Dáil debates

Wednesday, 9 November 2005

Priority Questions.

Budgetary Process.

1:00 pm

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
Link to this: Individually | In context

Question 101: To ask the Minister for Finance his plans to introduce innovations in the presentation of the budget Estimates in the procedures by which they are debated, in requirements for evaluations in respect of new initiatives and of the impact of tax measures in order that the debate on spending and taxation can be better focused on obtaining value for money. [33303/05]

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
Link to this: Individually | In context

I have been examining proposals for reform of the Estimates and budgetary process in conjunction with my Government colleagues on foot of my budget 2005 announcement that I intended to consider options for reform in this regard. These deliberations are still ongoing and I will also take into account the recent Committee of Public Accounts report. As I indicated in my reply to a previous parliamentary question in the matter, changes to current practices would have to be capable of being implemented in the short and medium term, would need to meet best practice, improve both the quality of debate and the data available to the House on the budget, meet our obligations to the EU and be capable of being delivered within the existing budget timetable. As I stated in my 2005 budget announcement, changes must also retain the right and duty of the Government to direct and manage the budgetary process.

As regards the timing of the budget, it is critical that the Government in formulating the budget should have the latest information available on fiscal trends before adopting the strategy for the following year. Thus, information on revenues to the end of November is to hand when the final budget strategy is adopted. Similar issues arise in determining expenditure, for instance, on the question of capital spend or possible carryover. I hope to announce the Government's proposals for reform shortly.

I am fully committed to the principle that every euro of taxpayers' money is well spent. I refer the Deputy to my speech of 20 October last to the Dublin Chamber of Commerce where I outlined a number of measures to improve value for money. This initiative builds on other measures introduced in recent years to improve the management of capital programmes and projects including five-year multi-annual budgets and revised guidelines for the appraisal and management of capital expenditure. The overall impact of these various developments has created a better framework for achieving value for money.

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
Link to this: Individually | In context

I thank the Minister for his reply, which is clear on commitment but short on detail. I am disappointed the Minister does not intend to have the new procedures in place to allow us to have a more meaningful debate on the Estimates and budget for 2006. I refer to five white elephants, e-voting, MediaLab, Stadium Campus Ireland, accommodation for asylum seekers that was not occupied and the health service computer system. Between them, they cost €500 million, which would have furnished 500,000 families with a medical card, ensured 40,000 inpatient procedures and 2,000 extra gardaí on the street. The issue of waste has a real impact on the capacity to deliver services to people who need them.

What changes will the Minister make to the budgetary process? Will Estimates be provided earlier? Will we be provided with more resources within the Houses to evaluate them? Will key performance indicators be linked to Estimates when we vote on them? Will a cost benefit analysis of taxes be conducted so we can see that what is being done on the tax front is sensible? Will the Minister change the remit of the Comptroller and Auditor General so that instead of examining repeated mistakes, the causes of mistakes are addressed? Will he reinstitute the programme review, which has been allowed to rust under recent stewardships in the Department?

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
Link to this: Individually | In context

I hope to make an announcement in the budget on the ongoing reform process I have in mind. My initial reply outlined a number of issues that must be borne in mind in the context of reform. We have obligations such as reporting to the EU and so on, and I referred to the question of timing. The PAC report, which is short but which contains annexes by Deputy Rabbitte and others, mentions the question of bringing forward the Budget Statement to September or October. However, we need updated data because when one is planning for the next financial year, the latest and most accurate data are needed. Under the present circumstances, having data up to the end of November provides a much better prospect of proper accountability regarding expenditure or revenue projections than relying on August's ERO or second quarter returns in June. I have come to that view and there is a strong reason that should be the case.

I refer to the Deputy's question regarding the Comptroller and Auditor General. The PAC's remit under Standing Order 156 provides that Ministers can be held to account. There is not an ex ante appraisal mechanism for the Comptroller and Auditor General and, therefore, I do not see why it should be provided for the PAC. That is not the issue. Ministers also have responsibilities and duties to discharge and we derive our executive authority from the House. The principle of democratic accountability is about the Executive acting and being held to account through the normal scrutiny powers available to the Parliament. We must be mindful in the context of reform not to provide that executive action is subject to ex ante appraisal before action is taken. That is a matter for Government to institute and decide upon in the interest of effective governance.

The principle of accountability relates to decisions taken and consequential expenditure. We do not want to end up with a gridlocked system where so many appraisals, overlays, overviews and reviews are under way that the opportunity for action is lost. What is put forward as a more effective and efficient procedure might undermine the objective for which it was set up. I believe in trying to devise mechanisms which will streamline the process by improving the data and information available to the House, ensuring the committees can discharge their accountability requirements and involve Members more widely in their appraisal and participation in such a process but not in trying to put the cart in front of the horse where the rights and duties of Ministers are compromised to the point of not achieving the objectives which the Deputy wishes to set out. There are many views on these issues but I am giving a flavour of what I am trying to do.

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
Link to this: Individually | In context

The Comptroller and Auditor General's remit should be extended beyond reporting on past failures to improve corporate governance by preventing their repetition. That was my suggestion. Does the Minister agree that if key performance indicators are not published by Ministers with the Estimates, the Dáil cannot effectively hold them to account? For example, an allocation of €46 billion is announced but it is impossible to get a handle on what it will deliver. Does the Minister agree the phoney secrecy surrounding the budget and the belief that the Minister must wait for the last bit of data has resulted in bad decisions being made in the past without scrutiny such as those relating to medical cards for the over 70s and decentralisation? Proper scrutiny or evaluation of these proposals was not conducted. Does the Minister concur, therefore, that we need to open the system to proper accountability mechanisms, which go well beyond what he has indicated to date? We must have performance indicators and more detail. We must see them earlier and real evaluative work must be done, thereby learning the lessons of the past.

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
Link to this: Individually | In context

In his reporting powers the Comptroller and Auditor General can make any recommendations to the committee, which will subsequently be communicated to Ministers and responded to by Ministers if they so wish.

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
Link to this: Individually | In context

That is the end of it, there is no follow up.

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
Link to this: Individually | In context

Ministers make decisions under legislative authority and the authority of this House. That is their constitutional duty and no one else has this duty. Those in other roles can make recommendations but Government makes decisions and is held accountable for these. This may involve disagreement among people.

Deputy Bruton seems to indicate that others should determine what are the Government's rights and entitlements. Government must make its decisions and must be held accountable for these decisions. Tax expenditures are regularly reviewed and examined in the context of the annual budget and Finance Bill process to ensure they continue to meet——

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
Link to this: Individually | In context

The Minister has experience of this. He should not pull that one.

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
Link to this: Individually | In context

I do not subscribe to the idea that budget day is irrelevant. One sets out a summary of budget proposals and the total Government revenue and expenditure for the following year. It is very important. The idea that we should reform because budget day does not mean anything might correspond to a popular myth but the budget is an important process.