The Football Association of Ireland (FAI) sought an €18 million "bailout" from the Government earlier this week, Minister for Sport Shane Ross has said.
He confirmed that the implications of the association, which has liabilities of €62 million, going into examinership or liquidation were being examined, but insisted he wanted to “avoid that at all costs”.
Mr Ross told the Oireachtas sport committee on Wednesday that the winding up of the FAI would also imperil the existence of the League of Ireland and prompt concern for the future of the game at all levels in the State.
The Minister, who met FAI officials on Monday, said the FAI “came seeking a bailout”, and that he “made it clear we cannot and will not provide them with taxpayers’ money”.
He later said the association looked for “various scenarios” of financial support, including a guarantee for its bank debts, but that an explicit request for €18 million was made.
“They sought, they named that figure, it was shocking,” Mr Ross said.
He told the committee his goal was to avoid examinership or liquidation of the FAI "at all costs", but confirmed that Grant Thornton, the financial advisers to the association, had done some work on the consequences of such a move that will be shared with his department.
Mr Ross said he did not want to see the FAI placed into examinership as the implications “could be very serious” and he would rather see it “rise from the ashes”. He told Sinn Féin TD Jonathan O’Brien his “guess” was that if the FAI was put into liquidation, the League of Ireland “goes the same way”.
International fixtures
Liquidation could also have implications for Republic of Ireland international fixtures. Under Uefa’s statutes, an association’s membership of the European governing body would cease in the event of insolvency. This would mean no League of Ireland clubs would be able to play in European competitions and no Irish international teams would be eligible to compete in Uefa competitions.
In his opening statement, Mr Ross said a forensic audit of the FAI by auditing firm Kosi, which has been referred to the Garda, had found "the FAI is not fit to handle public funds. They acknowledge some steps taken to address shortcomings, but there is a steep mountain to climb before they can reinstate funding to the FAI".
He said the department had identified a mechanism for supplying funding to the grassroots game by administering the salaries for regional development officers through a payroll services firm. He said this mechanism was ready to roll out next month and could continue through next year if needed.
“Grassroots football must not suffer because of mistakes made at the top of the greasy pole,” he said.
He confirmed his officials had contacted Uefa, European football’s governing body, to seek a meeting on the future of the FAI. Mr Ross said he hoped that meeting would take place early next month.
The Minister reiterated his demand that independent directors and an independent chairperson should be appointed to the FAI board urgently.
‘Unbelievably frustrating’
“The slow progress on the important things is unbelievably frustrating.”
An independent chairperson had been identified, the committee was told, and was considering whether to take up the offer. However, the identity of the chairperson, and the candidates for the roles of independent directors, were not known to the FAI.
John Treacy, chief executive of Sport Ireland, told the committee he knew "some" of the names of the individuals involved. The recruitment process had been contracted out to a third party recruiter.
Mr Ross said the FAI had flagged the potential risk to games due to take place in Dublin as part of Euro 2020 as a “possible danger of a disaster situation”, but said he had no indication whether funding for those games from Uefa was being withheld or delayed.
Minister of State for Sport Brendan Griffin told the committee that the liabilities of the organisation had risen to €62 million this year, largely due to advances of monies from Uefa which the FAI will eventually be expected to pay back. Revised accounts published earlier this month stated that the FAI had liabilities of €55 million at the end of last year.
The performance of the FAI's auditors, Deloitte, was also discussed at length. Mr Ross said he believed the company has "questions to answer" over its work.
“It does seem somewhat absurd for Sport Ireland and by extension us to depend on them, and then the accounts have to be restated,” he said.
