JOINT COMMITTEE ON FINANCE AND THE PUBLIC SERVICE debate -
Wednesday, 7 Jul 2004

Business of Joint Committee.

Chairman

Are the minutes of the meeting of 23 June agreed? Agreed. The next item is correspondence, which will be followed by an update on proposals from the EU. The Information Commissioner will then make a presentation on her annual report and the operation of the Freedom of Information (Amendment) Act 2003.

Under correspondence, the first item is statutory instruments. On 17 June the committee's attention was drawn to SI 198 of 2004, which was laid before the Oireachtas on 28 May. The statutory instrument gives effect to an EU directive requiring the regulation, reorganisation and winding up of credit institutions. The committee decided at the meeting to seek a briefing note on the regulations before deciding whether to scrutinise them. The note has been received and circulated. As these regulations are made under the European Communities Act 1972, they can be annulled by the Houses within one year of being made but the Oireachtas Joint Committee on European Affairs must make a recommendation to do so. This committee, therefore, also formed the view that if the regulations were to be annulled, it would not only have to persuade the House of that view but also the Oireachtas Joint Committee on European Affairs. Having reviewed the briefing notes, do members want the committee to consider the statutory instrument? They are contained in the letter dated 1 July from the Department of Finance. It is signed by Colm Breslin, principal officer.

Senator O’Toole

Was it not the next one relating to credit unions which we discussed at the last meeting?

Chairman

Yes. Also on this issue, on 17 June, the committee's attention was drawn to SI 223 of 2004, which was laid before the Houses on 28 May. I understand the instrument provides for regulations to enable credit unions to provide certain additional services beyond the traditional ones of savings and loans, without requirement for prior approval by the registrar of credit unions. The committee decided on 17 June to seek a briefing note on the regulations before deciding whether or not to scrutinise them. The note has been received and circulated. It is the note to which Deputy O'Keeffe referred. A 21 day review period applies in this case. Does the committee wish to consider this statutory instrument? There are two issues on credit unions. One concerns their winding up, about which there is a letter from the Department of Finance regarding the European Act 1972. The other is an e-mail which deals with the extra activities in which credit unions can engage.

Deputy N. O’Keeffe

Please explain the first matter.

Chairman

The first statutory instrument is to give effect to an EU directive requiring the regulation, reorganisation and winding up of credit institutions. On the previous day, we sought a briefing note from the Department. The document is a detailed two page briefing note. If members have not had time to consider it, perhaps we will postpone the decision or instead dispose of it now.

Senator O’Toole

Yes.

Deputy Ó Caoláin

I propose that we accept the additional services requirements regulations. It is the only way to proceed.

Senator O’Toole

I second the proposal.

Chairman

The question is that the proposal in respect of SI 223 of 2004 be agreed. Is it agreed? Agreed.

Deputy Ó Caoláin

In respect of SI 198 of 2004, I am open to guidance from other colleagues. I would like to read it again. Is there a time limit on addressing the matter?

Chairman

Yes, there is. Under these regulations, they can be annulled by the Houses within one year after their enactment if there is a recommendation from the Joint Committee on European Affairs. We have a year if we seek to have these annulled. They will come into effect but they can be annulled within 12 months if the recommendation comes from the Joint Committee on European Affairs. We would have to convince the committee that we felt it should be annulled. It is not imminent.

Deputy Ó Caoláin

These regulations relate to credit institutions as opposed to credit unions and the two should not be confused. There are many examples of financial institutions in Ireland whose parent body is located elsewhere in the EU. Where difficulties arise, a centralised decision is taken within the home economy rather than the host economy of a subsidiary or arm of the same institution. The regulation needs to be considered with more care. I am open to advice members might wish to offer. However, one must consider how events might play out in Ireland given certain circumstances. We would not have a direct input as the determination would be taken in the home country. There are consequences which need to be considered.

Chairman

My understanding is that this is the intention of the regulation. If there are issues around jurisdiction, it will be decided in the home state of the parent company. However, because that is not in force now, there is the possibility of different legal proceedings in each individual countries.

Deputy Ó Caoláin

The current position may well be the preferred one in terms of the individual and the rights of consumers. Therefore, we should be very careful in how we proceed. It merits careful weighing up.

Deputy Burton

As the regulations are quite technical and complicated, we should avail of the services of the Irish Financial Services Regulatory Authority, IFSRA. It has a number of people who specialise in the regulation of credit unions. If they feel these regulations are lacking in the context of all the new legislation which has been introduced, we should ask if they have a viewpoint. We could read this proposal several times and still not have an expert point of view. I propose that we seek a viewpoint from IFSRA. When Mr. O'Reilly was before the committee, we debated the elements of the Bill which dealt with credit unions.

Chairman

This relates to all credit institutions rather than just credit unions.

Deputy Burton

At that time, IFSRA offered to make some expertise available to the committee. I assume the committee would write to IFSRA stating that this issue is before the committee and asking for a viewpoint on the matter.

Deputy N. O’Keeffe

I support Deputy Burton on this matter. Credit unions are large businesses now. They have significant amounts on deposit and have in recent times become quite controversial. I am aware of the credit union regulators within IFSRA. Those people should meet the committee and discuss the matter.

Chairman

I wish to clarify that this statutory instrument relates to all credit institutions. The extension of powers to which we referred relates only to credit unions and we have agreed to it. This statutory instrument relates to all credit institutions.

Deputy N. O’Keeffe

It is still important that we meet the regulators responsible for credit unions.

Deputy Ó Caoláin

On a point of information, the credit unions are on home base here. They are not part of what is being considered in this.

Senator O’Toole

SI 198 has nothing to do with credit unions. It relates to credit institutions only. One of the reasons for it is that for as long as I can remember, every time large multinational credit companies have got into trouble, people trying to get some satisfaction from them have had to deal with 24 different institutions throughout the European Union. The companies can move their responsibility to the area of least regulation. Therefore, institutions were lodging themselves in the IFSC and, if they were wound up, would do so through, for example, Liechtenstein. Through an EU directive, this statutory instrument requires that it is the terms of the country in which the credit institution is incorporated under which it must do its business. Therefore, such companies would, for example, come under the regulation of IFSRA in Ireland. I support this statutory instrument.

There are significant problems throughout Europe, about which the Chairman is aware, concerning the lack of uniformity in accountancy standards and practices. This proposal provides for a small element of tidying up, although a considerable amount of it needs to be done. I have no objection to getting a view from IFSRA but the committee can do nothing other than support the proposal because it is badly needed.

Chairman

Will we agree to get a view from IFSRA, take it from there and move on? Agreed.

The next item of correspondence concerns Maynooth College chapel. On 17 June, the committee agreed to ask the Comptroller and Auditor General to examine the events leading to the approval of grant-in-aid for the refurbishment of Maynooth College chapel to determine whether procedures for the disbursement of public moneys were properly applied. We received a letter in which the Comptroller and Auditor General has confirmed that the payment will be examined from the point of view of regularity and propriety during the audit of the appropriation account for the Vote for the Office of Public Works for 2003. The Comptroller and Auditor General will form an opinion as to whether a substantial issue arises which merits public accountability. If so, it will be included in the annual report of the 2003 appropriations account and considered by the Committee of Public Accounts in due course. I suggest that we note this position in the letter from the Comptroller and Auditor General.

Deputy Ó Caoláin

Would it not be in order that the correspondence be circulated to members? We have not seen it. I certainly have not.

Deputy P. McGrath

It is in the post.

Chairman

It only arrived today.

Deputy Ó Caoláin

It is fine if it has been circulated.

Deputy N. O’Keeffe

This committee was the first to raise the Maynooth issue. It is our prerogative to examine it before the Comptroller and Auditor General even attempts to examine it.

Chairman

We also wrote to——

Deputy P. McGrath

There was no information to receive. There was no application. It was all done by way of a cosy chat.

(Interruptions).

Deputy P. McGrath

There was no scrutiny of anything.

Chairman

The issue is clear-cut on the Maynooth College chapel issue. The committee decided to refer this aspect to the Comptroller and Auditor General, which has been done. We also wrote to the Department of Finance seeking a full list of other similar payments made in the same manner in recent years. We await a reply from the Department of Finance.

Senator O’Toole

Will it come to us?

Chairman

Yes. When it comes to us we will examine the matter further.

Deputy N. O’Keeffe

I was just trying to assist Deputy McGrath.

Deputy P. McGrath

As always.

Chairman

The next item of correspondence is the transcript of meetings. On 17 June, the committee agreed to write to the Editor of Debates regarding the finalisation of transcripts. The reply received from the Editor and circulated to members describes the considerable progress that has been made and continues to be made in this regard. I suggest we note the reply. Is that agreed? Agreed.

Senator O’Toole

I do not want to put extra work on the secretariat. However, given all the documents received, it would be helpful if there was a number on each document. As I am from Kerry, perhaps I am slower than other members. It takes me a while to catch up.

Chairman

We will try to do so. There is not always such a large volume of correspondence. However, when there is a large volume, we will try to do what the Senator suggests.

Deputy Ó Caoláin

On the correspondence from the Editor of Debates, there is a staffing issue in regard to the backlog. However, it is anticipated that the backlog will be cleared during the recess. Is the staffing issue in the area being examined by the Houses of the Oireachtas Commission under the current review? If the Chairman does not know the answer, would it be possible to write to the Houses of the Oireachtas Commission and suggest the area merits address. Is that agreed?

Senator O’Toole

As a member of the commission——

Chairman

The Senator is not allowed to refer to the matter here.

Senator O’Toole

The matter is not being addressed. The letter might mean it should.

Chairman

We will send a letter to the chairman of the commission.

Senator O’Toole

It is worthwhile noting that in terms of comparability with other Parliaments, the editorial staff are first-class. I know of no parliament in the rest of Europe where the main Chamber debates are on-line the following day. The committee debates may be a bit slower. Deputy Ó Caoláin raised an important point. If there is a staffing issue, it should be addressed.

Chairman

New technology may be required to speed up the process.

The next item of correspondence is EU scrutiny. The sub-committee on European scrutiny has sent to this committee a list of documents and proposals considered and decisions taken at its meeting of 17 June. The sub-committee has drawn our attention to document COM (2004) 365 but has not recommended we scrutinise it. The proposal sets out the opinion of the European Commission on the amendments made by the European Parliament to a proposal for a directive on market and financial instruments. The committee considered the original proposal in March 2003. We reported to the House that we were fully satisfied with the approach being taken by the Department of Finance. The Department believes the Commission's opinion has no implications for Ireland. Is it agreed that the proposal does not warrant further scrutiny by the committee? Agreed.

The next item of correspondence is the report of the Revenue powers group. The committee has received a response on the report of the Revenue powers group from the Irish Taxation Institute. The institute's president would be happy to meet the committee to discuss the issues in greater detail. The report of the Revenue powers group was published in February this year and was included in our draft work programme for consideration. I suggest that we thank the institute for its report and inform it that we will consider how to proceed on the issue after the August break. Is that agreed? Agreed.

The next item of correspondence is IFSRA's study on interest rates. The Consumer Director of IFSRA has sent the committee copies of a study by the authority on the extent and feed of interest rates passed through on a basket of personal small business lending in deposit products. The findings of the study are clearly relevant to the committee's deliberations on bank charges and interest rates. I suggest that we review the findings following the August break. Is that agreed?

Deputy R. Bruton

They indicate that outside the mortgage market interest rates are not being passed on. This was an issue on which we got direct evidence. In some cases, only half the interest rate reduction was being passed on to businesses and small borrowers. There have been many hearings and we have on our work programme the production of a report in this area. If we do not produce a report soon, time will have moved on and the issue will have become dated. What are the proposals in regard to the report?

Chairman

Given the events at the AIB, the various discussions we have had and the investigations taking place on charges in the financial institutions, we parked the issue to return to it when the reports are finished. When IFSRA produces the report, perhaps after the summer, we will move immediately to deal with the report. That is my understanding, but we have not formalised a position on the matter.

Deputy Finneran

I agree with Deputy Bruton on the matter. It should be one of the first documents dealt with after the break. These are important issues which can become dated. There is great public interest — excuse the pun — in what has been taking place in the financial institutions and lending agencies. The way small businesses and individuals are dealt with is scandalous. It is a matter of great public interest and we need to get our teeth into this important issue as soon as possible.

Chairman

We will agree to make this a priority item for September. The next item of correspondence is the IFSRA consultation paper. The head of consumer information in IFSRA has informed the committee that IFSRA has published a consultation paper on financial planning education for consumers and that submissions on the paper will be accepted up to 22 September. I suggest that if individual members of the committee or parties wish to make submissions, they will be free to do so. I do not think the committee will sit down between now and then to agree an all-party submission. Is that agreed? Agreed.

The next item relates to PMDS. The Department of the Taoiseach has sent the committee copies of a report on the evaluation of the performance management and development system in the Civil Service. I suggest that we note the report.

Deputy Finneran

The remit of this committee in the area of the strategic management initiative has not been taken up. The committee has been sitting for two years and we have not addressed the issue of SMI. As we have a remit, we have a responsibility in that area. I raised the issue on a number of occasions. Other matters appear to take precedence. I suggest that we carry out our responsibility in this area. It is an important matter. There was a separate Oireachtas joint committee in the previous Dáil. In this Dáil this committee has a remit and we have not carried out our responsibility. I would like the matter to be dealt with. As Deputy O'Keeffe said in the past, we should set aside a special day once a month to deal with this important matter. We should not ignore it any longer.

Deputy Burton

I made a proposal on the issue which supports what Deputy Finneran said. It was suggested that perhaps the appropriate way to deal with the issue might be in a sub-committee as it therefore would not require the Chairman's presence. Deputy Finneran, as Vice-Chairman of the committee, would be perfectly capable of chairing a sub-committee. It is an issue which needs to be addressed. It is up to the Chairman to make a decision. Given the ending of the dual mandate, there is no reason the committee meetings cannot be held on a Monday or Friday. Something like that could be arranged. I supported it before and do so now. The matter should be addressed.

Senator O’Toole

It is ironic that we should discuss this matter on the day that the Department announced that it will refuse to review the pay of senior civil servants. It is disgraceful that people on whom we depend on should be treated like that. This committee should have a view on the matter. We have already praised them for their great work during the Presidency. We should also praise them for how they run the various institutions, semi-State bodies and Departments. Today's announcement is a disincentive at a time when we want to keep the best people in the public service. We should be concerned about people leaving the service for jobs in the private sector. I do not want a big debate on it even though I would be happy to take part. We need balance and reward is also part of management.

Chairman

Shall we set up a sub-committee with a chairman?

Deputy Finneran

We should not go back down that road. We had the matter on our agenda. We thought about setting up a sub-committee for some time and I was in favour of it at the time. We then took a decision not to establish a sub-committee but to set a day aside to debate the issue. We should implement our decision.

Deputy Burton

We did not.

Deputy Finneran

We could hold a meeting on a Monday or a Friday to deal with this important matter.

Deputy N. O’Keeffe

We all have a great deal of other business to deal with today.

Deputy Burton

Yes.

Deputy N. O’Keeffe

Important people have come here today to tell us their story. I support the establishment of a sub-committee. We have a great many reports before us that we need to examine. Perhaps a sub-committee could do that work. There is merit in Deputy Burton's suggestion that we meet on Mondays and Fridays.

IFSRA supplied us with a report on interest rates. Senator O'Toole raised an important matter that we should also discuss. The Government is trying to regulate its system of finance and wages and I support its endeavours. However, we should have an overview on it and we should discuss the matter.

Deputy R. Bruton

Do the committee's SMI responsibilities govern every Department or just the Department of Finance, the Department of the Taoiseach and the Office of Public Works?

Chairman

Yes, the latter.

Deputy R. Bruton

It dramatically reduces the scope of the committee's work. As Deputy Finneran said, we may not need a sub-committee if our responsibility is so defined and the issues are relatively limited. In an ideal world we would have a secretariat that could provide us with a scoping paper highlighting the key issues for our perusal. We could then decide how we would proceed. We do not have the resources to fund such a report. We ought to proceed like that rather than set up a sub-committee on a wing and a prayer.

Senator O’Toole

What are our responsibilities and objectives in this area? Should we be informed and know what is going on? What would a sub-committee do?

Chairman

We do not have a consensus to establish a sub-committee. On many occasions we just have enough people present for a quorum.

Senator White

Exactly.

Chairman

A sub-committee or second meeting might not have a quorum.

Deputy N. O’Keeffe

I have no time for committees. Over the past three weeks we have received a great many papers.

Deputy Burton

Yes.

Deputy N. O’Keeffe

Some of it will never be read.

Deputy Burton

It is very difficult to read it all.

Senator O’Toole

Is it our role to keep up to date with the SMI or make some input? I have never understood which.

Chairman

It is up to the committee to decide its role.

Senator O’Toole

It might not be. I do not think we can micro-manage or manage what happens in Departments. Let us be clear about what we are doing. We do not want to waste our time.

Chairman

We could start with the Secretary General's strategy statement. I have not seen one in recent times.

Senator O’Toole

That is perfect.

Deputy Burton

Yes.

Chairman

We should seek the most recent strategy statements from the Secretaries General of the Department of Finance, including the OPW, and the Department of the Taoiseach. I have not seen them in a long time, if at all.

Deputy Finneran

I propose that we review the matter over the next few weeks and choose a day to deal with it.

Chairman

I would like to see the strategy statements first because that is how a Secretary General views his Department.

Senator White

Yes.

Chairman

Is that agreed? Agreed.

A number of letters concerning the committee's consideration of recent events at the AIB have been circulated. Before discussing the letters, I ask members to refrain from referring to or naming correspondents where they may not have anticipated that their letters would be discussed publicly at this meeting. As Chairman, I have received many letters and I have most of them with me. I want people to refer to the author without using names. We shall not discuss all the letters.

A correspondent in Dublin 4 said that he had difficulties arising from financial advice given to him by the AIB. The person suggested that the committee put a number of specific questions to the AIB chairman. I suggest that a reply be issued to the effect that committee members will take into account the questions in the context of any meeting with the AIB in due course. Is that agreed? Agreed.

Deputy Ó Caoláin

On 15 May the Chairman received a fax transmission from MC on bank overcharges. Why are we only seeing it two months later?

Chairman

I am not sure.

Deputy Ó Caoláin

Does the Chairman note that we got it two months later?

Chairman

I do. I can answer some of those issues. A number of letters were sent to me at my home constituency office. Some correspondence was also directed at me as Chairman of the committee. In some situations I did not know whether it was appropriate to bring the letters to the committee because I received correspondence as a Deputy in my own right.

Deputy Burton

We have a great deal of business today.

Chairman

We can postpone discussing the letters about the AIB.

Deputy Burton

We were going to look at the AIB issue when the IFSRA report is available. I suggest that, while people's letters are acknowledged and we can read them, there is no point discussing them today.

Chairman

Perhaps we will have a lighter work schedule next week. We could revisit some of them then and dispose of them. We will come back to the issue.

Deputy N. O’Keeffe

When will we receive the report on the AIB?

Chairman

It will be after the summer.

Senator O’Toole

Perhaps in January. I am betting on Christmas.

Deputy N. O’Keeffe

The Senator will have received his final dividend by then.

Senator O’Toole

The Deputy is doing a great job protecting them.

Chairman

We shall postpone discussing the letters on the AIB. We can reconsider them at our next meeting when we are not under so much pressure to deal with other business. Is that agreed? Agreed.

There are two other items of correspondence. One is the consideration of a draft report on the EU proposal COM (2003) 822. On 28 April the committee heard a presentation by Department of Finance officials on it. The proposal concerns the rules on the pace and supply of services for VAT purposes. The officials agreed to provide further information in writing on a number of specified issues. It was received and circulated to members. I intended to circulate a draft report for agreement at this meeting but information technology difficulties in the Houses of the Oireachtas have prevented me from doing so. If members are happy with the Department's position and the clarification given, I suggest a draft report indicating that we are satisfied with the proposal. It should also indicate that we are happy with the progress made to date on negotiations and the committee's discussions with officials. We should not make any recommendations either. Is that agreed? We can also postpone it.

Deputy Ó Caoláin

I raised the issue of the impact of the proposed charges in the draft directive and the supply of services by people who are VAT-registered in this State and the North of Ireland. I welcome the clarification. I do not seek to delay consideration of the directive. However, it is important to keep a watching brief on this. I would like to see how it pans out. It will require a regular review of its functions.

Chairman

We can write to the Department and ask it to update us on any progress.

Deputy Ó Caoláin

Yes, please.

Deputy R. Bruton

I raised the issue of share dividends and the double taxation of Irish individuals who work for foreign-owned companies. The Department indicated that it is not aware of a problem with recovering tax. I can assure it that there is a problem. I cannot provide the Department with cases but ask it to approach the Revenue Commissioners to see if the procedures could be simplified and, perhaps, a double taxation agreement with other European countries developed to make it easier for people to get this refund.

Chairman

We can include that suggestion as a recommendation in our report.

Deputy R. Bruton

If the Chairman so wishes. We could ask the officials to do so, separately from the report.

Chairman

We will take Deputy Bruton's first suggestion, namely, that we write to the Department and suggest that procedures be put in place.

The last topic of correspondence relates to decentralisation. There are three items of correspondence concerning public service decentralisation. A letter from Deputy Burton, which makes a number of suggestions regarding the Government's decentralisation programme for consideration by the committee, has been circulated. A paper produced by Dr. Michael J. Bannon, professor at the department of regional and urban planning in UCD, has been received. Professor Bannon believes the paper may be of interest to the committee in its consideration of the decentralisation proposals and has offered to meet the committee. Mr. Seán Ó Ríordáin, secretary general of the Association of Higher Civil and Public Servants, has written to the committee enclosing a copy of a statement on decentralisation which the association issued recently and renewing the association's request for a meeting with the committee.

Before seeking the views of members, I propose that the committee begin considering the decentralisation proposals in July and continue our consideration in September. I suggest that the committee seek meetings with the following groups in July. We should invite an Irish Congress of Trade Unions delegation which is representative of the different views across the public service. This would accommodate the request from the Association of Higher Civil and Public Servants but would also ensure that we take account of the views of all public service trade unions. I also suggest that we might meet representatives of the Revenue Commissioners, whose office is, I understand, the largest decentralised office in the State. The move to Limerick was completed ten years ago and the Revenue should be in place to reflect on the experiences of decentralisation. I also suggest that we invite academics representing the full spectrum of views on the issue and the chambers of commerce of two towns to which departmental headquarters have been decentralised.

I suggest that the committee resume hearings when the deadline for priority applications to the central applications facility passes on 7 September. At that stage we should meet officials involved in the administration of the central applications facility and Mr. Phil Flynn, chairman of the decentralisation implementation committee. The committee has been in contact with Mr. Flynn's office regarding his appearance at the joint committee. He feels it would be more beneficial to meet the committee at the conclusion of our deliberations on decentralisation, at which time he will be in a position to address and answer the queries which will have arisen during the course of our deliberations. He suggested that September would be the best time when the committee had completed its considerations.

I also suggested that the Comptroller and Auditor General who has examined this issue in the course of his work in the past may be able to assist the committee. I spoke to him at length yesterday. While he would like to help, he feels he is precluded from doing so because he will, in due course, come to audit the decentralisation procedure and any involvement in the process at this stage might compromise the independence of his audit. He also indicated that the Comptroller and Auditor General is specifically excluded from discussions on policy decisions of Ministers and the Government. As our committee will be discussing substantially the policy issues of decentralisation, the Comptroller and Auditor General feels that he is barred from participating in such a discussion. I made that suggestion on the airwaves recently but, for practical reasons, we will not act upon it.

Deputy R. Bruton

I welcome that the committee will have these hearings. While not wishing to rake over the coals of previous discussions, the rejection, by a vote of the committee, of the committee's desire to have hearings on this issue after the local elections was a serious blunder. I am glad there has been a change of heart among other parties which are members of the committee.

I welcome the idea of commencing hearings in July and continuing in September. However, I have misgivings about the proposed structure. The individual public service unions are entitled to have a specific opportunity to present their view. They have specific viewpoints and it would be difficult for the ICTU to provide a consolidated presentation. We want to hear the views of those at the coalface in their diversity rather than expect the ICTU to present a consensus of them.

We need to obtain information from the Departments and from the Department of Finance in the first instance. In October 2003, we received a detailed presentation from the Department of Finance on the criteria to be applied in the selection of units for decentralisation and the places to which they would go. We need to hear again from the Department of Finance officials as to how this selection fitted in with those important criteria. The starting point for our discussion will be to see if the decision is well based and well established.

We also need to hear about the impact on individual units. One of the requirements for Secretaries General and Accounting Officers of Departments is that they do a risk assessment of moves or changes of this nature. We should hear the structure of the risk assessments to be applied in these cases and where the risk assessments which are completed have been carried out. If large numbers of people in specialist areas will not move, the skills base of an organisation could be undermined. We need to understand the extent to which this represents a threat and the extent to which we can make recommendations to mitigate that threat.

We must try to maximise the benefits and minimise the costs in a well thought out decentralisation programme. I fear that some elements of the existing proposals will not do that. We need to have an opportunity to shed some light on those elements. The Chairman's proposed list of witnesses, including ICTU, the Revenue Commissioners and academics, is not enough. We need to hear from some of the people who are involved in decision making. We need to hear from those who have past experience, other than the Revenue Commissioners. We know, for example, that more than 80% of people involved in previous decentralisations did not move from the Departments or offices which were being moved, so that there was only 20% retention. We also know that, in significant cases, approximately 40% went on promotion. There are issues in past experience from which we need to learn. We could do this by way of a document presenting the summarised information from past experiences.

I welcome the Chairman's proposals but I make those comments. I ask that some of these ideas be incorporated into the proposed structure.

Chairman

When we held hearings on the film industry, we operated through ICTU which brought in SIPTU, which was the main union involved. If the committee were to cherrypick individual unions, we could omit a union which has an important role in some element of the public service. I do not expect ICTU to have a composite view. I expect it to bring representatives of various unions who will put forward different views.

Senator O’Toole

Three unions have spoken specifically on this issue: the Association of Higher Civil and Public Servants, the Civil, Public and Services Union, which deals with clerical assistants and clerical officers, and the union dealing with middle grades. Those are the three Civil Service unions. They have three distinct voices and they will need to be heard in that way.

Chairman

I agree. I propose that we ask ICTU to propose how they could be heard. There are other unions in the wider public service. I did not want to select one and leave out another. By all means let the committee hear all those views separately. ICTU is the umbrella group and it could act as a co-ordinator.

Senator O’Toole

If the Chairman's point were made to ICTU, it could indicate to the committee the most appropriate people to make presentations.

Chairman

The ICTU might give us a list of the membership across the various trade unions in the public service. I do not have that information.

Deputy Burton

I wrote to the Chairman in some detail. My letter was a reiteration of the proposal I made to the joint committee and which the Government parties voted down. The U-turn, however late, is welcome nonetheless. It is helpful to the parties involved that there is a rational discussion of how this proposal will play out. However, a number of concerns remain. I am in favour of a programme of decentralisation that is well thought out and planned and is allowed to take place within a reasonable timescale while taking account of the individual circumstances of members of the Civil Service.

We have received a great deal of correspondence from the Association of Higher Civil and Public Servants. Its take on decentralisation is not only about its members' interests, which it has to serve, but also, critically, the impact of the proposal on the cohesion and effectiveness of the public service. It is critical we take a focused view of what it is we are trying to examine. The proposal to lump together the contributions and comments of the public service unions under the umbrella of congress is not satisfactory.

In the case of the film industry, to which reference was made, there was a unified view among the range of unions and people associated with the industry who lobbied this committee for a common objective. In this particular case, there are differing points of view across the range of public service unions. It is a little unfair to ask Mr. David Begg to sit in the middle of two delegates for and two against the proposal.

Senator O’Toole

He does that every day.

Deputy Burton

He may, but that is not a constructive way of working. We have received clear documentation from the Association of Higher Civil and Public Servants dealing not only with individual issues but with the broader impact on the cohesion, effectiveness and ethos of the public service. That issue needs to be addressed. It is, interestingly, also the issue addressed by Dr. Edward Walsh, the former President of the University of Limerick, a strong proponent of decentralisation and also by the former Taoiseach, Dr. Garret FitzGerald. These issues are deserving of serious examination.

We have also received a paper from Dr. Michael Bannon which covers one of the points raised in my letter. An article in The Irish Times today also raises the point of whether or not strategic clustering would offer the benefits of decentralisation without the loss of cohesion that a very fractured decentralisation might offer. The question was asked whether we should invite a delegation from the Revenue Commissioners. The Department of Social and Family Affairs has long experience of decentralisation. I was involved in that process more than ten years ago. It took time to achieve, a critical issue in all of this. The problem with the proposal is that the Minister for Finance wants everything done and dusted before the next general election which is under three years away.

Other issues needing consideration are matters such as the decentralisation of the Legal Aid Board to Caherciveen with technically expert staff refusing to relocate there. Currently the Legal Aid Board has an office in Caherciveen and one in Dublin and it is in financial crisis. What is the response? The answer is not to close the head office in Dublin but to close the suburban law centres in Dublin which provide a service to the public. If we handle decentralisation badly, it could put the cost of benchmarking completely in the shade. It could result in people refusing to move out of Dublin and their places around the country being filled on a supernumerary basis. We could end up with the nightmare scenario of possibly a large number of additional public servants being employed.

Chairman

We cannot have a substantive debate on decentralisation. It is unfair to other members. The Deputy should speak on the structure of the debate not the substantive issue otherwise all other members will want to speak about decentralisation.

Deputy Burton

I took the trouble to write in some detail to the Chair on the matter.

Chairman

Yes.

Deputy Burton

The Chair responded by way of his suggestion. It is not satisfactory to use the umbrella of the Irish Congress of Trade Unions in this regard.

Chairman

The Deputy does not agree with that suggestion.

Deputy Burton

As the Association of Higher Civil and Public Servants sent two lengthy submissions to the committee there would be no problem in meeting its representatives perhaps next Monday or Tuesday to obtain an overview of where it is at. I also proposed that Mr. Flynn, the chairman of the implementation group, be invited to make a presentation to the committee on what that group is proposing. I do not know if he is included in the Chairman's list.

Chairman

By way of clarification, I have been in contact with Mr. Flynn's office and have been informed he is currently preparing a report which will be available to the Government in a few weeks' time and to us at a later stage. He was of the view that rather than making an opening statement at the commencement and then several issues arising by people who would appear subsequently, he would prefer to attend in September to deal with all issues raised at our hearings and to respond at the end of the process. That is Mr. Flynn's suggestion.

Deputy Burton

When I made the original proposal, prior to the local elections, the closing date of the Central Applications Facility was the end of June. I suggested at that point that the closing date be the end of July in the context of the required information being available. Given the Chairman's remarks, I believe it would be better that the committee discuss the matter when the information is available. We will be speaking in a vacuum. Most of us guess there will be a rush of 25% of people in different Departments seriously interested in decentralisation. Delivering the other 75% will be extremely problematic and will be based on various packages, promotional outlets and so on being offered. Until we have that type of information, I do not know what will be the purpose of some of the discussions.

I would also like to refer to another point raised in my letter. A number of public bodies are affected by the proposal. They are in a different category to many of the Civil Service Departments in that they employ expert staff. One example is FÁS. It and various other bodies employ staff in a technical expert capacity. The Taoiseach, three days before the local elections, promised a Dublin applications facility for people wishing to remain in Dublin. That does not appear to have happened. Does it mean that people from FÁS will end up applying for a job in the broader public service? That will have grave implications for their careers. Some of those bodies and their representatives ought to be included in the group. I apologise for speaking at length but it is important we get this correct.

Senator White

The Taoiseach and the Minister for Finance are acutely aware of the concerns expressed by public servants not wishing to relocate from Dublin. The Taoiseach has re-emphasised that this will be a voluntary programme. The report of the decentralisation implementation group states that a system similar to the CAF should be developed at a later stage. I hope Deputy Burton is listening.

Senator O’Toole

We should stick to discussing the structure of decentralisation and nothing else.

Senator White

Deputy Burton is not listening.

Senator O’Toole

I do not want to listen. I would prefer if we stuck to discussing the structure of decentralisation.

Senator White

I have listened to Deputy Burton and Senator O'Toole who have dominated the debate.

Chairman

Members should speak through the Chair.

Senator O’Toole

We should first debate the structure of decentralisation and then everybody can have their say otherwise we will be here until morning.

Senator White

I listen patiently to Senator O'Toole in the Seanad.

Senator O’Toole

I apologise profusely.

Senator White

The report of the decentralisation implementation group recommended that a system similar to the CAF should be set up to assist the people in Dublin who do not want to move. This is to be implemented in the autumn and I assure Deputy Burton that I will ensure it is. Professor Ed Walsh is one of those completely opposed to the decentralisation programme. When my visit to Colombia to observe the human rights trial of the three Irish men was first mooted, he wrote to me stating what he considered of my proposal to go to Colombia. I visited Colombia seven times at my own expense and those men were proved innocent. Professor Walsh, the man who did not want me to go to Colombia to defend the human rights of three Irish citizens, is against decentralisation.

Senator O’Toole

We should keep that in mind when we are discussing decentralisation.

Deputy N. O’Keeffe

On a point of order, I see little depth in Senator White's or Deputy Burton's proposals. Why do we not sit down together, put something in place and have a meeting? Mr. Flynn is the only problem with regard to the proposal. If we put him at the bottom of the list and the others at the top, we are in business.

Senator O’Toole

I second that proposal.

Deputy Ó Caoláin

With regard to what is proposed, I have no difficulty with the groups identified by Deputy Burton and the Chair. However, I would like to add some suggestions. Professor Bannon, who has corresponded with us, has expertise on the issue of relocation and decentralisation, and also in the area of regional and urban planning. The documentation he has provided shows he has a particular expertise and view which would merit consideration by the committee. I propose that he be considered for an invitation to be part of the process.

Furthermore, it is important to find a formula to accommodate the 53 urban centres identified for decentralisation other than the sole proposition in the Chair's contribution, of including representatives of chambers of commerce. Other possible host communities marked out for decentralisation must have views and could have an input. Perhaps the executives of local authorities, county managers and county development board officers, could be involved. They could make an important and unique contribution, different from many of those already outlined. I would like to see their participation because they are dealing with the issue of accommodation, planning and development, issues which will impinge on the success, or otherwise, of the proposition.

Deputy Burton rightly raised another matter about which I have a concern, the issue of the central applications facility and the time extension. I share her view too that we may be rushing into this and may perhaps as a result be dealing with the issue in an information vacuum. Mr. Flynn has already indicated that he would prefer to wait to appear until September. I am not sure how to respond to that. I would have thought it would be the ideal place to start.

We are talking about six or seven weeks of meetings until the end of September as we will not meet in August. Is there an advantage in commencing the procedure this month, given there is so much yet to be revealed? Would it not be better to have the hearings over a common period of time setting aside a number of days per week over a succession of weeks, rather than having this disjointed approach of a July commencement when much information will not be available, a recess throughout August, and a return to it in September? It might be better to commence in the first week of September and do the business in a concerted, focused manner over the required period.

We are not serving the issue in a serious manner as we are currently proceeding. We need to structure the process. With respect, I propose we do not structure it in the manner suggested by the Chair. We need to organise it in a more tied together fashion and I propose we defer commencement of the process until September.

Deputy Finneran

A decision on the matter was taken some weeks ago. When it was discussed prior to that, I objected on the basis that matters such as the SMI, which were part of our remit, were being sidelined. This matter was given priority to the exclusion of the SMI and the same is happening again today, although we may have made some progress on the SMI.

I support the suggestion to bring in the Irish Congress of Trade Unions and others. I have some difficulty with Deputy Burton's letter, particularly with regard to the suggestion that commentators such as former Taoiseach, Dr. Garret FitzGerald, should be brought into the process. I recall that in 1992, when the General Register Office was being decentralised to Roscommon town, Dr. FitzGerald became spokesman in opposition to that move. He was opposed to the decentralisation in the same manner as Opposition elements are opposed to the current Government policy. I do not want to hear any more from Dr. FitzGerald on the issue. It went ahead without him then. There is a fine development in Roscommon and those located there will move into new €10 million offices shortly.

Senator O’Toole

Deputy O'Keeffe made a proposal which I seconded.

Deputy Finneran

I did not interrupt Senator O'Toole and it is not appropriate for him to interrupt me. People are entitled to have their say.

The position on decentralisation is that it is a voluntary scheme. This must be reiterated. Nobody is compelled to move. The number of representations of interest made to me as a rural Deputy with regard to when decentralisation will happen and the number of people who will take up the over 1,000 jobs decentralised to the midland region, 230 of them to Roscommon town, goes into hundreds. They want to take up positions in Athlone, Ballinasloe, Roscommon or elsewhere. I want to ensure that the voice of those individuals is brought to the attention of this committee also.

Chairman

I understand the point made that some of the work cannot be completed until September until we hear from the central applications facility. However, as has already been said, a number of trade unions have issued public positions on the matter. Their views are already in the public arena and I cannot see why we should not hear from them now or from representatives of a large or small operation that decentralised in the past. While these may have been successful moves we can learn lessons from the teething problems they faced and any mistakes made in the initial stages.

The positions of a number of academics and commentators have been stated and we do not need to wait until September to hear their views. Some of the host towns and local authorities also made submissions on the issue some time ago and their positions are well known. The only information we lack is the specific numbers. We know a large number want to move but do not know the final number. I cannot understand how people can think the majority of those we mentioned today need to wait until September. Most of their views are well known and there is no good reason why they should not come before us this month.

Deputy Twomey

As there is a conflict of views, can we have a committee meeting to make a decision on the issue? I am in favour of proceeding in order to get decentralisation to the south east. I know it will work there. Much of this discussion indicates that some members are opposed to many aspects of decentralisation. Would it not be beneficial for the committee to try and get some consensus before it invites anybody to come in and present on the issue? As the Chair said, we know the views of most of those who want to come in and we have all kept up to date on the issue since it was progressed in the Finance Bill last February. At the rate we are going, we will still be talking about it when the next Finanace Bill is introduced, with no conclusion reached. We have received so much information on it already that that perhaps we, as committee members, should reach a consensus and avoid issuing invitations to witnesses.

It is likely the committee will report next December, which is one third of the way into the so-called timeframe for the implementation of decentralisation. That is an impossible situation. We will end up as a talking shop getting nowhere. Why can we not come to some consensus on this between ourselves and see if we can move it forward?

Deputy N. O’Keeffe

I have a suggestion that Deputy Burton, who has a strong view on this, and the Chairman get together to draw up a programme. Neither document is very different from the other. The decision of the committee has been rebuffed by the Tánaiste and by the Minister of State, Deputy Parlon, and we have been whipped into line.

Senator White

That is not the case.

Deputy N. O’Keeffe

As we have to be good and loyal public representatives, we do what we are told.

Chairman

Can we agree or otherwise? I propose we set aside two days towards the end of this month and dates to be finalised at next week's meeting. We will conclude our business in September. We will arrange specific dates for next week's meeting. I will talk to the other parties between now and then about dates and timeframe for the hearings. Is that agreed?

Deputy Burton

There is a need for clarity as to the purpose of the exercise when we do not have the critical information. There are a number of different aspects to this which the committee should examine. The Government has made a decision but the problem is there are a number of factors which deserve to be examined. The critical ones are the amount of decentralisation which is proposed, the timescale under which it is proposed that it be completed and the fact that all the indications are, informally, that under 25% of public servants are willing to transfer. I am shocked by Mr. Flynn indicating that he is unwilling to speak——

Chairman

He said he is preparing a report and he considered it would be more useful to come in at the end of the committee's hearings and answer all the questions and issues that have been raised.

Deputy Burton

That is probably a reasonable position on his part but to be honest, if we are talking about this in a structured way, he is a key person to come to the committee and say, "This is what the ring is, this is what we are proposing." He is preparing to implement Government policy; that is his role. Our job as a committee, partly, is to tease out the pros and cons. I have made my position clear. I favour structured decentralisation done on an orderly basis. I served in the Department of Social Welfare when a successful decentralisation was carried out over about a seven year period.

Chairman

Shall we meet in July or not?

Deputy Burton

I see no point. If people want to meet, I would propose——

Chairman

That is the second U-turn of the day. The Deputy forced a vote and she is getting her wish.

Deputy Burton

——if Mr. Flynn's proposal is to meet this committee in early September and if the CAF results are out on 7 September, I propose we meet four days or so after that information is available.

Chairman

I propose we set aside two days in July to commence this process.

Senator White

To do what exactly?

Chairman

To commence the process. The majority of people who have been suggested on all sides——

Deputy Burton

What is the point?

Chairman

The views of the Association of Higher Civil and Public Servants will not change on 8 September. Its views are known.

Caoimhghín Ó Caoláin

There will be a lot of public interest and a fair amount of media interest. It would be better dealt with as a package as it will lead to greater cohesion as the information flow will be streamlined. It will happen over a period of days, together, instead of a piecemeal drip feed which is not helpful.

Chairman

I am trying to look forward to the autumn schedule. I had thought we would be returning to the situation regarding the banks, which might be clearing after the summer. In advance of the budget, I thought we wanted to do some proper analysis of the various tax reliefs that are in operation. Some of those issues may not now be dealt with if some of the work is not done before the summer. The issue of tax reliefs is topical. We need to take time out after the summer.

Senator O’Toole

There is only one issue to be decided now; should we begin in July or in September. I suggest it is put to a vote.

Chairman

I propose the committee meets in July. Is there agreement on that proposal? There is no discussion. Does Senator White second that proposal? Is there agreement that we commence the hearings for two days in July and have a detailed work plan agreed for the meeting next Wednesday? Is that agreed?

Deputy Burton

I wish to clarify the Chairman's proposal. If this is done in July, are further meetings in September precluded, when the material becomes available?

Chairman

No. Mr. Phil Flynn and the central applications facility are to be invited after the deadline on 7 September. The broader issues are not dependent on the report on 7 September.

Senator White

We will have further information by then from the central applications facility for those who do not wish to leave Dublin. It would be important to continue.

Senator O’Toole

Is the committee to meet on two days in July?

Chairman

Before the end of the month. We can deal with some of the work and proceed when we have the report.

Mr. R. Bruton

I want to see information on the selection process and on the risk assessments that each Accounting Officer is obliged to undertake on the impact of this decentralisation on their body. That is crucial evidence. The committee will require a documentary presentation and follow-up hearings if necessary.

Chairman

We will see what can be obtained in advance of our hearings. This discussion was about No. 2, correspondence.