FÁS REPORT:THE LATEST report on Fás by the Comptroller and Auditor General (C&AG) fails to address the role the former director general, Rody Molloy, played in the matters that have caused controversy at the training authority, a former director of internal audit, Terry Corcoran, has said.
In a lengthy letter to the Dáil Public Accounts Committee, circulated yesterday, Mr Corcoran outlined in detail how Mr Molloy was critical of an internal audit into spending matters at the corporate affairs division of the authority.
The controversy over these matters eventually led to Mr Molloy’s resignation as well as the drafting of new legislation governing Fás and the appointment of a completely new board.
In his letter, Mr Corcoran, who is still a Fás employee, sharply criticised the latest report on Fás by the C&AG, John Buckley, which deals with matters covered by the audit.
Mr Buckley’s account “obscures the main governance issue that arose – the response of senior management to internal audit’s conduct during the investigation, and whether this amounted to interference”, Mr Corcoran said.
He said the internal audit function had difficulty getting a response from Mr Molloy to the report, so it could be forwarded to the audit committee of the Fás board and then to the C&AG.
He said this matter was left out of the C&AG’s report.
“The facts are that a properly constituted audit committee, a statutory subcommittee of the board of a non-commercial State-sponsored body with an annual budget of almost €1 billion, was faced with a refusal by the chief executive to respond to a major investigation report.
“As far as I am aware, this was an unprecedented event in the governance of the Irish public sector. Yet, in a report specifically devoted to internal control and governance in Fás, the C&AG remains silent on these matters.”
Mr Corcoran wrote that almost all of the major breaches of purchasing procedures listed in an appendix of Mr Buckley’s report had been initiated by Mr Molloy, former assistant director general Gerry Pyke or the corporate affairs division of Fás.
The same applied to the travel expenditure, credit card expenditure, and expenditure on concerts and sporting events, all listed in Mr Buckley’s report.
He also said that these events occurred at the same time as Mr Molloy and Mr Pyke’s “interactions” with internal audit.
“Despite this, the C&AG’s report gives little systematic consideration to top management behaviour taken in the round, and the question of whether the various problems identified within Fás were to do with culture at the top rather than more widely across the organisation.”
He said the failure to be “precise about the location of problems has been unfair to the vast majority of Fás management and staff”.
Mr Corcoran was removed as head of internal audit in 2007, having been told by Mr Molloy that the decision had nothing to do with the inquiry into corporate affairs.
Two weeks previously, the board audit committee had backed him after Mr Molloy criticised the conduct of the inquiry.
Fás chief’s deal must stand, committee told
THERE IS no legal basis to change the severance terms agreed with the former director general of Fás, Rody Molloy, the Dáil Public Accounts Committee was told yesterday.
The secretary general of the Department of Enterprise, Trade and Employment, Sean Gorman, said a review in the department had been advised to this effect by the Attorney General’s office.
The review was ordered by Tánaiste Mary Coughlan last November, following statements that there had been a deliberate withholding of information from the board of Fás.
Committee member Róisín Shortall was sharply critical of Mr Gorman at yesterday’s meeting.
She said the committee was “extremely hampered by the lack of co-operation” it was getting from Mr Gorman in its inquiry into the Competency Development Programme run by Fás.
Spending on the programme jumped from €2 million in 2002 to €45 million in 2007. A review of the programme authorised by Government in 2005 has still to be completed.
Ms Shortall said it was “absolutely ludicrous” that the committee could not get its hands on the report.
“Is it the intention to wear down this committee?” she asked.
Chairman Bernard Allen said the committee was getting “scant co-operation but we are not going to go away.”
Mr Gorman said he expected the report would be ready shortly. He had appointed a retired official from the Department of Finance to chair the review committee. He rejected the suggestion that the programme had been a “slush fund” for employers.
Comptroller and Auditor General John Buckley said there had been repeated media reports that his office had said spending controls in Fás were excellent. No such assurance was or could be given by his office, he said.
FÁs Spent €2,255 In Sanctioned Hospitality
ROBBIE AT CROKE PARK: THE SECRETARY general of the Department of Enterprise, Trade and Employment, Sean Gorman, was among those who attended a Robbie Williams concert in Croke Park in 2006, as a guest of the national training authority, Fás.
The authority spent €2,255 on hospitality at the concert, which was one of a number attended by guests invited by Fás during the 2006 to 2008 period. The authority spent €35,000 on concerts and match outings in 2002-2008, with all expenditure sanctioned by the former Fás director general, Rody Molloy.
An invitation list for the Robbie Williams concert was read out at yesterday’s meeting of the Dáil Public Accounts Committee. The invitees were each offered two tickets, while Mr Molloy got six.
The invitees were: Mr Molloy; former assistant director general (ADG), Gerry Pyke; Fás director of corporate affairs, Greg Craig; former ADG Christy Cooney; ADG Oliver Egan; Labour Relations Commission (LRC) chief executive, Kieran Mulvey; LRC deputy director, Tom Pomphrett; Business Plusmagazine journalist and media and marketing columnist with The Irish Times, Siobhan O'Connell; Ark Life executive, Billy Finn; Irish Independentjournalist, John Walshe; Mr Gorman; former principal officer with Mr Gorman's department, Padraig Cullinane; and Anne Loughran.
Fás finance director Con Shanahan told the committee it was not known who attended the concert. A spokeswoman for Mr Gorman, a former director of Fás, later confirmed he had attended with a colleague.