Tag Archives: budget

Budget 2015

End of austerity?

Waterways Ireland’s southern money [85% of its current budget plus the full cost of capital work undertaken in the republic plus, according to this unicorn who has just dropped in, the full cost of the Clones Sheugh] comes from the Department of Arts, Heritage and the Gaeltacht under the heading of North-South Co-operation. The figures are subject to the approval of the North-South Ministerial Council.

Waterways Ireland accounts for the largest portion of the North-South Co-operation funding but the budget documents [PDF] don’t show the breakdown between WI and the languages body.

The 2014 estimate for current expenditure on NSCoop was €35,271,000; the 2015 figure is €34,870,000.

The 2014 estimate for capital expenditure (all but €119,000 for Waterways Ireland according to page 213) was €3,977,000; the 2015 figure is €3,487,000. Rather neatly, that’s 10% of the current expenditure figure. In 2008 WI got €11,000,000.

The total is 2% down on 2014.

The aim of the NSCoop programme

The aim of this Programme is to maintain, develop and foster North-South co-operation in the context of the implementation of the Good Friday Agreement and the St. Andrews’ Agreement.

Under this Programme, the allocation for 2015 will:

  • Through Foras na Gaeilge and the Ulster-Scots Agency, promote the Irish and UlsterScots language and culture; and

  • Through Waterways Ireland, maintain the waterways for some 15,000 registered boat users.

I noted last year that the department’s high-level programme activities were to include:

Development of inland waterways within the context of the implementation of the Good Friday and St Andrews Agreements.

I deduce, therefore, that development of inland waterways has been abandoned; the [more sensible] aim is now that of maintenance. Furthermore, I note that there is no mention of tourism or of non-boating waterways uses like those lauded by the minister the other day.

Capital “investment”

According to Table 1  Multi-Annual Capital Investment Framework 2015-2017 on page 211, Exchequer Capital Funding to the Department of Arts, Heritage and the Gaeltacht is to fall from €62 million in 2015 to €36 million in each of 2016 and 2017. The 2015 capital estimates are:

A – ARTS, CULTURE AND FILM €42,460,000
B – HERITAGE 6,916,000
C – IRISH LANGUAGE, GAELTACHT AND ISLANDS 8,717,000
D – NORTH-SOUTH CO-OPERATION 3,487,000

The allocations to the last three groups are small, so it looks as if the luvvies will be suffering the cuts. But the level of cuts is rather large; I wonder how that’s going to work.

A win for the luvvies

The departmental overview begins on page 45. On page It shows that Total Gross Voted Current Expenditure is to stay constant at €212 million in 2015, 2016 and 2017. Below that we read:

The multi-annual expenditure ceilings are binding and it will fall to the Department of Arts,Heritage and the Gaeltacht to deliver services within these agreed allocations for the period 2015-17. This includes responding to emerging expenditure pressures over that period without recourse to additional Exchequer allocations. To do so will involve commitment to ongoing reform and efficiency measures and reprioritisation of expenditure as appropriate.

And on page 46:

This funding will enable a significant level of services to be delivered in 2015. The funding provided reflects the Government’s commitment to the conservation, preservation, protection, development and presentation of Ireland’s heritage and culture and the promotion of the Irish language, support of the Gaeltacht and development of island communities.

No mention of waterways, or even of northsouthery, in that lot.

On page 47 we learn:

The 2015 current expenditure ceiling of €212m represents an increase of €4m over the REV 2014 allocation and €7m over the previously published expenditure ceiling.

The additional current expenditure funding in 2015 will be utilised to support existing services and fund initiatives to commemorate the foundation of the State.

So the previous talk of continuing savings has vanished; the department’s total budget is up by 4%, just under €10 million. What we are seeing is a reallocation within the department:

A – ARTS, CULTURE AND FILM up 11%
B – HERITAGE down 12%
C – IRISH LANGUAGE, GAELTACHT AND ISLANDS  up 1%
D – NORTH-SOUTH CO-OPERATION down 2%,

Why are the luvvies getting the loot?

All of this is from a quick perusal; more later as information emerges, in particular when the minister addresses the Dáil.

Jim Allister and WI’s business plans

I noted here that Jim Allister, Traditional Unionist Voice MLA, had been asking questions about the “regularity” and “legality” of certain amounts granted to Waterways Ireland and the cross-border Language Body by the NI Department of Culture, Arts and Leisure. His two questions to the Minister for Culture, Arts and Leisure were answered last week.

AQW 35466/11-15: To ask the Minister of Culture, Arts and Leisure, in light of the Comptroller and Auditor General qualifying her Department’s Resource Accounts for 2013/14, whether she accepts that grant payments of over £8m made by her Department’s North/South Bodies were irregular; and if she will seek approval from the Department of Finance and Personnel for all such payments in accordance with the statutory requirements of the North/South Co-operation (Implementation Bodies) (Northern Ireland) Order 1999. [Priority Written]

Answer: The accounts for both agencies of the North South Language Body and Waterways Ireland for the 2013 and 2014 years have not yet been completed and audited.

My Department’s Accounting Officer reported that during the 2013/14 year, DCAL incurred irregular spend in respect of grants to the Language Body and Waterways Ireland as the business plans for these respective periods have not been approved. Draft business plans were in place against which the performance and budget of the bodies were monitored, and Corporate Plans for the period 2011- 13 for Waterways Ireland and both agencies of the Language Body, which were approved by Sponsor Department Ministers; both Finance Ministers and the NSMC Ministers were in place.

That’s a lesson in how to avoid answering the questions you were asked.

AQW 35541/11-15: To ask the Minister of Culture, Arts and Leisure whether she will place into the Assembly Library, a copy of the documentation received from the Department of Finance and Personnel (DFP), or otherwise recording DFP approval, which verifies the claim by her Department’s Accounting Officer in the Resource Accounts 2013/14 that DFP approval of grants to North/South Bodies was given for the amount of the grant at estimates or efficiency stage negotiations. [Priority Written]

Answer: The 2013/14 Main Estimate is published on the Department of Finance and Personnel’s website (http://www.dfpni.gov.uk/main-estimates-2013-14.pdf). My Department included within the 2013/14 Main Estimate on specific lines entitled “Language Body” and “Waterways Ireland” an estimate of the grants (before any efficiency savings were applied) my Department intended to allocate to the North South Bodies during 2013/14.

Estimates are prepared by departments and examined by DFP Supply to ensure that they meet Assembly propriety requirements and are consistent with the Executive’s expenditure plans.

After approval by DFP Supply the Estimates are presented and recommended (as required by Section 63 of the Northern Ireland Act 1998) to the Assembly by the DFP Minister who moves the Supply Resolution/s summing up the requests for Supply for each body.

On the basis of legal advice, the Department considers that the process and published Main Estimate document shows approval by DFP for the grants allocated to the North South bodies. DFP did not approve the final business plan which has resulted in the grants being deemed irregular.

It would be nice to see that legal advice.

Last week’s Phoenix magazine had an article headed “Flanagan falls flat on face” [not online] about severe constipation in the business of the Northern Ireland Executive. It includes this paragraph:

The DUP have plunged the [NI] institutions into a blast freezer since May when unionist ultra Jim Allister, staunch opponent of the GFA [Good Friday Agreement], got 75000 votes in the Euro elections. His party won thirteen council seats the same day. That sent a high voltage chock through the party. They stopped doing business with Sinn Féin, fearful of losing votes in next year’s British election.

But the WI/Language Body business plans problem surely began before May 2014.

NI21 and waterways charges

Basil McCrea is MLA for Lagan Valley and leader of NI21. He is a member of the NI Assembly’s Committee for Culture, Arts and Leisure. He has asked two questions of the Minister for Culture, Arts and Leisure:

AQW 35965/11-15: To ask the Minister of Culture, Arts and Leisure to detail the Department’s total expenditure to Waterways Ireland in (i) 2012; (ii) 2013; and (iii) 2014 to date.

AQW 35966/11-15: To ask the Minister of Culture, Arts and Leisure whether there is legislative provision for her Department to impose a charge on users of waterways.

 

The best-value CEO

Mary Lou McDonald [SF, Dublin Central] asked Jimmy Deenihan [FG, Kerry North/West Limerick], before his departure from the waterways (and other stuff) department,

… if he will provide in tabular form a list of the annual salaries of the chief executive officers of all non-commercial State sponsored bodies under his remit.

Which he did; you can see it here.

I thought it might be interesting to see how the salaries of the CEOs relate to the numbers of staff and the budgets they control. It’s not easy to compare them. The salary figures are presumably current; the various bodies offer, on their websites, accounts for years ending anywhere from 31 December 2011 to [well done, the National Concert Hall] 31 December 2013. In some cases I could find no proper accounts, but at least the Crawford Art Gallery gave a figure for its income, which is more than the Chester Beatty Library did [as far as I could see].

There were several other minor difficulties, but the big problem is that some bodies distribute grants to others, so their business is processing money: as a result, their income (usually from, or mostly from, the state) is higher than it would be for non-grant-distributing bodies. I have made no attempt to allow for that.

To make comparisons easier, I divided the number of staff in each body by the CEO’s salary (converted to euro where necessary) and multiplied the result by 1000 to remove leading zeroes. That tells you how many employees you get managed for each euro of CEO salary. Waterways Ireland is by far the biggest organisation, but has the second-lowest CEO salary.

Similarly, I divided the organisation’s income by the CEO’s salary to provide a crude measure of how much activity you get for each euro of CEO salary. Bodies dispensing grants look better than they otherwise might using this measure.

This is then a very crude comparison, with many caveats, but I think that Dawn Livingstone of Waterways Ireland is the best-value CEO of those running bodies under the aegis of the Department of Arts, Heritage and the Gaeltacht.

 

Organisation Staff Budget (m) CEO salary Staff X 1000/salary Budget/salary
Arts Council 48[1] €63.9[2] €85,750 0.56 745.19
Chester Beatty Library 37[3] ?[4] €90,591 0.41 ?
Crawford Art Gallery 15 €1.1[5] €72,124 0.21 15.25
Foras na Gaeilge 64[6] €21.5[7] €113,429 0.56 189.55
Heritage Council 18[8] €7.8[9] €113,123 0.16 68.95
Irish Film Board 15[10] €20.2[11] €97,981 0.15 206.16
Irish Museum of Modern Art 83[12] €8.3[13] €85,720 0.97 96.83
National Concert Hall 103[14] €4.6[15] €101,056 1.02 45.52
National Gallery of Ireland 117[16] €9.5[17] €93,297 1.25 101.83
National Library of Ireland 93[18] €9.5[19] €81,080 1.15 117.17
National Museum of Ireland 176[20] €17.6[21] €96,148 1.83 183.05
Údarás na Gaeltachta 86[22] €40.2[23] €126,200 0.68 318.54
Ulster-Scots Agency 20[24] €3.4[25] €61,997[26] 0.32 54.81
Waterways Ireland 328[27] €41.0[28] €77,071[29] 4.26 531.98

I’m sorry the table spreads so far to the right; I can’t work out how to narrow the column widths.

 

 

[1] 41 full time and 7 part time WTEs, according to note 2c to accounts in Arts Council Annual Report 2012

[2] Total income y/e 31 December 2012 from Arts Council Annual Report 2012. €56.6m was dispensed to other bodies in grants

[3] Excluding volunteers and vacant posts shown in the Staff List in Report of the Trustees Chester Beatty Library 2012

[4] The annual report for 2012 available here http://www.cbl.ie/About-Us/The-Chester-Beatty-Library/Reports.aspx does not include accounts. There is a one-page balance sheet, without the associated notes, from which I am unable to form any idea of the cost of the institution

[5] I am unable to find any accounts on the Crawford Art Gallery’s website http://www.crawfordartgallery.ie/aboutus1.html. Its Annual report 2011, the most recent available, says “The Department of Arts, Sport and Tourism pay allocation to the Gallery for 2011 was €475,000, while the non-pay allocation was €600,000. The capital allocation for 2011 was €275,000.” I have used the (rounded) sum of the first two figures

[6] Staff Costs and Board Remuneration in Foras na Gaeilge section of The North/South Language Body Annual Report and Accounts for 2011

[7] Total income y/e 31 December 2011 from Foras na Gaeilge section of The North/South Language Body Annual Report and Accounts for 2011

[8] Heritage Council website www.heritagecouncil.ie

[9] Total income y/e 31 December 2013 from Heritage Council Annual Report for 2012

[10] Note 6 to accounts in Annual Report 2011

[11] Sum of total income figures from Capital Income and Expenditure Account and Administration Income and Expenditure Account y/e 31 December 2011 in Annual Report 2011

[12] Note 9 to accounts in Irish Museum of Modern Art Annual Report 2011

[13] Total income y/e 31 December 2011 from Irish Museum of Modern Art Annual Report 2011

[14] Note 2 to accounts in National Concert Hall Annual Report 2013

[15] Gross income y/e 31 December 2013 from National Concert Hall Annual Report 2013

[16] Note 7 to accounts in National Gallery of Ireland Annual Report 2012

[17] Total income y/e 31 December 2012 from National Gallery of Ireland Annual Report 2012

[18] Rounded. From Human resource management and development in National Library of Ireland Annual Report 2011

[19] Total income y/e 31 December 2011 from National Library of Ireland Annual Report 2011

[20] Note 13 to accounts in The National Museum of Ireland Financial Statements for 2011

[21] Total income y/e 31 December 2011 from The National Museum of Ireland Financial Statements for 2011

[22] Údarás na Gaeltachta Annual Report and Accounts 2012

[23] Total income y/e 31 December 2012 from Údarás na Gaeltachta Annual Report and Accounts 2012

[24] Staff Costs and Board Members in Tha Boord O Ulster-Scotch section of The North/South Language Body Annual Report and Accounts for 2011

[25] Total income y/e 31 December 2011 from Tha Boord O Ulster-Scotch section of The North/South Language Body Annual Report and Accounts for 2011

[26] £49,244

[27] Excluding student placements and temporary and agency staff (total 19). Note 4 to accounts in Waterways Ireland Annual Report and Accounts 2012

[28] Total income y/e 31 December 2013 from Waterways Ireland Annual Report and Accounts 2012

 

 

 

 

War over waterways: Sinn Féin -v- the Free State

I reported here that, in June 2013,the North South Ministerial Council (in inland waterways format) approved, on the same day, Waterways Ireland’s business plan and budget for 2012 as well as its annual report and draft accounts for that year. In other words, it approved the budget and plan eighteen months after the start of the year to which they applied; it approved the plans for 2012 and, on the same day, approved the outcomes.

Furthermore, by November 2013, 88% of the way through 2013, it had not approved the budget for that year (I don’t know whether it has yet done so). And, as of today (22 January 2014), WI’s annual report for 2012 has not yet been published.

I wrote:

Is it possible that one minister wants to spend very much more or less on waterways than the other does? As the total current expenditure is fixed at 85%/15%, it seems to me that one side might very well come up with a figure that the other didn’t like.

Is it possible that DCAL, run by Mr Adams’s party colleague Carál Ní Chuilín, is more keen on cross-border bodies than is DAHG, run by Fine Gael minister Jimmy Deenihan? Or are both of them struggling to find savings to pay for the Clones Sheugh, or at least as a deposit for the SEUPB?

Or could it simply be that WI is having great difficulty in cutting its expenditure to fit within the limits imposed by the RoI budget?

I then sent enquiries to Waterways Ireland, the (NI) Department of Culture, Arts and Leisure (DCAL), the (RoI) Department of Arts, Heritage and the Gaeltacht and the North South Ministerial Council. From the repsonses, and from yesterday’s statement to the NI Assembly by Carál Ní Chuilín MLA, NI Minister of Culture, Arts and Leisure, it is clear that I was right in my first para; it is possible that the first sentence of the second para is right too.

There is a major disagreement between the northern and southern departments about the level of cuts to be applied to Waterways Ireland’s budget and it is not clear what mechanism can be used to resolve it. DAHG, applying Irish government policy, wants bigger cuts than DCAL does.

NSMC

After each North South meeting, the secretariat issues a rather bland communiqué; the inland waterways ones are here. I suppose that the secretariat can’t be expected to write “There was a blazing row at yesterday’s meeting, skin and hair flying, and the ministers aren’t speaking to each other”. I mean, they wouldn’t write that even if it were true, which I’m sure it isn’t.

On 9 December 2013 I wrote to NSMC (I omit salutations and irrelevancies here):

Are you able to say anything about why the NSMC Inland Waterways did not approve the 2012 business plan and budget for Waterways Ireland until eighteen months after the start of the year in question? As far as I can see from the minutes for meetings since 2007, that is a highly unusual degree of lateness.

NSMC replied on 11 December (with a copy to the RoI Department of Foreign Affairs):

[…] this is an issue for both Sponsor Departments and they can be contacted directly.

On the same day I asked:

Have you any responsibility for seeing that the terms of the WI Financial Memorandum [PDF] are observed? It seems to me that they have been ignored in this case.

Despite a reminder, I have not yet received a reply.

DCAL

I wrote to DCAL on 10 December 2013:

I would be grateful if you could help me to understand why the North/South Ministerial Council did not approve the 2012 budget and business plan until 18 months after the start of the year to which it applied.

DCAL responded on 11 December 2013:

Waterways Ireland had submitted a draft 2012 Business Plan detailing the activities required to achieve goals set out in their 2011/2013 Corporate Plan. Recognising the challenges presented by the economic climate there were extended negotiations to agree the 2012 budget. The DCAL Minister raised concerns about going beyond the required savings advised by both Finance Departments. Minister Ní Chuilín therefore sought, and received, assurances from Waterways Ireland that frontline services would be maintained.

I sent follow-up queries on 16 December:

I am not entirely clear on the implications of your third sentence: “The DCAL Minister raised concerns about going beyond the required savings advised by both Finance Departments.”

Do you mean that Waterways Ireland proposed to cut its spending by more than the percentage cuts suggested by the Finance Departments? Or to spend less than it received (or expected to receive), in euro, from the two sponsor departments? If so, why did WI want to do that?

I would also be grateful if you could tell me what WI’s “frontline services” are and why they are deemed to be more important than other services.

And I would be grateful for more information on the reason for the extended delay in approving the busiess plan and budget: eighteen months after the start of the year, which was presumably even longer after the plan was drafted. I would be surprised to find that seeking and receiving assurances took eighteen months.

Did the delay result in a breach of the terms set out in the Financial Memorandum governing WI’s affairs?

I would also be grateful if you could tell me what delayed the approval of WI’s 2013 budget. I note from the NSMC minutes that it was not approved in June 2013; the matter is not mentioned in the minutes of the November 2013 meeting but, on 19 November 2013, the RoI Minister for Public Expenditure and Reform replied to a written question from Gerry Adams TD saying, inter alia, that “The 2013 Budget allocation to the Body are subject to on-going discussion by the two Sponsor Departments.”

That suggests that approval of the 2013 budget is at least eleven months late. I note too that the 2014 business plan and budget, and the Corporate Plan 2014-2016, were not approved at the November NSMC meeting. And I note that An Foras Teanga [Foras na Gaeilge + Tha Boord o Ulstèr-Scotch], the other North-South body sponsored by your department and the Department of Arts, Heritage and the Gaeltacht, was also, in November, awaiting approval of its 2013 budget.

There are two further items on which I would be grateful for information:

(a) is it proposed that the Hutton recommendations be applied to Waterways Ireland (and other bodies in the North-South pension scheme)? If so, what is the expected effect on WI’s budget and on staff take-home pay?

(b) WI’s accounts for 2011 (the latest I have seen) suggest that your department paid less than 15% of the money WI received from its sponsor departments. Did your department pay 15% in 2012 and 2013 and will it do so in 2014? And how do you take account of the effect of currency fluctuations on WI’s income denominated in its working currency, the euro?

Despite a reminder, I have as yet received no reply.

DAHG

I wrote to DAHG on 26 November 2013 with several questions; I include below only that relevant to this posting.

On 19 November 2013, in a written answer to Gerry Adams, Jimmy Deenihan said […]: “The 2013 and 2014 Budget allocations to the Bodies are subject to ongoing discussion by the two Sponsor Departments and will require, of course, formal approval by the NSMC.”

I would be grateful if you could tell me (a) why Waterways Ireland’s budget had not been finalised when 88% of the year had passed and (b) how that affected budgetary management in the Body.

The department replied on 3 December 2013:

As you are aware, Waterways Ireland is co funded by the Department of Arts, Heritage and the Gaeltacht and the Department of Culture, Arts and Leisure, Northern Ireland.   The 2013 Business Plan and budgets have been discussed by Ministers at NSMC Inland waterways meetings and key priorities for 2013 identified.  Indicative budgets have been provided by the Departments to Waterways Ireland as a pragmatic measure for business planning and operational purposes and the body is operating within these indicative allocations.

On 9 December I replied:

Thank you. That answers my question (b) pretty well. However, you haven’t answered (a): why Waterways Ireland’s budget had not been finalised when 88% of the year had passed.

I would be grateful for information on the causes of this extraordinary delay.

I have been wondering whether the problems of WI’s budget were very difficult to resolve or whether there was some major disagreement between the northern and southern ministers. If there was such a major disagreement, what was it about?

The department replied on 17 December 2013:

The Departments are still in discussions to agree the budgets.  The position is The Department of Culture, Arts and Leisure in Northern Ireland is not prepared to agree a 2013 budget for the Body in excess of a minimum efficiency saving of 3% set out in the two Departments of Finance Funding Framework for the North South Bodies. As you are aware from the Parliamentary Question Reply this Department’s REV provision for Waterways Ireland for 2013 is €25.463m, a 6% efficiency saving on 2012. Given the pressures on the public finances and on the Departments budget allocation, the Department is not in a position to provide any additional funding that would maintain the proportionality of funding. 85% of current funding is provided by Department of Arts, Heritage and the Gaeltacht and 15% by Department of Culture,  Arts and Leisure, Northern Ireland.

I responded on 18 December 2013:

[…] Just to make sure I understand you properly: when you say “a 2013 budget for the Body in excess of a minimum efficiency saving of 3%” am I right to presume that the phrase “in excess” applies to the savings or cuts rather than to the budget itself?

I also asked three questions about items of background information relevant to this topic:

1. I am less familiar with the NI Executive’s budgetary process than perhaps I should be. I gather that there are multi-year budgets, linked to a programme for government, with annual estimates and possibly supplementary estimates. The multi-year element seems to be stronger than in Irish budgets, but I wonder whether (aside altogether from the current economic situation) it is difficult to make decisions within the constraints of the different budgetary timescales.

2. I have not yet checked all Waterways Ireland annual reports, but reading that for 2011 suggests that DCAL paid slightly under 14%, rather than 15%, of WI’s current expenditure. Are minor deviations from the 85/15 ratio unavoidable? Do they balance over time?

3. Do currency fluctuations affect the amounts actually paid by the two departments? If so, how are the effects taken into account?

I have not yet received a reply.

Waterways Ireland

On 6 January 2014 I wrote to WI:

I would be grateful if you could tell me the effect on Waterways Ireland of the continuing dispute between its sponsor departments over WI’s budgets and business plans.

On 8 January WI said:

Waterways Ireland enjoys a supportive and positive relationship with both departments.

On 14 January I said:

I am very glad to hear it, but I don’t recall asking a question about that.

I repeated my original question, to which I have not had a reply. As with NSMC, I don’t really expect WI to be able to say anything undiplomatic. However, I would have thought that there must be some inconvenience in working to “indicative allocations”. I wonder whether they are based on DCAL’s preferred level of cuts, DAHG’s preferred level or some compromise. And if compromise is possible on the indicative allocations, why can’t the main issue be sorted out?

Furthermore, the delay in publishing the 2012 accounts suggests that there has been some real difficulty in operating under the indicative allocations regime. Or perhaps there is some other row altogether.

NI Assembly

Reporting yesterday to the NI Assembly on the November NSMC meeting, the NI Minister confirmed that there was disagreement.

Karen McKevitt [SLDP, South Down]: […] The chief executive set out a strategic direction for Waterways Ireland for 2014-16. In that, she mentioned budget efficiencies. Can the Minister highlight to the House what those might be?

Carál Ní Chuilín [SF, Belfast North]: The Member is right: the new chief executive gave us a very good and detailed presentation. Indeed, the Member will be aware — if she is not, she will be when I finish my answer to her question — that there have been additional pressures on everybody across the board in achieving efficiencies. However, as I have repeated to the Member and to other Members, and despite the meetings that I have had with Minister Deenihan around any proposed additional efficiencies that the Irish Government are saying are required, I am totally reluctant to go above and beyond any efficiencies that we agreed previously, and I have stated that to the chief executive of Waterways Ireland. That is the position. Following that, the Finance Departments and, indeed, officials and Ministers will hopefully be submitting additional or new budget plans very soon. I think that issues relating to any agreement to additional efficiencies lie beneath the Member’s question, but I can categorically state that I have not agreed to those.

“Efficiencies”, by the way, means “cuts”.

The importance of waterways to Sinn Féin

I have remarked several times here that Sinn Féin asks many Dáil questions about waterways, notably the Clones Sheugh, with Maureen O’Sullivan providing recent competition. I wrote elsewhere recently:

Waterways Ireland is a political creation: its very existence reflects a nationalist and republican desire to show the benefits of all-Ireland institutions — and a unionist desire to confine such institutions to areas of minor importance. […]

In prosperous times, managing recreational waterways is a feelgood activity, combining opportunities for local and national politicians to get their photos in the papers with relatively low risk of political controversy. Nonetheless, WI had to tread warily, especially in its early years; it has almost (but not quite) entirely avoided such controversy.

Timing

I don’t know if there is ever a good time for disputes between your paymasters, but it’s not as if Waterways Ireland, and its new CEO, didn’t already have enough to worry about. To quote again from the same piece:

Compared with British Waterways and C&RT, Waterways Ireland has very little real property from which it might derive an income — and very few other sources of income. According to its accounts for 2011 (the latest available), its total income was over £38 million but it earned less than half a million pounds from licences, property, interest, operating income (including charges to waterways users) and other sources. The rest came from its two sponsor departments.

Charges to boaters have traditionally been low or non-existent: zero for a boat kept on the Erne or on one of the Shannon lakes, with modest charges for passing through Shannon or Shannon–Erne Waterway locks; on the Grand, Royal and Barrow, an annual charge of €128 covered lock passages and mooring. There was no licence fee. Waterways Ireland has begun to impose slightly higher larger charges but may meet resistance.

But there is no immediate prospect of imposing charges high enough to make a significant difference to Waterways Ireland’s budget. That budget is set by the North South Ministerial Council: each government pays for capital works (eg harbour improvements) carried out in its own jurisdiction, while the running costs are paid in a ratio intended to reflect the proportion of the waterways in each: 15% by the Northern Ireland Executive and 85% by the republic’s Government.

Some difficulty may be caused by different timings of the budgetary processes in the two jurisdictions, but a greater problem is that the fixed ratio can lead to deadlock. WI’s budget for 2012 was not set until July 2013, eighteen months late: its budget, business plan, annual report and draft accounts for 2012 were all set on the same day. Final accounts for 2012 had not been published and WI’s budget for 2013 had not been agreed by December 2013.

The cause of the delay was that the republic’s government wanted to cut the budget by more than the Northern Ireland Executive did. The Irish economy has had severe problems in recent years and the government was unable to honour its undertaking to pay for the restoration of the Ulster Canal from Lough Erne to Clones (a short stretch that crosses the border several times). Public expenditure has been cut for all government departments and public bodies but the scale of the cuts is larger than the Northern Ireland minister wants to see. If the republic’s government gets its way, by 2016 WI’s budget will be one third lower than it was in 2010.

That is not the only financial problem that WI faces. Staff transferred to it from Irish government departments carried with them their entitlements to pensions of half of final salary plus retirement lump sums of one and a half times final salary. And, as is the norm in the civil service, the pension system was unfunded. WI had quite a few staff in their fifties and, as they now retire, their pensions and lump sums have to be met out of WI’s normal income from its sponsor departments. The pace of retirement may even by accelerated by a desire to avoid charges arising from the Hutton pension proposals.

During the era of the Celtic Tiger, Waterways Ireland prospered: it acquired much new equipment, built new offices and developed and improved facilities for boaters and other users. It now faces a much more difficult financial future and it is hard to see how it can avoid reducing its level of service. At the same time, its new CEO is — rightly — determined to continue widening the appeal of the Irish waterways to more types of users: walkers, cyclists, anglers, canoeists and others.

Maybe the two ministers might get their act together.

I will report later on other items covered in Ms Ní Chuilín’s statement; the bad (if unsurprising) news is that she is still stuck on the sheugh, but perhaps she can persuade the Imperial Treasury to pay for it.

Waterways budgets: cut by one third in six years

I wrote here and here about the RoI budgetary allocations to Waterways Ireland for 2014, here about the difficulty of establishing exactly what WI’s budget is and here about some questions I have put to the Department of Arts, Heritage and the Gaeltacht on the matter.

But, while a focus on the procedural woods is important, I may have been neglecting the implicational trees. I am recalled to a consideration of the details by two written Dáil questions asked by Gerry Adams [SF, Louth] on 19 November 2013, one of Brendan Howlin, Minister for Public Expenditure and Reform, and the other of Jimmy Deenihan, Minister for Arts, Heritage and the Gaeltacht. Reading the runes is reminiscent of Kremlinology, but it seems to be possible that Waterways Ireland will have to make significant cuts in its spending, cuts that will reduce the services it provides to waterways users.

The questions and the answers

This is what Gerry Adams asked Brendan Howlin:

To ask the Minister for Public Expenditure and Reform the total budget for each All Ireland Body established under the Good Friday Agreement for the years 2010 to date in 2013; and any proposed budget reductions to the these bodies currently being considered.

And this is what he asked Jimmy Deenihan:

To ask the Minister for Arts, Heritage and the Gaeltacht the total budget for each of Waterways Ireland, Fóras na Gaeilge and Ulster-Scots Agency for the years 2010 to date in 2013; and any proposed budget reductions to these bodies currently being considered.

Ignoring the details given for bodies other than Waterways Ireland, we learn that its allocations from its two “sponsor departments”, DCAL in NI and DAHG in RoI, were:

2010 €38.99 million
2011 €35.18 million
2012 €31.15 million

These figures appear to include capital and current expenditure.

For some reason,

The 2013 Budget allocation to the Body are subject to on-going discussion by the two Sponsor Departments.

But Jimmy Deenihan said

My Department’s REV provision for Waterways Ireland for 2013 is €25.463m, a 6% efficiency saving on 2012. My Department’s Estimates provision for 2014 is €24.183m, a 5% efficiency saving on 2013.

The extent of the cuts

I don’t know how to get from a REV provision, or indeed an Estimates provision, to WI’s total budget for 2013 or 2014. One possibility is that the figures include capital and current expenditure. In that case, the RoI contribution to WI’s 2013 budget would be €21.383 million current and €4.080 million capital [PDF; see p160]; adding the NI 15% contribution to current would bring that to about €25.156 million; the €4.080 million capital makes €29.236 million. Perhaps there might be a small amount extra for NI capital spending. By the same logic [and I repeat that I don’t know whether this is the way to do it], the 2014 Estimates provision gives €27.752 million plus NI’s capital spending. Without NI capital spending, the total is 71% of the 2010 figure, so WI will have had its total spending cut by 29% in four years.

Another crude calculation is that the 2012 figure of €31.15 million is 80% of the 2010 figure. Knock off Jimmy Deenihan’s 6% in 2013 and 5% in 2014; the 2014 total comes out again at 71% of the 2010 figure.

But that’s not all. Brendan Howlin said:

In common with other public sector bodies North and South, the North South Implementation Bodies are expected to deliver their objectives in a cost effective and efficient manner. In order to provide a framework for this, my Department and the Department of Finance and Personnel, have issued guidance to the North South Implementation Bodies requiring them to achieve a minimum of 4% efficiency savings per annum in 2014, 2015 and 2016.

So we have to cut another 4% in 2015 and 4% in 2016, by which stage the total will be just under 66% of the 2010 figure: a cut of one third in six years.

Coping

The brunt of the cuts has been borne by the capital budget; we have no figures for expected NI capital spending from 2013 onwards, but on the RoI figures capital spending by 2016 will have been cut by 70%. That seems to have been the general pattern in the Irish public service: cut capital spending first, cut staff costs last.

WI’s operating income is negligible: in 2011 it was €71,000 from licences, €120 from property and €193,000 from permits, lock charges etc, as well as a few other bits and pieces; it is almost entirely reliant on its sponsor departments. So if it is to cope with reduced departmental income, it must either devise new and significant earning opportunities quickly or make serious cuts to its services.

WI’s spending is categorised under five headings, one of which (currency gains or losses and interest) involves a tiny amount. The other four are depreciation, which can’t readily be cut, staff costs, “programme costs” and “other operating costs”.

The “other operating costs” are:

Travel
Recruitment costs
Training and conferences
Contracted in services
Compensation/provision for liability claims
Premises running costs including utilities
Health and safety
Communications
Other operating lease rental
Printing and stationery
Computer running costs
Rent
Audit fee
Marketing and promotions
Insurance and legal fees
Pension administrator costs
General expenditure.

The 2011 total was €5,026,000. None of the individual items looks as if it could provide huge savings, although I imagine each category is being shaved.

The programme costs are allocated to individual waterways; in 2011 (the latest available accounts) the total was €8,082,000, and 63% of those were incurred on the Grand, Royal and Barrow. The Royal’s programme costs were up in 2011, with the reopening, but the Grand’s were cut by 25% and the Barrow’s by 17%. You can’t keep cutting at that sort of rate every year, but I suspect that the Grand, Royal and Barrow will continue to be cut more than the Shannon, Erne and SEW (the Lower Bann cost is tiny).

WI’s main cost is staff: €21,903,000 in 2011, up very slightly on the previous year. I don’t know what cuts have been made in hours or rates (I have heard that there is an overtime ban) but I suspect we haven’t seen the last of them.

At this stage, I imagine that the easy cuts have been made; further cuts may require some combination of

  • reductions in services to users
  • major changes in work practices
  • cuts in staff costs.

There are interesting times ahead.

One small pointer

I noted that, when Jimmy Deenihan spoke in the Dáil on 16 October 2013, he said that WI’s “core activities and targets” included

… keeping the waterways open for navigation during the main boating season.

The last five words [emphasis mine] may be significant: Mr Deenihan may have been hinting that boating is no longer to be regarded as a year-round activity.

Modern management

I’ve just read the minutes (they call ’em joint communiqués, to be posh) of all the North South Ministerial Council Inland Waterways meetings since northsouthery got going again in 2007.

After a bit of catching up in the first couple of years, the NSMC has usually managed to “note” WI’s Annual Reports and Accounts about six months after the end of the year to which they refer: the accounts for 2008 were noted in 7 months, 2009 in 5, 2010 in 7, 2011 in 7 and 2012 in 6. But “noting” doesn’t mean approving: various other bods, including two Comptrollers and Auditors General, then have to look at them, so the citizenry doesn’t get to see the accounts for many months afterwards: the report and accounts for 2012 are still not available.

Nothing to see there, then: both WI and the NSMC appear to be doing their bit as fast as could reasonably be expected. But what is odd is the delay in noting or approving plans and budgets. Knowing litle of management science, I had the naive idea that managers would be working to approved plans and budgets from the start of the year, but WI usually doesn’t get approval until the year is almost over. I do not know why that is.

WI’s business plan for 2008 was approved in October 2007, which is reasonable, although it seems to have been revised in July 2008. But the plans for 2009 and 2010 were not approved until 11 months into the year, that for 2011 until 10 months and that for 2012 until June 2013, six months after the end of the year. I realise that forecasting is difficult, but retrospective planning is surely less than useful.

The same delays apply to the budgets for 2010, 2011 and 2012. So the June 2013 meeting of the NSMC approved or noted:

  • the business plan for 2012 (which had ended six months earlier)
  • the budget for 2012
  • the annual report for 2012
  • the draft accounts for 2012.

I do hope that someone checked to ensure that all the documents accorded with one another: it would be really embarrassing if they didn’t. But as a management exercise this seems to be somewhat less than useful.

The same meeting also

… noted progress on the development of the 2013 Business Plan and budget. Following approval by Sponsor Departments and Finance Ministers the plan will be brought forward for approval at a future NSMC meeting.

It is good to know that, six months into the year, there was progress on the business plan and budget for that year. The minutes of the November meeting don’t mention the 2013 business plan and budget (but do, I am pleased to note, mention the 2014 versions), but there was a disturbing item of information on the previous day, 19 November 2013. Brendan Howlin, Minister for Public Expenditure and Reform, replied to a written question from Gerry Adams [SF, Louth], saying inter alia

The 2013 Budget allocation to the Body are subject to on-going discussion by the two Sponsor Departments.

This is November; 88% of the year has passed and the Irish budget for 2013 was approved long ago — yet WI still hasn’t been told its budget for 2013. WTF is going on?

I note that the same applies to the other north-south body or bodies that share the [RoI] Department of Arts, Heritage and the Gaeltacht and the [NI] Department of Culture, Arts and Leisure as sponsors. An Foras Teanga, which includes Foras na Gaeilge and Tha Boord o Ulstèr-Scotch, likewise still has its 2013 budget under discussion by the two departments.

I have asked DAHG about this, and will no doubt receive a full and frank reply in due course. In the meantime, I can only speculate. Is it possible that one minister wants to spend very much more or less on waterways than the other does? As the total current expenditure is fixed at 85%/15%, it seems to me that one side might very well come up with a figure that the other didn’t like.

Is it possible that DCAL, run by Mr Adams’s party colleague Carál Ní Chuilín, is more keen on cross-border bodies than is DAHG, run by Fine Gael minister Jimmy Deenihan? Or are both of them struggling to find savings to pay for the Clones Sheugh, or at least as a deposit for the SEUPB?

Or could it simply be that WI is having great difficulty in cutting its expenditure to fit within the limits imposed by the RoI budget?

 

Questions, questions

I reproduce below the text of an email I have sent to the press office at the Department of Arts, Heritage and the Gaeltacht, which is responsible for waterways in RoI. Though you wouldn’t think it; DAHG’s home page has this list of activities on the left-hand side:

Arts
About Us
Culture
Heritage
20-Year Strategy for the Irish Language 2010–2030
Irish
Islands
An Ghaeltacht
Aran LIFE+ Posts
Ministers
Public Service Reform
National Famine Commemoration 2013
National Ploughing Championships
EU Presidency
Censorship of Publications
Press Releases
Publications
Speeches
Consultations
Links
Contact Details

Nothing about either waterways or northsouthery (which is the category into which waterways fall).

Anyway, here are the questions I asked.

1. On 19 November 2013, in a written answer to Gerry Adams, Jimmy Deenihan said:

My Department’s REV provision for Waterways Ireland for 2013 is €25.463m, a 6% efficiency saving on 2012. My Department’s Estimates provision for 2014 is €24.183m, a 5% efficiency saving on 2013.

I would be grateful if you could tell me what a REV provision is.

2. Your minister also said:

The 2013 and 2014 Budget allocations to the Bodies are subject to ongoing discussion by the two Sponsor Departments and will require, of course, formal approval by the NSMC.

I would be grateful if you could tell me (a) why Waterways Ireland’s budget had not been finalised when 88% of the year had passed and (b) how that affected budgetary management in the Body.

3. I would be grateful if you could tell me when Waterways Ireland’s report and accounts for 2012 will be published.

4. I would be grateful if you could tell me when Waterways Ireland’s plan for 2014 and subsequent years is to be published and what public consultation there has been on it.

5. On 16 October 2013 Jimmy Deenihan said in the Dáil that WI’s

core activities and targets

include

keeping the waterways open for navigation during the main boating season.

I would be grateful if you could tell me whether that formulation represents any forthcoming change in WI’s practices in keeping waterways open outside the main boating season.

 

WI’s budget: the minister speaks

I wrote here about the implications of the RoI 2014 budget for Waterways Ireland. The minister, Jimmy Deenihan [FG, Kerry North/West Limerick], spoke about it in the Dáil on Wednesday 16 October 2013 [h/t KildareStreet.com]. At the end of his lengthy contribution he said:

I am committed to developing North-South co-operation within the broader arts, heritage and commemorative activities of the Department as well as through the funding of North-South bodies. A provision of €38.3 million will be made available to support the two North-South implementation bodies, An Foras Teanga, comprising Foras na Gaeilge and the Ulster-Scots Agency, and Waterways Ireland. The provision will enable Waterways Ireland to deliver on its core activities and targets, which include keeping the waterways open for navigation during the main boating season and promoting increased use of the waterways resource for recreational purposes. This expenditure should also assist in developing and promoting the waterways, attracting increased numbers of overseas visitors and stimulating business and regeneration in these areas. Capital funding of almost €4 million will be made available to Waterways Ireland to facilitate the ongoing maintenance and restoration of Ireland’s inland waterways, thereby increasing recreational access along the routes of waterways.

The Government has reaffirmed its commitment to continuing to make progress, to improving the economy, to exiting the bailout, and to helping to create jobs. The Department and the sectors it represents will make a significant contribution to this work over the course of 2014.

I pointed out last year that Waterways Ireland is part of northsouthery and that, at budget time, we don’t get a breakdown of the northsouthery budget between An Foras Teanga and Waterways Ireland. In 2011, WI got roughly 60%, but I don’t know what happened after that. Here’s what I thought was happening last year:

Current spending (WI)

2010 Estimates: €25 585 000
2011 Estimates: € 24 335 000
2012 Estimates: €22 929 600 (60% of €38 216 000)

Capital spending (WI)

2008 Estimates: €11 000 000
2009 Estimates: €10 300 000
2010 Estimates: €8 000 000
2011 Estimates: €6 000 000 (or €6 002 000)
2012 Estimates: €4 500 000 (or €4 502 000) (100%)

In his speech, above, the minister said that northsouthery is going to get €38.3 million and that Waterways Ireland is to get capital funding of €4 million. However, the €4 million is included in the €38.3 million. The expenditure report [PDF; see page 160] gives these details:

  • for 2013 northsouthery had €36 210 000 of current spending; for 2014 it will get €34 425 ooo
  • for 2013 northsouthery had €4 080 000 of capital spending (all, or almost all, of which was for Waterways Ireland}; for 2014 it will get €3 958 000
  • the overall budget for northsouthery is down 5%.

We can calculate that the capital budget is down about 3%; the much larger current budget is down 5%. If WI gets 60% of the total, its current expenditure contribution from RoI will be €20 655 000, down over €2 000 000 from the previous year and about €5 000 000 since 2010, and its total current expenditure (85% RoI, 15% NI) will be €24 300 000.

The other interesting part of the minister’s speech is what WI is expected to do:

  • promoting increased use of the waterways resource for recreational purposes
  • developing and promoting the waterways
  • attracting increased numbers of overseas visitors
  • stimulating business and regeneration in these areas
  • increasing recreational access along the routes of waterways.

That should keep them busy. But I omitted one activity:

  • keeping the waterways open for navigation during the main boating season.

Emphasis mine, but does this mean that winter boating (at least if it involves staff time, eg at locks) will become a thing of the past?

 

WI budget

In 2014 the Department of Arts, Heritage and the Gaeltacht [.pdf: go to page 51] is to cut its current expenditure on North–South Co-operation by €2.1 million:

Savings, in excess of the agreed 3% per annum efficiency savings, for the North-South Implementation Bodies will require the approval of the North-South Ministerial Council.

The 85% of Waterways Ireland’s current budget that comes from the [Republic of] Ireland government is in there somewhere; the NI executive pays the other 15% and, in theory, the North–South Ministerial Council will have to give its blessing, but in practice the NI ministers can hardly force the RoI ministers to pay up.

There’s a list of 14 High Level Programme Activities [mustn’t hurt anyone’s feelings by leaving out their favourite fodder] of which No 13 is

Development of inland waterways within the context of the implementation of the Good Friday and St. Andrews Agreements.

Translation: Ulster Canal, even if there’s no money for it. But there is half a million for a

20-Year Strategy for Irish with a range of concrete measures, including supportive actions to roll out the language planning process on the ground, in line with the Gaeltacht Act 2012. These actions will include direct support to community organisations to enable them to prepare and implement practical and deliverable Irish language plans – not only in the Gaeltacht itself but also in selected towns and areas in other parts of the country.

Do they ever give up? They’d be better off supporting Ulster Scots, which has at least some chance of showing a growth in the number of speakers. But page 51 has a long list of imaginary measures to allow the department to claim that it will save €15 million in 2014: more efficient working, review, examining the scope for achieving further efficiencies … waffle.

On the capital expenditure side, RoI and NI each pays for works within its own jurisdiction. The RoI spending will be down from €4071000 in 2003 to €3858000 for 2014: a cut of just over 5%.

Maybe the money is being put aside to pay for the Clones Sheugh, although it’s not specifically mentioned in the document.