The Department of Finance has this afternoon released its file of correspondence with the National Treasury Management Agency (NTMA) over an issue that led to €3.6 billion being added to the General Government deficit in error.
The correspondence consists of emails and letters from the NTMA alerting the department about new financing arrangements for the Housing Finance Agency t hat required different accounting treatments.
The first email was sent on August 23rd, 2010, and in all some six emails and letters were sent before the issue was finally addressed and rectified in late October this year.
The department admitted today that no evidence or documents have come to light that show the officials responsible replied to the email or letters, or responded to the issues being flagged.
Senior officials from the Department and the NTMA appeared before the Public Accounts Committee today where they were asked to explain how such a large error, which is equal to the total budgetary adjustment this year, could have been left unnoticed for so long.
Secretary general of the department Kevin Cardiff said the error was made at “middle management” level and was never communicated up to a more senior level. He said the department was initiating an internal inquiry to examine the issue and would establish an external review to look at the systems and to put safeguards in place to ensure such mistakes were not repeated in the future.
Mr Cardiff, and, to a lesser extent, NTMA chief executive John Corrigan - who was not at the meeting - were criticised by members of the committee.
Sinn Féin’s Mary Lou McDonald said she had not confidence in Mr Cardiff and believed that, as the accounting officer, he should resign over such a major error. Ms McDonald also said she had no confidence in Mr Cardiff becoming Ireland’s next representative on the European Court of Auditors in the new year.
Mr Cardiff responded by saying that if a secretary general resigned after every error there would be no secretaries general, and if a secretary general resigned in the wake of a major error, the only ones who would survive would be “lucky secretary generals”.
Mr Cardiff said he had spent every waking moment since assuming the top position in the Department of Finance in February 2010 working to ensure he was doing the best post possible job for the country.
