not know.
Bobby Aylward (Carlow-Kilkenny, Fianna Fail)
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For the information of the committee, following the receipt of scientific evidence two or three years ago the Nore and the Barrow were opened after being closed for seven or eight years. It was permitted to catch a couple of hundred fish a year for two years. When the fish levels reduced again, the rivers were closed once more. It all depends on the scientific evidence.
Seán Fleming (Laois, Fianna Fail)
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Will Mr. Griffin send us a detailed note?
Seán Fleming (Laois, Fianna Fail)
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Absolutely. I call Deputy Cullinane.
David Cullinane (Waterford, Sinn Fein)
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I welcome Mr. Griffin and his colleagues. While I do not want to go back over ground that has already been covered, I have one question that follows on from the questions asked by Deputy Connolly. I welcome Mr. Griffin's statement that the Department is looking to achieve 33% energy efficiency across the public service. I assume this means there will be a 33% reduction in usage.
David Cullinane (Waterford, Sinn Fein)
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Mr. Griffin said that the overall figure which has been achieved is 21%.
David Cullinane (Waterford, Sinn Fein)
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I imagine that there are variances across the public service.
David Cullinane (Waterford, Sinn Fein)
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Some Departments have done better than others.
David Cullinane (Waterford, Sinn Fein)
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Could Mr. Griffin give this committee a breakdown of that?
David Cullinane (Waterford, Sinn Fein)
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Where does the Department of Communications, Climate Action and Environment sit on the league table?
David Cullinane (Waterford, Sinn Fein)
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I do not think it is good that when Mr. Griffin, as the Accounting Officer of the Department that has set the overall target of 33% across the public service, comes before the Committee of Public Accounts, he can tell us that the average is 21% but he is not in a position to tell us what percentage has been achieved by his Department, which should be setting an example in this regard. I am aghast that Mr. Griffin is not personally aware of the figure in question. Perhaps he has just been handed the relevant details. I would have imagined that Mr. Griffin would be familiar with this information, or would at least be interested in knowing whether the Department of Communications, Climate Action and Environment is exceeding the targets it has set for all Departments. Why did Mr. Griffin not know the relevant figure in advance of this meeting?
David Cullinane (Waterford, Sinn Fein)
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I am asking why Mr. Griffin did not know. My feelings do not come into it. Why did Mr. Griffin not make an inquiry to ascertain whether the Department has reached the targets it has set for all Departments?
Mr. Mark Griffin:
Part of the reason is probably that there are many figures and statistics rattling around in my head. I do not have the figure. I will get the figure. It is set out in the Sustainable Energy Authority of Ireland's reports, which are published on an annual basis. The authority's next report will be published next month.
David Cullinane (Waterford, Sinn Fein)
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I accept that the setting of a target is a good thing. The Department has accepted that this is an important initiative across the public service.
David Cullinane (Waterford, Sinn Fein)
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Obviously, the Department wants the targets that have been set to be met. I do not think it is acceptable that even though Mr. Griffin is the Accounting Officer for the Department that set those targets, he is not in a position to tell us today what the Department has achieved. I do not think it is acceptable leadership from Mr. Griffin, as the Secretary General, or from the Department. That is my own view. This is not about my own feelings. It is a fact that Mr. Griffin was not in a position to give us that information. Maybe he can furnish the committee with a full breakdown of the figures that have been achieved by all the Departments-----
David Cullinane (Waterford, Sinn Fein)
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-----so we can see which of them have and have not stepped up to the mark in terms of the targets.
David Cullinane (Waterford, Sinn Fein)
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Perfect.
David Cullinane (Waterford, Sinn Fein)
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Figure 1 on page 1 of the Comptroller and Auditor General's opening statement sets out that the Department's gross expenditure for 2016 was €439 million. Mr. Griffin is the Accounting Officer for that €439 million. Is that correct?
David Cullinane (Waterford, Sinn Fein)
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Is that entirely correct? Is Mr. Griffin the Accounting Officer to the Committee of Public Accounts for the full €439 million?
David Cullinane (Waterford, Sinn Fein)
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The Comptroller and Auditor General referred on the last line of his opening statement to "those which I audit and those that are outside my remit".
David Cullinane (Waterford, Sinn Fein)
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I referred earlier to a graph on the last page.
David Cullinane (Waterford, Sinn Fein)
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It provides a breakdown of the expenditure. The part of the box that is highlighted in blue - it might not be clear on the screen - relates to what is audited by the Comptroller and Auditor General. Is that correct?
David Cullinane (Waterford, Sinn Fein)
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There are commercial State bodies outside of that. Is that correct?
David Cullinane (Waterford, Sinn Fein)
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Does the Comptroller and Auditor General audit those bodies?
David Cullinane (Waterford, Sinn Fein)
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Okay. Just one of the seven commercial State bodies that are highlighted receives funding from the Department of Communications, Climate Action and Environment. Is that correct?
David Cullinane (Waterford, Sinn Fein)
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That would be RTÉ.
David Cullinane (Waterford, Sinn Fein)
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The document says "nil" in that respect. I am looking at the-----
David Cullinane (Waterford, Sinn Fein)
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Is the €179 million paid to RTÉ audited by Mr. McCarthy's office?
David Cullinane (Waterford, Sinn Fein)
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Why not?
David Cullinane (Waterford, Sinn Fein)
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Why is it not within Mr. McCarthy's remit? I am trying to understand the logic of that.
David Cullinane (Waterford, Sinn Fein)
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Is the €179 million part of the €439 million?
David Cullinane (Waterford, Sinn Fein)
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In percentage terms, how much of the Department's funding is not under the remit of the Comptroller and Auditor General?
David Cullinane (Waterford, Sinn Fein)
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Yes.
David Cullinane (Waterford, Sinn Fein)
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Maybe I will put my question a different way.
David Cullinane (Waterford, Sinn Fein)
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For clarification purposes, is Mr. Griffin accountable to the Committee of Public Accounts as Accounting Officer for that €179 million?
David Cullinane (Waterford, Sinn Fein)
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That is a start. I have questions on it. Do we have a breakdown on what that money is spent on? What specifically is that €179 million spent on?
David Cullinane (Waterford, Sinn Fein)
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Do we have a breakdown of what that money is actually spent on?
David Cullinane (Waterford, Sinn Fein)
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Yes.
David Cullinane (Waterford, Sinn Fein)
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Mr. Griffin is accountable to us for money that is spent. I am asking him about a big chunk, amounting to €179 million, to RTÉ, which is approximately 40% of the overall gross expenditure. He is here to account for the spend of money and expenditure from the Department. I am asking a question on what specifically that €179 million is spent on.
Mr. Mark Griffin:
It is spent by RTÉ, in addition to its commercial revenue, on all of the services that RTÉ provides, including all of the radio services, all of the TV services, the provision of orchestras, the provision of longwave services to the UK, the commissioning of independent productions, the pay of staff in RTÉ-----
David Cullinane (Waterford, Sinn Fein)
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Some of the €179 million goes towards the pay of staff.
David Cullinane (Waterford, Sinn Fein)
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Is Mr. Griffin aware that some of those more highly paid people in RTÉ, and in particular broadcasters, operate a system whereby they create companies and those companies are more often than not named after themselves? We had a similar issue regarding the health sector, where hospital consultants were using a similar system. They can set up a company of which they are directors. They get a salary from the company, so they pay PAYE and payroll taxes on that portion of their salary, but on the remainder they pay corporation tax. It is seen as a way of avoiding income tax. Is Mr. Griffin aware of that practice in RTÉ?
David Cullinane (Waterford, Sinn Fein)
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Mr. McCarthy did a report on the health sector where he looked at hospital consultants.
David Cullinane (Waterford, Sinn Fein)
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There was a similar practice. It is perfectly legal and within the rules. I do not agree with the rules, but these companies can be set up and someone can become a director, and tax on a portion of what is really income is paid at corporation tax rate and the person pays PAYE on whatever is received from the company. There were deductibles and expenses that were not allowable, and there was an issue about this, which meant Revenue recouped approximately €60 million or €70 million. Is that correct?
David Cullinane (Waterford, Sinn Fein)
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Exactly.
David Cullinane (Waterford, Sinn Fein)
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I know, but what I am saying is there was a question mark over the allowability in that area.
David Cullinane (Waterford, Sinn Fein)
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So how do we know-----
Mr. Seamus McCarthy:
It is a matter for Revenue I think, and Revenue, because it perceived there was a particular problem with medical consultants, did an extensive exercise on it. I do not have any information. I do not think it is appropriate to suggest that there may be something wrong with an area if there has not been any evidence produced of that.
David Cullinane (Waterford, Sinn Fein)
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What I am saying is it is for me to decide whether something is appropriate or not in terms of the questions I put. I am not suggesting-----
David Cullinane (Waterford, Sinn Fein)
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I know, but I am not suggesting anything is wrong. I am suggesting we came across a problem in one area, and we know this is a practice in RTÉ. What I am saying is Mr. Griffin is the Accounting Officer, we know there were problems with this operation in other areas, and how do we know the same problem does not exist. It may or may not. In my view, all of these areas should be examined. There is scrutiny, at the moment, of tax avoidance and, in my view, that is what this is. It is legal, but it is a way of avoiding paying income tax. We have a duty to scrutinise what happens in every organisation funded by the taxpayer.
In terms of the €179 million, I would like a greater breakdown of what exactly the money is spent on. We are told in broad terms it is spent on the operations of the company. I would prefer to be able to scrutinise exactly where that €179 million goes and specifically how much is spent on payroll, how much is spent on programmes and how much is spent on administration. Does Mr. Griffin have this information?
David Cullinane (Waterford, Sinn Fein)
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Can we bring RTÉ before the Committee of Public Accounts?
Seán Fleming (Laois, Fianna Fail)
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On that, and I thank the Deputy for asking that question and I will not take from his time, what service level agreement does the Department have in place with RTÉ for the €179.1 million it gave it in 2016?
Seán Fleming (Laois, Fianna Fail)
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I understand all that. Go back to the question.
Seán Fleming (Laois, Fianna Fail)
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No, go back to the question. Mr. Griffin is the Accounting Officer. He wrote a cheque for €179.1 million of Irish taxpayers' money and gave it to a third party, RTÉ, a commercial semi-State body. What service level agreement and contract does he have in place with RTÉ for that €179 million? I am not asking about RTÉ's responsibility, I am asking about Mr. Griffin's responsibility. Does he has a service level agreement in place?
Seán Fleming (Laois, Fianna Fail)
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That is shocking. The biggest item of expenditure of the Department, €179 million, is handed over to RTÉ. We all know RTÉ and we watch it, but Mr. Griffin is telling me he does not even know if he has a service level agreement. I take it if he had one he would know the answer to that.
Seán Fleming (Laois, Fianna Fail)
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No, let us pursue this line.
Seán Fleming (Laois, Fianna Fail)
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Does Mr. Griffin think he should have a service level agreement in place? He is handing over taxpayers' money. Should he have a service level agreement? If he does not think so we certainly think so. We are here every week of the year when publicly funded Government Departments hand over substantial funds to third parties on the basis of work being carried out. We would expect a public service level agreement to be in place and I am shocked to hear that.
Regarding the Deputy's first question on whether we can bring in RTÉ, I have in front of me on my iPhone RTÉ's summary financial highlights for 2016 from its financial statements. Its commercial revenue in 2016 was €158.2 million and licence fee revenue was €179.1 million, giving a total income of €337.3 million. The majority of RTÉ's income comes directly through the Department so it is unusual. Up to now, we have always taken the view that commercial semi-State bodies, such as ESB and others, have a large amount of commercial revenue, but it is clear to me that the majority of RTÉ's funding comes directly from the Department.
An organisation that gets the majority of its funding through the Vote of the Department should be answerable to this. Since the Department of Communications, Climate Action and Environment has no service level agreement in place, I think RTÉ might have to answer to us because it has not provided a service level agreement to date. The 2016 figures are in line with 2015. This is an organisation which is substantially funded directly through Mr. Griffin's Department.
David Cullinane (Waterford, Sinn Fein)
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Could I just add-----
Seán Fleming (Laois, Fianna Fail)
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I just wanted to put that in.
David Cullinane (Waterford, Sinn Fein)
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Absolutely. When an Accounting Officer appears before the Committee of Public Accounts to account for gross expenditure, in the normal run of things, we would have a line-by-line breakdown of how that money is spent. There is a gap here where we do not have €179 million of the overall €439 million. Mr. Griffin cannot tell us whether a service level agreement is in place. In broad terms, he tells us that it is just spent on RTÉ and then goes on to tell us how RTÉ spends its money. That does not cut it. We need to come back to this issue. I would like RTÉ to appear before the Committee of Public Accounts if possible. Maybe we should discuss that and come back to it.
Mr. Mark Griffin:
Where there is deemed to be a requirement for a service level agreement, a service level agreement is in place. We have it in place for the digital hub, the EPA, the Loughs Agency, Inland Fisheries Ireland, IFI, and the Sustainable Energy Authority of Ireland, SEAI. The operation of RTÉ is governed by comprehensive legislation, the Broadcasting Act 2009. There are provisions in it for the objectives of RTÉ. It submits a five-year strategic plan to the Department. The code of practice for the governance of State bodies applies to it. The updated 2016 code of practice will be applied to it. The company has an independent regulator. Control mechanisms are in place. The strategy has to be signed off.
David Cullinane (Waterford, Sinn Fein)
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Notwithstanding all that, I assume Mr. Griffin understands that our job is democratic accountability. He is the Accounting Officer to the Committee of Public Accounts. Rather than coming to the Committee of Public Accounts and asking us to Google information and to look back at previous reports, which is what I took from his response, he has a responsibility to account-----
David Cullinane (Waterford, Sinn Fein)
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I refer to the response regarding RTÉ's published accounts. Mr. Griffin has a responsibility to-----
David Cullinane (Waterford, Sinn Fein)
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Mr. Griffin has a responsibility to account for the €179 million-----
David Cullinane (Waterford, Sinn Fein)
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-----that is given from his Department. He signed a cheque to RTÉ. I do not believe that he is in a position today to adequately address that spend. That is my view. Maybe Mr. Griffin can give us a line item and more detail on how that money is spent. Maybe he does have that information. Maybe I am wrong and he might be able to break down for us how that €179 million is spent.
David Cullinane (Waterford, Sinn Fein)
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Following up is not good enough.
David Cullinane (Waterford, Sinn Fein)
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Mr. Griffin is not here to follow up.
David Cullinane (Waterford, Sinn Fein)
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What does follow up mean?
David Cullinane (Waterford, Sinn Fein)
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Why would that information not be at his fingertips now? He is coming into the Committee of Public Accounts to account for €179 million and is telling me that I have to wait until he is gone before I have that breakdown, which puts me at a disadvantage because I cannot then scrutinise how that money is spent. Mr. Griffin is not equipped to answer my questions today on that spend, which is 40% of the overall gross expenditure of his Department and I do not believe that is acceptable. We need to come back to this when the witnesses are finished.
Seán Fleming (Laois, Fianna Fail)
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We might have to.
David Cullinane (Waterford, Sinn Fein)
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I have many other issues to address.
Seán Fleming (Laois, Fianna Fail)
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The Deputy may do so when he speaks again. I have a question for the Comptroller and Auditor General about this. He might not have it at the tip of his fingers since he did not know the question was coming and he might have to give us a note next week. Are there any other Departments where amounts of this scale are handed out without a service level agreement being in place? Everything mentioned has been about the controls in place for RTÉ, its financial accountings, reportings and its regulator. Are there many cases of grants of this scale from Departments being handed out without some level of agreement in place? We have had the third level sector before the committee. The colleges and universities have to submit a programme of what they are doing to draw down grants. It does not interfere with their independence but one cannot just hand out €50 million or €100 million and hope that is the end of it and they do their job.
Mr. Seamus McCarthy:
Off-hand, the big transport companies like CIÉ, Irish Rail and so on spring to mind. There would be similar sized grants, but my understanding and recollection is that there are public service obligation agreements for those. It is probably in the same space as the situation with RTÉ.
Seán Fleming (Laois, Fianna Fail)
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It all follows from Deputy Cullinane's initial question about the taxation arrangements by people who work in RTÉ but who are self-employed contractors. We now know that the majority of those self-employed contracts have been funded directly by departmental funding. That is where it has led us. It would be another issue if it was strictly a commercial matter but we now know that the majority of the funding for those contracts has come from Mr. Griffin's cheque.
Seán Fleming (Laois, Fianna Fail)
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I have just said it. I have just said that €179 million of RTÉ's €337 million annual turnover is from the Department.
Seán Fleming (Laois, Fianna Fail)
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That means a majority of RTÉ's funding comes from the Department.
Seán Fleming (Laois, Fianna Fail)
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I do not think RTÉ produces financial statements separating the use of the €179 million from its commercial revenue. I think it is just one pot. We are entitled to some proportionality. Most of the money went in from the Department. Most of the money that went out, under various headings, is taxpayers' money. Mr. Griffin gets where the sequence led.
Seán Fleming (Laois, Fianna Fail)
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That is an issue. We will move on from the topic but we will have to revert to it. From our point of view as the Committee of Public Accounts, we see a cheque go out for €179 million and we have not seen any audit trail for how it was spent. That is where we are now and we have to discuss how we close that circle in due course.
Seán Fleming (Laois, Fianna Fail)
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We will have to come back to the topic separately. I ask Mr. Griffin to send along any information he can provide to assist us with our query.
Seán Fleming (Laois, Fianna Fail)
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That will be one. Sorry about the delay. I call Deputy MacSharry.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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I welcome the witnesses. On the realignment of the Department, the witnesses started by saying what the Department was involved in when they were previously before the committee. What costs were associated with that realignment?
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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No. How much did administrative restructuring cost?
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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Nothing at all. Nobody moving offices?
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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So there was no cost at all?
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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Is it disruptive and unwieldy from Mr. Griffin's perspective?
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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That is grand. Once the Department writes the cheque to the various agencies it funds, including Inland Fisheries Ireland and RTÉ, does it let them go off to their own devices or is there substantial oversight?
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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Is that signed?
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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I am sorry to stop Mr. Griffin and I know that it is annoying from his perspective, but I only have ten minutes and a good bit to get through. The CEO, for example, seemed to be pursuing a line of selling fisheries, but the Minister of State, Deputy Seán Kyne, has said we are not selling any more. Is the current CEO compliant with that direction from the Minister of State?
Mr. Mark Griffin:
As I understand it, based on independent advice, there was a suggestion or recommendation that hatcheries be rationalised or closed. There has been subsequent discussions with the Department, the Minister and, most importantly, stakeholders. That decision will not now be progressed.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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That is the decision to sell Galway weir, for example.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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I know that there has been no decision.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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Have there been cuts to the predatory element of the budget that is having an impact on fisheries within Inland Fisheries Ireland?
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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It is to reduce the predation of fisheries.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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There are animals that eat fish, other than us.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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They eat the fish before we catch them. It eats into the potential for angling tourism, for example.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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Sure.
Mr. Mark Griffin:
There is a review under way in the case of pike and trout. There are arrangements already in place for managing pike stocks. These arrangements remain in place and no decisions will be taken to put in place any further arrangement until the review has been completed. I expect that will be done.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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Will Mr. Griffin raise with the chief executive officer the matter of cuts to the budget for measures to operate against predation which I have explained? There is anecdotal evidence to suggest it is having a detrimental impact. Is it true that Inland Fisheries Ireland has a guest house in Connemara?
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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Will Mr. Griffin check?
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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If it does have a guest house, he might let us know who runs it, what way it is run, if there was a contract put out to tender for the people who run it, if it is profitable and whether the Comptroller and Auditor General sees the accounts for it. There are two properties listed in the accounts. There is a cost or valuation of €859,000 as of 1 January. The note indicates that the lands and buildings are the GPO and Henry Street arcade in Dublin. Are we valuing them at €859,000?
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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Yes.
Mr. Mark Griffin:
No. There are a number of properties in the ownership of the State that have been leased. An Post occupies the GPO under a 50-year licence arrangement. There are a number of companies sublet to a subsidiary of An Post, Arcade Property Company Limited. If the Deputy is familiar with the GPO arcade, it involves some of the properties there.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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It is rental income. That is fine. It is also indicated on page 11 of the accounts that valuations were not available for properties in Galway - these are fisheries I believe - and on the Inishowen Peninsula in County Donegal. Is that the case? Mr. Griffin can take it as that because I am reading it. Perhaps Mr. McCarthy might comment on it. Is it reasonable to assume the value of the Galway fishery which arguably is the jewel in the crown from an angling perspective and the property on the Inishowen Peninsula are not included in the capital assets as far as the accounts are concerned?
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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Then we do not have a true picture of the scenario.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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These are fixed assets that are quite valuable but which are not reflected in the accounts.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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They are capital assets.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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I know about the €859,000 rental figure. I have moved on.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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We are valuing the GPO-----
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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It is located on O'Connell Street in Dublin but valued at less than €1 million.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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How old? Is it 30 years old?
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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That would not be very good at all. From my basic knowledge of auctioneering, if there is rental income of €200,000 per annum, there would-----
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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One would look perhaps at a purchase figure of ten years of rental income, which would be reasonable, putting it in the region of €2 million.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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It is all very cumbersome. Mr. Griffin will write to somebody in the OPW which will write to the Valuation Office and it will be put out to tender. Knight Frank might value it at €2 million and we will have spent €10,000 to get that valuation. Where is the joined-up thinking and when will we use a little common sense to pull things together? There are two valuable capital assets that belong to the State, but their value is not being reflected in the accounts. It is stated no valuation was available. Do we have to go through the lengthy process I have just mentioned or why will IFI not go to Rooney's in Galway and whoever else in County Donegal to get a valuation? That would lead to us having accurate information for the people.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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Rather than saying "we may very well do" or getting around to it after speaking to the Minister of State, Deputy Seán Kyne, why not just get on and do it?
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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Mr. Griffin is more than welcome.
Mr. Mark Griffin:
The normal course in seeking a valuation of State property is through the OPW and the valuation authority. We have probably reached a point where we have exhausted that process. We will look at going directly to a commercial valuation company to give us updated valuations of the GPO and the other two properties mentioned by the Deputy.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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If the value of that property was €859,000, I would buy it. I would have no problem in banking that deal with rental income of €200,000 per year. If this is replicated throughout the Department, the Comptroller and Auditor General will have no chance to outline an accurate financial position for the State and agencies. I will move on.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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Absolutely. If I was to go to the Revenue Commissioners and say I owned three properties worth approximately €4 million but did not have a valuation and could not give an accurate picture as a result, what would they say? It is one rule for the State and another for the private sector. It is unacceptable, haphazard, shabby and certainly does not reflect the accountancy procedures that should be accruing. The Department does a very good job, although it is under enormous pressure. I do not know how the personnel manage such an unwieldy Department. Off the record, Mr. Griffin might say, "Mark, you are dead right. I do not know how I can manage this because it is such a mess."
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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I know that Secretaries General are not responsible for policy.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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I know Mr. Griffin would.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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Let us just leave it. Eircode's cost is €38 million. Is it true An Post does not use the system?
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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The position has been changed since 1 June as An Post made a statement at the time that it was not involved with its design and although it might use aspects of it, in the initial process, delivery personnel throughout the country did not use it. Has there been a big change since 1 June?
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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Is it a subsidiary?
Mr. Mark Griffin:
It is a subsidiary of An Post. The cost of the ten-year contract is €38 million and we have spent approximately €21 million. If the design of An Post had been geared to deal exclusively with the delivery of mail, we would have made a big mistake. The system was not designed to deal exclusively with the delivery of mail. As there has been a decline of 35% in mail volumes in the past few years, I am glad that is so. We can look at what the product was intended to do. It was to provide a unique address for all properties; 35% of property addresses in the State are non-unique. In that regard, the nearest to us in the OECD is Portugal which is at a figure of 2%. The system was also relevant to the development of e-commerce in reducing the cost of logistics, furthering access to emergency services and reducing the State's input.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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How much money-----
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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I am going to stop Mr. Griffin.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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I am sure there are people using it. Are all State agencies using it?
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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No, in other words.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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That is fine. We might find out the answer to that question. As with climate change, let us start setting targets to get everybody using this and if it is not fit for purpose and it is another €38 million, then so be it. It would be a disaster but if it was the case-----
Mr. Mark Griffin:
I am firmly of the view that it is fit for purpose based on what we have seen over the past number of years in terms of the types of companies that are using it. It is far more useful to logistics companies. It is being used by insurance companies. It is being used by the CSO, as I said, the Property Registration Authority, the OSI and the health boards in terms of the unique health identifier system. We have seen a very significant increase in the level of usage since the last time I was before the committee dealing with this issue. We have 25,500 look-ups-----
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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I am sorry for cutting Mr. Griffin off but before when he was here-----
Seán Fleming (Laois, Fianna Fail)
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The Deputy should be conscious of time.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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The Chairman gave 20 minutes to the previous person so he might be a little bit lenient with me.
Seán Fleming (Laois, Fianna Fail)
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I took four minutes of that time.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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Fine, that is 16 minutes. Mr. Griffin told the Committee of Public Accounts that the more people in Ireland who get broadband the more we will see Eircode being used. It is a bit like "Live horse and you'll get grass",
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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Mr. Griffin told the Committee of Public Accounts before that the more people who get broadband, the more benefit we will see.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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I ask that Mr. Griffin identifies all the State agencies and sets targets for all those people to use Eircode to its maximum capability. As the shining light in this area, I have no doubt the Department will set an example.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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I will move on to shared services. What shared services has the Department availed of?
Mr. Mark Griffin:
There are three that immediately spring to mind. We have payroll shared services like the vast majority of other Government Departments. We have the HR shared services, PeoplePoint. We also have a shared service with the Department of Agriculture, Food and the Marine, which provides IT services to the Department.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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Is there still duplication?
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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Is the Department doing any of that in-house as well?
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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How much is the saving?
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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Yes.
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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That will be important because we would like to be able to have a metric to measure against to see that this thing is working and how much it is saving us. I will move on to the subsidiaries of An Post. We have Air Business, Jordans, One Direct and the Gift Voucher Shop. Are they all wholly owned subsidiaries or is the private sector involved?
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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What about the other two?
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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Could Mr. Griffin check that? Could he check if any current serving staff of An Post, either at senior or junior level, are shareholders in those companies? Are there service level agreements in place for each of them and are they signed?
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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Yes. I am out of time. One thing that has always bothered me is prize bonds. We all probably got presents of them from grannies or granddads over the years. Does anybody win on them?
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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I am sure at the bottom of the small print on some website, this information is available. Will Mr. Griffin outline how much money was won and what part of the country beneficiaries were in over the past year, so we can have peace of mind that there are winners?
Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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No. I do not know whether I have too many but I certainly have not won.
Catherine Murphy (Kildare North, Social Democrats)
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I want to start with the area of landfill and the 70 high risk sites that have been identified. How many of them are in the ownership of local authorities?
Catherine Murphy (Kildare North, Social Democrats)
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Is it the majority of them?
Catherine Murphy (Kildare North, Social Democrats)
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The one that-----
Catherine Murphy (Kildare North, Social Democrats)
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The one Mr. Griffin referred to earlier, Kerdiffstown, was in private ownership and it was a waste mountain. Kildare is not known for mountains. It is a very flat county. This mountain started to grow and grow. There were ongoing complaints about it for years and then it went on fire and cost about €40 million. Mr. Griffin might correct that number. There was a very expensive remediation effort over several years as a consequence of not properly monitoring or regulating and all the rest of it. On those types of legacy sites that are not public sector landfills, particularly the ones that are high risk, what is the prospect of pursuing the original owners for the costs if they have to be remediated by the State? What has been spent on legal issues so far on that?
Mr. Mark Griffin:
The Deputy is probably aware that the company behind the landfill in Kerdiffstown was fined €20 million. That is still payable to the Courts Service but to date it has not been paid. There are prosecutions ongoing with regard to the two principals. In that case, legal proceedings are still in place with a view to the State securing as much of the fine as we are entitled to. Where there are illegal landfills, the Deputy can be assured the State is engaged or will engage in undertaking legal actions where that is required. What we are seeing is that the State has become better at this over the past few years. We have put in place what is known as the waste enforcement regional lead authority. There are three lead authorities in place, more or less aligned with the jurisdiction of the regional waste management planning process. We provide €7.4 million annually to fund a network of 120 enforcement officers. We are seeing the effect of that on the ground.
Catherine Murphy (Kildare North, Social Democrats)
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I have very limited time. I would appreciate that information.
Mr. Mark Griffin:
The quick answer to the Deputy's question is that we are pursuing it jointly with the local authorities, the waste enforcement regional local authorities, the Garda and the Department of Employment Affairs and Social Protection and whatever other agencies need to be involved. They are being deployed in ensuring enforcement action takes place.
Catherine Murphy (Kildare North, Social Democrats)
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Where would the income be shown from those fines? Is it shown as a liability that has not been realised? Is it at Department level or local authority level? What level is it at? Where is it accounted for?
Catherine Murphy (Kildare North, Social Democrats)
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The Courts Service.
Catherine Murphy (Kildare North, Social Democrats)
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I will turn to contingent liabilities on page 15 of the appropriation accounts. This matter has been touched on. It states:
There is potential for financial liabilities to arise in 2017 and subsequent years depending on the outcomes of current, pending and possible future EU and other legal actions. The amounts involved cannot be determined at this point.
Do we have a global cost for the remediation of the high-risk landfills?
Mr. Mark Griffin:
All I can do is cite the historical figures. Since 2006, we have spent €105 million of the Vote and €10 million from the environment fund. It may be impossible to say what the final cost will be until the technical assessments on the sites that are in difficulty have been completed.
Catherine Murphy (Kildare North, Social Democrats)
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When will that be?
Catherine Murphy (Kildare North, Social Democrats)
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Mr. Griffin stated that the liability cannot be determined at this point. It has been included in the accounts as a potential contingent liability and will relate to this year. Has any figure been indicated?
Mr. Mark Griffin:
No. We have spent €17.6 million on Kerdiffstown, for example, but it may take substantial additional millions of euro for that work to be completed. Regarding the other projects on which assessments are to be undertaken this year, we will not have any sense of the scale of the cost until they have been completed.
Catherine Murphy (Kildare North, Social Democrats)
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What is the nature of the potential EU fines?
Mr. Mark Griffin:
The accounts refer to "possible future EU and other legal actions." At any point, there is a potential vulnerability to the State where the European Commission may determine that we have not transposed the directive in time - we are not in that space just yet - or we have not transposed it properly. In other legal cases currently under way before the national courts, damages may arise - we hope not - relating to the State's performance of its functions. We also have judicial review cases on a number of issues. These factors could materialise in future years, but for us to try to put a figure on them would be speculative and inappropriate at this stage.
Catherine Murphy (Kildare North, Social Democrats)
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We will probably have to revert to this broad issue. Mr. Griffin stated that the bulk of the environmental levies came from landfills as opposed to the plastic bag levy.
Catherine Murphy (Kildare North, Social Democrats)
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I understand that the number of landfills operating is four. Is that correct?
Catherine Murphy (Kildare North, Social Democrats)
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Five. Is it the case that incineration is seen as a less expensive option for waste disposal?
Catherine Murphy (Kildare North, Social Democrats)
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The difficulty with that comes when counting the cost. I can see it in practical terms because one of the open landfill sites happens to be in my constituency. There are registrations from every corner of the country, which means that there are other associated costs that are not counted. I am making this point without seeking a response. Those other costs include damage to roads, unsustainability, waste not being dealt with where it is collected, etc. Is the landfill levy producing a less sustainable and more costly result?
Mr. Mark Griffin:
We understand that the cost of road impact and other impacts locally is factored into the company's licence and that there should be some accommodation in that regard. There are five open landfills. The one that the Deputy is most familiar with is Drehid in County Kildare. We also have Ballynagran in County Wicklow, Ballinasloe in east County Galway, Knockharley in County Meath and Powerstown in County Carlow.
Catherine Murphy (Kildare North, Social Democrats)
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Turning back to the various subheads in the appropriation accounts, there was an underspend in 29 of 33 headings. The outturn was less than the provision. Mr. Griffin made the point that we had to walk before we could run, but is there scope within the Department to redirect some of the-----
Catherine Murphy (Kildare North, Social Democrats)
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Why did that not happen?
Catherine Murphy (Kildare North, Social Democrats)
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That some of the 29 saw significantly smaller outturns than their provisions at a point when most public services had been cut to the bone strikes me as an inefficient use of resources. Some of it had to be returned to the Exchequer. Mr. Griffin stated that there were procurement issues, but if there was scope to redirect within the Department, why was it not done to a greater extent?
Mr. Mark Griffin:
For a couple of reasons. We monitor the programmes on an ongoing basis, receive regular reports from finance officers and discuss them with our management board. In the early part of the year, the expectation is that progress will be achieved and items set out in programmes will be delivered. It is only in the latter part of the year that there is final clarity around the level of activity and, therefore, the level of spend that is available to us.
There is little point in reallocating money in September because, for example, those programmes that may have capacity are not in a position at that stage to go through a tendering process to secure the additional services that we would propose to fund. We perform a reallocation in the middle of the year. It will become apparent in the third quarter of the year where we are likely to end up in terms of the level of underspend. I have set out what happened in respect of landfill remediation, but I could go through each subhead and give an explanation of what happened.
I will make two further points. We are in a position to carry over up to 10% of our capital provision to the following year. That happens. I would be more comfortable with money returning to the Exchequer to other worthy causes, be it in the year in question or in subsequent years, rather than it being spent inappropriately.
Catherine Murphy (Kildare North, Social Democrats)
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I am certainly not looking for inappropriate spending-----
Catherine Murphy (Kildare North, Social Democrats)
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-----or for money to be wasted, but there seems to be a low level of ambition.
Mr. Mark Griffin:
There have been increases in some programmes in recent years. In terms of energy efficiency, we will have more or less doubled between 2016 and 2018. Doing that is great, but it also requires the agencies to be in a position to gear up. The Sustainable Energy Authority of Ireland, SEAI, had to take on additional staff, which meant that it needed to recruit and procure external advisers to support some of the services that it-----
Catherine Murphy (Kildare North, Social Democrats)
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I am tied to time. Representatives from the Department of Finance appeared before us approximately one month ago and the issue of potential fines relating to climate change arose.
I asked about the penalty for not reaching our targets.
Seán Fleming (Laois, Fianna Fail)
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Will the Deputy ask her final question. She will have a second opportunity to put questions.
Catherine Murphy (Kildare North, Social Democrats)
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I asked about the level of the likely fines and was told that the annual fine from 2021 onwards would be €600 million, which is a significant amount of money. We are on the wrong trajectory to 2030, never mind to 2020 because we will have missed the targets to that year. We are facing a significant fine each year from 2021. In that context, what strikes me, given that there was still flexibility in the Department of Communications, Climate Action and Environment, is the level of ambition to make sure we will not end up paying these fines.
Mr. Mark Griffin:
First, I do not accept the figure of €600 million which I know came from the report of the Committee on Budgetary Oversight prior to the Estimates. We had a target to achieve a reduction of 20% in emissions by 2020. That was one of the highest targets in the European Union when it was established in 2009. The simple fact is that we had a decade of lost investment. We wanted to do certain things, whether it be renewable energy or energy efficiency projects, that we simply were not able to do because the money was not available. That is the context in which we have to discuss the issue. Based on the most recent estimates which the CPA will update in April 2018, we will hit a figure between 4% and 6% of the 20% target. That leaves quite a distance to reach the target. There are mechanisms in the European Union which allow us to buy carbon credits at a price. However, we do not know the price or the quantum of credits we will need to buy.
There is an acknowledgement by the European Commission of the "lack of realism" - I cannot come up with a better way to describe it at this stage - in the target set for Ireland in 2009. It was reflected in the approach the Commission had decided to take in setting the starting point for member states in progressing towards the 2030 target, average emissions between 2016 and 2018. In the Department we are working to assess the various scenarios in terms of the potential cost to the Exchequer, if we must pay. I would not use the term "fines" because that would require the Commission to issue infringement proceedings against a member state. There are statistical transfer mechanisms in place which will allow us buy allowances. We have acquired allowances in the past few years that will be offset any cost that will arise.
I covered the level of ambition in the Department. I only focused on the Department, but one would also need to look at the Departments of Transport, Tourism and Sport and Housing, Planning and Local Government in terms of the work being done on the built environment and the housing stock. There is a high level of ambition, determination and political commitment across the system of government to do more in this area.
Shane Cassells (Meath West, Fianna Fail)
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My apologies for being absent earlier, but I was attending another committee meeting on the issue of local government funding at which I was fighting to obtain more money for county councils.
I welcome Mr. Griffin and thank him for providing a copy of the presentation ahead of the meeting. I will begin by referring to RTÉ, although the issue was discussed earlier.
Many like to bash the State broadcaster. On various discussion programmes one will hear contributors refer to the headline figures for presenters' pay and so forth. That seems to be the popular thing to do, but I do not subscribe to it at all. If we value the national broadcaster, we need to foster it at a time when the traditional media are under immense attack. As politicians, we should be conscious that this issue goes to the very heart of our democracy. In a functioning democracy an integral element is a functioning independent journalistic system. To use a phrase that has made its way into the dictionary, thanks to the man in the office in America, we now live in the age of fake news. We should, therefore, value and foster the traditional media outlets at a time when they are coming under increasing attack. Do we value high quality journalism? Do we value the special "Prime Time" report last week, about which Members spoke this week? It takes investment to commission such a report from respected journalists. When people castigate RTÉ for not being successful in bidding for major international sports events, they forget that it is competing on a global scale and that takes money. When we look at the Comptroller and Auditor General's assessment of the Appropriation Accounts, it comes down to factors such as the television licence fee evasion rate and the intense digital competition. I fear for the State broadcasting service. RTÉ has had to make staff cuts this year. It has sold land to try to tide itself over, but this can be done only once. Does the Secretary General share my fear for RTÉ because of the pressures it is operating under? I know that there was a discussion earlier about service level agreements and so forth, but RTÉ's public service obligations are immense and it must cover items that are not mainstream. We should try to bring balance to our discussion. Has the Secretary General undertaken an analysis of things that could be done to help the State broadcaster?
Mr. Mark Griffin:
I am glad that the Deputy raised that issue, as I unequivocally share his concerns. There has been a reduction in the TV licence fee income and commercial revenues in the past few years. Since 2008 RTÉ is down €85 million in commercial revenues. This is having a real and direct effect. If one looks at the capacity of RTÉ to invest in independent productions, in 2007, when the economy was its peak, it was spending €79 million in that sector. In 2016 it spent €40 million. The inability to invest in the sector is costing jobs across the State. In fact, it is affecting the quality of what viewers see on RTÉ, the ability of the company to produce high quality output and media content. In the Department we have a real concern about the future funding of the company. If I was to be brutally honest, I would say the TV licence fee model was broken and I am not sure whether it can be fixed. The level of evasion is 14.6% and we are losing €40 million per annum. That affects not only RTÉ but also the broadcasting fund, from which good works, both audio and audio-visual, are commissioned. There has been a major reduction in the capacity of the fund to deliver such programmes.
The Minister has asked the Oireachtas joint committee to look at the funding of public sector broadcasting and it has done a body of work in the past few months. We expect to see its report in the next few weeks. The Minister will bring it to the Government with proposals as to how the issue can be dealt it. We need to take a serious look at how we approach the funding of public sector broadcasting.
Shane Cassells (Meath West, Fianna Fail)
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The Secretary General has stated the TV licence fee model to fund broadcasting is broken. The figures back that up. The licence fee has remained the same at €160 since 2008. Population and household numbers have risen, but RTÉ's TV licence fee income has fallen by more than 10%.
Along with that, the figure for uncollected tax on TV sets exceeds RTÉ's annual losses. Mr. Colm McCarthy produced a piece on this earlier in the year in which he used similar language in speaking about the "broken" model, saying it was not fit for purpose, given the proliferation of media on which one could access content. What are the potential replacement models? A doubling of the licence fee has been looked at, but commercial revenue has also dropped this year and which has been attributed to the impact of Brexit. I have been talking to advertising executives and believe viewing patterns are also changing. People go home in the evening and watch Netflix. They are not even watching mainstream media. Advertising executives realise that their spot at 9.15 p.m., during the break in the RTÉ news programme, is not as valuable as it once was. As a consequence, they are going to lower the amount they spend and it becomes a race to the bottom. The commercial side could also end up being banjaxed.
Shane Cassells (Meath West, Fianna Fail)
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How are we going to fix this? We should be protecting the national broadcaster, but how can we do that if the commercial side is in trouble and the traditional licence fee model is broken?
Mr. Mark Griffin:
My two kids are aged 19 and 23 years and very well educated, but I cannot remember the last time I saw them sit down to watch television. They access content online and use YouTube, Netflix, etc. Their generation is moving away from the linear model. People are more interested in television stations making decisions for them when they are 35 years old and have a home, a couple of kids and a job and do not want to make decisions themselves. With opt-out channels such as Sky, Channel 4 and Dave Ja Vu, a lot of advertising is beamed from the United Kingdom and there is a hit to the State of €50 million in the loss of advertising revenue. Through the revision of the audiovisual media service directive we are looking at introducing a levy on that advertising.
Shane Cassells (Meath West, Fianna Fail)
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How would it work?
Mr. Mark Griffin:
These channels substitute Irish advertisements for their UK advertisements and their overheads are much lower as a result. There is a hit of €50 million in an overall advertising market that is worth between €200 million and €235 million. There was an increase of 30% in online advertising in 2015 and 2016 and revenues from online advertising in Ireland increased from €100 million to €445 million between 2010 and 2016, which reflects a huge change in the trend. If people are moving away from consuming linear broadcasting, is it credible to talk about a TV licence? People now access TV in very different ways. A number of years back we debated a broadcasting charge. Is this a space about which we need to start thinking again? The then Minister, Alex White, said he was not prepared to proceed with it until he had built a case and got the public to understand it. The work done by the joint committee and the roadshows held will help, but I hope the committee will now come forward with firm proposals.
There is also a big debate on retransmission fees. The Deputy may have read about the spat on this issue between ITV and Virgin Media in the United Kingdom. At the committee we discussed whether the broadcaster should be in a position to simply negotiate with the likes of Sky and Virgin Media. There is a potential revenue stream there, but there is major resistance from these companies. Nevertheless, we hope the committee will come forward with recommendations for us in this area in the coming weeks. I hope we can bring them back to the Oireachtas and the Government.
Shane Cassells (Meath West, Fianna Fail)
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I hope the conversations will take place because otherwise we will have a dead product. We will enter the space of American TV where commercially-owned channels can dictate editorial policy. I do not want to live in a world where I will have to watch the Irish version of Fox News to get my information. We either value journalists or we do not. We must wake up to the reality of what it takes to fund a national broadcaster and defend it.
Shane Cassells (Meath West, Fianna Fail)
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What is Mr. Griffin's view on the provision of support for other media, particularly print media? My party's spokesperson, Deputy Timmy Dooley, is looking at that issue. It is an industry that has equally been crucified. Some titles are selling only 60% of what they sold 15 years ago. Again, we have to ask if we value independent media, including print media. I am still a card-carrying member of the NUJ. They also need to be protected. I wonder what role the Department could play in that regard. It deals purely with broadcasting, but has it looked at this issue?
Mr. Mark Griffin:
We have not looked at this specific issue as our remit is purely on the broadcasting side. We have a role in regard to media mergers. As the circulation levels of regional papers have declined substantially, there is a need for further investment. Whether that is by way of mergers or other investment devices we do not know, but I do not wish to comment on the issue as it is not our responsibility.
Shane Cassells (Meath West, Fianna Fail)
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Deputy Timmy Dooley wants to bring forward proposals in this area.
My next question is on land remediation and landfill sites. I spent a long time on a county council and wonder if the Department has looked at the potential exposure in this regard. In my county an illegal dump has recently been discovered in Timoole in Rathfeigh and the bill for 70,000 tonnes of waste, including 30,000 tonnes of contaminated soil, comes in at €6 million. There was also a high profile case in County Donegal during the summer. How can we resource councils in order that they can nip this in the bud before having to spend such sums?
Mr. Mark Griffin:
We are making progress in Timoole and expect a contractor to be on site imminently, if it is not already the case. We have become a little more sophisticated in our enforcement processes in the past few years and the regionalisation of waste management functions has helped. We have designated waste enforcement regional lead authorities and committed €7.4 million last year and this year, with a similar amount next year, for 120 local authority waste enforcement officers who work closely with the regional authorities to prioritise enforcement action. We work very closely with the Garda, the EPA and other statutory authorities such as the Department of Employment Affairs and Social Protection. The fruits of that labour could be seen in what happened in the recent case in County Donegal and we expect more such concerted action in the future. When we find legacy landfills sites, we will continue to pursue people to recoup some of the costs incurred.
Shane Cassells (Meath West, Fianna Fail)
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What is the role of the Department in respect of the emergency call answering service? In my home town of Navan the 999 service contract was awarded to BT Ireland, but BT Ireland has continuously outsourced the service. There were protests outside the centre last year because of the company's refusal to engage with the CWU. It is causing a lot of angst.
Mr. Mark Griffin:
The new contract is to be awarded. BT is the preferred bidder, but the final contract pieces have yet to be put in place. That will happen very quickly. It outsourced, under the previous contract, a conduit. I know that there is a process under way that started at the WRC and is now before the Labour Court which is to reconvene-----
Shane Cassells (Meath West, Fianna Fail)
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It does not respect the WRC.
Seán Fleming (Laois, Fianna Fail)
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We are not finished yet.
Mr. Mark Griffin:
I do not know if the Chairman has particular questions, but may I refer to one issue? I am not happy with the reply I gave to the Chairman and Deputy David Cullinane about RTÉ. I will provide a more comprehensive, written reply on the provisions in the various codes of practice and governance and so on. Under the new 2016 code of practice we will have an oversight agreement in place with RTÉ by the end of the year. As I have to revert to the committee on a number of issues, I will revert to it on this matter when doing so and deal with it comprehensively.
Seán Fleming (Laois, Fianna Fail)
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We will now suspend the sitting as there is a vote in the Dáil Chamber.
Seán Fleming (Laois, Fianna Fail)
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There is a vote in the Dáil Chamber. I do not know how long it will take, but it will be followed by lunch.
Catherine Connolly (Galway West, Independent)
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I want to follow up on the matter of broadband provision. Mr. Griffin explained the position on the national broadband plan. Will he give us the dates once again? I have a specific example in mind which has general implications. It concerns an address in Connemara. There are blue spots where there is broadband. There is, however, a house right beside a blue spot which does not have broadband. We have written many times about the matter and been told that is not commercially viable to provide broadband in this house, although a service is availble in the house beside it. Having made further inquiries, we have been told by the broadband liaison officer that the house will come under the new national broadband plan. Will Mr. Griffin clarify the matter?
Mr. Mark Griffin:
This is an example where good news becomes very frustrating for people. I suspect that the house in Connemara to which the has Deputy referred is one that will be provided with a service as part of the eir 300,000 initiative agreed to in April. A service will be provided for close to 20,000 houses in Galway under that arrangement. The house beside it falls to be dealt with as part of the State's broadband intervention. We expect it to be put out to tender very early in 2018, to award the tender during the year and then commence its roll-out. I cannot give the Deputy a date for when the person in Connemara who is 100 m from the other individual will have their connection, but it will be within three years of the date on which the project commences. A prioritisation scheme will be put in place, but I cannot give a date. I can only say it will form part of the State's intervention programme.
Catherine Connolly (Galway West, Independent)
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The man in question runs a business. I understand Mr. Griffin cannot give me a date, although he says it will be three years from now. What is the explanation for it not being commercially viable to provide a service for him?
Catherine Connolly (Galway West, Independent)
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The two houses are as close as I am to Mr. Griffin.
Catherine Connolly (Galway West, Independent)
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It is because of the specifics of the case.
Catherine Connolly (Galway West, Independent)
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Mr. Griffin is saying it could be three years before a broadband connection is supplied.
Catherine Connolly (Galway West, Independent)
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Therefore, the State's role is funding a private company?
Catherine Connolly (Galway West, Independent)
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The Department is in the middle of a complex procurement process to secure a private company, or might it secure more than one company?
Catherine Connolly (Galway West, Independent)
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Where does that fit in with what is already in place? Is Mr. Griffin referring to the metropolitan area network, MAN?
Catherine Connolly (Galway West, Independent)
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I am not; it is set out somewhere in the documentation that the Department provided for the committee.
Catherine Connolly (Galway West, Independent)
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It works in parallel with the scheme to which Mr. Griffin referred.
Catherine Connolly (Galway West, Independent)
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The two systems will work together, or, in fact, there will be three systems. There will be the metropolitan area network, the national broadband plan and the private operators.
Catherine Connolly (Galway West, Independent)
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I will return to Mr. Griffin on the matter.
On the underspend, there is considerable urgency attached to the matter of tackling climate change. I will not start to quote figures as Mr. Griffin is familiar with them. It is our greatest challenge; everything else pales in comparison. We will not be crawling or walking if we do not face up to the issue of climate change. How, therefore, could there have been an underspend, particularly when the Department is rolling out such wonderful initiatives? Will Mr. Griffin elaborate on the matter of sustainable energy communities? It is a wonderful idea which is mentioned on page 39 of the Department's annual report.
Mr. Mark Griffin:
I will make a note of that and cover the matter of the underspend. The Department has a number of schemes within the energy efficiency programme.
The members will be familiar with several of these, such as the grant scheme, better energy warmer homes, and the better energy community schemes. We provide capital grants to support energy efficiency upgrades proposed by communities. That could be a community hall, a number of homes or other buildings within the community. Second, the community scheme itself is grant funding that is provided to sustainable energy communities, to allow them gear up and put together with advice from the SEAI appropriate packages of measures that they can put forward. That is an area we have put in-----
Catherine Connolly (Galway West, Independent)
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To take that example, if we take parts of Galway such as Knocknacarra, Salthill and Claddagh, where I am, what are the positive implications for the people of those areas under sustainable energy communities? I have read it; it looks wonderful, but what does it mean?
Catherine Connolly (Galway West, Independent)
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Is that €16 million?
Mr. Mark Griffin:
Yes. It is open to a group of people within a community to come together with a plan, for example, to improve the energy efficiency of the local hall or community centre or of a number of homes that are particularly vulnerable within the community. There is a separate provision of €0.5 million which is based on providing the necessary expertise to the people in the area to come together and develop a programme which could then be put forward for grant aid from the SEAI.
Catherine Connolly (Galway West, Independent)
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It is not extending to wind farms or other energy-----
Catherine Connolly (Galway West, Independent)
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Would that be the ambition, that the community would benefit?
Mr. Mark Griffin:
We are bringing forward a further renewable energy support, RES, scheme which is geared at assisting us towards meeting our 2030 targets on the renewable energy front. What we will be providing for in that is a facility for communities to come together and involve themselves as part of that development, take a shareholding in the wind farm development and that particular part is under development at the moment. We have a RES scheme that we expect to be in a position to launch in the first part of next year. A significant part of that will involve community involvement in the schemes themselves, whether they are development led or whether it is communities coming together. For example, in the Tipperary energy scheme they were putting forward a project themselves. We will have to look at a mechanism to fund that as well.
Catherine Connolly (Galway West, Independent)
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Mr. Griffin was going to come back to the issue of the underspend.
Catherine Connolly (Galway West, Independent)
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Yes.
Mr. Mark Griffin:
There was an underspend of about €3 million on the energy efficiency programmes themselves. Probably the biggest underspend was on the demand-led scheme, which is the Better Energy Homes scheme where we are relying on people to come forward to us and make proposals or seek grant funding from the SEAI. That did not arise to the same extent that we had predicted but, overall, relative to the provision in 2016, the underspend is modest enough. I mentioned earlier that one of the issues for us is that when we get additional funding, we have to ensure that the SEAI is fully geared up in terms of staffing and external advice to support delivery of the schemes. There was some work to be done on that in 2016 because there was such a big jump in the capital provision between 2015 and 2016 but the SEAI is well geared up now. We have a very detailed and frequent engagement with the SEAI-----
Catherine Connolly (Galway West, Independent)
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Would Mr. Griffin expect there to be no underspend this time next year?
Catherine Connolly (Galway West, Independent)
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On the same note, the energy research programmes had a huge underspend. The note says that the renewable heat incentive, RHI, programme was not initiated in 2016 due to delays in finalising a detailed consultancy report. Why was there a delay and why was there a need for a detailed consultancy report? This is an energy research programme.
Mr. Mark Griffin:
On the RHI, I guess we approached that with a significant degree of caution having regard to what happened in Northern Ireland. We need to learn lessons in respect of how we roll out an RHI programme to make sure that the sort of cost overruns that have occurred and the potential very significant cost overruns that are likely to occur in the future will not happen in our scheme. Part of the consultancy was to look at the controls that need to be put in place to protect the State and its investment, at both scheme and project levels, and to make sure that for any windfall gain, for example, through a reduction in the price of biomass, there would be some clawback mechanism.
In respect of the others-----
Catherine Connolly (Galway West, Independent)
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Is that scheme in place now in 2017?
Catherine Connolly (Galway West, Independent)
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It missed this year completely.
Mr. Mark Griffin:
We have finalised all the analysis now and are going to Government shortly to get the final sign-off on it. We have been working very closely with the Commission in respect of state aid approval and we have to get a final sign-off with them on that. It will be fully operational in 2018 with a provision of about €10 million, I think.
On the other parts, there was a €900,000 underspend on an INTERREG programme that did not proceed. There was an underspend on the international energy research programme because again that is a demand-led scheme and it is difficult to predict what the level of demand will be in any given year. The reassuring thing in respect of ocean energy is that we are investing and continuing to invest. Some of the projects we are seeing coming through the prototype development fund in terms of creativity, cutting edge and initiative are very impressive and, in fact, it might be no harm in writing to the committee to include a copy of the most recent report they have done from the prototype development fund. I think people will really be bowled over by the calibre of the work that is being done.
David Cullinane (Waterford, Sinn Fein)
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I just had a quick look at the environment fund. I thank the secretariat for supplying us with that.
Seán Fleming (Laois, Fianna Fail)
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What year is that for?
David Cullinane (Waterford, Sinn Fein)
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It is for 2015. We do not have the 2016 one. I have a quick question on one element. In 2014, there was €100,048 for nuclear safety. There was no provision in 2015. What was that spent on? It is on page 6.
David Cullinane (Waterford, Sinn Fein)
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Mr. Griffin might send us a note on that. I am assuming, then, that there was no money spent in 2016 on nuclear safety. That was a one-off report. If there was money spent in 2016, Mr. Griffin might give us a note on that as well. I am assuming from what Mr. Griffin is saying that it was a one-off spend on a report on the potential of a leak, accident or something at Sellafield.
David Cullinane (Waterford, Sinn Fein)
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Okay. I have a number of issues. I will be as quick as I can. The first is in respect of Eircode, which is under Mr. Griffin's Department.
David Cullinane (Waterford, Sinn Fein)
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How much was spent on Eircode? How much did it cost the taxpayer?
David Cullinane (Waterford, Sinn Fein)
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What is the expected cost? Is it a ten-year contract?
David Cullinane (Waterford, Sinn Fein)
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What is the expected cost?
David Cullinane (Waterford, Sinn Fein)
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Have we got value for money at €38 million? Is the Eircode system working to the satisfaction of the Department?
Mr. Mark Griffin:
I have seen considerable progress in the two years since it was introduced. On the previous occasion on which I was before the committee, we discussed the introduction of postcodes in other jurisdictions. It can take many years for the effects to be seen.
I briefly outlined to Deputy MacSharry some of the things that we are starting to see in terms of take-up. The postcode system is being used by the HSE National Ambulance Service very effectively. The Central Statistics Office is using the system for its residential property price index. The National Transport Authority has included the system in its journey planner. It may be of interest to Deputy Cullinane to note that Waterford City & County Council has incorporated Eircode into the online customer management system. The HSE has incorporated it into its primary care reimbursement service and patient care administration system. We are seeing several large logistics companies using it, including CityPOST, DHL and Niteline. The Property Registration Authority is using the system, as is Ordnance Survey Ireland. We have statistics available to suggest that 7,500 active courier delivery drivers used the Eircode app during October. That app has been used 600,000 times since its launch in May 2016. We are seeing the system used far more in retail and e-commerce. A recent Government decision held that all public authorities that are upgrading systems in which there is an address field are to use Eircode. I will add to what I said earlier about the National Ambulance Service. The service is upgrading its fleet. The new fleet will have satnav included and Eircode will be built into the technology.
I am satisfied that we have made considerable progress. Some 800 private sector companies are using Eircode. They operate in the sectors I have mentioned and there are others in the insurance and financial services sectors as well.
David Cullinane (Waterford, Sinn Fein)
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What I am hearing is that there is considerable public sector usage but perhaps not as much private sector usage. Clearly, Mr. Griffin has considerable detail before him. It might be no harm to give the committee some follow-up detail.
David Cullinane (Waterford, Sinn Fein)
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I might put some questions - as part of the follow-up - in respect of some information I might want. How does the Department carry out analysis of how successful Eircode has been in terms of usage, who is using it and how are they using it? Are global positioning system companies integrating Eircode? How many have integrated it or are planning to integrate it? How many addresses are in the State? Are they all now linked? Do they all now have an Eircode postcode? How many businesses use Eircode as part of their daily work? I am keen to get that type of information if possible.
Mr. Mark Griffin:
I can provide that separately, but we get information directly and through Capita. All of the addresses in the State have been allocated an Eircode postcode. In the case of new builds, it takes until the following quarter from the completion of the premises for the postcode to be allocated.
David Cullinane (Waterford, Sinn Fein)
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Is Capita the company with the contract?
David Cullinane (Waterford, Sinn Fein)
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That leads me on to my next question, which relates to the emergency call-answering service. This is now linked. There is considerable outsourcing in the public sector at the moment. Does the Department recognise the industrial relations machinery of the State?
David Cullinane (Waterford, Sinn Fein)
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Many of these companies, including Capita and the company operating the emergency call-answering service, do not recognise the industrial relations machinery of the State. They refuse to attend Workplace Relations Commission, WRC, and Labour Court hearings. When the Department enters into contracts with these organisations, why are there no obligations on them to at least recognise the industrial relations mechanisms of the State? I would have thought that should be a basic obligation. If a company is being asked to do a job on behalf of the State and is getting taxpayers' money, I would at least have expected that it should have to comply with industrial relations law and abide by and participate in the industrial relations machinery of the State. The first point related to Capita. Is Mr. Griffin aware that Capita has, in several instances, not engaged with the industrial relations architecture of the State?
Mr. Mark Griffin:
In respect of Capita, the answer is "No". Deputy Cullinane raised a second point relating to the emergency call-answering service call centre. I am familiar with the issue because of an industrial dispute last year that affected the Navan call centre in particular. The information I have suggests that Conduit attended the WRC with the workers during 2016. It was not possible to resolve the issues at the WRC and the matter was referred to the Labour Court. The Labour Court has examined the matter on several occasions. I understand the Labour Court has invited the parties back on 12 December to address the matter further.
David Cullinane (Waterford, Sinn Fein)
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What was the background to outsourcing the emergency call-answering service? Why was it outsourced in the first instance?
Mr. Mark Griffin:
The emergency call-answering service initially would have been operated by Eircom in what was effectively a monopoly position. That is going back several years. I understand a decision was taken in 2007. I am unsure whether it was forced upon us, taken by design or voluntarily. In any event, the decision was to tender for the provision of an emergency call-answering service. There was an open tender at that stage. The contract was won by BT, which was appointed in 2009 or 2010. The company has run the service effectively in recent years. We can see this by reference to our statistics relative to other member states - we perform exceptionally well.
David Cullinane (Waterford, Sinn Fein)
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What is the term of the contract and what is its value?
David Cullinane (Waterford, Sinn Fein)
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Do any colleagues of Mr. Griffin who are present have the costs?
David Cullinane (Waterford, Sinn Fein)
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Can we have a breakdown of the current cost and the cost prior to outsourcing?
David Cullinane (Waterford, Sinn Fein)
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I wish to return to the point about attaching conditionality to contracts. I am unsure whether there are any guidelines from the Department of Public Expenditure and Reform on the matter or how it plays out. If there is no stipulation or requirement that the companies in question should at least engage with the industrial relations machinery, then I imagine the Department would have no difficulty with the principle. Is that correct? If we are going to pay a company to do a job under a public contract, it should engage with the WRC and the Labour Court. Does Mr. Griffin agree with that as a principle?
Mr. Mark Griffin:
There are things that we are entitled to include in procurement tender documentation in respect of compliance with employment law. Obviously, that would be included. Whether the documentation specifically states that there is an obligation on the party that is successful in the tender process to engage with the industrial relations machinery of the State, I cannot say. However, we would expect that where there is a difference of opinion between employers and employees, the facilitates of the State, by way of the WRC or the Labour Court, should be available, as in the case of Conduit. Again, I will come back on that.
David Cullinane (Waterford, Sinn Fein)
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Let us suppose this was done directly by the State, whatever arm of the State, for example, the Department. Then that arm of the State would recognise the Labour Court and WRC. Is that correct?
David Cullinane (Waterford, Sinn Fein)
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As Mr. Griffin knows, there is more and more outsourcing happening in the public sector.
David Cullinane (Waterford, Sinn Fein)
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If it is a case that more and more we have contracts outsourced-----
David Cullinane (Waterford, Sinn Fein)
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-----and that is not happening then one can see that there could be a potential problem.
David Cullinane (Waterford, Sinn Fein)
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If the Department cannot then that means we might have to change legislation, which is a matter for policymakers. Maybe it is something that we need to check out. Does Mr. McCarthy know?
Mr. Seamus McCarthy:
There certainly would be conditionality involved in public procurement, particularly around tax compliance but also, I think, in many contracts, an obligation to comply with health and safety legislation. I am not sure what the requirements would be in relation to employment law.
David Cullinane (Waterford, Sinn Fein)
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I thank the Comptroller and Auditor General and the Secretary General.
Seán Fleming (Laois, Fianna Fail)
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I shall ask a few questions before we finish. In terms of broadband, who are the Department's commercial advisers in terms of this contract?
Seán Fleming (Laois, Fianna Fail)
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Who is the lead commercial adviser?
Seán Fleming (Laois, Fianna Fail)
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Does it bring in the others as requested? Are there four separate arrangements?
Seán Fleming (Laois, Fianna Fail)
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Who chairs the group?
Seán Fleming (Laois, Fianna Fail)
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I do not need to know the person at all, personally. Please give me the level of expertise he or she has on broadband and commercial contracts of the scale of this nature.
Mr. Mark Griffin:
There are two people. The programme director would have a huge amount of understanding of the regulatory system because we have him in on secondment from ComReg. So he knows the players in the market, he knows how the market functions and he understands broadband very, very well.
We have a technical director at that level as well who, again, has come in as a permanent civil servant from the private sector, who knows the broadband market from a technical perspective very, very well.
The programme's sponsor would have a lot of experience in dealing with largescale projects in the Department over an extended period of time. So he would bring that experience of project management in dealing with external stakeholders and dealing with complex procurement, regulatory and financial issues from previous projects that he would have been engaged in.
Seán Fleming (Laois, Fianna Fail)
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Is that person a senior Department official?
Seán Fleming (Laois, Fianna Fail)
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An assistant secretary.
Seán Fleming (Laois, Fianna Fail)
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I want to tease out the following matter. The Secretary General has said that a 1,500 page contract was drawn up in 2015.
Seán Fleming (Laois, Fianna Fail)
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I think the Secretary General said that.
Seán Fleming (Laois, Fianna Fail)
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Since 2015. The Secretary General has said that he hopes to be in a position to sign a contract early 2018.
Seán Fleming (Laois, Fianna Fail)
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Or sometime in 2018.
Seán Fleming (Laois, Fianna Fail)
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Late 2018. So the three year period only starts at the end of 2018.
Seán Fleming (Laois, Fianna Fail)
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Or the last. We do not know.
Catherine Connolly (Galway West, Independent)
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My query was not specifically about one person.
Seán Fleming (Laois, Fianna Fail)
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There is a 1,500 page contract that has gone through various iterations and the Department has four commercial advisers. How much have the four commercial advisers cost to date?
Seán Fleming (Laois, Fianna Fail)
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I want to know the total figure to date.
Seán Fleming (Laois, Fianna Fail)
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Is that an additional €7 million?
Seán Fleming (Laois, Fianna Fail)
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So those four professional firms will get €13 million up until 2017 and that is before we get to the contract being signed towards the end of 2018.
Seán Fleming (Laois, Fianna Fail)
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Towards the end of 2018. Let us say, by the time the contract is signed, the Secretary General has said that €6 million was spent up to 2016.
Seán Fleming (Laois, Fianna Fail)
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Another €7 million will be spent in 2017. How much will be spent by the time the contract is signed, sealed and delivered?
Seán Fleming (Laois, Fianna Fail)
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I understand that. I just asked the cost.
Seán Fleming (Laois, Fianna Fail)
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For what?
Seán Fleming (Laois, Fianna Fail)
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Suppose things had moved as fast as the Department had anticipated and it was awarding the contract this year.
Seán Fleming (Laois, Fianna Fail)
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Does the Secretary General mean that the arrangement with these people was not in place to sign the contract, had it been done on time, this year?
Seán Fleming (Laois, Fianna Fail)
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I do not understand this.
Mr. Mark Griffin:
We had appointed advisers to assist us in doing the work around the cost benefit analysis, to assist us in the mapping process, to scope out the technical nature of the scheme and to assist us in the preparation of contract documentation. That contract was time limited and we could not have it open ended. So, it is likely that we will go back to the market in Quarter 1 2018 to procure advisers. It may well be some combination of what we had there or may be new advisers.
Seán Fleming (Laois, Fianna Fail)
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Is the Secretary General telling me that we spent €6 million in 2016, €7 million in 2017 but by the time we get to 2018 it is possible none of these people, who will have received €13 million to advise on this contract, will be around and the Department will be starting with a new contract?
Seán Fleming (Laois, Fianna Fail)
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Now the Secretary General will understand my original question inquiring who were the commercial advisers. The Department has not received very good advice if €13 million will be spent on drawing up a 1,500 page contract for national broadband. Plus, the people who will have received the €13 million may not even be in situnext year and the Department will have to re-tender. That €13 million could be down the drain.
Seán Fleming (Laois, Fianna Fail)
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Who owns the work that has been done to date?
Seán Fleming (Laois, Fianna Fail)
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Is it the Department's work?
Seán Fleming (Laois, Fianna Fail)
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It is not their work.
Seán Fleming (Laois, Fianna Fail)
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In other words, the Department will be able to hand over the contract it has at that point to whoever comes in to take it forward.
Seán Fleming (Laois, Fianna Fail)
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Can the Secretary General not see why we are concerned? It could be four different companies picking up the work of some other companies.
Seán Fleming (Laois, Fianna Fail)
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How come the original arrangement was so shortsighted? It did not take us to the end of the process. It just took us for X number of months.
Seán Fleming (Laois, Fianna Fail)
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X refers to 24 months or X number of months.
Seán Fleming (Laois, Fianna Fail)
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Was part of their contract not to advise and assist in completing the contract?
Seán Fleming (Laois, Fianna Fail)
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No. When they were getting the contract was that the intention? Was it intended that the people who did all of the scoping and advised on the tender would assist the Department in signing off the contract with whoever the successful bidder would have been?
Seán Fleming (Laois, Fianna Fail)
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None of us buys that. The Irish Water people said the same to us. That is guff and let us be straight about that now. I know it was said in this House. Irish Water told us its project was the biggest one since rural electrification and every other day we hear statements. I do not mean to be rude but there is more to it than all that.
Seán Fleming (Laois, Fianna Fail)
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Yes. I am saying to my colleagues who say it that they are bluffing. The Secretary General can carry on.
Catherine Connolly (Galway West, Independent)
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It allowed for two contract-----
Seán Fleming (Laois, Fianna Fail)
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What was the first duration?
Seán Fleming (Laois, Fianna Fail)
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The first extension was granted.
Seán Fleming (Laois, Fianna Fail)
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The second extension was granted.
Seán Fleming (Laois, Fianna Fail)
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The second extension will have expired before we get to signing the contract.
That does not sound good.
Seán Fleming (Laois, Fianna Fail)
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I understand that. However, going back to my first question, I do not believe it is any more complex today than when the process started. It indicates there was a lack of appreciation of the complexity in the times involved from day one and this was not envisaged.
Mr. Mark Griffin:
I do not think there was a lack of appreciation. During the course of the dialogue with the companies, matters came up that required further evaluation and analysis by the Department and its advisers. We had to do additional work on the map, which would not have been predicted, by virtue of the fact that Eir decided to roll out broadband to 300,000 premises. That could not have been predicted. Extra elements of complexity were added that prolonged certain parts of the dialogue process.
Seán Fleming (Laois, Fianna Fail)
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After Eir decided to roll out to 300,000 premises, how many bidders were in the field at that stage?
Seán Fleming (Laois, Fianna Fail)
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Has one dropped out?
Seán Fleming (Laois, Fianna Fail)
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Who are the two remaining bidders?
Seán Fleming (Laois, Fianna Fail)
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What happens if one of them drops out? The remaining bidder will have the State over a barrel. Or do we go back to scratch?
Seán Fleming (Laois, Fianna Fail)
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However, Mr. Griffin just said that he did not pre-empt Eir doing what it did with 300,000 premises and it added to the complexity. Now he is not pre-empting Eir doing something else.
Seán Fleming (Laois, Fianna Fail)
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Mr. Griffin should cover all risks.
Mr. Mark Griffin:
Contingency planning is being done in the Department on all aspects of the contract. On the point the Chairman raised, by the time we go back to test the market in 2018 as to who is interested in getting involved in the process, which we will be obliged to do, if it is other bidders, they will have to demonstrate they can pick up where the other crowd left off and drive ahead.
Seán Fleming (Laois, Fianna Fail)
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I understand that. Moving away from those commercial, financial and legal advisers to the contract itself, if by next spring, the Department is down to one bidder, can the Department proceed with the terms that one bidder dictates?
Seán Fleming (Laois, Fianna Fail)
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We are in difficult territory then.
Seán Fleming (Laois, Fianna Fail)
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Is it precarious?
Mr. Mark Griffin:
I would say complex. If we are left with one bidder, it will depend on what terms have been offered, what level of subsidy will it require, what level of service will it provide and how quickly it can roll out its programme. There are a whole lot of conditions stitched into the contract. Then it is a matter for the Government to decide whether it wants to proceed or not.
Seán Fleming (Laois, Fianna Fail)
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The one bidder standing may want to change the contract.
I take it that this would not be the first time major issues like this resulted in only one bidder standing at the end. What would be good practice in the Comptroller and Auditor General's view if one bidder was left in a major contract situation like this?
Mr. Seamus McCarthy:
If one starts with a capital investment appraisal and does an analysis of why and how much one would be willing to spend, one would certainly want to be looking back at the model of what one is trying to procure. One is back to very fundamental questions. At the end of the day, one either decides one is willing to spend what the provider is asking or not. That becomes the fundamental question. It is probably not even a pragmatic solution for the State to get directly involved in providing a service of this nature.
Seán Fleming (Laois, Fianna Fail)
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The Committee of Public Accounts would hate to be here in two years' time looking at the ultimate contract signed with the Department explaining that only one bidder was left standing, referring to the national interest and that the bidder had it over a barrel.
Seán Fleming (Laois, Fianna Fail)
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Is it outside the Department's control how many bidders are left standing?
Seán Fleming (Laois, Fianna Fail)
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What reasons did SIRO give for pulling out?
Seán Fleming (Laois, Fianna Fail)
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Was that because of Eir's roll-out to 300,000 premises?
Seán Fleming (Laois, Fianna Fail)
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Was it because of the nature of what was on offer changed from 900,000 premises?
Seán Fleming (Laois, Fianna Fail)
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One small point which ties in with what Deputy Connolly said, concerns the delivery of the contract. The Department will talk to local enterprise offices, LEOs, and the link person in the local authorities to identify the priorities.
Seán Fleming (Laois, Fianna Fail)
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Will information be available in each local authority and LEO on the areas which will be dealt with in year one, year two and year three?
Mr. Mark Griffin:
That will be there before the roll-out commences. The contract or contractors, using their own technical information and the information provided by regional action groups and the local digital strategies, will agree prioritisation plans. One will be able to click on the map to see one is getting broadband on date X.
Seán Fleming (Laois, Fianna Fail)
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What is the role of the liaison officer in the local authority in this process?
Mr. Mark Griffin:
They have a couple of roles. They are involved in the preparation of local digital strategies, involved in one-stop-shops in the local authorities with the contractors to remove any blockages around planning, development levies or whatever else emerges. They are also there as an access point for the sort of question the Deputy had as to when a person or premises will get broadband, who is active in the area and what sort of options are available.
Catherine Connolly (Galway West, Independent)
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There was no reply to that from the named officer.
Catherine Connolly (Galway West, Independent)
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Yes, but there was no answer. The officer could not give an answer.
Seán Fleming (Laois, Fianna Fail)
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If Mr. Griffin says that one more time, he will be sorry he said it in public.
Seán Fleming (Laois, Fianna Fail)
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I am already compiling my list.
On the environment fund, under which Department does Met Éireann come?
Seán Fleming (Laois, Fianna Fail)
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Why is it not under the Department of Communications, Climate Action and Environment? Under the environment fund, the Department is paying €4 million to international meteorological organisations.
Seán Fleming (Laois, Fianna Fail)
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Why is the Department paying funds to international meteorological bodies?
Seán Fleming (Laois, Fianna Fail)
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I will start off with a general observation about waste and litter. The countryside is a dirtier place now than it was a few years ago. More dumping is happening on the sides of roads with, for example, couches tossed out of the backs of cars. In the environment fund, expenditure on waste prevention and national market development programmes was reduced in 2015 compared with 2014. I also note funding for the national strategy on biodegradable waste was cut from €38,098 in 2014 to €1,845 in 2015.
The Department is going in the wrong direction.
Mr. Mark Griffin:
What the Chairman sees is part of the picture because part of that is funded from the Vote. Waste initiatives are part funded from the Vote and part funded from the environment fund. I will provide the full picture in writing back to the committee because the Chairman raises a valid point. On the face of it, it appears we are doing less on waste when in fact we have done a great deal more on it over the last year.
Seán Fleming (Laois, Fianna Fail)
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I will touch on these points. Under "environmental awareness", the Department had €32,550 for BirdWatch Ireland in 2014 but nothing was contributed to that organisation in 2015. Perhaps, it carried out a survey for the Department in 2014, I do not know, but we have to be concerned about wildlife in the natural amenity. Why did that happen and what is the most recent position in 2016? In fact, the Department probably has the 2017 figures. That leads me on to anti-litter initiatives. The local authority anti-litter awareness grant was reduced significantly in 2015 compared with 2014 based on what is in the fund. I will let the Secretary General come back with a comprehensive answer to that.
Out of all households in the State, how many are using wheelie bins for waste disposal, approximately?
Seán Fleming (Laois, Fianna Fail)
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That is utterly-----
Seán Fleming (Laois, Fianna Fail)
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I am talking about bins for waste collection.
Seán Fleming (Laois, Fianna Fail)
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I do not mind the colour - a bin. I have a blue and a black and my neighbour has a green and a black. A green bin for recycling in one area is a blue bin in my area. It depends on the contractor. My question is very simple. How many houses have a waste collection facility? It is mainly done through the private sector.
Seán Fleming (Laois, Fianna Fail)
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No, that pay for waste collection and recycling. That is the question I am asking. We are dealing with this environment issue. I do not think I have ever sat at a meeting like this without asking this question. Of the approximately 1.6 million houses in the country, how many are paying for waste collection and recycling each week?
Seán Fleming (Laois, Fianna Fail)
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I am very disappointed that the Secretary General does not know and I hope it is in excess of 1 million. However, the cost of waste collection in County Laois is €360 per annum for a wheelie bin. I pay it, but it is bad value for money. It is €1 a day and €7 a week for a person in receipt of social welfare payments. I used to travel through towns years ago and practically every house had a wheelie bin. They are a rarity in some communities now because of the cost. All the talk the Department engages in on waste management and everything it measures relates only to what is collected through the system. I maintain, however, and my own instinct is, that at least 50% of houses are not even being counted or considered because they cannot afford a wheelie bin for recycling or whatever. Every time I ask this question, I am told the private sector has it. I cannot understand how a Department does not have a handle on this issue. I am surprised that nobody knows the number of people who have a bin.
We have spent decades drawing up waste management plans and we continue to talk about the different centres. However, no one talks about the 40%, 50% or 60% of houses that are outside the system. I ask the Secretary General to talk to me about that. What is the Department doing to bring more people into the system? I do not get any sense of it and never have in my life as a public representative. Is it possible for the Department to provide the committee with the number of houses from which each licensed contractor collects? Does it have that? Any time I have asked a local authority, I have been told the information is commercially sensitive but the Department cannot do its job unless it knows the answer. It cannot know what its job is in relation to waste management unless it has this information. I hope the Department can provide it. It is probably not possible to provide the information by local authority area because of contracts. AES in the midlands covers a variety of areas. What can the Department do?
Seán Fleming (Laois, Fianna Fail)
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The number of households should be uppermost in people's minds when we talk about waste management. By his own admission, the Secretary General tells me at least 600,000 houses are outside the system, if it is 1 million. That is an awful admission but the Department does not seem to know about it or have any information. I am being a bit difficult on this because I do not believe the Department and local authorities and everyone else involved. It is a commercial business and the money is taken from those who are willing to pay. Those who do not pay do not exist as far as waste collection statistics are concerned. Does the Secretary General understand?
Seán Fleming (Laois, Fianna Fail)
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Everything we get from the Department is only 50% of the truth because it is only covering 50% of the houses. The Secretary General can understand-----
Seán Fleming (Laois, Fianna Fail)
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Which is 50%. The Secretary General gets the point.
Seán Fleming (Laois, Fianna Fail)
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The public system of waste management is fundamentally flawed because I do not believe people at Government level. The fact is that even Mr. Griffin, the Secretary General of the Department, cannot tell me. I am not being personal; I am saying it is endemic in the system not to want to know. The Department does not ask those kinds of questions, it just issues licences and there it goes.
Seán Fleming (Laois, Fianna Fail)
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We would appreciate that but I am expressing a frustration here. The Secretary General can understand that.
Catherine Connolly (Galway West, Independent)
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Galway city had a fantastic service and we knew exactly what the percentages were. It was in public ownership and it went up to 70% recycling on a pilot project. We knew exactly what was being collected.
Seán Fleming (Laois, Fianna Fail)
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Galway is a good example.
Catherine Connolly (Galway West, Independent)
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No. In fact, we were punished and the service was privatised. Now, nobody has a clue. So, there you are.
Seán Fleming (Laois, Fianna Fail)
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So, the Deputy is concurring.
Catherine Connolly (Galway West, Independent)
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Yes.
Seán Fleming (Laois, Fianna Fail)
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I do not believe it. If I was asked as part of a survey, I would respond responsibly by saying "Yes". We will go back to this morning's question about a service level agreement with RTÉ.
Mr. Mark Griffin:
There are a couple of things on that. I am sorry I was not in a position to provide the level of detail required by the Chairman and Deputy Cullinane this morning. If one looks at what is required by a service level agreement, a great deal of it is covered by the Broadcasting Act 2009. The Act sets out the public service objects of the public service broadcasters, which are RTÉ and TG4. RTÉ and TG4 must provide public service statements, statements of strategy and annual statements of performance commitments. Annual reviews are carried out by the Broadcasting Authority of Ireland and presented to the Minister. There is a five-year review on the adequacy of funding. As I said earlier, the accounts are independently audited, published by the organisations and go before the Government and so on. We obtained legal advice at a point in time - I will need to check when - and it said that a service level agreement was not appropriate given the comprehensive provisions governing strategy objects in the Broadcasting Act and, separately, the fact that RTÉ and TG4 are independent in their functions. I also note that, in accordance with the 2016 code of governance, we will be putting in place an oversight agreement between the Department and RTÉ before the end of the year. It is also the case, of course, that RTÉ reports to the relevant joint committee on a regular basis on a whole range of issues. On the point Deputy Cullinane raised, presenters' fees account for 1% of overall company costs. I will set this out in a more structured way in a response to the committee.
Seán Fleming (Laois, Fianna Fail)
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The only thing I want to concentrate on now is the oversight agreement the Secretary General has just mentioned. Why is that being done, why is it necessary and why has it not been in place up to now?
Seán Fleming (Laois, Fianna Fail)
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What is the gist of the oversight agreement, from Mr. Griffin's point of view? Is it oversight by the Department?
Seán Fleming (Laois, Fianna Fail)
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What does it broadly entail?
Seán Fleming (Laois, Fianna Fail)
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Where is the oversight by the Department?
Seán Fleming (Laois, Fianna Fail)
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Who checks that RTÉ is meeting its obligations in that regard?
Seán Fleming (Laois, Fianna Fail)
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Who checks that on behalf of the Department? Before the €190 million funding is handed out this year or next year, who checks that all requirements are being met?
Seán Fleming (Laois, Fianna Fail)
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That system is not yet in place.
Mr. Mark Griffin:
It is in place on an informal basis because there are regular discussions at assistant secretary and principal officer level with the chief financial officer, CFO, in RTÉ regarding where matters stand, the level of deficit likely to emerge, pressures and so on. That will be formalised and there will be a formal obligation for it to be done, recorded and so on.
Seán Fleming (Laois, Fianna Fail)
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And there will be a formal obligation on the Department to have oversight.
Seán Fleming (Laois, Fianna Fail)
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Will the oversight agreement stipulate what sanctions will be available if the Department is not satisfied?
Seán Fleming (Laois, Fianna Fail)
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Will that be covered in the agreement?
Seán Fleming (Laois, Fianna Fail)
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How will Mr. Griffin, as Accounting Officer, exercise his oversight? He has told us about the responsibilities of RTÉ in respect of the legislation. He has to be sure it is compliant, as it is telling him it is.
Seán Fleming (Laois, Fianna Fail)
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I tabled a parliamentary question on 26 July 2017 for written answer to the Minister for Communication, Climate Action and Environment seeking the details of each body and organisation scheduled to receive in excess of €1 million from the Department's vote of expenditure and whether a signed service level agreement is in place in respect of the services to be delivered by the bodies or organisations and whether the Minister would make a statement on the matter. I asked that question of every Minister on 26 July because the issue of service level agreements has come up at other meetings. The reply I got on that occasion is not inconsistent with what Mr. Griffin is saying.
Seán Fleming (Laois, Fianna Fail)
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It said that the Department intends to give RTÉ €190.724 million according to this year's Estimates and that the agreement in place is that the relevant provisions of the Broadcasting Act 2009 apply. The same answer was given in respect of TG4 and the BAI broadcasting fund. An Post, Sustainable Energy Ireland, Inland Fisheries Ireland, Loughs Agency and so on all had service level agreements in place. In the reply, the Department said that at that point it was relying on RTÉ complying with the Broadcasting Act. That is still the case.
Seán Fleming (Laois, Fianna Fail)
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My principal criticism is that the Department has no way of knowing whether it is in compliance with the Act. I want there to be an onus on Mr. Griffin, as the person writing the cheque, to come before us and be able to say that the Department has ensured RTÉ is complying with the Broadcasting Act 2009 and is happy to give it its €190 million funding. I am not asking Mr. Griffin to manage RTÉ but there has been a gap which it seems the oversight agreement will now deal with. He can understand why-----
Seán Fleming (Laois, Fianna Fail)
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I am sure somebody in the Department will remember receiving that parliamentary question because it was tabled just before the summer recess.
Seán Fleming (Laois, Fianna Fail)
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Mr. Griffin also received it.
Seán Fleming (Laois, Fianna Fail)
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Did he get it during the recess?
Seán Fleming (Laois, Fianna Fail)
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I knew I had it and took the opportunity to fish it out during the break.
Mr. Mark Griffin:
A couple of other issues arose, such as where the Department is in terms of its energy efficiency. It is at approximately 20.2%, which is more or less in line with the average. There is an energy management system in place, incorporating heating management, lighting upgrades and so on. I have more information in that regard and perhaps I will send it to the committee in writing.
Seán Fleming (Laois, Fianna Fail)
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Mr. Griffin should do that because some members are absent.
Perhaps the Comptroller and Auditor General might be best placed to answer my next question. On page 28 of the Department's accounts, it is noted that there is €6 million in the petroleum infrastructure programme fund.
Seán Fleming (Laois, Fianna Fail)
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Also noted is the energy efficiency national fund. There is €32 million in that account and all that seemed to happen in 2015 is that it lost €2 million on its investment but there was no activity. There is also the carbon levy revenue fund. Can one of the witnesses tell me where those funds fit into the system or are they separate funds or is it just------
Mr. Mark Griffin:
The first fund is known as the petroleum infrastructure programme - expanded offshore support group, PIP - EOSG. There is a licence condition attached to all frontier exploration licences. Each of the companies has to pay €17,742 each year into a fund that is generally used for environmental research.
Seán Fleming (Laois, Fianna Fail)
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Where is that fund? Is it part of the Department's accounts?
Seán Fleming (Laois, Fianna Fail)
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It is not a separate fund similar to the environment fund?
Seán Fleming (Laois, Fianna Fail)
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It is in the Vote.
Seán Fleming (Laois, Fianna Fail)
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I am fine with that. When I saw it was a fund, I wondered was it in a separate account completely, as the environment fund is, but it is not.
Seán Fleming (Laois, Fianna Fail)
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What is the situation regarding the energy efficiency national fund and the carbon levy revenue fund? They are dealt with in paragraph 7.2 on that page.
Seán Fleming (Laois, Fianna Fail)
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Is that a separate account?
Seán Fleming (Laois, Fianna Fail)
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Mr. Griffin might send an information note on that to the committee because it is noted there and these are new accounts to me.
Mr. Mark Griffin:
It is related to the energy efficiency fund. Of the surplus revenues that were in the carbon levy fund before it was closed, €35 million went into the energy efficiency fund and €9 million went to the OPW to fund the optimising power at work scheme. The energy efficiency fund is an investment fund that is jointly funded by €35 million from the carbon levy fund and also through private sector investment. The idea is to try to mobilise a series of investments in energy efficiency in private sector companies.
Seán Fleming (Laois, Fianna Fail)
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The Minister had a 45.7% shareholding in the carbon levy fund. When the fund was closed, who were the private shareholders who got the balance?
Seán Fleming (Laois, Fianna Fail)
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No, I am talking about the carbon levy fund. The Government provided €35 million from the carbon levy revenue fund.
Seán Fleming (Laois, Fianna Fail)
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The accounts note that net assets attributable to holders of redeemable shares stood at €5 million on 31 March 2016. At that point, the Minister held 45.7% of the total shareholding of the fund. Who owned the balance? Is that the new fund?
Seán Fleming (Laois, Fianna Fail)
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Mr. Griffin was dealing with the carbon levy fund and this followed after it and, therefore, I thought it related to that.
Seán Fleming (Laois, Fianna Fail)
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Yes. Mr. Griffin need not give me the final accounts.
In respect of the 2016 annual report, Mr. Griffin must be tired discussing broadband but mobile phone signals are also an issue. I do not have a mobile phone signal from any operator in my constituency office or my house. At either location, I have to walk out to the garden or to the side of the road in order to receive a phone call. I live in a village that it is not very small. Mobile phone signals in Ireland have deteriorated. Everybody is talking about broadband but there has not been a single mention of mobile phone signal strength. Many people use smartphones to access the Internet as well to make calls. Broadband is brilliant but one needs a mobile phone signal to start with. Mr. Griffin said the regulator let companies off too lightly by not insisting on a sufficiently high level of penetration once it got to 80% or 90% of the------
Seán Fleming (Laois, Fianna Fail)
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Exactly. What can the Department do in this regard? Mr. Griffin must be aware that mobile phone signal quality varies and is poor in some areas, including busy locations.
Mr. Mark Griffin:
There are a couple of things. First, the availability of a good and ubiquitous mobile phone service requires spectrum. One thing the Minister has done is to auction the 3.6 GHz spectrum, which frees up more spectrum for use for the mobile phone sector while accruing €78 million to the State. I mentioned earlier that he has given RTÉ €8 million to do a class of a digital switchover, which will allow it to get out of using some of the spectrum that is used for television broadcasting and free that up for mobile phones. This type of spectrum - 700 MHz - is particularly useful in rural areas because of the nature of the wave. That will become available in 2019.
The other thing that is ongoing on foot of the mobile phone and broadband task force is that the operators are working very closely with the local authorities. A number of pilot local authorities, including the Chairman's local authority in County Laois, are under way to see where are the blackspots. Local authorities and the mobile phone operators have been asked to identify these and what can be done, including piggy-backing onto State infrastructure, to see if the service can be improved. That pilot programme is under way.
Seán Fleming (Laois, Fianna Fail)
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Will Mr. Griffin send me a note on that?
Seán Fleming (Laois, Fianna Fail)
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He will understand that the mobile phone signal is very poor in many areas.
Seán Fleming (Laois, Fianna Fail)
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We hear a great deal about broadband but we do not have the basics. We have been informed that another mast is required. While masts were highly controversial a decade ago, I have not seen-----
Seán Fleming (Laois, Fianna Fail)
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We all understand that. I have not seen any new masts being erected in the past five years. While the old permissions are being renewed, there does not appear to be an appetite to fill the gaps. The companies are throwing the issue back on the State by asking to use State infrastructure rather than spending a few bob of their own money.
Cybersecurity is an emerging theme. There have been a few cyberattacks, including on the Health Service Executive.
Seán Fleming (Laois, Fianna Fail)
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What is the Department's role? Is Mr. Griffin the man, so to speak, when it comes to protecting our cybersecurity?
Mr. Mark Griffin:
Yes, I am the man, technically, who is responsible for making sure the State has an adequate cybersecurity capacity, both in prevention and response. We set the policy, although in fairness a lot of the policy is derived at European Union level, in particular, from the network and information security directive, which will put very significant obligations on critical infrastructure providers, namely, the energy companies and transport, and on the digital service providers, namely, the cloud computer providers such as Amazon, eBay, Google and so on. We spent a lot of money in the past few years, particularly the last two years, on beefing-----
Seán Fleming (Laois, Fianna Fail)
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What kind of money?
Mr. Mark Griffin:
It is mainly people money so it is pay. In this space, it is not equipment by and large but grey matter that is required. While I will not give a number, we have recruited a good number of staff over the last year and we have secured approval in our Estimate this year to recruit additional staff.
Seán Fleming (Laois, Fianna Fail)
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Is Mr. Griffin referring to the Department's Estimate for 2018?
Seán Fleming (Laois, Fianna Fail)
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When is the Estimate expected to go to committee?
Seán Fleming (Laois, Fianna Fail)
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I presume it will be soon.
Seán Fleming (Laois, Fianna Fail)
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It will be done before Christmas at any rate.
Mr. Mark Griffin:
Yes. We will start engaging in a further stage of the recruitment process, ideally before the end of the year, to get extra bodies in. We are quite happy with the quality of the people. I had a conversation with a counterpart in the United States last week. Even though they are far better equipped than are we, they acknowledge that it is really hard to keep ahead of the curve on this particular issue. Some of the stuff we are seeing is not nice.
Seán Fleming (Laois, Fianna Fail)
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I am sure we will return to this matter next year.
On electricity infrastructure and the Celtic connector between Ireland and France, I am aware the Department is moving on to the next phase. Is this a five or ten-year project?
Seán Fleming (Laois, Fianna Fail)
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I am not referring to the date of an actual connection.
Seán Fleming (Laois, Fianna Fail)
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That is not especially big.
Seán Fleming (Laois, Fianna Fail)
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We are familiar with the 400 kV line.
I am surprised the Department's 70 page annual report features only one page on renewable energy. It seems very light in that regard given that wind and solar are such big issues. What is the position regarding the renewable energy feed-in tariff, REFIT, and its rate?
Mr. Mark Griffin:
We have had three REFIT schemes in place already. We are putting in place a new renewable electricity support scheme. It is more likely to be auction based rather than the REFIT, which is a fixed amount. That will be in place from 2018. The design of the scheme is almost complete. We have a public consultation process under way, if not concluded. We will take on board the views of the people who have made submissions to the consultation process and we will work to get that up and running in 2018.
Seán Fleming (Laois, Fianna Fail)
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Will that add to the public service obligation, PSO, on electricity bills? Is that from where funding for the scheme will come?
Seán Fleming (Laois, Fianna Fail)
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In other words, electricity bills will increase to pay for the scheme.
Seán Fleming (Laois, Fianna Fail)
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Is it more expensive to produce energy through renewable as opposed to conventional methods?
Seán Fleming (Laois, Fianna Fail)
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How much spending did it avoid?
Seán Fleming (Laois, Fianna Fail)
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Now that Mr. Griffin has informed me of the savings achieved, will he tell me how much it cost to achieve that saving?
Seán Fleming (Laois, Fianna Fail)
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What was the cost?
Seán Fleming (Laois, Fianna Fail)
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I will finish on that point. Mr. Griffin's answer is akin to me answering a question from my better half, on my return from a shopping trip, how much I had spent by saying I did not know how much I had spent but I knew how much I had saved. Mr. Griffin has given me a similar answer. Does he get my point?
Seán Fleming (Laois, Fianna Fail)
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The public service is great at giving us half of the picture. Mr. Griffin did not give me a proper answer.
Seán Fleming (Laois, Fianna Fail)
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I just wanted Mr. Griffin to say that.
Seán Fleming (Laois, Fianna Fail)
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Mr. Griffin is essentially saying the further we move towards renewable energy, the greater will be the increase in the cost of electricity for consumers.
Mr. Mark Griffin:
No. First of all, the cost of renewable energy technologies is falling. We have seen that quite clearly over the last number of years. People would not have dreamed, even five years ago, of getting into offshore renewable energy. The price of that has come down dramatically. We are seeing the technology costs reducing very significantly. I am talking about the totality of the shift from the sort of fossil fuel-based economy that we are operating in to a low-carbon economy where we will have to invest in the electrification of the suburban rail lines and more Luas lines. There will have to be changes in agricultural practices and there will be a cost. We will have to fundamentally change our tax model if we are moving away from diesel cars to electric cars. All of this has a cost but obviously there are massive savings and good things will come.
Seán Fleming (Laois, Fianna Fail)
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We have moved into a broad conversation. I asked about the REFIT scheme and Mr. Griffin indicated an auction process is likely to be held in 2018.
Seán Fleming (Laois, Fianna Fail)
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At this stage, there are only a few of us left. We have asked all the questions we had to ask. I take it that the information on the various matters that is to be sent to us will come within two weeks.
Seán Fleming (Laois, Fianna Fail)
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We have concluded our discussion and are agreeing to dispose of the appropriation accounts for 2016, Vote 29, pertaining to the Department of Communications, Climate Action and Environment.
On behalf of the committee, I thank all the witnesses from both Departments and the Office of Comptroller and Auditor General for participating in the meeting today and for the materials supplied. We will adjourn until 9 a.m. on Thursday, 16 November 2017, when we will be meeting witnesses from the Department of Education and Skills, SOLAS and a number of education and training boards. Our focus will be on the financial accounts and related matters concerning the education and training boards.