Shane Ross (Independent)
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I welcome the Minister of State. The matter I wish to raise is one with which he will have some familiarity because he was a member of the Joint Committee on Transport in a former life. The issue is the refusal of the non-executive directors of CIE to appear before the Joint Committee on Transport. I regard this as an extraordinarily serious issue. These non-executive directors were asked by the committee to appear before it to answer some extremely sensitive but important questions about the running of CIE and the conduct of its executives. Their refusal to do so is a straightforward two fingers not only to the committee but to the Houses. I do not know of any precedent where employees of the State or of semi-State bodies have said they will not appear before a committee in such a case. The company of which they are non-executive directors is under a cloud because of corruption that has been found to exist by a group of independent consultants who were employed to find out the extent of corruption in CIE.

The questions that have to be answered are multiple, not only relating to the corporate governance of CIE during that period but also relating to the knowledge of the non-executive directors about what was going on. The evidence at present about the knowledge of the non-executive directors indicates they did not know what was happening and that they had not seen the Baker Tilly report on the corruption. What is necessary to know and what we are entitled to know as taxpayers and as Members of the Oireachtas is how much they knew and whether they were doing their jobs.

The chairman of CIE appeared before the committee after the publication of the Baker Tilly report on corruption and losses at Iarnród Éireann of at least €2.7 million, with an earlier draft stating €8.6 million. After that report, the chairman was asked about the knowledge of the non-executive directors. He stated they had received the report after it was issued. He then clarified that they had not received the Baker Tilly report. Not only had they not received the Baker Tilly report, the Minister had not received it either. This was a report into corruption at one of the State's most heavily subsidised companies and even the Minister did not know what was going on. He did not know about the report, he had not read it and he did not know the cost of the report, which at €500,000 must be a world record.

What is happening is that political appointees, and all of the people we are looking for are political appointees, who earn €17,000 a year from the State - I am open to correction - are being asked by the State's representatives, that is Deputies and Senators, to come in and explain their stewardship of a company which receives €300 million, and they are saying to go jump in a lake, that they will not do it, that they are not answerable and will not answer the questions that are necessary. There is no excuse for this. What is going on in CIE is very murky. There is a continuing dispute in CIE, particularly in Iarnród Éireann, about whether the losses reported on by Baker Tilly were €2.7 million or €8.6 million. The evidence is contradictory. In the earlier report Baker Tilly found it was €8.6 million and in the later report, when it was picked up on by CIE, it was found to be €2.7 million because CIE or Iarnród Éireann stated it was two different things. It is a really sorry situation.

There are two groups of people who can clarify this. One is the group which brought in Baker Tilly and told it the terms of reference were wrong. This group comprises three people, all of whom are employees of Iarnród Éireann, one of whom had a court case against Iarnród Éireann which has just been settled. He has been asked to appear before the committee and it is hoped he will agree to do so in September. He may shed some light on this. The other people who can shed real light on this are the non-executive directors. They can also shed light on their own participation in board decisions and on whether they are simply passengers or sleepers in this controversy.

This goes to the root of whether Iarnród Éireann is being run by a cabal or small executive of very powerful people, or whether the non-executive directors are hands on and know what is happening. It seems to me that by their refusal to appear before the committee, they have reneged on their duty to the Minister and to the State. The appropriate action for the Minister to take now is to sack them and replace them with people who are prepared to be transparent, appear before the committee and answer questions which tell us what is happening with this very important but extraordinarily expensive drain on taxpayers' money.

Ciarán Cuffe (Dún Laoghaire, Green Party)
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The executive chairman of CIE, Dr. John Lynch, has regularly made himself available to the Joint Committee on Transport on a variety of issues relating to the CIE group. Since September 2009 he has appeared before the committee on four occasions. It is accepted practice that the chairman and chief executives of State companies appear as requested before Oireachtas committees to represent the State body concerned. For example, in enacting the Dublin Transport Authority Act 2008, which provided for the setting up of the Dublin Transport Authority, now the National Transport Authority, the Oireachtas provided under section 41 that the chairperson and chief executive would appear before Oireachtas committees as required. No provision was made for entire boards or individual non-executive directors to appear before Oireachtas committees. It would be entirely inappropriate, therefore, for the Minister for Transport to dismiss the non-executive directors of CIE.

The Minister received a copy of the Baker Tilly Ryan Glennon report into procurement practices in Iarnród Éireann in October 2009 and arranged for a copy, with some deletions for legal reasons, to be placed in the Oireachtas Library. The chairman and chief executive of Iarnród Éireann have been before the committee on two occasions regarding the issue of procurement practices at the company. The chairman of the board audit committee appeared at the last such meeting in December 2009, together with the chairman and senior management of Iarnród Éireann. The Minister sought and received from the board of CIE a full report, dated 15 January 2010, on the background to the Baker Tilly Ryan Glennon report and the state of implementation of its recommendations. A copy of this report was provided to the Committee of Public Accounts and to the Joint Committee on Transport. The Minister is satisfied that the CIE board has taken the necessary steps to ensure adherence to the procurement requirements detailed in the code of practice.

There are a range of measures in place to ensure CIE accounts for the discharge of its functions, including annual reports and accounts which are placed before the Oireachtas, annual reports by the chairman certifying compliance with code of practice requirements, regular appearances before Oireachtas committees, and annual audit of accounts by independent auditors.

Dr. John Lynch was re-appointed by the Government as chairman of CIE, as executive chairman of the company and as chairman of Iarnród Éireann, Dublin Bus and Bus Éireann, for a maximum period of one year until 28 March 2011. The reappointment of Dr. Lynch is to ensure continuity at this critical juncture in the implementation of the cost recovery measures under way and planned across the CIE group. The successful implementation of these measures is critical for the financial viability of the group.

During his ten-year period in office, the chairman has overseen a transformation in the quality and reliability of bus and rail services. Major projects have been delivered on time and within budget, including a major revitalisation of the railway service with Exchequer support and the renewal of Dublin Bus and Bus Éireann fleets. The Minister is satisfied that as regards its obligations to Oireachtas committees, the CIE board has complied with all reasonable requests relating to the issue of procurement within the CIE group.

Shane Ross (Independent)
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Of course, the reply did not answer the question and the Minister of State should be ashamed of himself for reading that script given to him by the Department of Transport. The issue here is not whether it is compliant. As he stated, CIE complied with all requests about procurement. The issue here is whether non-executive directors - take CIE out of the equation - should appear before and be answerable to Oireachtas committees. Is the Minister of State telling me he and the Government approves of them saying they will not appear and be answerable and transparent in these or any situations?

Ciarán Cuffe (Dún Laoghaire, Green Party)
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Simply to clarify, I repeat that in the 2008 Dublin Transport Authority Act, the Oireachtas provided under section 41 that the chairperson and chief executive would appear before Oireachtas committees, and no provision was made for entire boards or individual non-executive directors to appear before Oireachtas committees-----

Shane Ross (Independent)
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It does not stop them coming in.

Ciarán Cuffe (Dún Laoghaire, Green Party)
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I can only say that it would be inappropriate for the Minister for Transport to dismiss the non-executive directors of CIE.

Shane Ross (Independent)
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I did not ask that question. I am sorry, a Leas-Chathaoirligh, I will not ask a supplementary. I will ask the same question and I want an answer to it. Does the Minister approve of non-executive directors on any issue being allowed not to come in and not to be answerable to the Oireachtas? Do not give me this stuff about procurement or about the Act. Does the Minister approve of them not coming in?

Ciarán Cuffe (Dún Laoghaire, Green Party)
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I can only repeat what I stated already, that the legislation that governs this is the Dublin Transport Authority Act 2008, and that Act does not provided for the entire boards or individual non-executive directors to appear before Oireachtas committees.

Shane Ross (Independent)
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It does not provide for Coco the Clown coming in either but he can come in too.