asked the Minister for Education if he will now provide adequate funds to Galway County Council to enable increases in university grants to be paid to students; and if he will make a statement on the matter.

Following discussions with the County Manager of Galway County Council, satisfactory arrangements have been made by my Department for the refund to the council of their expenditure in 1981 on higher education grants.

Have the grants been paid and, if so, when?

Local authorities recoup grants in the year following that in which they incurred the expenditure.

Have the grants been paid to the students?

I understand that the students have been paid their maintenance allowances by Galway County Council. The arrangement which my Department has now made is that we will make a payment to Galway County Council earlier in 1982 than would be normal, so as to improve their cash flow.

The grants to be paid in 1982 cannot be recouped until 1983 and this is causing the local authority to have an overdraft for a long time. Can the Minister do anything to help the local authority in question on that point?

Since 1968 local authorities are paid the money which they have expended in relation to higher education grants one year afterwards. While that might cause a problem in the first year of operation, the payment of the grant in the second year ought to help to fund the payment of moneys during the second year. In the past it has not been as big a problem for local authorities as it seems to be this year. Galway County Council seems to have been in particularly difficult circumstances. I understand it may well have been because the Government decided to improve maintenance grants by two-thirds on the amount which was paid by the previous Government and the local authorities, naturally, had not budgeted for that in their estimates for the year. They had to carry the additional moneys because of that improvement. I accept that it is not a satisfactory arrangement form the point of view of local authorities and I have made proposals to the Department of Finance with regard to making a change in the payment machinery. I understand it would be 1983 before the local authorities could benefit from that.