Noel Ahern (Dublin North West, Fianna Fail)

I move: "That the Bill be now read a Second Time."

I am pleased to have the opportunity to address the House on the Dormant Accounts (Amendment) Bill. The Government has continued the good work of previous administrations in introducing various programmes and measures to tackle disadvantage and exclusion in society. The dormant accounts scheme is one such measure. Every Member welcomed the original legislation to establish a framework for the use of unclaimed moneys in financial institutions to assist the less well-off. There has been considerable public debate on the Government's decision to make changes to the administration of dormant accounts and bring forward the legislation before us. The purpose of the Bill is to build on the progress made to date and address deficiencies which have become evident in the existing arrangements. The Government takes the view that there are compelling governance and public policy reasons to introduce legislation at this time.

Members will be aware that the current value of the fund is in the order of €200 million. While a prudent reserve must always be maintained in the fund to meet claims for repayment, it is anticipated that with further annual inflows the potential spend from the fund will increase considerably. While appropriate corporate governance structures are required to support and oversee the disbursement of funds on such a scale held in public trust, the existing legislation makes no provision for a proper organisational structure to support the board. Currently, the law provides for an ad hoc arrangement for the secondment of staff from my Department. Given the emerging scale of the fund and the independence of the board, the Government is not satisfied that such an arrangement is tenable.

The Government was also influenced in deciding to change the current arrangements by concerns about the accountability of the chairman of the board to the Committee of Public Accounts on disbursement decisions. The chairperson of the board, who is in a part-time post. is accountable to the Committee of Public Accounts for decisions on the potential allocation of up to €250 million. While having the highest regard for the ability and integrity of the chairman, this arrangement is not appropriate. The current arrangements are fundamentally deficient having regard to best practice in governance structures and organisational arrangements.

Questions also arise from a public policy point of view. If we are serious about tackling severe disadvantage, the State must use all available resources for this purpose using a focused and sustained approach. In this regard, it must be ensured that spending from the fund is co-ordinated with policy priorities identified by Government and debated in this House. It is doubtful that current arrangements can secure optimal impact in this regard.

Given the existing deficiencies, it could be argued that a new permanent administrative support structure should be established to enable the board to administer funding programmes. However, the Government has decided for a number of valid reasons not to take this route. First, such an arrangement would dissipate significant dormant accounts funds on administration costs; second, this option ignores the inherent finite nature of the fund; and third, critically, such an arrangement would bypass the expertise and knowledge within existing public bodies in tackling disadvantage and providing assistance to persons with a disability.

A more logical approach is to draw on the expertise, knowledge and capabilities of existing public bodies. This is the approach favoured by the Government and provided for in this Bill. It limits bureaucracy and provides the framework for decision making consistent with public policy priorities approved by Government. It also minimises spending on administration and maximises funding for those who need it most. The Government has decided against setting up a new organisational structure for these reasons. Instead, the Bill provides that the Government will in future decide on disbursements from the fund following a public application process and within a framework of transparency and process set out in law.

Under the legislation, the key functions of independent planner and critical appraiser are being assigned to the board. This will ensure the board's independent input into the overall planning process. The Bill proposes that the board will retain responsibility for preparing the disbursement plan, which is the framework through which proposals for disbursements from the fund will be developed and the board will review and assess the extent to which the plan's objectives have been achieved and whether its strategies have been effective.

Importantly, the board will also be conferred with a new power to report on the additionality of disbursements. In this way, critical analysis of the impact of such spending on the ground will be placed on a statutory independent footing through the board tracking and assessing disbursement decisions. Having regard to these responsibilities, the board will have a key role in influencing the strategies for disbursements from the fund and in assessing the additionality and impact of spend. These arrangements demonstrate the Government's commitment to a structured, transparent and effective board.

While the purposes for which disbursements can be made will be to assist persons who are socially, economically or educationally disadvantaged and persons with a disability, transparency in decision making on disbursements from the fund is important. Genuine concerns have been raised as to the extent to which the changes may adversely affect the focus and impact of spending from the fund. Recognising this, the Government has provided a range of measures in the Bill to secure and enhance transparency and accessibility. The existing objectives of disbursements from the fund and the key relevance of the disbursement plan will be retained. This ensures the focus of the spend.

However, two further critical measures provided for in the Bill are a new requirement to publicise and invite applications for funding and to publicise the criteria for assessing such applications and a further requirement to publish lists of all successful application and the amounts involved. Each year, following Government approval of programmes and projects for funding, applications will be invited for eligible programmes or projects. Following evaluation of such applications by or on behalf of public bodies, the Government will approve a range of specific measures and projects. A statement containing details of the approvals will be laid before the Oireachtas and a list setting out the approved measures and projects and specifying the amounts to be disbursed will be published within one month.

These rigorous and extensive measures confirm the Government's absolute commitment to ensure decisions on the fund are informed by the public interest, accessible to public application and fully subject to public scrutiny. The legislation also proposes that spending from dormant accounts will be channelled through the Votes of relevant Departments. It will be separately recorded and identifiable, thus facilitating the board in carrying out its new function to assess the additionality of spending from the fund. Where approval is given for a project, the relevant funding will be channelled through the Department principally dealing with that sectoral group. Dormant accounts spending will be tracked across Departments in this way and transparency relating to spend and additionality will be enhanced. This mechanism will afford opportunities to streamline funding to organisations that may receive assistance under a number of different headings from Departments and State agencies.

Given the moneys involved and the opportunity presented to improve the lives of disadvantaged persons and communities, the Government, including the Minister, and I are committed to the highest standards of good practice in the operation of dormant accounts funds. It is our intention and the purpose of this Bill that disbursements from the fund will be made subject to the board's plan in a focused way using the existing mechanisms of the State.

On behalf of the Government, I convey the Government's appreciation to the Dormant Accounts Fund Disbursements Board for the work it has undertaken to date. The willingness of board members to contribute their time and expertise to the service of the public should be acknowledged. All too often we take for granted and do not stop to acknowledge that members of State bodies are in many cases giving up their spare time, which is becoming scarcer with the demands of modem society. The board has been busy over the past few months progressing the initial round of funding. It has approved 420 projects to the value of approximately €42 million, with a focus on supporting proposals within RAPID, CLÁR and drugs task force areas. As the funding for these approved projects is disbursed, it will have a measurable impact on alleviating disadvantage in the worst affected areas. The Government will ensure that the good work initiated by the board will be continued.

I refer to the main provisions of the legislation. Sections 1 to 5, inclusive, are standard provisions relating to definitions, establishment day, interpretation and so on. Section 6 amends the principal Act in regard to the section on penalties and proceedings, consequent on the removal of the provision in the principal Act on unauthorised disclosure of confidential information. Section 7 provides for a new Part 5 of the principal Act. With the exception of section 31, the other sections in Part 5 substantially reflect the existing provisions in the principal Act. Section 31 provides that the new dormant accounts board will prepare a disbursements plan and submit it to the Minister, and review, assess and report to the Minister on the pattern, impact and additionality of spending from the fund and the effectiveness of the strategies in the plan.

Board membership, including the chairperson, is increased from nine to 11, with a corresponding increase in the quorum for meetings from five to six. The Minister will be responsible for appointing board members, all of whom must have knowledge or experience of matters relevant to the board's functions. As part of the appointment process, the Minister will invite submissions from interested organisations and individuals with regard to the appointment of four of the ten ordinary members. Existing disbursement board members are eligible for re-appointment to the new board. The terms of office of board members are set at a maximum of five years for the chairperson and three years for other members. Other provisions relating to conditions of office, filling of casual vacancies, meetings and procedure, membership of the Oireachtas, the European Parliament or local authorities, and disclosure of interest remain as they were for the former board.

The Bill provides in section 8, the new Part 6, for two stages in the process whereby decisions on spending from the fund will be made. First, provision is made in section 42 of Part 6 for the preparation and submission for the Minister's approval, not later than 1 June 2006, of the new board's plan for disbursement of moneys from the fund. Section 43 provides that the Minister, having consulted with other Ministers, shall, not less than once each year, make a proposal to Government concerning the programmes or types of projects for which applications for funding should be invited and the criteria to be used in assessing such applications. Spending thresholds may be applied to particular programmes or projects.

Subsequent to Government approval of the proposal, the Minister, following a public process of invitations for applications, will recommend for funding a list of programmes or projects that have been assessed by or on behalf of public bodies. In addition to this process, and as previously provided for under the principal Act, the Minister has discretion to approve funding for additional programmes that comply with the core purposes of the fund. All decisions made under either of these processes will be detailed in a statement to be laid before the Oireachtas and publicised, with the disbursements routed to successful applicants through Departments.

Section 9 provides that the National Treasury Management Agency will report annually on the operation of the fund to the Minister for Finance. The new board will report annually to the Minister, who will lay copies of the report before the Oireachtas. The new board's report will reflect the change in functions from those of the former board.

Also, reflecting the changed role of the board, section 10 removes the accountability of the chairperson of the new board to the Committee of Public Accounts. The chairperson of the former board will remain accountable to the committee in respect of decisions of that board. The new board will have power to instruct the National Treasury Management Agency to make disbursements on foot of decisions made by the former board which have not been paid out on establishment of the new board and the chairperson of the new board will be accountable to the Committee of Public Accounts in respect of those decisions.

Sections 13 to 15 make standard provisions regarding transfer of assets, liabilities and contracts to the new board, takeover of contracts and agreements, and substitution of the name of the new board in any legal proceedings.

This Bill retains the ethos of the original legislation which is to ensure that the purpose of spending from the dormant accounts fund is to assist persons who are socially, economically or educationally disadvantaged, and persons with a disability. The new dormant accounts board will be assigned the key roles of independent planner and critical appraiser. These responsibilities demonstrate the Government's commitment to a transparent and effective process. Furthermore, the Government has provided for a range of rigorous measures in the Bill to secure transparency and accessibility by ensuring that decisions on the fund are informed by the public interest, accessible to public application and fully subject to public scrutiny.

I acknowledge that there has been considerable public debate on these proposed changes, which is entirely natural and appropriate. It is my job and that of the Minister to develop legislative proposals that safeguard the public interest in the spending of these funds. It is our job as legislators to critically appraise every legislative proposal presented to us. In this case, given the vast amount of money that is to be disbursed, we must make every effort to enshrine a process in this legislation that is robustly and transparently fair and effective in providing support where it is needed most. It is imperative that the legislative arrangements for the dispersal of moneys in the dormant accounts fund have the confidence of the House, of the persons who may seek to secure support from the fund and of the public to whom this money belongs in the first place.

A rigorous and detailed testing of the proposals in the Bill by this House can only serve to strengthen the legislation. I look forward to this in this debate and in the stages that will follow. Deputies will be aware that I and the Minister have been open to suggestions for improving these proposals and have sought at all stages to address all legitimate concerns that have arisen. I assure the House that we will listen closely and consider carefully all comments and suggestion made by Deputies, as we did in the Seanad. I commend the Bill to the House.

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