Comptroller & Auditor General
Report: The 2011 report from the C&AG reports that 17% of public bodies ignored
a survey on the €15bn annual procurement bill. The report also says interest on
the national debt will consume 21% of tax revenues in 2015.
The National Procurement Service
undertook a survey of public bodies, asking them to report their ‘top 30’
suppliers of goods and services in 2009. Bodies were also asked to indicate the
category of goods and services procured. The survey targeted 310 public bodies
in respect of 2009 and by the end of June 2011, a total of 257 bodies (83%) had
responded. Certain categories of goods and services were excluded from the scope
of the survey i.e. professional fees, construction related activities, costs
related to the purchase and rent of property and all payroll costs.
The NPS aggregated the results of
the survey by expenditure type, which showed combined reported spend was €50m or
over in 2009. The areas of highest spending were medical supplies, computing,
fuel and water.
The fact that 53 bodies
binned the survey query or the National Procurement Service acted as a shrinking
violet in the face of inertia and laziness, speaks for itself.
Estimates prepared by the Department
of Public Expenditure and Reform indicate that public expenditure on procurement
of goods and services in 2010 totalled around €9bn, with a further €6bn being
spent on capital works.
Departments reported that they
placed contracts in 2010 to the value of €75m without pursuing competitive
tendering processes. A further €4.4m of non-competitive procurement was
identified in the
course of audits.
PPS: The total outstanding commitments of central government
departments and agencies in respect of contracted PPP (public private
partnerships) projects at end 2010 is estimated at €4.3bn. A further significant
number of PPP projects were in development at the end of 2010 but had not yet
reached contract stage. Estimates of the potential cost of those projects are
not currently available from the Department of Public Expenditure and Reform.
The National Roads Authority had to
make payments totalling between €5m and €5.5m this year to the private operators
of the M3 motorway and the N18 Limerick Tunnel because of declining road
€10.3m was incurred in respect of around 100 staff directly employed by the NTMA
(National Treasury Management Agency) and assigned to NAMA (National Assets
Management Agency: €9.2m) and the cost of NTMA employees operating shared
services including IT, Human Resources and Finance (€1.1m). €4.6m was incurred
in respect of other costs incurred by the NTMA including rent, office services
and consultancy costs.
At 31 December 2010, 34% of the NPRF’s (national pensions reserve fund)
resources were devoted to capitalisation of Irish banks and up to a further 44%
had been allocated towards the State’s contribution to the EU/IMF Programme of
Financial Support for Ireland. By April 2011, the NPRF had converted €10bn of
its discretionary investment portfolio into cash and placed it on deposit with
Irish commercial banks pending further direction from the Minister as to how
this was to be invested.
For the year ended 31 December 2009,
the NPRF valued the directed investments at cost under a direction of the
Minister. At 31 December 2010, following revised directions from the Minister,
the directed investments were valued at fair market value. For the ordinary
shares and the cumulative non-voting shares, the market price at 31 December
2010 was taken as the fair market value of the shares. For the preference
shares, which are not quoted on the market, the National Treasury Management
Agency, on behalf of the NPRF, engaged Davy Corporate Finance (Davy) to provide
a fair market valuation of the NPRF’s holding in the BoI and AIB preference
shares as at 31 December 2010.
The Davy report, concluded that:
Unrealised losses of €3.7bn
have been reported in the accounts of the NPRF for 2010.
The State paid €979m on interest on
the national debt last year - - up 37% on 2009.
€73.4m has been paid out on
consultancy costs linked to the banking crisis. This amount includes €35.1m for
financial advice, €22.5m for legal services and €15.6m for accounting-related
The value of bank liabilities guaranteed by the State at the end of June 2011was
about €123bn. A further €74bn is covered by the guarantee on deposits held in
the six Irish-owned banks provided in September 2008.
The Central Bank had provided €56bn of emergency funding to the banks at the end
The State contributed €1.35bn to the
European Union budget and received €1.88bn from Brussels.
The proportion of taxation required
to service the national debt rose from under 4% in 2007 to over 11% in 2010.
The report estimates the national
debt was €126.4bn at the end of July this year. Assets held by the State at the
end of July were worth €13.6bn, giving a net debt of €112.8bn.
The cost of servicing the debt rose
to €979m, or 31%, last year. 11% of the money taken in by the State in tax
now goes towards paying off debt. Some 21% of tax revenues will be required to
pay interest on the national debt by 2015. The report says while a significant
level, it is below the ratio experienced in the mid-1980s when around a third of
the tax revenues generated in the State went towards servicing the interest on
the national debt.