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Mistress of Inaction on Fas

Posted on: September 13th, 2009 1 Comment

There is nothing urgent about the overspending in Fas. It’s all in a day’s work. Ask the Tanaiste.

A damning report about Fas has been sitting in Mary Coughlan’s department since June 12. She had three months to lay it in the Dail library. She just beat the deadline last Thursday. The squalid state agency ended up with three months’ breathing space.

Why?

A cynic might suggest that last Thursday was a good day to release an embarrassing report. All the main news bulletins were jammed with the full details of Brian Lenihan’s Nama bill.

The truth is that Mary is a master of commissioning endless reports and a mistress of inaction.

Her solution to the orgy of overspending at Fas is to play for time and commission reports.

Last year the top brass at Fas incurred indefensible travel and lavish entertainment bills. The state agency that cares for the unemployed was the vehicle of junketeers to sunny Florida.

That little racket was exposed by the Sunday Independent, not by Mary’s department — the outfit with responsibility for Fas.

Following the Sunday Independent story and an interview with RTE’s Pat Kenny Fas director-general Rody Molloy resigned.

Last Thursday, John Buckley, the Comptroller and Auditor General, revealed another torrent of overspending at Fas, a torrent that would embarrass any normal political mistress. Not the Tanaiste.

Mary Coughlan “welcomed” the report.

She pleaded that it demonstrated ” serious deficiencies” in financial controls in particular areas of Fas over a specific period. Wishy washy stuff.

“Serious deficiencies”? That’s all.

She went on to welcome the measures that Fas has taken “to improve financial control and governance across the organisation” since SHE raised her concerns about the matters last year. If my memory serves me right, she was not at the front of the queue.

Good old Mary. She is cleaning up Fas. My eye.

The rest of her response remained self-congratulatory. Following Mary’s intervention Fas has apparently been cleaning up its act. “Work is underway” (it always is), continued the Tanaiste, to amend the Labour Services Act to improve corporate governance practices. Big deal.

There would be no more corporate credit cards for staff following the gross abuses exposed by the Sunday Independent. A breakthrough.

A new internal audit procedure was being introduced etc etc. Small beer.

John Buckley examined the 2002 to 2008 period in Fas. This latest, in a series of reports, scrutinised the advertising and promotional spend of Fas over those seven years. The findings were horrendous.

Expenditure in the general advertising area exceeded budgets by 66 per cent.

One of its unexplained findings is that much of the lucrative advertising budget was “ineffective”, meaning it hit all the wrong targets. No explanation is offered for such a strange mistake but let us hope that Fas was not trying to buy off bad publicity.

Some €600,000 was spent on an advertisement that never saw the light of day.

And €622,000 was spent on items for which there was no evidence of service at all.

All this happened under the nose of this or some other minister.

Mary was not in command for most of that time ; but no minister, neither Mary nor her predecessors, took a blind bit of notice of the Fas monster until the media seized the initiative.

Then, very slowly, they grasped the nettle. Fas was always a politically protected species, its €20m-a-week budget never — before the scandal broke — the main subject of scrutiny by any Dail committee.

Today the game is to pretend that ministers are clearing up the “serious deficiencies”.

The first “serious deficiency” is the minister . The second “serious deficiency”is the board. Both are squatting in office.

If Mary was remotely serious about cleaning up Fas the entire board would have been sacked the moment the Fas flights-to-Florida story broke last year.

Not Mary. She commissioned a few reports.

Ever since then the directors of Fas have clung to their seats despite their clear responsibility for the antics of the most profligate state agency on record.

Headed by trade union leader Peter McLoone, they decided to tough it out. Peter was one of the many lucky luxury travellers to sample the joys of Florida. He also draws €25,000 a year as chairman of the board.

A second trade union representative, Owen Wills of the crafts union, was another to hitch hike on a €7,000 return ticket to Florida.

He is still drawing €14,000 from Fas as a nice little part-time gig.

Des Geraghty, the former Labour MEP and Siptu boss, remains perched at the top of this rotten agency.

None of these boys are budging. Nor is Danny McCoy, the big employers (Ibec) boss, drawing €14,000 a year from his sideline. Danny and Ibec are fond of lecturing us about the need for good corporate governance, national discipline and sacrifice. These noble principles obviously do not apply to any board adorned by Danny.

Danny is joined on the board by three other Ibec staff enjoying the spoils of Fas office.

None of them could have held on without political support. Both social partners — unions and employers — have their snouts in the Fas trough.

John Buckley’s report is an indictment of them all.

His findings include a telling incident when chief executive Rody Molloy exceeded his authority while signing a contract with Croke Park for the Jobs Opportunities Fair. Molloy authorised over €500,000 of expenditure for the project. He needed board approval for any sum over €250,000. He did not bother to seek it but gained it retrospectively.

Not the mark of a vigilant board.

Buckley’s findings revealed that Fas did not always meet public sector procurement requirements; he discovered shortcomings in internal financial controls .

This is civil-servant speak for a state agency running amok.

Mary is now waiting for the next report. No doubt she will “welcome” that one too when it finds more “serious deficiencies”.

Fas has no AGM. If the same shenanigans happened in one of our quoted banks, even the most arrogant of that discredited band of chancers might fall on his sword. Instead the directors of Fas lurk in the undergrowth nursing their cushy, publicly funded protectorate in a manner that would make Sean FitzPatrick blush.

Fas is lucky. Its only shareholder is the Government. It has been a doddle for Fas to fritter away its budget, unchecked by a sleepy board and a co-operative shareholder for, at least, seven years.

Last week when I asked Coughlan’s department why it had taken her three months to lay the report in the Dail library, her spokesman replied that the minister had been studying it.

Later when I joined other members of the Oireachtas in calling for the directors’ heads on a plate, the hopeless Tanaiste issued another limp statement saying she would accept the directors heads on plates if they were offered to her. She should have sacked them on the spot.

Meanwhile in these times of economic hardship, Fas and its top brass still manage to spend €20m a week. We are beginning to find out where it is going.