Business Irish

Sunday 4 December 2016

Mandarins go on orgy of spending

Cosseted civil servants splurge on toasters, taxis and an awful lot of carpet tiles as country strangled

Published 28/11/2010 | 05:00

The Department of Finance, which last week cooked up the savage austerity cuts we must face for its mismanagement of the banks and the economy, squandered tens of thousands of euro on grinning PR photographs, toasters and perks for civil servants and politicians, including €786.50 for a new comfy seat for "the minister".

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Department officials, with their gold-plated pensions, were also kept well supplied with hot buttery toast at the taxpayers' expense. An obscene €762.30 was spent on a Fortius conveyor toaster in April as both Greece and Sean Quinn's empire toppled over. The toaster cost as much as a family with three children will lose in child benefit under the four-year plan. We also paid another €913 for the repair of a departmental dishwasher and "bain marie"-- often used for making hollandaise and other sauces.

Documents obtained by the Sunday Independent last week, reveal the extraordinary levels of profligate spending inside the most important government department in the State. The documents show all major departmental spending from 2008 onwards. This weekend, Finance Minister Brian Lenihan and his officials are locked in discussions with the IMF and EU officials trying to hammer out the final details of the €85bn bailout of the State. Last week's four-year plan -- compiled by the department -- will see €15bn crowbarred out of the economy through savage tax rises and brutal cuts in spending.

Incredibly, despite the three-year long recession and out of control jobless figures, the Department of Finance also splurged thousands of taxpayers' euro on PR and spin, including swathes of photographs.

Almost €4,500 has been spent on "Budget day pictures" as income taxes rise and social welfare is filletted. In October 2009, a ridiculous €1,640 was spent on photographs and "54 prints" as part of the Commission on Taxation report. We paid €786 for a "pop-up stand" as a backdrop for departmental announcements. Huge sums were paid to PR firms for "press monitoring" and training, with MKC and Carr Communications the chief beneficiaries.

While the highly paid mandarins at the department clearly didn't see the financial crisis coming, it should have -- given that it spent €1,500 on a speech by George Lee for the "Assistant Secretaries' talk 2007". Another €7,050 was spent on 42 subscriptions to The Economist magazine. That's one issue for every 15 members of staff.

The mandarins of Merrion Street also spent €1,500 in a history essay by TV historian Diarmaid Ferriter for the government website. His wasn't the only contribution to the website with €1,500 fees paid to other experts for essays on symbols and genealogy all for the government website. There was also over €5,500 spent on calendars by the Department.

The documents reveal Minister of State Martin Mansergh clocked up a €779 bill for a "limousine" to an IMF meeting in May 2009 -- 18 months before the bailout. Club Travel was also paid €11,024 for travel costs incurred by Mansergh and another official in July 2008. It also shows that EU Rescue Fund boss Klaus Regling was put up in the D4 Hotel -- owned by shattered property tycoon Sean Dunne. Regling stayed in the hotel while completing his report on the banking collapse.

Despite its central location, officials blew close to €65,000 on taxis in two years. We spent nearly €1,700 on bikes and cycling equipment for two civil servants.

Nearly €63,300 was spent on new floor tiles and carpets at the department within weeks of Brian Lenihan's appointment as minister in 2008. Almost €1,100 of taxpayers' funds was splurged on "spraying for flies".

The Merrion Street department has demonstrated its inability to get a handle on the country's buckled finances by producing woefully inaccurate budgetary forecasts and masterminding shocking policy decisions, including the decision to raise VAT prices just as the UK cut its rate. This led to a near €700m exodus of money to the North as shoppers flocked across the border for cheaper groceries. The bank bailout and guarantee has also been seen as a disastrous strategy but it is mirrored by an extraordinary inefficiency in the way the department is run. Scores of different suppliers and contractors were paid for similar goods and services leading to major concerns about how the taxpayers' money was spent.

Computer and office equipment was bought from more than a dozen different suppliers, with computers coming from Apple, Dell and HP, with Codec, Canon, Ergo, Business Management Systems, Bryan S Ryan and Hibernian Business all supplying separate bits of equipment to the department. Telecommunications was provided by Eircom, Lan Communications, BT and O2, with hundreds of separate bills and invoices. Heating and lighting costs were a mish mash of agreements with ESB, Bord Gais, Energia and Flogas.

Value for money issues are further highlighted by the extraordinary high costs of what the department spent on basic materials such as photocopying paper. Invoices reveal that the Department of Finance was paying up to €15.23 for boxes of 80gm paper. This is more than three times the price of the same paper from other suppliers examined by the Sunday Independent. The department was paying prices of up to €13.70 per box of bog-standard photocopy paper -- which is widely available for less than €3 elsewhere. The department consumes hundreds of boxes of paper each year.

Sunday Independent

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