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(Speaker Continuing)
[Deputy Simon Harris:   ] It is not too dissimilar from the CIE situation. I have a deep suspicion, as I think all mortgage holders do, that what has happened is that the money that was given for the purpose of writing down mortgages has just been put into a black hole within AIB and it now continues to hike up the variable interest rate. Can we try to get some clarity on this? We had a lengthy discussion with the Secretary General of the Department of Finance, but there is no clarity in the minds of the public as to the use to which this money has been put. It is taxpayers' money.
Chairman: On foot of the Deputy's query we will ask the Accounting Officer about this. Then we can take the issue up again.
Item No. 6 is the draft report from the HSE. We will wait for the evidence to be taken at our meeting next Tuesday before we finalise that report. Is that agreed? Agreed.
Deputy John Deasy: As a matter of interest, when did we invite the witnesses to next Tuesday's meeting? Was this arranged a couple of weeks ago?
Clerk to the Committee: Yes, it was agreed about three weeks ago.
Deputy John Deasy: Who is coming in?
Clerk to the Committee: The Accounting Officer for the HSE and the Accounting Officer for the Department of Health. Both of them are coming in.
Deputy John Deasy: Thank you.
Chairman: Is there any other business?
Deputy Paschal Donohoe: I have a question on a matter the Chairman himself raised at a recent meeting. Where do we stand with regard to the skills fund investigation? The Comptroller and Auditor General indicated that his office was involved in a matter. When will this come back to the committee?
Chairman: It is a special report, but I will ask the Comptroller and Auditor General to respond on that.
Mr. Seamus McCarthy: I spoke about that last week also. I have a draft report on my desk, but have not got to it yet. The field work is completed. We need to clear it and the clearance process is likely to require legal advice, given the nature of the issues. I expect to complete this by the end of the year.
Deputy Paschal Donohoe: Thank you.
Chairman: We have agreed our agenda for Tuesday, 9 October, which will involve the HSE and the Department of Health and their 2012 budgets. Can we also agree the agenda for Thursday, 11 October 2012? The first part of the meeting will be a briefing by the Minister for Public Expenditure and Reform on the public sector reform programmes. Separately, we will receive a briefing from the implementation body on progress to date in implementing the public service agreements 2010-14. Is that agreed? Agreed.
Special Report No. 78 of the Comptroller and Auditor General: Matters Arising out of Education Audits (Resumed)
Higher Education Authority - Annual Financial Statements 2011: Discussion
Mr. Seán Ó Foghlú (Secretary General, Department of Education and Skills) and Mr. Tom Boland (Chief Executive Officer, Higher Education Authority) called and examined.
Chairman: Item number 8 is the Special Report No. 78 on matters arising out of the education audits. Before we begin, I remind members, witnesses and those in the Gallery to turn off their mobile telephones as interference from the telephones affects the sound quality and transmission of the discussion.
I wish to advise witnesses that they are protected by absolute privilege in respect of the evidence they are to give the committee. If they are directed by the committee to cease giving evidence on a particular matter and continue to do so, they are entitled thereafter only to qualified privilege in respect of their evidence. They are directed that only evidence connected with the subject matter of these proceedings is to be given and asked to respect the parliamentary practice to the effect that, where possible, they do not criticise or make charges against a Member of either House, a person outside the Houses, or an official by name or in such a way as to make him or her identifiable.
Members are reminded of the provision within Standing Order 158 that the committee shall refrain from inquiring into the merits of a policy or policies of the Government or a Minister of the Government, or the merits of the objectives of such policies.
I welcome Mr. Seán Ó Foghlú, Secretary General of the Department of Education and Skills. This is his first appearance at the committee and I wish him well in his work. I invite him now to introduce his officials.
Seán Ó Foghlú: I am joined by Ms Mary Doyle, deputy secretary in the area of higher education, Mr. Philip Crosby, principal officer in the area of industrial relations, and Ms Laura Casey, assistant principal officer in the higher education area.
Chairman: I welcome Mr. Tom Boland, chief executive of the Higher Education Authority, and invite him to introduce his officials.
Mr. Tom Boland: Ms Mary Kerr is deputy chief executive of the HEA, Mr. Fergal Costello has responsibility, among other things, for the area of funding for our institutes of technology and Mr. Stewart Roche is the management accountant in the HEA.
Chairman: Who have we got from the Department of Public Expenditure and Reform?
Mr. Dermot Nolan: I am Mr. Dermot Nolan from the Department of Public Expenditure and Reform and I have responsibility in the area of the education Vote.
Chairman: I now invite the Comptroller and Auditor General to introduce the special report.
Mr. Seamus McCarthy: I propose to recap briefly on the sector-wide issues I outlined at last week's meeting, but I will refer first to the Higher Education Authority's financial statements for 2011, which are also included in the agenda for today.
The HEA is the statutory planning policy development and advisory body for higher education and research in Ireland. It is also the primary State funding authority for the universities, institutes of technology and certain other designated higher education institutions. The authority's expenditure and disbursements to higher education institutions in 2011 amounted to a total of €1.37 billion. Recurrent grants to institutions accounted for €1.2 billion, or approximately 88% of the total expenditure. Other significant distributions related to capital grants of some €48 million and research grants amounting to €95 million. It should be noted that the Department of Education and Skills also disburses capital grants to the institutes of technology.
The HEA received a clear audit opinion in respect of the 2011 financial statements. However, the certificate draws attention to the existence of balances held in the pension control accounts in five of the universities, which they treat as liabilities due to the authority. The background to the accounts is dealt with in the special report.
The pension control balances contribute to the large cash balances of over €700 million held by the institutions, at the end of the academic year 2011, in commercial bank accounts, which are dealt with in the special report. It concludes that it may be worthwhile reviewing the State's wider treasury management policy and considering the merits of providing for a sweeping-up of surplus funding in third level institutions and other State bodies. The HEA informed us that it was taking steps to slow the flow of funding to the institutions around the year end. Last week, Deputy Fleming asked if we could get an update to 2012. The end of year for the universities was 30 September, so it was not feasible to have something ready for the Deputy. However, I will provide an update as soon as possible.
Control over remuneration levels and employee numbers are matters shared between the authority and the Department. Both were involved in oversight of the employment control framework for the higher education sector introduced in July 2009 and updated on a number of occasions thereafter. Overall, the restrictions resulted in a reduction in staff numbers within the third level education sector by an estimated 7.3% between the end of 2008 and the end of 2010. Over the same period, full-time student numbers increased by an estimated 10.5%. Only one of the institutions concerned, Trinity College Dublin, was identified as not having kept within the terms of the framework.
Rates of remuneration of staff of universities are subject to the approval of the Minister under the terms of the Universities Act 1997. The fact that there were payments in excess of the approved levels for many senior staff was reported upon in an earlier special report. I outlined last week the exercise undertaken by the Department and the HEA to identify the amounts involved over the period June 2005 to February 2011, to provide them with the basis for deciding what action to take on recoupment.
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