Kieran O'Donnell (Limerick East, Fine Gael)
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Question 60: To ask the Tánaiste and Minister for Education and Skills the position regarding the recent draft European Social Fund audit finding in relation to FÁS; if she will provide those findings; and if she will make a statement on the matter. [41359/10]

Seán Haughey (Dublin North Central, Fianna Fail)
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In September to October 2009, the European Commission carried out an European Structural Fund audit mission that included an audit of FÁS expenditure. The final report of this mission was issued in February 2010 and raised two areas of concern for the auditors. The first area where issues arose from this audit was in contract extensions and tendering procedures not being properly followed. This involved €20,040 expenditure, or 0.1% of the total FÁS claim. The second and main area was the reconciliation of estimated costs to actual payments for contracted training for the unemployed. This was related to the information technology system used to account for this expenditure and it resulted in an incorrect ESF claim of approximately €165,000, or 0.2% of the total FÁS claim. It is anticipated that new information technology system will be fully operational by 1 January 2011 and will address the European Commission's primary concern in this area, as well as prevent a recurrence of this event in the future. In March 2010, the European Commission auditors carried out a follow up audit on the FÁS issues raised. A draft report on this audit was received by my Department on 25 June 2010 and was responded to within the two month deadline set by the European Commission. The Commission has instructed that the draft audit report be treated as confidential and, as it is not intended for publication, I am not in a position to describe its findings.

The resulting final audit report has not been formally received from the European Commission to date. However, I can confirm that no EU funds have been lost by Ireland on this matter to date and, as it is intended that alternative spending will be substituted for the above amounts in a future claim, it is anticipated that there will be no loss to the Exchequer.

Fergus O'Dowd (Louth, Fine Gael)
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I am not happy with the Minister of State's reply. It is more than one year since the first investigation was conducted into this matter and a number of audits have been carried out since then. Was the request to treat the draft findings as confidential made by the Department or the European Commission? I cannot understand why they are being kept secret because there is no issue if the sum in question is only €165,000. Is it not a fact that the problem does not arise so much from the information technology section as from the absence of documentation or a paper trail? There were estimates but no receipts were produced. Is it a fact that some of this spending occurred in 2000? When does the Minister of State expect to be in a position to respond publicly and transparently to the issues raised?

Seán Haughey (Dublin North Central, Fianna Fail)
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The European Commission instructed that the draft audit report be treated as confidential and it is not intended for publication. The final audit report will be a Commission document and, as such reports are not generally considered public documents, Commission approval must be received before copies can be distributed. However, I am willing to make a statement on the progress of implementation of the issues raised in the report and my Department has replied to previous questions on this matter. It is anticipated that matters will be finalised by the end of the year. It is not expected that the Exchequer will lose money because of the substitute expenditure and we are implementing measures to deal with these issues.