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External review of €3.6bn accounting error "under way" - Noonan

The minister says he hopes to publish the results of internal and external inquiries into the error – depending on legal advice.

Image: Niall Carson/PA Wire

THE MINISTER for Finance says he hopes to publish the findings of two investigations into a €3.6 billion accounting error in state funds - but that they may not be released to the public, depending on legal advice about their contents.

The minister also said that an external review of the incident is under way.

The error saw €3.6 billion in state funds was counted twice in the government finances in 2010. The money was transferred between the National Treasury Management Agency and the Housing Finance Agency when it was counted twice.

The error led to controversy around the government’s support of the nomination of Department of Finance Secretary-General Kevin Cardiff for a place on the European Court of Auditors. Despite the controversy, Cardiff’s nomination was approved and he is due to take up the post on 1 March.

Responding to a question from Fianna Fáil TD Michael McGrath, Michael Noonan said on Tuesday that a draft of the internal report has been prepared by management in his department with assistance from the department’s internal audit unit.

The minister said that, following advice from the Attorney General, this draft “is being circulated to some of the parties involved who will be allowed sufficient time to provide their final comments on it.”

“Although this error was most regrettable, it was a statistical reporting discrepancy where our debt level was mistakenly stated as being higher than it actually was, but which had no impact on the 2011 budgetary deficit.”

Noonan said that Deloitte Consultants have been appointed to run an external inquiry into the incident and that is now under way. “I expect the external report to be finalised by the end of the first quarter of this year.”

“My intention is, subject to legal advice and in a timely manner, to submit both reports to the Committee of Public Accounts and make them public.”

McGrath said he believes the reports should be completed and published “without any further delay” to give the public “absolute clarity as to what exactly happened” and why the department did not pick up on the error sooner.

“There have been leaked reports in the media that the officials within the NTMA raised the issue with the Department of Finance on a number of occasions over many months but to no avail,” he said. “Details of all correspondence between the NTMA and the Department of Finance should be made public along with the report.”

Read: State ‘no better or worse’ off as result of €3.6bn accounting error, says CSO >

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