THE Secretary of the Department of Transport, Energy and Communications, Mr John Loughrey, was the first person to appear before the committee.

When asked by the Fianna Fail spokesman on Energy, Mr Seamus Brennan, about the cost to the taxpayer of the whole affair, Mr Loughrey said the "amount has to be set in the context of the company and the standards in the public sector".

Mr Loughrey also made it clear, in response to questions from Mr Brennan, that the chairman, Mr Dineen, had not been given any specific instructions to investigate Dr O'Connor's remuneration when he was appointed last September.

The new chairman was made aware of Government policy but there was "not even a scintilla of guidance that referred to any package of Dr O'Connor", he said.

Mr Loughrey explained the departmental files showed Dr O'Connor's package complied with the guidelines as the previous chairman had confirmed this in writing each year.

There was "no hint of any aberration or departure from Government guidelines", he said.

The Secretary also disputed that any tension existed between Dr O'Connor and the Department prior to Mr Dineen's appointment.

"The Department and I had nothing but the most friendly and professional relationship with the chairman and the former managing director," he said.

Mr Loughrey also told the committee that the Department had not been involved in the leaking of any documents during the affair.