Oireachtas Joint and Select Committees

Thursday, 16 November 2017

Public Accounts Committee

City of Dublin Education and Training Board and Kilkenny and Carlow Education and Training Board: Financial Statements

Ms Carol Hanney(Chief Executive, City of Dublin Education and Training Board)and Ms Cynthia Deane(Chief Executive, Kilkenny and Carlow Education and Training Board)called and examined.

9:00 am

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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We will continue our discussion about the consideration of the financial statements relating to the education and training board sector. In this session we are joined by the City of Dublin ETB and Kilkenny and Carlow ETB to discuss their 2015 and 2016 financial statements, respectively. I welcome from the City of Dublin ETB Paddy Bourke, chairperson, Carol Hanney, chief executive, Aideen O'Riordan, director and head of finance, and Alan Murphy, head of SUSI. From Kilkenny and Carlow ETB we are joined by Councillor Peter Cleere, chairman, Cynthia Deane, chief executive, Linda O'Brien, head of finance, Eileen Curtis, director of schools, and Liam Scott, director of organisation. We also continue to have representatives from the Department of Public Expenditure and Reform, SOLAS and the Department of Education and Skills for this session, and I am sure there will be also some questions for that group.

I remind members, witnesses and those in the Public Gallery to turn off their mobile phones. I mentioned that earlier this morning.

I want to advise witnesses, because they are new here, that by virtue of section 17(2)(l) of the Defamation Act 2009, they are protected by absolute privilege in respect of their evidence to the committee. If they are directed by the committee to cease giving evidence on a particular matter and they continue to do so, they are entitled thereafter to only qualified privilege in respect of that 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 or entity by name or in such a way as to make him, her or it identifiable.

Our lead speaker for this session will be Deputy Noel Rock, but we must complete the last bit of the session before lunch. We will go on to the main session in a moment.

Deputy Alan Kelly had one final question to put-----

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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I have more than that. I will be as quick as I can.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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-----to the Secretary General and then we will move on to the opening statements of the next witnesses. We will finish off one item.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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It is kind of weird because I am looking at the back of the Secretary General's head. The Secretary General is based out of the Department of Education and Skills but how much of his time does he spend there?

Mr. Seán Ó Foghlú:

In Marlborough Street?

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

Mr. Seán Ó Foghlú:

About 70% of my time.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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I cannot hear Mr. Ó Foghlú.

Mr. Seán Ó Foghlú:

About 70% of my time.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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I have a few quick-fire questions. Can the Department ensure that every board of every ETB publishes their minutes? There seem to be gaps in minutes across some of the boards. I will ask that question of every ETB here. Can the witnesses make a commitment that all minutes will be published online and made available?

Mr. Hubert Loftus:

We see it as good practice. It is something we can look at as part of our review of the code of practice for ETBs which is ongoing.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Will Mr. Loftus make the minutes available for us please?

Mr. Hubert Loftus:

Yes.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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As part of this process, as the Chairman outlined before the break, we will be writing a report and as part of that we will be making recommendations which we expect to be considered. I presume this will be one of them. We have only a selection of ETBs here. It would not be practical to have every one of them here, although I am sure we will be visiting some of them again. Could we also ask for audit reports on the past two or three years as well? They are not available publicly.

Mr. Hubert Loftus:

These are the internal audit reports. Over the past three years there have been about 60 internal audit reports and they are provided. There are procedures for providing those. Will Ms Fannin indicate the procedures involved?

Ms Jill Fannin:

What the Department receives is the opinion report elements. The Department does not have, on a day-to-day basis, all of the internal audit reports. They are in the hands of the ETBs themselves.

Mr. Hubert Loftus:

Of the 60 internal reports-----

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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This is only a sample. Can we just have the ones on the four ETBs? We cannot be exhaustive. We have picked four ETBs. Can we have the reports from the four that are here?

Mr. Hubert Loftus:

We will look at that issue.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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It is something we have requested so I take it the answer is "Yes." I have a number of quick-fire questions for the Secretary General. We are looking at integration. Can the Secretary General assure me there is a consistent policy across all ETBs on how expenses are claimed and leave entitlements? If not, why not and when will it happen?

Mr. Seán Ó Foghlú:

There is a consistent policy that has been established on those matters.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Is it implemented? Is it in place everywhere on both those issues?

Mr. Hubert Loftus:

The Department of Public Expenditure and Reform reformed the travel and subsistence arrangements centrally and we have updated the travel and subsistence arrangements for the ETB sector to reflect those reforms. They were issued by a circular from the Department and all ETBs were requested to implement them. In terms of leave arrangements, they are dealt with. There are standard terms and conditions on those and they operate centrally. As part of the changeover and amalgamation of VECs and bringing in training centres, there might have been some legacy issues that had to be managed and there is an IR form for operating within the sector to work through those issues.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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When will they be dealt with? They have been going on for four years now.

Mr. Hubert Loftus:

In the main they operate straightforwardly for the vast bulk of staff and I would think-----

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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There are anomalies there.

Mr. Hubert Loftus:

There are some legacy issues to work through and they are worked through in the IR domain.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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It is going on for four years. All I am getting here is that it is ongoing. What I need to hear is that there will be an end to it soon because four years is absolutely excessive.

Mr. Hubert Loftus:

As part of our response to the committee, we can provide an update on that.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Will you also provide an update on the other item? I have a final couple of questions. Are all the chief executives based primarily in the head offices of the ETBs?

Mr. Seán Ó Foghlú:

That is their primary place of work. They spend time in different offices and elsewhere but their main office is in the head office.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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I have a reply from the Minister on the matter and he says it is what he expects.

Mr. Hubert Loftus:

That is where they would be headquartered for travel and subsistence purposes and things like that.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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The Minister says he expects that all ETB chief executives are based primarily out of their head offices. We might come back to that. When it comes to the issue of the directors who were appointed in December, there were three directors appointed for each ETB. There was sanction for that. They were appointed to the three different areas. I would expect they would be based out of head office too in each ETB.

Mr. Hubert Loftus:

That can depend on the configuration of functions within individual ETBs. In the main, they would be based in the head offices, but there would be some ETBs that might be based in a different location. For example, in one of the head offices of Kilkenny and Carlow ETB, which is represented here, there is the chief executive and one director. Within the other office of that ETB there are two directors headquartered there. The chief executive may wish to make a comment on that.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Would it be unusual that three-quarters of the four most senior roles in an ETB are not based in the head office?

Mr. Hubert Loftus:

These are dealt with at-----

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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Hold on a second. The Department is an oversight body. Would it not be incredibly unusual, and why would the Department allow it to happen in the first place? Would it not be unusual?

Mr. Hubert Loftus:

It can come down to the individual circumstances within each ETB in terms of the configuration of functions within the different locations and the judgment calls of the chief executive. The chief executive is accountable to the board of the ETB.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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The boards are accountable to the Department.

Mr. Hubert Loftus:

There is a hierarchy of accountability.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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At the end of the day it comes back to the Department. This is what we spoke about earlier in regard to oversight. It would be helpful if as a result of this the Department would supply us with a list of where the people in those positions are located across the ETBs.

Mr. Hubert Loftus:

Yes.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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For me, it seems absolutely illogical that, given the amount of work, they are not based in the one location, for the majority of time at the very least, if not exclusively. I accept there would be a significant amount of movement from time to time. This is my last question for now. With regard to teaching allocations, how does the Department monitor the fact that each ETB is pro rata administering their teaching allocations to the relevant schools? As I understand it, they are given their teaching allocations. They come to the Department. The Department allocates the volume and then it is up to each ETB to assign the allocations in accordance with their thoughts or views. What checks and balances are there in place to ensure that pro rata the actual allocations that are given to the schools reflect the volume of students in those schools? I am sure the Department has an audit process for doing so. Please do not tell me it does not.

Mr. Hubert Loftus:

The allocation is given annually to each ETB and that is based on the number of students in the schools within that ETB. It is an overall allocation for the ETB because they are employed by the ETB as distinct from being employed by the individual school. That gives a certain level of flexibility in terms of ensuring the best management of that at ETB level. They are managing that taking account of the particular needs and number of pupils in individual schools. Each of the ETBs are required to return to the Department information on how they utilise that allocation. That is something that comes back into the Department.

Separately, there was an internal audit of teacher allocations and that was done across all of the ETBs.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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When was that?

Mr. Hubert Loftus:

That was done in the past year. The audit opinion was very positive in terms of how the ETBs managed that. Based on feedback from the ETBs in terms of utilisation, and based on the internal audit controls and opinions, it certainly would not be an area I would have a significant concern from the Department's perspective in terms of how well it is managed at ETB level. It is important to acknowledge the ETB sector played an important role in the implementation of cross-sectoral redeployment arrangements for the teacher cohort as a whole and played its part in ensuring that overall teacher allocations are managed.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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I accept Mr. Loftus's latter point and I agree with him. There are checks and balances in place at all times and what I want to know is should some schools feel aggrieved obviously they can go through the process with the ETB or directly to the Department.

Mr. Hubert Loftus:

Yes.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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That was completing the last round of questions from this morning. I will now ask for an opening statement from Ms Carol Hanney from the city of Dublin ETB, followed by an opening statement from Ms Cynthia Deane of Kilkenny and Carlow ETB. Our first speaker will then be Deputy Noel Rock. Because of the volume of speakers and the long session, we agreed this morning that opening speakers will have 15 minutes and everyone else will have ten minutes, because people want to contribute and we want to give everyone a chance. There will be many questions and answers here today.

Ms Carol Hanney:

I thank the Chairman for allowing me the opportunity to make an opening statement. The City of Dublin Education and Training Board, CDETB, was established on 1 July 2013, replacing the former City of Dublin VEC. It is a large and diverse organisation with an overall estimated budget of €588 million and a staff of approximately 3,200. CDETB provision includes second level education, very large post leaving certificate, PLC, courses and vocational training and opportunities scheme, VTOS, provision, two training centres and ten Youthreach centres. We provide education services to more than 2,000 prisoners in seven prisons, part-time programmes for adults up to Quality and Qualifications Ireland, QQI, level 6 delivered in more than 80 centres in the city and a wide range of specialist projects. We also fund 13 community training centres.

CDETB, through its youth services board, CDYSB, delivers, funds and supports a wide range of community organisations to develop and deliver youth work services. CDETB has been at the forefront of innovation from the original work in the curriculum development unit to the development of PLC provision and QQI programmes. We continue to develop new programmes in partnership with industry and third level institutions. These include maths as part of science, technology, engineering and mathematics, STEM, a QQI level 5 course in digital media production and new programmes in ICT and construction and, through our international projects, technology enhanced learning, work-based learning and blended learning. Recently, we have been involved in the development of two new apprenticeships in accounting technician and commis chef, now being delivered in three of our further education colleges. We are also leading the development of three further apprenticeships and two traineeships.

Since 2012, the Student Universal Support Ireland, SUSI, unit of CDETB has replaced 66 former grant awarding authorities in the provision of a centralised student grants administration function. Handling more than 100,000 grant applications annually and awarding more than 80,000 student grants, SUSI administers approximately €365 million in student grant funding, has annual administration costs of approximately €8.5 million and an approved staffing complement of 100. With grant payments to more students now commencing earlier each year, and with more than 95% of all grant applications now processed and paid before Christmas, SUSI continues to meet and exceed its key performance targets for the timely processing of grant applications and for the payment of awarded grants.

CDETB has adopted the code of best practice for governance as set out by the Department of Education and Skills. The board has 20 members and holds an average of ten meetings each year. The audit and finance committees meet as required by the Act and also report to the board. CDETB has a strong risk management structure and a strong system of internal control. In compliance with the ethics Acts, CDETB board members and designated staff provide annual disclosures of interests.

The 2016 budget for CDETB was approximately €585 million, an increase of 200% over the 2010 CDVEC budget of €190 million. The significant budget increase over this period was due in the main to the set up of the new SUSI unit in 2012 and the transfer of two Dublin FÁS training centres on 1 January 2014. In 2014, the payment of Department of Education and Skills scholarships and bursaries, to the value of approximately €4 million, transferred to SUSI. The total value of SUSI-related receipts in 2016 was approximately €394 million and the training centres accounted for a further €46 million of the budget total.

Until 2016 no additional staff had been assigned to the CDETB head office finance department as a result of this significant increase in operational activity, but the broadening of functions has resulted in an increased demand for senior staff management and oversight. The completion of the annual financial statements on a timely basis continues to be a key priority. Despite significant challenges facing the organisation over recent years, CDETB has, since 2012, continued to produce draft accounts for audit by the middle of the year immediately following the accounting period, and they have been signed off by the Comptroller and Auditor General before the end of the year. However, the running of the operational areas of the finance department in a time of significant change and scarce staff resources has also been prioritised so as to ensure that all CDETB staff, trainees, students and suppliers are paid. The 1 April statutory deadline for submission of draft accounts for audit has not been achievable to date by the organisation. However, we are committed to bringing forward the date for submission of the draft accounts to the Comptroller and Auditor General to an earlier date.

Since 2013, CDETB has gone through a significant process of change. We successfully made this transition and we have maintained and grown our services notwithstanding a net reduction of more than 60 administrative staff due to the public service staff moratorium. CDETB continues to engage with industry to open up employment opportunities for students and to ensure that the programmes offered are relevant to the skills needs of employers. Over the years, CDETB has developed a wide range of progression routes from its colleges to third level institutions. CDETB's strategic vision is to deliver a high quality provision for all its learners in line with QQI guidelines and it is committed to further developing its systems to enhance the central oversight of its provision and to lead proactively the continuing advances required at a time of change and development. It aims always to respond to student and learner needs and to fully engage its staff in the change management process. The pathways to achieve these changes are set out in our strategy plan for 2015 to 2020 and in our quality assurance procedures continuous improvement plan of 2017.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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I thank Ms Hanney and I will now ask Ms Cynthia Deane to make her opening statement on behalf of Kilkenny and Carlow ETB. This is probably the first time the witnesses have appeared before the Committee of Public Accounts. Normally we have national bodies and Departments but we have not had ETBs. I am conscious of this from the point of view of the witnesses. We are familiar with the proceedings as we are here every week, but we are conscious of the witnesses' perspective.

Ms Cynthia Deane:

On behalf of my team I thank the committee for the invitation to attend. As chief executive, I take very seriously my role as the accountable person under the ETB legislation, and I acknowledge the committee’s role in ensuring that public services are run efficiently and achieve value for money. I am pleased to have an opportunity to make a brief opening statement to the committee and I will give a quick summary of three main points, namely, our ETB services, developments since 2013 and our approach to preparing financial statements.

I will start with very brief information about Kilkenny and Carlow Education and Training Board, KCETB. Our ETB caters for the needs of 25,000 learners in 14 schools and colleges and 30 further education and training centres across the counties of Carlow and Kilkenny. We reach into towns, villages and rural communities from Hacketstown on the Carlow and Wicklow border to Ferrybank in south Kilkenny on the outskirts of Waterford city. We have approximately 1,200 staff on our payroll and our annual budget is in the region of €53 million.

I will now discuss the main developments in KCETB since it was formed in 2013 following the amalgamation of Kilkenny and Carlow VECs. After the amalgamation of the two county VECs in July 2013, KCETB had three main aims. We wanted to maintain continuity of services, uphold good standards of governance and minimise the risk of failure in critical areas of administration. These aims were all achieved, thanks to the commitment of all staff and especially our administration team leaders, who made it possible for the ETB to maintain high standards of service and minimise disruption to our learners and staff.

One of the ways we maintained continuity of services involved reorganising and rationalising the work of the Carlow and Kilkenny office so that our ETB head office functions are carried out between the two locations. Since 2013 we have integrated and improved administration systems across the two offices. We have implemented a new code of governance, we have harmonised policies and procedures across the ETB, we have merged computer systems and installed a shared ICT network operating between the two centres, and we have integrated the training services from March 2016.

During the transition period our services not only continued uninterrupted, we also prepared for significant growth and reform. Since 2013 enrolment in our schools has grown and we have undertaken a number of building projects to extend our capacity and refurbish our facilities to meet demand. We had, for example, a major extension in the Abbey Community College in Ferrybank and we are about to open a new campus in Carlow, which will house 2,000 learners in state-of-the-art teaching and learning facilities.

I shall now turn to the preparation of annual accounts. We give priority to the preparation of annual accounts by the relevant deadline. This has been achieved in recent years because of a number of critical factors. We have robust and efficient systems for regular checking of income and expenditure throughout the year. All our school principals, senior managers and administrative staff co-operate fully to routinely carry out this. We invest considerable staff resources in the preparation of the annual accounts in the first quarter of the year. We also make effective use of our ICT system to support the annual accounts process.

I hope I have managed to give the committee an overview of our operation in the Kilkenny-Carlow Education and Training Board, and a sense of how we try to make a positive difference for the people in our two counties. Out of a total population of 156,000 people in the two counties the KCETB has 25,000 participants in our education and training services. This is one in six people of all ages, or one quarter of the people who are aged 12 to 65, in the two counties. In other words, an average of one person in every household in Kilkenny and Carlow is accessing our services. The average cost is €776 per head per annum. In everything we do we try to achieve a balance between competing demands and priorities. As public service managers we try to do things right and we try to be efficient. As educators we try to do the right things and be effective for our learners. As the chief executive, it is my goal to ensure that KCETB is doing the right things right. I thank the committee for its attention.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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I thank Ms Deane for her opening statement.

Photo of Noel RockNoel Rock (Dublin North West, Fine Gael)
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I thank all the witnesses for coming in to speak to the committee this afternoon. I appreciate it.

It has been said that the traditional lack of accountability with regard to these structures will not wash anymore. It is quite clear there is a difficulty with a great many ETBs around filing accounts in a timely manner. My first question is directed to the City of Dublin ETB. Ms Hanney has said that she intends to bring forward to an earlier date next year the deadline for the submission of the draft accounts to the Comptroller and Auditor General. What is that earlier date and can she commit to having them on time next year?

Ms Carol Hanney:

We would very much like to have them on time. We have aimed every year to have them on time. As I have outlined, however, there was a moratorium on staffing, which caused us a big problem. We now have some extra staff in the department and I hope we would be able to file on time. I do not want to commit to something that I am not certain we will deliver. I hope we will be able to deliver by the end of March. That would be my hope but I cannot one hundred percent commit because we have to train in new people, even when we do get new staff.

Photo of Noel RockNoel Rock (Dublin North West, Fine Gael)
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Absolutely. It can be unpredictable and I appreciate that. With regard to the critical challenges that were facing the City of Dublin ETB and that were blocking its path to having the accounts in on time, one was the moratorium and the other was the complexity involving the two different accounting systems. Is that correct?

Ms Carol Hanney:

Yes that is correct. The moratorium resulted in us losing a lot of staff and even when we get replacements, those staff must be trained in and get the expertise. We are also losing some staff to shared services and other places. Even when we get new staff, they must be trained in but the challenge mainly is the increased workload and a smaller staff.

Photo of Noel RockNoel Rock (Dublin North West, Fine Gael)
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I understand there would be a transitioning from the two different accounting systems, the shared services model. Perhaps Ms Hanney could tell the committee more about that and how it might eliminate the difficulties in accounting in the years ahead.

Ms Carol Hanney:

Yes. I might pass over that question to our head of finance.

Ms Aideen O'Riordan:

Currently in the City of Dublin ETB - and in many of the ETBs - we operate two separate systems. The traditional system is the SunSystem, which was in the old ETB side of the house. When the training centres came on board they used SAP and this was kept because of the integration of all the systems within FÁS. We currently integrate SAP into our SunSystem for our annual accounts. That causes part of the delay in preparing the accounts. The idea behind finance shared services is basically to have one finance system for each ETB. It will be operated out of a shared services centre, with the 16 ETBs each having their own company in the shared services. The main areas for processing will be the accounts payable, which will be quite labour intensive, and a general ledger function. There will be a lot of input from the schools and centres under the shared services model. It is very important that a lot of training would be given right across the board and not only to head office staff, which is where the core finance function currently is. Training will be needed at school and centre level also because they will have an increased role to play under the shared services environment.

Photo of Noel RockNoel Rock (Dublin North West, Fine Gael)
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Is it correct to say that in order to integrate one system into the other is quite manual?

Ms Aideen O?Riordan:

Yes. We operate a receipts and payments system in the ETBs. Our SunSystem is set up as receipts and payments, but FÁS-SOLAS operated under an accruals based system and SAP was configured for an accruals basis. In order to merge the two a cash report is created from SAP and we bring that cash report into the SunSystem. We try to automate it as much as we can but it is still a manual process in that one has to do all the mapping and make sure everything is in play. We do this on a monthly basis but it is an additional task that takes time every month. We must also do the reconciliations to make sure we are bringing in all the data that are accurate and complete.

Photo of Noel RockNoel Rock (Dublin North West, Fine Gael)
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While Ms O'Riordan is chatting perhaps my next query would be Ms O'Riordan's department more than Ms Hanney's but I am happy to pass it back over. Have the audit and finance committees each met four times per year as outlined by SOLAS earlier?

Ms Aideen O?Riordan:

Yes. I believe the audit committee has met three times this year. We had a meeting of the finance committee recently - we have met twice - and I put the finance committee on notice that we need to meet twice more before the end of the year. In prior years we would have sought to meet the requirements under the code of governance, which is four times per year.

Photo of Noel RockNoel Rock (Dublin North West, Fine Gael)
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Okay. So that has happened in each of the previous years going back as part of the-----

Ms Aideen O?Riordan:

As far as I am aware. I believe there may have been one year when the finance committee met three times. This would have been noted in the minutes.

Photo of Noel RockNoel Rock (Dublin North West, Fine Gael)
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Does the ETB publish those anywhere online?

Ms Aideen O?Riordan:

The minutes are not published. The minutes do not go to the board. This is under the code of corporate governance. A presentation is made to the board by a representative from the finance committee and the audit committee at a meeting following the finance committee meetings.

Photo of Noel RockNoel Rock (Dublin North West, Fine Gael)
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I shall zoom in around the involvement of the drugs task force and the allocation of funding there. I am not sure if this query is for Ms Hanney and if it is not then we can pass it over. A figure of €212,000 is allocated to the City of Dublin ETB in respect of the drugs task force. This amount pales in comparison to the levels of funding for other drugs task forces, especially compared with the Kildare and Wicklow Education and Training Board which receives €858,000 per annum. I am curious about why the amount is so disproportionate between the two areas?

Ms Carol Hanney:

No I cannot talk for Kildare and Wicklow ETB. I only know what the City of Dublin ETB is allocated. There is a history to the drugs task force funding. I am aware that the City of Dublin ETB would have applied for different elements of funding over the years. I cannot give the committee exact details as to where the drugs task force funding is, why it is at that level, what we have applied for and what we have received. Over the years there have been times when we could apply for different types of funding.

There is history that I cannot give details of at the moment.

Photo of Noel RockNoel Rock (Dublin North West, Fine Gael)
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Would it be possible to provide that information?

Ms Carol Hanney:

It would be. Does Ms O'Riordan have that information?

Ms Aideen O'Riordan:

Is the Deputy talking about the €213,000?

Photo of Noel RockNoel Rock (Dublin North West, Fine Gael)
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Yes. It says €212,000 here.

Ms Aideen O'Riordan:

That is for 2015 and relates to three different projects that are under the City of Dublin Education and Training Board's, CDETB, head office's control. There is drugs task force funding too under City of Dublin Youth Service Board, CDYSB.

Photo of Noel RockNoel Rock (Dublin North West, Fine Gael)
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Okay. That might account for some of it. Maybe Ms O'Riordan can give me the historical context. What is the rational for ETBs being involved in funding local drugs task forces?

Ms Aideen O'Riordan:

I am not aware of that.

Ms Carol Hanney:

It would generally be to fund projects which would be aimed at reducing drug usage in the long term. The projects could be educational or about intervention. The ETBs are involved there.

Photo of Noel RockNoel Rock (Dublin North West, Fine Gael)
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Ms O'Riordan referred to a head office. It struck me, going through the notes, that the head office lease expired in September 2016, or was due to expire then according to the 2015 financial statement, which indicated that it was under negotiation. The rent was €55,000. Do we have an updated figure for what it is now?

Ms Aideen O'Riordan:

We have two different buildings. The rent for one is €52,500 and the other costs €35,000.

Photo of Noel RockNoel Rock (Dublin North West, Fine Gael)
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Would there have been consideration, given that the lease was expiring, about moving? The headquarters is in Dublin 4 which is presumably more expensive and does not seem to be near most of CDETB's services.

Ms Carol Hanney:

It is beside the head office so we did not consider moving.

Ms Aideen O'Riordan:

We have three different buildings in the same area. The main building is the town hall. The two rented buildings are close by and are side-by-side.

Photo of Noel RockNoel Rock (Dublin North West, Fine Gael)
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Staying on that theme, there were two other leases that were due to expire. The lease for Bonnybrook Youthreach's building was due to expire in February 2017. It cost €72,000 or €77,000 in rent. Was that renegotiated successfully?

Ms Carol Hanney:

We have left that building.

Photo of Noel RockNoel Rock (Dublin North West, Fine Gael)
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There are no details on the lease for the Ballymun Youthreach building.

Ms Carol Hanney:

It turned into a licence from the Department of Education and Skills, which owns the building.

Photo of Noel RockNoel Rock (Dublin North West, Fine Gael)
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Super. I will move on but wanted to address that area of rent in particular. The CDETB administered the SUSI applications, which it is fair to say got off to a difficult birth. Constituency offices were overwhelmed with complaints about late processing and so on. New things take time to bed in and we all appreciate and understand that. In the last two years, the CDETB has been quite successful in turning that around. The applications processed by 31 October varied between 55% and 60% for the first three years and are now up at approximately 80% to 85%. Ms Hanney talked about the 31 December deadline in her opening statement, with 95% of applications being processed. Are there are any new, updated goals in light of that going forward?

Ms Carol Hanney:

We set goals every year. This year, we have passed out any of the goals we had. We had aimed to have 55% of new applicants assessed by 31 October. We had achieved 81% last year and 84% this year. Our target for 30 November was 75% and last year we achieved 90%. This year, we are heading to the same level. It was 85% for 31 December and we had achieved 97%. We passed our targets.

Photo of Noel RockNoel Rock (Dublin North West, Fine Gael)
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The volume of correspondence to my office has gone down as a consequence so I thank Ms Hanney. There were some overpayments. In the scheme of CDETB's budget, in defence of that, it is a relatively minor level of overpayments, but they are overpayments nevertheless. What were the circumstances there? Will Ms Hanney explain the procedures and checks that have been put in place to ensure that does not replicate itself?

Ms Carol Hanney:

Does the Deputy mean SUSI overpayments?

Photo of Noel RockNoel Rock (Dublin North West, Fine Gael)
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Pardon me. The issue relates to apprentices.

Ms Carol Hanney:

The overpayments were identified within the training centre itself and immediate action was taken. The overpayments occurred because the first intake of the new version 3 of the aircraft mechanic apprenticeship reached phase 4. It was the first group of apprentices to be registered on the new schedule of phases for the complete aircraft mechanic apprenticeship programme. It was a new phase of a programme. There was a very short lead-in time of only two weeks as opposed to eight weeks. The training centre had not been completely briefed and was not completely on top of it when it was introduced. There were anomalies in correspondence. There was confusion about phase numbers. Procedural changes have been brought in since then, including additional checks, which have been implemented as a result of the overpayments identified. As soon as the payments were identified, measures were put in place to contact the apprentices and seek recoupment. At this stage, the apprentices had finished in the training centre and many efforts were put into contacting them in different ways but it was unsuccessful. Eventually it was considered prudent to write off those exceptional overpayments and they were written off. We talked to SOLAS about that and it noted it as well.

Photo of Noel RockNoel Rock (Dublin North West, Fine Gael)
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Did CDETB get any moneys back?

Ms Carol Hanney:

I do not think we got any. We tried. There were letters and phone calls, employers were contacted and many measures were put in to try to recoup overpayments.

Photo of Noel RockNoel Rock (Dublin North West, Fine Gael)
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Has CDETB developed any more advanced processes in case such a thing were to happen again the future, above and beyond what clearly did not work?

Ms Carol Hanney:

It is very hard to recoup overpayments. It is probably easier for us to stop it from happening again. We have put measures in place to hopefully ensure that it will not happen again. One can write to people and take other measures, then has to balance the cost of recouping overpayments versus what one is recouping.

Photo of Noel RockNoel Rock (Dublin North West, Fine Gael)
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I thank Ms Hanney for taking my questions. I understand that my colleague, Deputy Pat Deering, from Carlow will be addressing some questions to the Kilkenny and Carlow ETB.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
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I welcome the witnesses. I congratulate Ms Cynthia Deane for successfully completing her paperwork on time. I do not know if she is in the habit of peer-to-peer learning but perhaps she has some nuggets of wisdom that she might share with her colleagues. I commend her for that and for her presentation today. What did Ms Deane do prior to holding this post? Was she in Carlow or Kilkenny Vocational Education Committee, VEC?

Ms Cynthia Deane:

I was chief executive of Carlow VEC before I came to be chief executive of Kilkenny and Carlow ETB.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
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Where was Ms Hanney?

Ms Carol Hanney:

I was chief executive in Dún Laoghaire VEC and then worked in the Department of Education and Skills for two years. I was previously principal of a second level and further education college in Bray.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
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Will Ms Deane describe to us the process by which she was appointed to her current position?

Ms Cynthia Deane:

There was a process of redeployment of existing VEC chief executives. It was managed by the Department of Education and Skills. At the time, there were 20 serving full-time chief executives and 16 posts to be filled. Each of the serving chief executives could opt for a first choice location. There was a system that was almost like the CAO process of allocating people to their choices. Some 16 people were allocated by that process and I was lucky enough to be one.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
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I thank Ms Deane. Could I ask the Department what happened to the other four? How did it go from having 20 people to 16?

Mr. Seán Ó Foghlú:

The other four were given roles within the Department or other agencies to undertake work and were available for redeployment at a later stage as vacancies arose.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
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Did they indicate to the Department that they would prefer a role other than a position of chief executive or did the Department apply some criteria to decide the matter?

In other words, did the four people who were not successfully appointed to the new positions volunteer to be redeployed or did Mr. Loftus make that decision?

Mr. Hubert Loftus:

At that point in time there were 33 VECs. Any vacancies in the VECS at that point in time and prior to it in the lead-in period were filled on an acting basis to minimise the extent of redeployment. Those acting positions were then terminated at the point of the establishment of the ETBs.

In regard to the four people redeployed to other areas, that number has since reduced.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
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I thank Mr. Loftus for his reply which, while interesting, does not answer my question. I want to know how the four people were identified as not for appointment to the new positions.

Mr. Hubert Loftus:

That was done based on arrangements that were agreed with the union representing the chief executives, the agreed arrangements that were worked through. They provided the basis for the redeployment of the chief executives of the former VECs to the newly established ETBs.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
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I can imagine, and correctly so, that there would have been an agreement with the unions on redeployment. I understand that. What I want to know is whether four people stated a preference for a job other than a chief executive position or did Mr. Loftus have to apply criteria to reduce the 20 to 16?

Mr. Hubert Loftus:

Criteria was applied. Seniority would have played a big factor in the decision.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
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Seniority was one factor. What were the other factors?

Mr. Hubert Loftus:

I was not there at the time.

Mr. Seán Ó Foghlú:

Every CEO had to apply for at least one post and seniority then applied to the order in which the posts were filled, having regard to-----

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
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Was competence, ability, talent or energy an issue?

Mr. Seán Ó Foghlú:

No. We had 20 existing CEOs, all of whom were permanent. As stated by Mr. Loftus, we had ensured that as other posts arose after the decision was made more permanent people were not appointed. Therefor, it was a matter of reassigning people who were in permanent roles.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
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To be clear, there were 20 people and 16 posts. Criteria such as seniority and preference - I am not really sure what that means - were applied in regard to the filling of the 16 posts and the remaining four people were deployed to other senior posts, presumably of similar or equal rank, in the public service. Is there a document in which the criteria to be applied in terms of reducing the 20 to 16 set out? That would be critical. I imagine that issue had to be discussed with the unions.

Mr. Seán Ó Foghlú:

There is a redeployment arrangements document that we can provide to the committee.

Photo of Mary Lou McDonaldMary Lou McDonald (Dublin Central, Sinn Fein)
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That would be very useful. Thank you.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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I will be brief. I thank the witnesses for being here today. The City of Dublin ETB assumed responsibility for the SUSI grant system in 2012. What staff complement was provided to it in that regard, including on the financial side?

Ms Carol Hanney:

The staff complement was to the SUSI unit. It was originally 66. It then increased to 91 and is now 100 full-time equivalents. The staffing was to the SUSI as opposed to the ETB.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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Prior to that there was a large number of VECs processing third level grant applications, including the City of Dublin VEC. What happened to the staff who carried out that work? Were they transferred to the SUSI unit?

Ms Carol Hanney:

The staff of the City of Dublin VEC would have been, but only a small number of staff from the other VECs were transferred to it. The moratorium then came into force. As most of this staff were also engaged in other duties in the former VECs they would have remained where they were.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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In most cases, they would have been redeployed during peak times in terms of the grants.

Ms Carol Hanney:

Yes.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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Was staff time at Kilkenny and Carlow ETB freed up as a consequence of the ETBs workload being reduced following the centralisation of the grants system?

Ms Cynthia Deane:

Yes, some staff time would have been freed up. The grants process was seasonal and took an amount of staff resource during a particular part of the year rather than throughout the year. Staff always had other duties as well as grants. When the grants process moved to SUSI over a number of years the staff were reassigned to other duties, usually within the corporate services or finance and accounts areas.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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Am I correct then that the moratorium would have had a lower impact on Kilkenny and Carlow ETB by virtue of the fact that there was staff time freed up?

Ms Cynthia Deane:

The moratorium still had an impact. A small amount of staff time was freed up but the staff concerned were allocated to other duties during that time.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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In regard to the risk register of the City of Dublin ETB, what are the issues that were primarily identified as needing to be addressed on the financial as opposed to the education side?

Ms Carol Hanney:

I am trying to recall what we have in our risk register. Timing is very much an issue because it is not just timing of accounts it is also timing of payments and ensuring everything is paid for when it should be paid for. There are possible risks in that regard all of the time. There are risks associated with the loss of key staff, including in regard to their replacement and the retraining of new staff. We take our risk register very seriously and we revisit and redefine it regularly to note what has and has not been done. It changes. In terms of finance, there is always the risk that something will not be done in time.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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Are circulars from the Department and procurement issues matters for the risk register?

Ms Carol Hanney:

Probably not because we are very particular about them and we abide by them. We would hope that they would not be a risk. In procurement, we are very careful to abide by the guidelines. We also abide by circulars and so neither of those issues usually ends up on the risk register.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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I would like to raise a final matter which, while a separate matter, is linked to procurement. We sometimes hear from suppliers that large organisations are favoured in terms of procurement, particularly in the supply of publications and so on. In France, there is a very low level of procurement outside of the State. The same applies in Germany yet here the reverse is the case. In terms of spend, what can be done to address this issue while at the same time adhering to the procurement guidelines?

Ms Carol Hanney:

It is difficult for us as an ETB to do that because we are required to abide by the guidelines. In abiding by the guidelines we have to ensure we are getting value for money and, generally speaking, that is always the lowest tender, although that may not always be the case. I know that small groups of companies often come together and tender as a unit. As a public body we have to procure according to the guidelines.

We therefore must opt for the cheapest and best value, despite where it might be or how large the company might be.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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I am not suggesting for a minute that the ETB would not adhere to the procurement guidelines. The reason I asked the question was to find out if there are lessons we could learn from the direct experience. I have no further questions.

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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I welcome the witnesses. My first questions are for Ms Deane. The enrolment number for second level is 3,988 for last year. Given that Ms Deane was previously the chief executive officer of the VEC in Carlow I presume she would have an understanding of how the numbers have increased in recent years. Does she have comparative figures for four years ago, for example?

Ms Cynthia Deane:

I do not have them with me. We have some for the previous two years and I can-----

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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How do they compare?

Ms Cynthia Deane:

The enrolments are growing in many of our schools, in some they are staying steady and in one or two they are decreasing.

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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What plans are there to increase the numbers in the schools where they are decreasing?

Ms Cynthia Deane:

Our plans are to promote enrolment and to promote the schools in the local communities. The schools do a very good job in promoting their services in the local areas. Currently, they are running open evenings and enrolment events to which local parents and primary school students are invited. Schools take responsibility for that and we support them by helping them with their publicity and so forth. We are hoping that our new school in Carlow, for example, which has capacity for 1,000 second level students, will grow to fill that capacity because there is a demand for extra places in Carlow town. The Department carried out a demographic survey some years ago and discovered that there was a shortage of 800 places in Carlow town for the years around 2020. It decided to invest in a new second level school for the ETB in Carlow, which is a great vote of confidence in what the ETB does in Carlow. Likewise, in Kilkenny, we are included in the building plan for 2018, for a new campus on the fringes of Kilkenny in a growing housing area for two new schools for Kilkenny city vocational school and our Gaelcholáiste. We have plans to grow enrolments in our schools throughout the two counties.

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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The ETB is currently responsible for 13 schools in both counties.

Ms Cynthia Deane:

It is 14 schools. We had 13 in the 2016 accounts but in 2017 we now have 14 because our school in Carlow, which was a second level school and a PLC, was split into two for the new campus.

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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In view of the fact that some of the enrolment numbers are quite small compared to other numbers, does Ms Deane envisage some consolidation in the future?

Ms Cynthia Deane:

We have no plans to consolidate at present. We are hoping to retain and build up the numbers in each of our areas. Many of the schools are stand-alone schools in very rural communities, so we have small schools because the demographics are such that only a small school is needed in an area. We take very seriously the responsibility to serve our communities wherever the needs are and wherever there is parental demand.

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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The new school Ms Deane mentioned is a fine building. It has capacity for 1,000 second level students and 1,000 post-leaving certificate students. Currently, there are only approximately 247 students enrolled in the old Carlow vocational school, if I can call it that. It will require a massive jump to go from 247 to 1,000. What plans are in place to do that in the short term?

Ms Cynthia Deane:

As I mentioned, the Department carried out the research to assess the need and decided that there was a need for 800 extra places in Carlow town. In its wisdom it decided that the new ETB school was the place to cater for that need. We have rebranded the school. Instead of being Carlow vocational school it is Tyndall College Carlow. It has a new identity and that is being promoted in the local area with great success. We have a new principal and deputy principal. They are very energetic and focused on building up the enrolment. They are making good inroads in respect of fifth and sixth class pupils in primary schools by promoting the school with open evenings and displays-----

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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How long does the witness think it will take to get to the number?

Ms Cynthia Deane:

It will probably be four to five years.

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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Secondary school is a very competitive business in that part of the country.

Ms Cynthia Deane:

It is, but the demographic trends are going upwards. Carlow is now becoming a suburb of Dublin and a commuting town. It is a great place to live and many people are attracted to live there. It is an hour's commute from Dublin and housing is picking up, so we are very confident that we will fill that school in four to five years and, indeed, that it will be bursting at the seams.

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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Okay. The Muine Bheag vocational school task force was instigated some two years ago. What was the outcome of that?

Ms Cynthia Deane:

I will give a little background on our vocational school in Bagenalstown. Bagenalstown is a small town and about 25 years ago it had three schools. Many Irish towns were the same, with the nuns, the brothers and the tech, as it was called. There was a Department proposal to amalgamate all three into a community school but the two religious congregations, the De La Salle Brothers and the Presentation order, decided they did not want a community school. They made an amalgamated secondary school for the boys and girl and the vocational school was left as a stand-alone school. It was a second school in a small town attempting to maintain its enrolment. Over a number of years the school struggled to fill with first year enrolments. It tried to reinvent itself on several occasions by bringing in more PLC students, more adult learners on a part-time basis and introducing more programmes for people with special needs and disabilities. However, in 2015, we in the executive examined the enrolment pattern over a number of years and discovered that eight students were enrolled for first year for that coming September. We had a consultant examine the matter and the recommendation was that, as it was a small number, the school was not sustainable or viable at that stage. We established a task force to examine the issue in more detail and to determine what approaches we might take. The outcome of the task force was that the school should attempt to review its enrolment and try to expand its catchment to attract more students to the school. It has also rebranded and is now called Coláiste Andrew. The school, the parents' association and the community are working very hard to promote the school and keep it open.

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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How many enrolments are there this year?

Ms Cynthia Deane:

I will ask the director of schools to reply to that.

Ms Eileen Curtis:

It had ten first years enrolled this year.

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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What is the projection for next year?

Ms Eileen Curtis:

The period when enrolment takes place is between now and April next year. The original target set in the task force report was 20. We are making every effort to try to recruit students. The school management and the community are working on that at present.

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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Will it be practical to maintain a school with only ten first years enrolling?

Ms Eileen Curtis:

It is a very difficult situation. Initially, the concerns about viability and the learning experience for the young people concerned were the two issues that drove looking into the situation. At that time, in 2015 and 2016, there were three groups that had 13 students. This year we would have four groups that have smaller numbers. The report identified that the bulge was at the senior cycle so when they left school that would reduce the number to approximately 80. It was on that projection that the concern was raised.

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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With only ten students enrolled this year, how difficult will it be to maintain the teachers?

Ms Eileen Curtis:

It will be difficult. We will be facing a drop of approximately four teachers.

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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How viable will the school be with ten students enrolled and down four teachers?

Ms Eileen Curtis:

If one projects that over the years ahead it would reduce the number to approximately 74 in 2021. That would be assuming an enrolment of 12 students each year. Obviously, the allocation of teachers to a school is determined by the numbers, as was pointed out earlier.

That would mean we would have to look at restricting the curriculum in the school in terms of being able to provide the number of teachers to cover that. Also then, there would be the learning experience for the young people. We would contend that a group of 20 students, or anything smaller than that, is what is required to give the best learning experience to the young people concerned.

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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How much money was invested in the school in the past five or six years?

Ms Eileen Curtis:

I would not have that to hand, Deputy. We will certainly get that information for the Deputy, in terms of the value of the teacher allocation and the value of any other moneys that would have gone into the school. Certainly, we will put that together.

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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If that is possible.

Ms Eileen Curtis:

Yes, we could.

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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In the event, likely or unlikely and, hopefully, unlikely, that the school became unviable, is there a plan for it?

Ms Eileen Curtis:

I suppose what had been set out in the task force report was that we would enter into discussion with the relevant parties, which would include the Department of Education and Skills. We would also look at the provision of second level education in the town and how that might be configured in the period ahead.

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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The ETB had an accumulated deficit on 31 December last year of just over €1 million. What gave rise to the deficit?

Ms Cynthia Deane:

I will ask my colleague, the head of finance, to take that question.

Ms Linda O'Brien:

The deficit is due to a shortfall in funding from the Department for our ordinary non-pay grant. We have covered it by balances in other areas where we have funding.

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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That is the proposal to eliminate it. How does the ETB propose to eliminate the matter for the future? Is it an ongoing issue? Is there a shortfall every year?

Ms Linda O'Brien:

No, not in the last year.

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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Was it a once-off?

Ms Linda O'Brien:

Over a number of years. In recent years, there has not been.

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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Is there a projected deficit for this year?

Ms Linda O'Brien:

That deficit will carry forward if we are not funded. Depending on the funding from the Department, the deficit will continue to carry forward.

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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Does it look like there will be a deficit this year?

Ms Cynthia Deane:

Maybe the Department might answer.

Ms Linda O'Brien:

The question is for the Department.

Ms Cynthia Deane:

I know the question was answered earlier on.

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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Sorry.

Ms Cynthia Deane:

It is not an overspend; it is an underfunding, so the committee is aware of that.

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

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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I just wanted to clarify the matter.

Mr. Hubert Loftus:

Just to clarify for the Deputy, we came up with the explanation that it was a result of the budget cuts that were required in order for the Department to manage within its overall expenditure limits, going back to the troika years and things like that. Each ETB, as I explained earlier this morning, would have a set expenditure limit. It is for the ETB to manage its provision within that and that may create a certain level of deficit within certain areas. Obviously ETBs are encouraged to manage as much as possible within their own allocation.

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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I thank the witnesses.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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I call the final speaker on this section, Deputy Connolly.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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The questions on the deficit have been asked. Does the matter also apply to Dublin?

Ms Cynthia Deane:

Yes, I believe it does.

Ms Carol Hanney:

It would be the very same circumstance in Dublin in that when the budget was reduced we were still allowed to spend up to our 2012 limit so it is a funding issue more than a deficit in a way. We are hoping that from now on that the funding will match the cost of providing the service.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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First, I congratulate both organisations for their clear audits and for the fact that no issues have been raised by the Comptroller and Auditor General. I thank the witnesses for coming forward. It is not easy. I thank them for their co-operation. I thank Ms Deane for pointing out how the tentacles of the ETB go into every single household in her area, which brings home the importance of the sector.

What have the ETBs learned from their governance procedures? What issues have arisen that they have dealt with that we and other sectors can learn from?

Ms Carol Hanney:

I will just briefly say that what I have learned, in my 43 years of public service, is that the procedure is your friend. So the code of governance, the guidelines or the circular letter is the thing that we stick to. We sometimes like to think that as educators we have noble philosophies about reaching the educationally needy and so on but we have to balance that with, as I said earlier on, doing things right. The procedures and processes are very clear. They are very clearly laid out by the Department. We are working together, I think very well, as a sector at the moment to endeavour really our very effort to implement those procedures. Sticking to the book, boring as it might seem, keeps us out of trouble.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Do the audit, finance and relevant committees meet every single year for the required period?

Ms Carol Hanney:Yes.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Are the minutes appropriate or have any issues arisen?

Ms Carol Hanney:

No issues have arisen.

Mr. Peter Cleere:

None.

Ms Carol Hanney:

Our chairman would like to comment on that.

Mr. Peter Cleere:

We meet as per the statutory requirements. We have never had an issue brought before the main board from either the audit or finance committee.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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I ask the City of Dublin ETB the same questions.

Ms Carol Hanney:

I would say the same thing. We follow procedures and processes. It is very important to keep an eye on everything. It helps if one has good staff as well because one is not going to do everything. If one has good staff who are well trained and keep an eye on everything I think then things should be okay. There are processes and procedures there and we try, as far as we can, to abide by them. I hope we abide by them all completely.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Have any risks been identified?

Ms Carol Hanney:

Sorry?

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Did the City of Dublin ETB identify specific risks that it took action about?

Ms Carol Hanney:

Yes, regularly.

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

Ms Carol Hanney:

We have a very strong risk management structure. We do identify risks and address them. We come back to them again and we bring that to the audit committee. At about every second audit committee we address the risks and we address the risks as well at our committee.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Is Ms O'Riordan the finance director?

Ms Aideen O'Riordan:

Yes.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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I think Ms O'Riordan referred earlier on to finance committees meeting but the committee did not meet the required number of times or did it?

Ms Aideen O'Riordan:

No. This year it met twice and there are two meetings planned for before the end of the year.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Is that in a rush before the end of the year because we are now in November?

Ms Aideen O'Riordan:

Well, yes, I mean we had a change of membership of the finance committee. That delayed the last meeting a little bit.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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That is what I am wondering. I am just using the City of Dublin ETB as an example because we will go through this with the others in terms of committees meeting. Somehow sometimes it falls between stools. Is that right?

Ms Aideen O'Riordan:

Yes. I suppose also it depends on what makes sense from the perspective of presenting to the finance committee. I know, earlier on, SOLAS mentioned about the reporting that we do to them. We do a mid-year return, which is at the end of May. We do a quarter 3 return as well and, obviously, we report to the Department on a monthly basis. It makes sense to bring the current reports as well to the finance committee so that can often dictate when the actual meeting happens.

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

Ms Aideen O'Riordan:

With the summertime as well, that can cause a delay in that it is harder to-----

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Is Ms O'Riordan confident that there will be two finance meetings before the end of the year?

Ms Aideen O'Riordan:

Yes, there will be. As I said, at the last finance committee meeting I actually flagged that, that we are required to have four in the year.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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I shall turn next to the Department. I could not find the following when I was looking for it today. I knew there was a reference to a pilot programme somewhere. It was a pilot programme involving the sectoral governance compliance unit. Who in the Department of Education and Skills is aware of it?

Mr. Seán Ó Foghlú:

Sorry, whereabouts did the Deputy see that?

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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I am reading from an extract from the statement on internal financial controls under the heading of education sector corporate governance. The Accounting Officer stated that "the Department's sectoral governance compliance unit made significant progress".

Mr. Seán Ó Foghlú:

That is the overall group that I was talking about. The sub-committee.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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I missed the meaning of that.

Mr. Seán Ó Foghlú:

That is fine. It is a sub-committee of the management board

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Is that the compliance unit?

Mr. Seán Ó Foghlú:

The compliance unit reports to that.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Tell me a little about the compliance unit and the pilot programme.

Mr. Seán Ó Foghlú:

We have a pilot under way whereby the code of practice for State bodies, the code of governance, is analysed centrally, in this departmental unit to see how each of the State bodies, as in the national State bodies and not the ETBs or the higher education institutions, have fared and to see where there were gaps and challenges, and where the Department or the agency would have gaps. We have communicated an analysis to the chairs of each of those bodies. There is a dialogue with the bodies about that. This was an attempt to do a corporate approach on how we were working with our State bodies. It is part of the approach of bringing together the national State bodies, the ETBs and the higher education institution perspective.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Was that done as a pilot project for a particular piece of time?

Mr. Seán Ó Foghlú:

The pilot was done because it was the initial project. It is not on the duration of the project but its nature. We wanted to see what we would learn from that and then to keep on going from there.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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What has been learned?

Mr. Seán Ó Foghlú:

I suppose it has been different interpretations of the code of governance. We wanted to set out what we felt would be the appropriate understanding of the code of governance for the various national agencies. It also threw up issues around how we handle some of the requirements that are new, in the code of governance, and how we look at those, as a Department, going forward. An example would be the review of agencies provision that is in the code of governance.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Will the witnesses from Kilkenny and Carlow Education and Training Board comment on the expenditure of €911,000 under the Youthreach heading, which seems by far the lowest spend under that programme for any ETB? Why is that the case?

Ms Cynthia Deane:

There are legacy matters at play here. Our two VECs each had one Youthreach centre with 25 places authorised and approved by the Department, one located in Kilkenny and the other in Carlow. Other ETBs simply have more centres. As well as the two centres under our remit, several community training centres have come under our management following the merger with the training function. We are funded on the basis of our further education and training service plan, and that plan is based on the programmes already approved by the Department and which are continuing. Youthreach and community training services are being reviewed and evaluated by SOLAS, as a result of which the current distribution might change. We are confined in so far as our current position is the one we took forward from our VEC days, namely, two Youthreach centres, each with 25 approved places.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Is there much engagement between the training board and the juvenile liaison officer in regard to the numbers coming through the Youthreach programme and so on?

Ms Cynthia Deane:

I cannot say with certainty and would have to get that information. There is ongoing interaction between all the various support services of the State and the Youthreach service.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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I am merely concerned that the allocation for the area under this programme is historically low, which might mean Kilkenny and Carlow ETB is not receiving a fair portion of available funding.

I see that City of Dublin ETB received €1.45 million from SOLAS for the back to education initiative, which seems remarkably low given that Cork, for example, gets a much higher sum. Why is the allocation for Dublin city, with such a large population, so low? The figure is set out on page 70 of the SOLAS annual accounts. The level of activity under this programme appears low relative to the size of the population the board is serving and compared with Waterford and Wexford ETB, for instance, which receives €1.9 million.

Ms Carol Hanney:

We have several further education colleges, together with ten Youthreach centres and 13 community training centres. That amounts to a lot of provision which might otherwise be captured under the back to education programme. I am not sure about the other ETBs but, as far as we are concerned, we offer a wide range of provision.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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I always like to point out any acquaintance I have with witnesses and, in that vein, I bring it to the attention of colleagues that I have known Ms Hanney for several years. I have a question for the delegates from both ETBs. The Department provides funding for schools for information and communications technology, ICT. Is all of that allocation used exclusively for schools?

Ms Carol Hanney:

It is generally, but there may sometimes be a requirement for something to be done centrally. Depending on the type of ICT system being installed, one might require the expertise and technical skills of head office. However, generally speaking, the funding goes directly to the schools and colleges.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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A centralised software application might have to be installed by head office. I will not hold Ms Hanney to this but would she say, on average, that in the region of 90% or 95%, say, of the funding goes directly to schools?

Ms Carol Hanney:

It would probably be 90%. The last IT grants that were given were specified per school.

Photo of Alan KellyAlan Kelly (Tipperary, Labour)
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In general, however, more than 90% of the totality would go to the schools?

Ms Carol Hanney:

Yes, I would expect so.

Ms Cynthia Deane:

The director of schools would be able to give the Deputy a more precise answer.

Ms Eileen Curtis:

To clarify, the total grant goes to the school but support might be required from our IT staff in head office.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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I have a question for the two chairmen of the board. What issues have arisen in recent years as a consequence of the merger of the former VECs to create the new training boards? In both cases, as I understand it, the large membership includes local authority members, two staff members, parent members and five other members appointed under section 11 of the legislation. In the view of the chairmen, have the amalgamations leading to the establishment of their respective boards worked out well in practice?

Mr. Peter Cleere:

One of the best things we do is rotate our meetings, with one taking place in Carlow and the next in Kilkenny. That is working very well and allows us to have a footprint in each location. We have a very robust board of 21 members, including public representatives, delegates from nominated bodies, parent representatives and so on. We are fortunate to have an open and honest engagement between members and a very proactive board. In addition, the executive is very forthcoming with information in response to questions by board members, with that information made available either as the meeting is progressing, when either the director of schools or the director of further education is speaking or under any other business at the end of the meeting. This provision of information is always an item on the agenda, which ensures the executive is held to account on a regular basis. We are lucky in Kilkenny and Carlow to have a very strong team. Members of the finance and audit committees receive great training internally and through ETBI. Something that works particularly well for us is that if we are meeting in November, say, we will hold our finance committee meeting the week before. As well as being best practice, this means we end up meeting six times per year by default.

Mr. Paddy Bourke:

We did not merge with anybody but a huge volume of extra work was put our way via the new functions in respect of Student Universal Support Ireland, the community training centres and so on. I would like to see an amendment to the legislation to allow for a smaller quorum for meetings. The existing quorum of 12 causes difficulty for us because board members are not paid to attend and there are conflicting demands on people's time. Moreover, we never have a full complement of members at any given time because there is always a movement of people on and off boards.

There is another issue I wish to bring to the committee's attention. I have signed off on the accounts for 2015 and will sign off on those for 2016. However, I will have great difficulty signing off for 2017 in the absence of the appointment of an internal auditor. If that does not happen, it will create a major problem for us.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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That is useful information in the context of my question as to whether there are any impending staffing approvals that might affect the capacity of either board to carry out its functions.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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I asked about risks the delegates have identified. The lack of an internal auditor certainly seems to present a huge risk.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Is that role contracted out or is it internal?

Ms Carol Hanney:

We did previously have an internal auditor in Dublin but we are now going in under the internal audit unit for the education and training boards. I understand a recruitment process is ongoing.

Mr. Hubert Loftus:

A central internal audit unit service was established and is operating for 15 of the 16 ETBs, with the Dublin city board separate. When the internal auditor for City of Dublin ETB retired, we used the opportunity to bring all 16 ETBs together under one internal audit arrangement.

We are not just replacing but strengthening the internal audit team and there has been an interview process for that purpose, which took place yesterday. It can be difficult to get vacancies filled within the Dublin region because of accommodation costs so, wherever there are gaps, we will look at an outsourced service to ensure the audit provision can be dealt with and managed.

The chair of the City of Dublin ETB raised the quorum issue. A quorum is 12 out of 21, that is, a 50% quorum such as operates traditionally within the other national bodies in the education sector. If we reduced it, it would be a bit out of line. We tried to ensure a proactive approach to this issue so the Department carried out a survey of ETBs and wrote to all the personnel involved in nominating people to boards and to the ETBs themselves. This has made some progress in helping to avoid quorum issues but we remain vigilant about them and we will be doing another survey later this year.

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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Does the committee agree to dispose of the City of Dublin 2015 financial statements and Kilkenny and Carlow ETB's financial statement for 2016? Agreed.

I thank the witnesses for coming. They are invited to remain for the next session if they choose. We will suspend while the witnesses from Tipperary ETB and from Kildare and Wicklow ETB take their seats.

Sitting suspended at 4.02 p.m. and resumed at 4.07 p.m.