Bernard Allen (Cork North Central, Fine Gael)
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Question 83: To ask the Minister for Foreign Affairs the position regarding the decentralisation of Irish Aid; the number of senior and principal development specialists now volunteering to decentralise; the manner in which his Department is addressing concerns regarding the auditing of Irish Aid spending; and if he will make a statement on the matter. [10617/07]

Conor Lenihan (Dublin South West, Fianna Fail)
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Under the Government's decentralisation programme, the development co-operation directorate of the Department of Foreign Affairs will decentralise to Limerick. This is scheduled to take place during the second half of 2007 and will involve the relocation to Limerick of 124 posts. In addition, and in order to help effect the smoothest possible transfer to Limerick, an advance party involving approximately 50 staff is scheduled to decentralise in May. Overall, personnel have at present either been assigned to, or identified for, some 90 posts or approximately 73% of the 124 posts scheduled to be decentralised to Limerick.

Development specialists perform an important role in the business of Irish Aid. The specialists work alongside diplomatic and general service staff, in close contact and co-operation with each business unit within the division. There are a number of issues to be worked out with regard to the specialist posts which are also scheduled to move to Limerick. Discussions are ongoing at a senior level with representatives of the specialists, with their union, IMPACT, and with the Departments of Finance and Foreign Affairs in order to resolve all the outstanding issues involved. Progress has been made and I hope that these discussions can be brought to a successful conclusion at an early date. Until these sensitive discussions are concluded, it would be premature to speculate on the number of specialist posts which might be decentralised to Limerick.

In addition to the development specialist posts at headquarters, there are 20 development specialists attached to the embassies working with Irish Aid in our programme countries.

Almost all members of the senior management team for Limerick are in place. In this regard, the director general of Irish Aid will be decentralising to Limerick, as will seven counsellors or principal officers who are already in place in the directorate. The changeover of the senior management team, just as in other grades, has been implemented in a planned and careful way so as to minimise disruption to the business of the directorate.

Irish Aid has a dedicated evaluation and audit unit, which contributes to an efficient and effective development programme by ensuring accountability and lesson learning. The unit's mission includes promoting the culture of evaluation and audit within Irish Aid. The specific role of the internal audit element of the unit is independently to examine and report to management and the Accounting Officer on whether public funds and resources have been used for the purposes for which they have been authorised or allocated.

Additional information not given on the floor of the House.

The evaluation and audit unit has a staff of eight at headquarters. The Department is currently recruiting two additional auditors to further strengthen the unit. A further six auditors are based in the programme country offices. The work of these locally recruited auditors is overseen by the evaluation and audit unit, and complements the work of field office accountants.

The evaluation and audit unit undertakes its own internal audit work, commissions internationally recognised audit firms to conduct external audits of directly-funded projects, and also makes use of audits commissioned by partners, which are undertaken by internationally recognised audit firms or by national auditors-general. Multilateral organisations and non-governmental partners of Irish Aid are also the subject of statutory and other audits.

This audit coverage is supplemented by a reliance on partner governments' own public expenditure reviews, work carried out by other donors, and internationally conducted country assessments, typically led by IMF-World Bank officials. In addition, Irish Aid works in collaboration with other donors and our partners to strengthen their financial management and auditing systems.

A number of initiatives are being taken in order to strengthen the audit function of Irish Aid. An audit tracking officer has been appointed to engage with management on follow-through and to report on implementation of audit recommendations that require action at headquarters. In addition, a series of meetings has been held with heads of mission in Africa, and local accountants and auditors, aimed at strengthening financial evaluation and audit procedures in the field, including follow-through on audit recommendations to partners.

Bernard Allen (Cork North Central, Fine Gael)
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Compared to the reply provided on 8 February, it is obvious from the Minister of State's response that no progress has been made since then as regards the ongoing dispute between the Department of Finance and the IMPACT union representing development specialists and other staff. The Minister of State said that an advance party will be going to Limerick, conveniently just before the general election, to show that there is some movement on decentralisation. What discussions have taken place with NGOs on the implications for the effective expenditure of Irish Aid moneys on the projects administered by such NGOs? The Comptroller and Auditor General's report showed serious deficiencies in the control and accountability of moneys being spent in certain areas administered by Irish Aid.

Conor Lenihan (Dublin South West, Fianna Fail)
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I will deal initially with the first part of the Deputy's question about no progress having been made since 8 February. If he had listened carefully to what I said——

Bernard Allen (Cork North Central, Fine Gael)
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I did.

Conor Lenihan (Dublin South West, Fianna Fail)
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I said there has been strong progress——

Bernard Allen (Cork North Central, Fine Gael)
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Such as?

Conor Lenihan (Dublin South West, Fianna Fail)
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——and I am hopeful that shortly we will have a resolution to the issue involving our development specialists. We value them as being integral to the efficient delivery of the programme. We are hopeful therefore and, as I emphasised in my reply, the negotiations are at a delicate stage. We are on the cusp of a breakthrough and hopefully when that is achieved the Deputies opposite will welcome it. It will mean that all the staff, including development specialists, will be able to move to Limerick to administer and deliver the vast and expanding Irish Aid programme.

The early deployment of 50 staff will occur in May, occupying rented accommodation arranged by the Office of Public Works. That initial move in May has nothing to do with the election, it would have happened in any event. It is very much necessary to ease the transition and minimise any disruption to the programme as we effect the transfer to Limerick. Opposition Members have raised that specific point, as have NGOs and others. Our main priority in moving to Limerick is to minimise any disruption to the programme so staff are being allocated and put in position to assist in the transition to the new location, once the building is ready this autumn. The purpose of the early deployment is to help staff to adjust. It is also being done for family reasons. For certain people who are transferring from the Department and Irish Aid to Limerick the move will involve considerable disruption, especially for their families. The transitional group will assist them with any issues that may arise, including schooling for their children. Such issues will be addressed and assistance given to people who have chosen to decentralise to Limerick.

As regards the effective spending of Irish Aid's money, particularly by NGOs, we conduct rigorous audit requirements. An interesting aspect of the development programme as it has evolved over the years — with the involvement of Ministers of many political persuasions — is that Irish Aid is subject to much more scrutiny concerning auditing, monitoring and evaluation than virtually any other element of State expenditure, particularly at domestic level. The reason for this is the money we are spending has a very low administrative overhead of 5%, so 95% of it is pure spend in policy areas and in distant countries where the NGOs operate.

Bernard Allen (Cork North Central, Fine Gael)
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Is there time for a supplementary question?

Conor Lenihan (Dublin South West, Fianna Fail)
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The expenditure is audited at several specific levels, ranging from the Comptroller and Auditor General to an arrangement we have with the World Bank to audit the programme along with other donors. In addition, we have auditors in our embassies and Irish Aid offices in the programme countries where the money is being spent. Therefore the programme is subject to extensive audits at a number of levels. We also spend money with our partner governments, strengthening their audit systems so that the money can be appropriately accounted for.

The Department of Foreign Affairs has the only independent — in the truest sense of the word — audit committee of all Departments. The Department's audit committee contains external staff, which is a robust system in its own right, apart from the fact that we have auditors in the field. We also undertake regular internal and external audits of our expenditure on NGOs. Those figures are available to the Department in making decisions as to which NGOs we will fund. Clearly, if there is evidence of NGOs not having spent money appropriately, lessons can be learned and a scaling back of funding applies.

Bernard Allen (Cork North Central, Fine Gael)
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May I ask a supplementary question?

Conor Lenihan (Dublin South West, Fianna Fail)
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I am sorry about that.

Bernard Allen (Cork North Central, Fine Gael)
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Is the Minister of State telling me that things are getting even more chaotic? He says that an advance party — 50 of the 124 staff — will go to Limerick in May and that they will occupy rented accommodation until permanent accommodation is ready later this year.

Dermot Ahern (Louth, Fianna Fail)
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The Deputy does not think much of Limerick.

Bernard Allen (Cork North Central, Fine Gael)
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No, it has nothing to do with Limerick. I welcome decentralisation but I am talking about the chaos the Minister is administering. The staff will be going into rented accommodation in May, just before the election, and will have to wait until later in the year to move again into permanent accommodation. What about the nine development specialists that were there in 2003 when decentralisation was announced? None of those will be moving. The Minister is presiding over a chaotic situation which will have serious implications for the effectiveness of the expenditure concerned.

Conor Lenihan (Dublin South West, Fianna Fail)
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I do not want to get into a rhetorical ding-dong with the Deputy on this point.

Bernard Allen (Cork North Central, Fine Gael)
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The Minister of State does not have to. He should just answer the question.

Conor Lenihan (Dublin South West, Fianna Fail)
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The net point is that 73% of the required staff we will need to decentralise fully by the end of this year are already in place and ready to move.

Bernard Allen (Cork North Central, Fine Gael)
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Into rented accommodation.

Conor Lenihan (Dublin South West, Fianna Fail)
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The idea of the early deployment in May is a good one from the taxpayers' point of view. This is an enormous aid programme which is going through its biggest ever expansion in the history of the State. It is imperative that staff be deployed there early to ease the transition involved. Even in my own, very modest, experience of the private sector, prior to my role in politics, I often worked for companies that moved office premises. None of the measures that are now being taken to move staff from one location to another was ever taken in the big private sector companies I worked for over the years. We are taking every precaution to ensure there will be minimum disruption to the service our partner countries expect from an aid programme that has the strong international reputation ours has. The point of the deployment is to ensure there is not a chaotic transition to Limerick, to see that there is a proper, smooth delivery of the public administration service given by civil servants in Irish Aid. I think it is right to rent a separate office prior to the full offices being made available and I confirm that this is the major expense incurred by decentralisation. Other costs, including the need to retrain staff, come within the Department's existing training budget of 4%. The cost is necessary and justified to make sure decentralisation works and is neither a token gesture nor an inappropriately managed process. I fully defend how this money is being spent.