Government accused of creating dormant accounts ‘slush fund’

THE Government has been accused of attempting to rush through legislation to give it a political slush fund of more than €100 million in advance of the next General Election.

Under the Dormant Accounts Amendment Bill 2004, published yesterday by the Minister for Community, Rural and Gaeltacht Affairs, Éamon Ó Cuív, the Cabinet will have the final say on how money from the fund is paid out.

The Dormant Accounts Fund is intended to be used to aid the disadvantaged and those with disabilities. It is made up of money in bank accounts, building societies and post offices that has not been touched for 15 years.

Up to now an independent body, the Dormant Account Disbursements Board, decided which groups were to benefit.

The change was branded a disgrace by Labour’s Community spokesman Brian O’Shea.

“The Government’s decision to give itself the final decision on disbursement is cynical, political opportunism of the worst kind,” Mr O’Shea said. “The Government has come on a crock of gold which will be used as a slush fund by Ministers coming up to the next General Election.”

He added that he was particularly concerned that the Government might attempt to rush through the Bill before the recess without proper debate. “We will fight any attempt to guillotine this Bill,” he said.

“The excuse is that the Board is too small to cope with the decision on pay-out. The alternative would have been to strengthen the number of personnel to administer the fund. However, this will actually weaken the Board.”

Noel Ahern, the Department’s junior minister with direct responsibility for dormant accounts, also announced that the amount to be paid out this year under the fund was being increased from €30 million to €60 million.

He said that the increased funding was at the request of the Dormant Accounts Fund Disbursements Board.

“The Board requested increased funding because the level of applications for assistance from the fund was greater than anticipated and because there were no approvals for funding in 2003,” said Mr Ahern.

Both Mr Ahern and Mr Ó Cuív said the Government was committed to maintaining an “open, transparent and accountable process for dealing with applications for Dormant Accounts funding.”

They said the objectives of the scheme would remain unchanged and that application processes for funding would be “transparent and publicised”. However, under the Bill, the Board will only have an advisory and monitoring role. From January next, its powers will be confined to the preparation of a draft plan, reviewing progress and assessing what the Department yesterday described as “the additionality and impact of spend.”

Last month dormant life assurance policies were added, giving it an extra €56 million, bringing its total to €225 million.