Legal action ruled out over €29,000 for travel at Fás

The State body which replaced Fás does not believe it has any prospect of legally recouping controversial travel expenses for the spouses of senior officials and board members.

A total of up to €29,000 remains unpaid for spouses' travel on business class flights to destinations including Tokyo, Honolulu and San Francisco between 2002 and 2008, according to internal records.

In a statement on Tuesday night, Solas – which has replaced Fás – said it obtained some voluntary repayments from former senior officials, but money remained outstanding.

“Legal options were considered but, on the basis of legal advice, were deemed unlikely to be successful and therefore any legal costs that would have arisen would have been a further cost to the taxpayer,” a spokeswoman said.

A review of travel at the organisation found that of 17 instances where Fás paid travel expenses for the spouses of officials or board members on foreign trips, 16 were in respect of then director-general Rody Molloy and assistant director-general Gerry Pyke. The remaining trip was in respect of a then board member.

An audit by the Revenue Commissioners in late 2013 concluded that spousal travel costs should be treated as a benefit-in-kind and taxed accordingly.

Based on these calculations, Mr Molloy faced a bill of between €17,500 and €19,465, while Mr Pyke faced repaying between €4,800 and €9,800.

Penalties

Fás wrote to both men requesting they pay in full the cost of the spouse’s travel or the benefit-in-kind, plus penalties.

Records released to The Irish Times under the Freedom of Information Act indicate that a payment of just over €2,500 was received in 2014 and a separate payment of €824 was also made. They also state that the net figure of €29,082 remains outstanding. Both Mr Molloy and Mr Pyke resigned from the organisation in 2008 following a public outcry over expenses,

It later emerged that Mr Molloy received a €1 million “golden handshake” in return for his resignation.

His length of service was increased by an extra four-and-a-half nominal years, which increased the size of his lump sum payment by approximately €50,000 and his annual pension by about €11,000 per annum. The actuarial total cost of the deal, on a presumption that Mr Molloy lived for another 30 years, was €1 million.

A subsequent investigation by the Dáil's Public Accounts Committee was highly critical of the training agency's "inappropriate spending" on first-class flights and luxury travel.