Road Safety Authority defends €20m cash reserve

The Road Safety Authority (RSA) has defended having nearly €20 million in cash reserves at a time of national financial crisis, saying it needs the money to ensure its stability when its public funding is stopped.

The authority spends about €40 million per annum and currently has €19.5 million in accumulated reserves.

Last year it received €6.5 million in funding from the Department of Transport, of which it retained €1 million in the bank to shore up its financial position.

The reserves held by the authority, which runs road safety campaigns and driver and vehicle State testing services, have been criticised as excessive in the current financial climate when, for example, vulnerable and ill people have faced a battle to retain medical cards.

When it was put to RSA chairperson Moyagh Murdock at the Public Accounts Committee today that the reserves were excessive, she said her organisation had been to the forefront in reducing road deaths from 335 in 2003 to 190 last year.

The reduction in serious collisions, according to a recent evaluation of the first road safety strategy from 2007 to 2012 commissioned by the Government, had revealed a “saving” of 686 fatal collisions, 1,400 serious injury collision and 650 minor collisions.

“This amounts to a monetary saving of approximately €1.85 billion to society and the Exchequer in general,” she said.

The reserves would be used to fund the RSA’s capital programmes and new initiatives when it was self financing from next year.

These included road safety campaigns, transferring the road worthiness testing of commercial vehicles from local authorities and running enhanced training for driving instructors and bus and truck drivers.

It was also responsible for operating of the new driver licence services and changes to the system governing the transport of dangerous goods.

Ms Murdock added only five per cent of the authority’s income came from State funding, with the remainder generated by the services it ran.

Secretary general of the Department of Transport, Tom O’Mahony, told the committee the financial position of the RSA was constantly reviewed when deciding how much of its funding allocation it was permitted to draw down in any given year.

“It may end up getting nothing,” he said of the €3.37 million allocation for the current year, adding the authority had received no capital funding from the State since 2010.

“The intention is from next year it’s getting nothing. We are effectively turning it into a commercial semi state; self funding.”

When State funding was stopped, a dividend may be taken at the end of the year by the State from any surplus money.

However, the authority needed to invest in capital projects in the years ahead and also anticipated a fall off in funds it was currently generating from running the national car test (NCT).

Ms Murdock said when the RSA was approached by the Garda whistleblower Sgt Maurice McCabe in 2012, his concerns about the termination of penalty points were received by her predecessor Noel Brett.

He passed them on to the Garda Síochána Ombudsman Commission immediately, as well as the Comptroller & Auditor General and the Garda.

She has agreed to supply the committee with all of the records retained by the RSA outlining the details of how it acted to pass on the complaints from Sgt McCabe after it initially received them in October 2012.