Joe McHugh (Donegal North East, Fine Gael)
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Question 148: To ask the Minister for Finance if he will provide a report of the number consultancy reports commissioned by his Department between 1997 and January 2011; the cost of commissioning each report; if he will provide information on the implementation of recommendations set out in each report; and if he will make a statement on the matter. [22598/11]

Michael Noonan (Limerick City, Fine Gael)
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The information sought by the Deputy is as follows. It is not possible to provide all the information is a short time frame and more specific information will be provided to the Deputy in relation to the implementation of recommendations.

National Treasury Management Agency

( Inclusive of State Claims Agenct, National Development Finance Agency, National Pension Reserve Fund and

National Asset Management Agency)

2008

National Treasury Management Agency

2009

BodyName of Report or ReviewCost

(ex VAT)

2010

BodyName of Report or ReviewCost

(ex VAT)

National Pension Reserve Fund Commission

2008

BodyName of Report or ReviewCost

(ex VAT)

2009

BodyName of Report or ReviewCost (ex VAT)

2010

BodyName of Report or ReviewCost (ex VAT)

*These reports were commissioned at the request of the Minister for Finance in the context of the State's preference share investment through the National Pensions Reserve Fund in Bank of Ireland and Allied Irish Banks plc.

**Commercial confidentiality provisions in the relevant contracts preclude the publication of the fees paid in respect of these individual reports. However, the total costs (ex VAT) in respect of the 9 reports referred to above are €3,131,330.

Special EU Programmes Body

The Cost in relation to the reports and reviews carried out by the Special EU Programmes Body listed below would have been jointly funded by the European Union, the Department of Finance and the Department of Finance and Personnel. The majority of the Reports and Reviews were commissioned for the INTERREG IVA and PEACE III European Structural Funds Programmes, The EU funds 75% of INTERREG IVA programme costs and 67.5% of the PEACE III Programme costs, with Ireland and the United Kingdom providing the remaining funding.

The Special EU Programmes Body is responsible for the management of the PEACE III and INTERREG IVA Programmes which value some €333m and €256m respectively. In line with public expenditure requirements and as agreed with Accountable Departments, all applicants seeking funding under the Programmes are subject to a robust and defined assessment process. All applications meeting the basic eligibility criteria and seeking funding of over £500,000 will automatically be subject to a full Economic Appraisal (EA). These appraisals make up the majority of external reports and reviews commissioned by the Special EU Programmes Body.

Please note that there are a number of instances where a contract has been awarded to a provider for completion of a block of Economic Appraisals. Detail on the individual Economic Appraisals contained within these contracts is not available within the required timeframes but can be provided upon request.

The information presented is based on the Special EU Programmes Body Consultant Register as at 16 November 2010 and costs outlined within Tables 1-3 are based on the total costs stipulated at the time of award of contract. Should a contract complete under budget, this will not be reflected within the Tables. The Special EU Programmes Body appraisals make up the majority of external reports and reviews commissioned by Special EU Programmes Body.

Please note that there are a number of instances where a contract has been awarded to a provider for completion of a block of Economic Appraisals. Detail on the individual Economic Appraisals contained within these contracts is not available within the required timeframes but can be provided upon request.

The information presented is based on the Special EU Programmes Body Consultant Register as at 16 November 2010 and costs outlined within Tables 1-3 are based on the total costs stipulated at the time of award of contract. Should a contract complete under budget, this will not be reflected within the Tables. The Special EU Programmes Body estimates that the number of contracts to which this applies is negligible. Should however, further costs be incurred on a contract, these will be described as Annex Bs within Tables 1-3.

Table 1: External Reports and Reviews Conducted by SEUPB in 2008

Table 2: External Reports and Reviews Conducted by SEUPB in 2009

Table 3: External Reports and Reviews Conducted by SEUPB in 2010

Anglo Irish Bank

Consultancy charges outside the normal course of business in 2009 and 2010 (cash out basis and to Sept 2010) were as follows:

* other includes special items primarily consists of consultants hired to assist with the restructuring plans and NAMA related valuation costs.

Central Bank of Ireland

In addition to the reports listed above a number of reports or reviews were carried out by external parties on behalf of the central bank of Ireland (including the Financial Regulator for pre – October 2010) in the period 2008 to date in 2010. Details of the reports are included in the following tables:

2008

2009

Name of Report or Review

2010

Name of Report or Review

In addition the consultative consumer and industry panels commissioned reports in 2008 to date in 2010. the reports cost €114,836 in 2008, €4,860 in 2009 and €4,599in 2010.

Consultancy Reports - Valuation Office 1997 - January 2011

2000 – 2001

Deloitte Touche

Methodology for implemenation of the Valuation Act 2001

161,000.00

Recommendations were implemented following receipt of the report and were reviewed in 2008 on completion of one complete Revaluation area.

2001 - 2002

Cap Gemini

Financial System Tender Evaluation and Selection Support

67,500.00

The recommendation was accepted and implemented.

2004

Price Waterhouse Coopers

Expenditure Review of the Valuation Office

20,010.00

The recommendations in this report were, where practicable, implemented

2005

Epsilon Consulting

Review of Internal Financial Controls and Procedures

14,000.00

The operations manual on Internal Financial controls and procedures was rewritten following receipt of the report.

2008

David Rainey

Rainey Report on Revaluation

13,853.24

All practicable recommendations in this report have been implemented, including the setting up this year of a central market analysis Unit to assist the National Revaluation project.

2009

Occupational Health and Safety Services

Review of Safety Statement and audit of safety management system

1,176.12

All recommendations on Safety Management Systems, Improvements in Preventative arrangements and the formulation of the Office Safety Statement were implemented.

2008

Review Body on Higher Remuneration in the Public Sector (Report No 43) - €190,561

Job evaluation of posts in the public sector for the Review Body on Higher Remuneration in the Public Sector - €114,000

2009

Parallell Benchmarking Pensions Review - €32,805

Review Body on Higher Remuneration in the Public Sector (Report No 44) - €268,959

Aine Griffin/Marie Ralph:

Eamann Phelan:

Maurice O'Connell, former Governor of the Central Bank and Financial Services Regulatory Authority, was asked to address, in October 2008, in the context of a review of the National Pensions Reserve Fund (NPRF), the following questions:

· Whether existing arrangements for automatic payment into the NPRF should be modified, and

· Whether the Minister for Finance, on behalf of Government, should be empowered to direct or influence the strategic investment policy of the Fund.

Mr O'Connell's conclusions were:

1. The performance of the NPRF since its establishment has been professional. In recent times it has suffered poor returns in exceptionally volatile conditions. This has been the experience generally of comparable investment institutions.

2. Where the national interest is concerned, it is appropriate that the Minister for Finance should be in a position to give directions on investment policy to the NPRF Commission, notwithstanding the requirement on the NPRF to secure the optimal financial return. This will require enabling legislation.

3. A top financial priority at this time is to contain the State's borrowing requirement which has exceeded earlier expectations by a wide margin. In this climate there is a case for suspending or adjusting payments to the Fund, especially as the cost of borrowing may well be higher than the Fund is likely to earn on its investments in the short term.

4. Any decision should also take account of the need to preserve the Fund, to the maximum extent possible, and the potential reactions from prospective international investors and credit rating agencies.

5. The options in relation to contributions to the Fund are to continue with existing arrangements or to adjust downwards or suspend payment in full on a temporary basis (preferably for the calendar year 2009 only). Valid arguments can be put forward in support of each option and the issues are finely balanced.

6. In view of the conflicting priorities and uncertainties that lie ahead, the more prudent approach at this time is to take a longer term perspective and maintain a contribution to the Fund, even at a lower level than is now required. Any change in existing arrangements will require enabling legislation.

7. The scope for non-cash payments, such as shareholdings, in making contributions to the Fund, should be explored further. In this context, it is for consideration also whether the legal prohibition on the Fund taking control or large stakes in individual companies should be amended.

8. The NPRF Commission should redouble their efforts at this time to find suitable investment opportunities in Ireland given the new economic realities.

Implementation of recommendations:

Not directly resulting from Mr O'Connell's report, under legislation enacted in 2009 and 2010, the Minister for Finance has power to direct the NPRF Commission to —

? invest in credit institutions (used to recapitalise AIB and BoI)

? buy Irish Government bonds

? provide cash to the Exchequer for capital expenditure until 2013

? ensure that it has cash or liquid assets available in the event of a direction.

?

In addition, the Minister for Finance has power, until 2013, to suspend or reduce the statutory annual Exchequer contribution of 1% of GNP to the Fund.

In relation to the investment of the Fund, the NPRF Commission has in the Fund's Discretionary Portfolio increased its commitment to Irish assets within the framework of its commercial investment mandate, including to Innovation Fund Ireland, water metering and infrastructure.

Cost of consultancy:

Nil.