The Comptroller and Auditor General
John Buckley today issued
annual report for 2009 and said the accrued liability for Irish public
pensions is €129bn. The C&AG also reports that the Government has paid a writer
€341,714 for the history of the Office of Public Works (OPW) and 2 chapters were
delivered by Dec 2009 after 7 years.
The C&AG said the number of civil
servants fell from 317,274 in 2008 to 310,208 in 2009 while public service
pensioners increased from 113,384 to 123,954 -- 1 pensioner for
The accrued cost outstanding of pensions has risen 7.4%
from €108bn to €116bn and adding in the
Sate pension costs bring the total to €129bn.
The report says the total outstanding commitments of central
Government departments and agencies in respect of contracted PPP projects at end
2009 is estimated at €4.1bn. A further significant number of PPP projects were
in development at the end of 2009 but had not yet reached contract stage.
Based on the assumption that the projects will progress as
scheduled at July 2010, the Department of Finance has estimated that the
potential total expenditure on currently contracted projects and projects
expected to commence construction by 2016 will be approximately €24bn over the
period 2010 to 2053. Expenditure is projected to average €730m a year over the
30-year period from 2010 to 2040.
Up to the end of July 2010, the State had spent or committed a
total of €24.35bn on the direct provision of financial support to credit
institutions. This comprises
Apart from the capital injections for individual financial
institutions, the State has provided substantial guarantees in respect of
banking liabilities. At end June 2010, the extent of the credit institutions
liabilities covered by such schemes was estimated to be €334bn. This included
€78bn covered under the Deposit Guarantee Scheme.
The State has received some funding in return for the guarantees
it has provided in respect of bank liabilities. By end July 2010, it had
collected guarantee fee payments totalling €1,026m. A small amount of the costs
of developing and administering banking stabilisation measures has also been
recovered from the institutions availing of the guarantee cover. In addition,
substantial balances were held in the Deposit Guarantee Account in the Central
Bank (€608m at the end of 2009).
The report says administrative costs incurred by State agencies
in relation to banking stabilisation measures have been substantial in absolute
terms, but are small relative to the scale of the costs, financial commitments
and risks associated with the banking stabilisation measures. Access to timely
and professional advice is a vital input to decision making in this context. At
the same time, it is important to ensure that sound procurement and contracting
practices are followed to ensure that the expenses being incurred are no more
than is warranted in the circumstances.
Public agencies paid consultants €34m to the end of July for
advice on the banking crisis. Law firm Arthur Cox received
€11.6m in fees, followed by US investment bank Merrill Lynch at
Accountants PriceWaterhouseCoopers (PwC) made €6.65m
and investment bank, Rothschild, which took over the advisory
role from Merrill Lynch in 2009, earned €4.54m.
Data on public procurement in 2009 indicate that payments
were made under 473 contracts concluded without competition. The total value
of the contracts reported in 2009 was €69.1m. Both the number and value of
non-competitive procurement payments reported decreased in 2009 relative to 2008
(522 contracts with a combined value of €79.1m).
The Irish Prison Service (IPS) had the highest reported level of
contracts awarded without a competitive process, with expenditure of €22m on 154
contracts in 2009, and expenditure of almost €28m in 2008. The Department of
Finance has stated that the position of the IPS is receiving particular
attention. The IPS has indicated that it has put new contracts in place where
existing ones had been extended beyond their original term — a particular issue
identified by the Service in analysing its purchases.
It is expected that the drop in the level of expenditure by the
Service under contracts not subject to competitive tender will continue in 2010
The report says that in January 2002, following a request for
proposals from interested persons, the OPW entered into a two-year contract with
a professional historian to research and write a text for publication on the
history of the OPW from the seventeenth century to 2000. The total fee specified
for this commission was €76,184, with a completion date of January 2004.
In January 2004, the OPW agreed a further two-year consultancy
contract with the author at a revised fee of €78,470. The deadline for the
production of the final text was extended to January 2006. No signed contract
beyond this date was entered into.
Up to 31 December 2009, the author has been paid a total of
€341,714 (inclusive of withholding tax of €68,172). Two completed chapters of
the book have recently been received by the OPW.The Dáil Public Accounts Committee (PAC) said it intends to closely probe the findings of this report in order to establish why,
in some instances, value for money was not achieved and how in future, improved
procedures should be put in place to ensure a better return for the State’s
Committee Chairman, Bernard Allen TD said today: “The
Committee welcomes the publication of the C&AG’s report today. It draws
attention to situations in which public money may not have been prudently spent
and where practices in State bodies and departments were lax.
During the coming months, the Committee will call witnesses to the Committee
from the relevant State bodies and agencies identified in the report to get
responses concerning the findings of the report and to find out how they intend
to address the matters raised.
In particular the Committee will prioritise areas such as:
- The escalating cost of bank stabilisation
measures in particular relation to Anglo and Irish Nationwide Building
- The delays in winding down or
amalgamating quangos arising from Government decisions.
- The cost of decentralisation, including
what can only be described as waste or nugatory expenditure on this
- The exorbitant cost of farm inspections.
- The issue of measuring those waiting for
in-patient procedures and out-patient appointments in our public hospitals.
- The use of public money to enable some
officials to travel on loosely defined fact finding missions to places
such as Hong Kong, Australia and Los Angeles under a skills programme
operated by SIPTU as part of an agreement with the Department of Health and