Dáil debates

Wednesday, 24 May 2017

Priority Questions

Third Level Institutions Governance

4:00 pm

Photo of Joan BurtonJoan Burton (Dublin West, Labour)
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37. To ask the Minister for Education and Skills if his attention has been drawn to reports in the media of audits into third level institutions that have revealed a range of governance issues, including additional payments to staff and non-compliance with procurement rules; and if he will make a statement on the matter. [24658/17]

Photo of Joan BurtonJoan Burton (Dublin West, Labour)
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Several universities and institutes of higher education have tens of millions of euro in private trusts and foundations and alumni funds. These institutions are resisting declaring these moneys in their accounts despite pressure from regulators and from the Government. This is a scandal that is besetting the Department of Education and Skills, damaging third level education in Ireland. We do not know what is happening with these very significant resources.

Photo of Richard BrutonRichard Bruton (Dublin Bay North, Fine Gael)
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This question is about general governance across higher education. The Higher Education Authority, HEA, oversees governance issues through a number of mechanisms, including the return of annual governance statements from each of the institutions, annual system funding reviews and meetings with the Comptroller and Auditor General concerning audits of accounts, and acting upon those. Indeed, it was as a result of acting upon one of these that the particular issue of the foundations came to light. These are now being integrated into the accounts of these institutions. That is progressing, and many of the colleges have already done so and others are in the course of doing so.

As part of my Department and the HEA's ongoing work to develop, in co-operation with the higher education sector, a robust system for good governance and accountability in the sector, it was agreed that a programme of rolling reviews would be set up which would cover specific elements of governance. This process involved setting a centralised procurement framework to deliver the reviews, the aim of which is to evaluate the effectiveness of governance in organisations against stated policy, best practice and national and international standards. My Department agreed with the HEA that the first rolling review of governance compliance would be on procurement. This review was undertaken in 2016. As a follow-up to the review and to increase awareness of the need to comply with national procurement guidelines, the HEA, together with Education Procurement Services, EPS, organised a higher education procurement summit.

It has been agreed that the next rolling review will be carried out on non-compliance of payments, including any payments to staff at higher education institutions. The process of tendering for this review is under way in the HEA.

The Department’s overall intention is to standardise its approach to governance compliance across the education sector, taking into account the diverse nature of education sectoral bodies and having regard to the core standards of governance as articulated in the 2016 code. In developing this approach, the Department acknowledges governance codes do not override existing statutory requirements such as the Companies Act, ethics legislation and other obligations imposed by the specific statutory provisions relating to the body itself and any other relevant legislation.

Photo of Joan BurtonJoan Burton (Dublin West, Labour)
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Is the Minister saying that he is washing his hands of this problem and that because many of the third level institutions and universities are established under particular statutes, he as Minister is powerless to do much about it? The public are going to be genuinely scandalised when they find out the extent of what has been happening in terms of the money in these accounts, which are essentially off the balance sheets of their parent institution.

The Minister mentioned the question of salaries. Will he tell us if it is true that in some institutions numbers of staff are being paid over and above their public salaries and that in some cases these payments run into tens of thousands? It may be that the institutions have good arguments for this, but the fact is there is no accountability for it. At a time when educational resources are scarce, everyone is pleased to see universities fund-raising. However, they need to be accountable for the fund-raising. The Minister is being quite evasive about this.

Photo of Richard BrutonRichard Bruton (Dublin Bay North, Fine Gael)
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My Department and the HEA are very alert to the need for effective governance. We have, as the Deputy knows, given institutions of education considerable autonomy. They have to use that autonomy carefully. They are subject to audit by the Comptroller and Auditor General who has, as he as done in other public institutions, revealed cases of bad practice. Those are being addressed. Going beyond that, we have outlined a specific programme of rolling reviews that are now in place to enhance the governance. Besides the annual reviews of governance which we receive, we are undertaking cross-institution reviews and focusing on areas where there have been particular concerns. Non-compliance of payments is a particular example where there is now a review in place. We are taking a very proactive approach to this.

On the specifics of the foundations and bringing them on balance sheet, we have been working with the Comptroller and Auditor General. Many of the institutions have now regularised their accounts and others are in the course of doing so to make sure these foundations are properly reported. Many institutions have funding sources other than just the State. That is how these developed. They have been commendable sources of funding, but they do need to be accounted for in a proper way in order that we can see transparency. This is an issue the Comptroller and Auditor General has identified and it is being addressed.

Written Answers follow Adjournment.