‘Improve how €360m training fund is run’

The Department of Education has been told to improve accountability and transparency in the management of the €360m National Training Fund.

This came after the department had to reverse a move it made to raid €9m from the fund to cover “significant risks” that threatened the budget of Fás throughout 2012.

This should not have been done and the department had to get retrospective approval for taking the money from the NTF in the first place.

This year the NTF will spend €362m and it receives the vast bulk of its money from a levy placed on employers to support training.

In his analysis of the NTF’s 2012 accounts the Comptroller and Auditor General, Seamus McCarthy, raised concerns about the department’s decision to take €9m from the NTF to support Fás programmes.

In a management letter he wrote this February to the department’s secretary general, Sean Ó Foghlú, he said the way in which the NTF delivers accounts needs to be improved to give greater disclosure on what the fund is spent on.

A 49-page internal briefing report was prepared on the issue ahead of the department’s appearance before the Public Accounts Committee this summer and it revealed the ongoing issues with the NTF.

The report was released under the Freedom of Information Act.

The €9m transfer issue arose because Fás’ income was raised both from the department and the ring-fenced NTF, which got €299m from its €317m income in 2012 directly from employers.

These employers are charged 0.7% on most earnings to support the fund. The money is collected under the PRSI system and is managed on the behalf of the fund by the minister for education.

At the end of 2012 the department had to reverse the move and put €9m back into the fund.

The department got retrospective sanction for the raid from the Department of Public Expenditure in September 2013. The back-dated approval said the Department of Education had got verbal permission in 2012.

In 2011 the C&AG audited spending on the fund and found that there were shortcomings in the process used to monitor if programmes given money complied with the terms of it.

A year later Fás had still to put the procedures in place that were recommended by the C&AG.

In its report the NTF said the promised compliance audit had still not been done and said this was because of structural changes in the change from Fás to Solas.

But it said it had taken steps to address the concerns of the C&AG and his auditors.