Mr. David Moloney:

I thank the Chairman. My prepared statement is probably a little longer than five minutes but I will try to keep it to that, maybe by taking some of it as read, with the Chair's permission. As the Comptroller and Auditor General said, there are four Votes under my Department, namely, those of the office of the Minister for Public Expenditure and Reform, superannuation and retirement allowances, the OGP and the Office of the Government Chief Information Officer. I understand that the committee has expressed an interest in examining the format and content of the appropriation accounts, public private partnerships, PPP, and the Benefacts database. With the Chair's permission, I will not go through the detail of the Votes, which is set out in the opening statement I have submitted. There are some surpluses to return to the Exchequer, which relate mostly to the timing of staffing and pensions.

As the Comptroller and Auditor General noted, the Vote of the Office of the Government Chief Information Officer is new. It is an important innovation and the need to establish it emerged as a result of the build to share initiative, which was a pillar of the 2015 public service ICT strategy, and that remains central in the recently published Connecting Government 2030 - A Digital and ICT Strategy for Ireland’s Public Service.

In regard to chapter 4 of the report, the Comptroller and Auditor General summarised the main amounts. The total gross amount was €70.1 billion and the net figure was €67.3 billion, after deducting realised appropriations-in-aid totalling €2.8 billion. There were a number of changes to the Estimates in 2020, relating to the Covid pandemic and the restructuring of a number of Departments. The strong position of the public finances before Covid put the Government in a position to deliver very significant supports in regard to Covid. As the impact of the crisis recedes, the summer economic statement of 2021, agreed by the Government and published last July, set out a fiscal strategy, including a medium-term expenditure strategy. This is based on growth and core expenditure each year broadly in line with the estimated trend growth of the economy, and will facilitate continued investment in our economy and society to deliver on improvements in infrastructure and public services while reducing the deficit to underpin the sustainability of the public finances. It is the role of my Department to implement a credible and sustainable public expenditure framework in tandem with reforms supporting excellence in public service delivery, strategic policymaking and public governance structures. To achieve these, my Department sets out policies and guidelines for Departments to follow. In order for effective and transparent management of public expenditure and achievement of value for money, it is important our colleagues across the public service apply these policies and guidelines in their organisations.

On the format and content of the appropriation accounts, the committee has written to the Department in respect of the manner in which a number of issues are dealt with in the appropriation account, including pay, funding received from European funds and legal costs paid by Departments, which I will now briefly address. On foot of earlier requests from the committee, we took in the 2021 accounts to revise the presentation of legal costs. This will allow for an examination of costs arising in the year of account and also allow us to disclose the total number of cases settled in that year. We will, of course, review the impact of that change, along with any views of the committee or the Comptroller and Auditor General, to see whether any further changes are needed in 2022.

The Department also took action to provide for the disclosure of Accounting Officer salary in the 2021 account and committed to examining this issue further for 2022. I acknowledge that the committee has sought further changes in this regard to provide actual levels of remuneration, rather than as set out in the circular. There is a need to have regard to potential legal issues that may arise in this instance, but the Department is happy to consider this further, with a view to the 2022 account and possibly also as an additional note to the 2021 account. We are also reviewing the points raised in respect of greater disclosure regarding pay and will engage in consultation with other Departments on this issue shortly. The Department also continues to progress the wider reform of the accounting framework for central government in order to align our framework with the international public sector accounting standard. We are currently reviewing a set of 12 standards as a priority and will write to committee members shortly to seek their further views.

On public private partnerships, significant infrastructure projects have been developed on behalf of the State through the use of PPP procurement. Some of the advantages associated with PPPs include that they allow the public sector to avail of greater private sector expertise and innovation and that the private partner assumes responsibility for a considerable portion of the risk. The contracts tend to be long-term arrangements, typically spanning 25 years or more. The Department’s role in PPPs is to maintain and develop the general policy framework within which PPPs operate. It has had no direct involvement in the procurement or delivery of individual PPP projects. Therefore, the delivery of projects through the use of PPPs is, in the first instance, a matter for the relevant Departments. As part of the review of the national development plan, NDP, the Department undertook a review of PPP policy. Broadly speaking, the review found the PPP policy framework was robust and that the current guidance was fit for purpose, with a track record of successful delivery. Hence, PPPs remain an option for public procurement where they provide the best value for money, with risk transfer forming an important element of that assessment, and we will continue to monitor the role they can play.

The year 2021 saw my Department enter its final funding arrangements with Benefacts, covering the three-month period to March 2022. This agreement was primarily to enable Benefacts to cease its operations in a timely, orderly and compliant manner. Benefacts was a pathfinder project established in 2014 amid heightened disquiet among the public concerning the charity sector, in particular. During 2020, my Department undertook an evidence-based review, which found the environment had altered substantially. In reaching its decision, my Department considered a number of factors, including the Charities Regulator’s production of a register of core data sets and transparency information, the vesting of policy ownership of the Department of Rural and Community Development of the State's relationship with the not-for-profit sector, and the persistence of state aid and procurement risks associated with the continued funding of this company.

Before concluding, I would like to update the committee on some of my Department’s priorities for the sustainable management of public expenditure and driving and supporting the reform programme. The progress we made in these areas in 2020 was set out in considerable detail in my Department's annual report of that year. Our report for 2021 will be published shortly and I will be happy to forward it to the committee. Looking ahead, our priorities continue to be to manage public expenditure at sustainable levels in a balanced, evidence-informed manner to support Ireland's economic, social and climate goals, alongside challenges such as the impacts of Brexit and Ukraine, and to drive reform and innovation across the civil and public service to improve service delivery to the public and enable strategic policymaking and public governance structures.

To develop and implement policy, my Department will continue to: produce multi-annual Estimates and expenditure statements that meet Government objectives and are consistent with the Government’s agreed fiscal strategy; mainstream budgetary reforms and, through the Government's economic and evaluation service, drive capacity-building for evidence-informed policy in the Civil Service; enhance the governance, oversight and delivery of the new national development plan; manage public service pay and pension costs on a fiscally sustainable basis; continue to address the challenges posed by Brexit while maximising the opportunities and benefits to Ireland of EU membership; and lead the development and implementation of Civil Service Renewal 2030, which will build an innovative Civil Service organisation and workforce that delivers evidence-informed policy and services; while the Department will continue, in its leadership role, to drive digital transformation across the public service as well as lead a procurement reform programme to enable effective, sustainable and compliant procurement across the public service.

I take this opportunity to pay tribute to my colleagues in the Department for their hard work, the contributions they have made to delivering on our objectives over the past couple of very difficult years and their role in response to the Covid-19 pandemic in particular. I thank the Chairman and committee members for their attention. I look forward to our discussion.