THE STATE would get a better financial return on the investment of its €3 billion social insurance fund if it placed the money with a local post office or credit union, the Dáil public accounts committee heard yesterday.
Fianna Fáil deputy Seán Fleming said that a return of €53 million on the fund as set out in the 2006 annual report drawn up by the Department of Social and Family Affairs was "wholly inadequate".
He said that this represented a return of about 2 per cent, which he described as "hopeless".
The social insurance fund, which is made up of PSRI contributions, finances a range of benefits including unemployment pay, pensions, illness and maternity allowances.
The fund is managed by the National Treasury Management Agency.
Comptroller and Auditor General John Purcell told the committee that about €1 billion was held in bonds, €1.7 billion in commercial deposits with Irish and foreign banks and about €360 million was held on deposit with the Central Bank.
Members of the committee strongly criticised the Department of Social and Family Affairs over following only "the letter of the law" in relation to the operation of the rent supplement scheme.
The department secretary general, Bernadette Lacey, told John Curran of Fianna Fáil and Róisín Shortall of Labour that it paid out rent supplements in respect of 97,000 tenancies last year.
Mr Curran asked what checks the department made to ensure that all tenancies which it was funding were registered with the Private Residential Tenancies Board.
He said that the department was prepared to pay out money without looking at the overall policy of having a regulated market.
Ms Lacey said the department gave a monthly list of all tenancies in respect of which it was providing funding to the Private Residential Tenancies Board.
Mr Curran said that this was "passing the buck".
Ms Lacey said that if the tenancies board advised that one was not registered, it would stop paying. She said registration was the role of the board and that if the department started chasing up registrations, there would be duplication.
