Patrick O'Donovan (Limerick, Fine Gael)
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27. To ask the Tánaiste and Minister for Foreign Affairs and Trade in view of the recent reports into the use of donations and proceeds from shops to top up the salaries of chief executive officers and other officials in sections 38 and 39 organisations funded by the Health Service Executive, if he will seek clarifications from the NGOs funded by his Department to determine if similar practices exist in those organisations; and if he will make a statement on the matter. [52163/13]

Joe Costello (Dublin Central, Labour)
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The Government’s international aid programme, Irish Aid, which is managed by the Department of Foreign Affairs and Trade, is recognised internationally for its effectiveness in producing results for the poorest and most vulnerable communities. About a quarter of Ireland’s overseas development assistance is channelled through Non-Governmental Organisations (NGOs). This reflects the strong contribution which Irish NGOs are making to the fight against world poverty and hunger, and the broad support which they continue to receive from the Irish public. Funding is provided to support the long-term development work carried out by NGOs in developing countries, as well as emergency humanitarian assistance and development education programmes. Given the level of Government funding for the NGO sector, the issue of their internal governance arrangements is a matter of legitimate public interest. It is important to note, however, that NGOs are independent organisations. The salary levels of their employees are determined by the Board of the NGO and are typically funded from a variety of income sources, including general donations from the public, bequests and official funding.

In relation to the funding provided through the Irish Aid programme, the Department appraises funding applications from the NGOs and assesses the cost efficiency and effectiveness of their projects and programmes and the basis of their expenditure decisions. Financing agreements between Irish Aid and NGO partners include clear parameters on certain cost categories, including administration costs. A limit of 6% of funding provided can be allocated to administration costs, with remuneration levels for senior executives being reviewed in the context of overall administration costs.

In 2012, Irish Aid entered into agreements for a new series of programme grants with the larger Irish development NGOs for their long term development work over a four year period. These agreements require the NGOs to follow best practice financial reporting standards for staff salaries as set out in the Statement of Recommended Practice in place in the UK. This British standard is currently used by Irish Aid, pending the regulation of the Charities Act 2009. In line with the standard, NGOs are required to set out in their published audited financial statements the number of staff receiving salaries above €70,000.