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The Anglo Irish report is now available.

Gavin has just informed me that there is an official description for regulatory agencies like the Irish Financial Regulator who act in favour of special interest groups rather than the public good (my emphasis)

Regulatory capture is a term used to refer to situations in which a government regulatory agency created to act in the public interest instead acts in favor of the commercial or special interests that dominate in the industry or sector it is charged with regulating (This is an exact description of how the Irish Financial Regulator operates).

For public choice theorists, regulatory capture occurs because groups or individuals with a high-stakes interest in the outcome of policy or regulatory decisions can be expected to focus their resources and energies in attempting to gain the policy outcomes they prefer, while members of the public, each with only a tiny individual stake in the outcome, will ignore it altogether.

When this imbalance of focused resources devoted to a particular policy outcome is successful at “capturing” influence with the staff or commission members of a regulatory agency so that the preferred policy outcomes of the special interest are implemented, then regulatory capture has occurred.

Regulatory capture theory is a core focus of the branch of public choice referred to as the economics of regulation, economists in this specialty are critical of conceptualizations of regulatory intervention by governments as being motivated to protect public goods. Two often cited articles are Laffont & Tirole (1991) and Levine & Forrence (1990).

The theory of regulatory capture is associated with Nobel laureate economist George Stigler, one of its main developers. Two other cited references are Bernstein (1955) and Huntington (1952).

Copy to:
Financial Regulator

There’s something very rotten in the ESB. On Liveline last week (Mon, Tue, Wed) there was an endless line of callers expressing shock at the massive increase in their bills. Here are some examples.

Previous bill €250 – Latest – €323
Previous bill €243 – Latest – €424
Previous bill €140 – Latest – €280
Previous bill €408 – Latest – €667
Previous bill €180 – Latest – €485

A Dublin woman living in a one bed-roomed apartment saw her bill increase from €265 to €453. She has two Dimplex and one storage heater, no washing machine, no dishwasher, only uses the sink immersion and all her bulbs are energy saving. She’s taking out a credit union loan to pay her bill.

A man in Roscommon opened a petrol station in 2002 when the price of a litre of petrol was 95c and his electricity bill was €800. Today, a litre of petrol is still 95c but his electricity bill has increased to €3,000

As Joe Duffy said, the ESB is ripping off its customers. The recent price increases do not explain these massive increases. Isn’t it curious that when such scandals are exposed in Ireland, nothing happens?

Everybody has a pretty good idea of what’s going on but no state authority will act unless the media dig deeper and expose the full truth.

See here for an excellent article by Senator Shane Ross which gives a good idea of how rotten things are in the ESB.

Letter in today’s Irish Examiner.

Haughey’s legacy

AT the presentation of Charles Haughey’s private papers to Dublin City University, it was reported he left a note claiming he never made a decision or took any action that was not motivated totally by the public good (Irish Examiner, February 4).

I eagerly look forward, therefore, to learning how the public good was served by just the following three activities of Haughey as uncovered by the tribunals:

1. The theft of millions from the State through tax evasion.

2. The embezzlement of large sums of money from the party Leader’s Fund.

3. The misappropriation of £200,000 from the Brian Lenihan (senior) liver transplant fund.

Yours etc.

Anthony Sheridan

Letter in today’s Irish Independent.

I NEED to express my concerns at the proposed pension levy for public service workers. I am a member of An Garda Siochana.

This morning, Sunday, February 8 2009, I read a report that Bank of Ireland Staff were to receive a 3.5pc pay increase.

Are they having a laugh?

Are the banks not getting a state bailout of €8bn from the state pension fund? And now they want us to pay an extra 6pc into this state pension fund to make up for money guaranteed to the banks, while the banks give their staff pay increases?

Again, I ask, are they having a laugh?

ESB, too, are to give their staff a pay increase. The Government owns ESB’s shares, yet they do not face a pension levy. And ESB rates have gone up. So recently I have faced more costs through larger ESB bills and now I am going to have less income.

Are they having a laugh?

Both ESB and bank staff get to return home every evening and weekend while we sacrifice our sleep patterns, relationships and quality of life. Accepted, we receive allowances for working nights, Saturdays, Sundays and weekends, but does this compensate us for facing abuse from certain elements of the public?

Operational gardai are putting their family life, personal safety and mental health on the line every day facing verbal abuse, being assaulted and injured, being threatened, stabbed, sometimes even shot at or killed.
Unsocial hours allowances don’t compensate for this.

All of this to protect the security of the State. And it wants to return the favour by hitting us with a 6pc pension levy, or pay cut, or whatever you like to call it. Mutton dressed up as lamb is still mutton.

Again, are they having a laugh?

After my mortgage and car payments I will be left with a pittance. I face selling my car in order to have some income left every week. There is not an adequate public transport service to facilitate our working hours and I certainly will not be able to afford taxis.

I, for one, am not laughing.

I would like to also sympathise with the thousands losing their jobs every week whose pain and distress must be on a totally different level.

name and address supplied

Letter in Sunday Independent.

Mansergh needs a reality check

Sir — It was with a sense of bewilderment and dismay that I listened to Minister of State at the Department of Finance Martin Mansergh state that “the government jet and ministerial cars (with two garda drivers) were necessary for ministers to do their jobs”.

As principal of a large voluntary secondary school I am now expected to manage a school in line with the recently announced cutbacks.

This in reality will mean three less teachers (seven per cent cutbacks in staffing), reduced subject choices, no funding for free books, radical adjustments in programmes for students with special education needs, a reduction in essential grants, no funding for Traveller children, reduced substitution and supervision resulting in a curtailment of school-related activities and the availability of adequate time for subject planning and curriculum development.

Set against this background the minister’s comment would seem to be most inappropriate. The implication of his statement is that the provisions that have been withdrawn from schools were not necessary for school leaders to do their jobs.

Such logic further demonstrates how removed from reality the minister is and also how unimportant equality and social justice is for this Government.

Shay Bannon, Principal,
CBS High School,
Clonmel, Co Tipperary

I received the following email from the Houses of the Oireachtas Commission in response to my inquiries regarding the new, and much vaunted, system of allowances and expenses for TDs and Senators.

Anthony,

The new system of Members expenses, adopted by the Houses of the Oireachtas Commission, has yet to be agreed by the Minister for Finance so unfortunately there are no further details of the expense system available just yet. When we have been advised further by the Department of Finance we will be happy to answer all of your submitted questions.

In relation to questions being submitted to our office in writing, the only reason that we ask queries to be submitted in this manner is for administrative ease. Usually queries with multiple parts require coordination from many different sections so if we have it in writing we can direct it by email which speeds up the process of response. In the event that citizens seeking information do not have ‘access or ability to make a written submission’ then we are more than happy to deal with their query by phone.

Hope this helps but if you need any further information please feel free to contact me here in the office.

Liam O’Brien
Houses of the Oireachtas,
Communications Unit,
Leinster House,
Dublin 2

My reply:

Liam,

“This is a significant action. It represents a real break with long-standing tradition and is a clear demonstration of how members of the Oireachtas are not only transparent and accountable, but will now be seen to be to a greater degree.” John O’Donoghue, TD.

Before I lifted the phone to make inquiries I knew, from long experience, that I was wasting my time.
Could you give me an estimate, say within the timeframe of the next decade, of when citizens can expect the Minister for Finance to adopt the new system?

“To bring greater transparency and accountability to the way members of the Houses of the Oireachtas receive expenses and allowances.” John O’Donoghue, TD.

Yours sincerely
Anthony Sheridan

The Houses of the Oireachtas Commission has adopted a new system of allowances and expenses for TDs and Senators. According to the chairman of the commission, Ceann Comhairle, John O’Donoghue, the new system will:

“Bring greater transparency and accountability to the way members of the Houses of the Oireachtas receive expenses and allowances.”

(Irish Times, 21st Jan.).

Two of the changes mentioned in the Irish Times report are:

A standard all-in monthly parliamentary allowance on a cost-neutral basis that would make the system more simple and streamlined for members and more verifiable and accountable from a public perspective and, for the first time, the attendance allowance paid to all politicians will be recorded and verified by party whips. Apparently, non attendance will result in non payment of the allowance.

I had a number of questions regarding this new system particularly regarding the standard all-in monthly allowance so I rang the Ceann Comhirle’s office for clarification and was promptly told that all queries must be made in writing.

I emailed my questions today.

Dear

In relation to our phone conversation of yesterday the following are my questions regarding the new system of allowances and expenses for TDs and Senators that was adopted by the Houses of the Oireachtas Commission and was welcomed by Ceann Comhairle John O’Donoghue as follows.

“I am pleased that my commission colleagues have adopted this progressive and important step.” (Irish Times, 21st Jan.).

Standard all-in monthly parliamentary allowance on a cost neutral basis.

What allowance/s does this new allowance replace?
How much is this new allowance?
Who monitors the payment of this allowance?

TDs attendance allowance.

According to the Irish Times report party whips will play a part in the verification of this payment.
What other department/person is involved in verification?
Will the public/media have access to verification records?

Publication of new system of allowances and expenses.

Is the new system of allowances and expenses available to the general public?
If so, how can the general public access the document?
If not, why not?

Rule that all questions to your office must be in writing.

Is this an official rule backed up by law/regulation or is it a local office rule?
What provisions does your office offer to citizens seeking information but who do not have access or ability to make a written submission?

Yours sincerely
Anthony Sheridan

An independent consultant’s report on the waste water treatment plant at Ringsend in Dublin has identified major flaws in establishing its capacity and how odours could be controlled. The findings have prompted the Minister for the Environment John Gormley to say “Someone must be held accountable.”

The report said that serious errors of judgement were made:

“Those errors of judgement have affected people’s quality of life in this area and I think people who have made errors should be held accountable.”

John Gormley (Six One News, 8th report).

Serious errors of judgement that cost taxpayer’s millions are par for the course in Ireland. John Gormley is just mouthing meaningless political words when he talks about accountability – nobody is ever held accountable.

Next scandal please.

Last week the Minister for Health Mary Harney told the Seanad that there were 10,000 fewer over 70s in the population than the number of those which had the medical card. This means that doctors are being paid millions for patients who are dead.

The HSE says it carries out monthly checks of all deaths registered to ensure patients who have died are deleted from its database of medical card holders.

A doctor speaking on Liveline during the week blamed bureaucratic incompetence and an inefficient HSE IT system for the shambles.

Whatever the reason, we can be sure of one thing – a massive fraud is being perpetrated on the taxpayer by somebody. This scandal has been going on since 2001 and apparently nobody possesses the intelligence or will to resolve the matter.

Last year it was conservatively estimated that doctors owed the State €1.8 million in overpayments but for some inexplicible reason the HSE seem unable to force doctors to hand back the money.

Expressing dissatisfaction with the situationat the time, the Comptroller and Auditor General advised that breaths should not be held by those waiting for repayment from doctors.

Keeping in mind what the above doctor said about inefficient IT systems here’s what Dr. Ronan Boland, Vice Chair of the Irish Medical Organisation’s GPs Committee had to say on Morning Ireland in March 2007.

“New IT systems have been put in place, so for the first time in the last 12 months, doctors like myself or my staff can go online and see in real time whether somebody is eligible for a service but that’s only in the last 12 months approximately.”

So, if new IT systems were put in place over two years ago why are doctors still been paid for 10,000 dead patients and more importantly, why are doctors who, according to Dr. Boland can see in real time who is eligible, accepting such payments?