Review blames €3.6bn error on reduced staff numbers

Reduced staff numbers and an absence of supervisory checks errors contributed to €3

Reduced staff numbers and an absence of supervisory checks errors contributed to €3.6 billion error in the public finances, an internal Department of Finance review has found.

The accounting error came about after the Housing Finance Agency, which lends money to local authorities, borrowed €3.6 billion from the NTMA in 2010.

This figure was already included in the national debt figure but was added to the general Government debt in error, meaning it was counted twice.

An internal Department of Finance review found that two divisions within the department which deal with the Housing Finance Agency were not aware of the impact the duplication would have on the overall Government debt.

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The review pointed to reduced staff numbers and an absence of supervisory checks of key statistical date in relevant sections of the department. It also found that current departmental systems carried with them a risk of errors or omissions.

Meanwhile, a Deloitte external review of the same matter recommended that overall responsibility for reporting Government debt should be transferred to the CSO, adding that this could be done by March 2013.

However, it said the department should retain responsibility for predicting for forecasting current year and general Government debt.

Both reports also recommended changes in communication, coordination and review of processes.

A spokesman for the Department of Finance said it would not be commenting on either report ahead of the appearance of the general secretary of the department, John Moran, in front of the Public Accounts Committee on Thursday morning.