Chairman and members of the Committee of Public Accounts, I am delighted to come before you this morning to outline the position of Bord na gCon and to highlight the very strong financial position of the Irish greyhound industry. I do not, as suggested in recent media reports, come before you to defend myself or Bord na gCon. I see no necessity to do this as I believe the industry's practices and its success speaks for itself.
I fully appreciate that this committee is the watchdog over public expenditure and I will be happy to answer all and every question which members may have concerning any aspect of the administration of Bord na gCon. I believe that the committee and the board share a common goal, which is to ensure taxpayers get the best value for their money. The members of the committee and I as chairman of a semi-State company must ensure this happens at all times. It will be more appropriate that some issues concerning day-to-day matters are addressed by my colleague Mr. Michael Foley, who is a fellow of the Institute of Chartered Accountants in Ireland and is a man of the highest integrity and dedication. He is the board's financial controller and for the past seven months has been acting chief executive officer. In my opinion the board is very lucky to have a man of Michael's superb ability among its senior executives.
By way of background I will give the committee a brief outline of my role and some detail of what we as a team have achieved during my time as chairman. In 1995 I was approached by then Tánaiste, Dick Spring and asked if I would accept the position of chairman of Bord Na gCon. Initially I refused. However, Dick Spring, Ivan Yates and Jimmy Deenihan eventually persuaded me to accept the position. When I took on the role of chairman, I more than most was fully aware of what lay ahead. I had been involved in the greyhound world since a child and I was fortunate enough to have won an Irish greyhound derby with Dipmac in 1984. I was also very fortunate to be a close friend of Kevin Heffernan, the former chairman.
When I became chairman in 1995 the greyhound industry was in a state of decline and despair. Attendances were at 580,000 and falling. The morale among staff, owners, trainers and indeed all involved in the industry was at an all-time low. Our stadiums were mostly in a bad state of repair and many of them were in a scandalous condition.
In 1995 there were four main countries in the world operating greyhound industries — Ireland, England, Australia and the United States. There is no doubt that at that time Ireland was at the bottom of the table and nearly off the Richter scale. Taking on the role of chair was akin to trying to make Carlow all-Ireland hurling champions or bringing Kilkenny to an all-Ireland football final in Croke Park. It should be noted that Carlow are on their way to a hurling final because they were in Croke Park playing hurling last Sunday but they did not take on Kilkenny. This shows that everything is possible.
As chairman I set about putting in place the various changes and structures which I felt would transform our industry. It was going to be a long hard road. However, I love the greyhound industry and because of this I believed I had the passion and commercial experience required for the job. My colleagues on the board shared this passion and this made our job much easier. We more than most wanted to succeed because we genuinely cared about our industry.
We did succeed. Ten years on it is acknowledged that we are no longer bottom of the table but are now well clear at the top of the table. We are like Chelsea in the premier division. The Irish greyhound industry is now the world leader with facilities and structures in place that are the envy of our colleagues and fellow greyhound owners in other countries. I refer to some of the figures. Attendances in 1995 were 580,000. Last year they were a staggering 1.4 million. This year attendances at greyhound meetings may well exceed for the first time the numbers attending horse racing in Ireland. I suggest this fact alone speaks volumes for what we have achieved.
Looking at betting, in 1995 the total amount bet was €28.9 million. In 2005 this has increased to €141.8 million. Bookmaker betting has increased from €22.2 million in 1995 to €90.5 million in 2005 while tote betting has increased from €6.7 million in 1995 to €51.3 million in 2005. That figure is probably the most remarkable in that we have passed out the horse-racing industry and we were well behind them when we started.
Owners and trainers are the bedrock of this business. They have also enjoyed and shared in our success. Prize money has increased from €1 million in 1995 to €12 million last year. We received €13.7 million in Government funds in 2005 and we had considerable capital expenditure and still paid out nearly €12 million in prize money to the owners and trainers who are the bedrock of the industry. I believe that it is a reasonable record by any standards.
These figures clearly illustrate that we have enjoyed unprecedented and unrivalled success in our industry. This did not happen on its own. It was achieved through a positive working relationship between Government and the board of Bord na gCon. At this stage I would like to record my appreciation to the Minister, Deputy O'Donoghue and the various Ministers whom I have had the pleasure of serving with down the years. Mr. O'Donoghue has been extremely supportive of the greyhound industry over the years and his regular attendance at our various events has always been much appreciated.
Over the last seven months we have had a certain amount of controversy — from my side, it was a lot of controversy — concerning a number of matters and the manner in which these were dealt with. I wish to record my appreciation to the Minister for his continued support during this period which was important to both myself and my colleagues on the board.
To deal with the controversies, because that is what the committee is here to hear and what I am here to address. First, I would like to deal with the circumstances surrounding the dismissal of former chief executive Aidan Tynan. There is a belief by a few that the dismissal of Aidan Tynan was in some way related to his position regarding the EPO findings in November. This is absolutely and totally without foundation. While procedures and systems are matters on which people may have varying views, the integrity of the industry and the seven members of the board who unanimously dismissed Aidan Tynan must be beyond reproach and must be clearly seen to be such.
The difficulties with Aidan Tynan arose in the summer of 2005. The board had become aware of specific changes which were being enforced which was creating low morale among staff at the various locations around the country. The deteriorating financial position was of major concern to me. I and my fellow board members let it be known that changes should be made in the reporting structures which would have returned to a practice which was in place before Aidan Tynan took up his role with Bord na gCon and which had worked very successfully. There was unanimous agreement among the board members. I stress it was unanimous agreement at every stage, which is crucial in the successful running of any organisation. There has been innuendo as well as hearsay, which is nothing new when one is running the greyhound industry, about the facts surrounding this case but I believe, as chairman, I must disregard all of this and comment only on what is a matter of record. It is a matter of record in the various minutes and correspondence maintained by the board. In this regard, I will now refer members of the committee to when the concern and disappointment of Aidan Tynan's stewardship first came to be addressed by the board.
On 29 October 2005 a board meeting was held in the Kingsley Hotel in Cork. It lasted more than eight hours. At this meeting a number of very serious matters were raised by me and various members of the board and an honest and frank discussion took place. There was a lot of criticism of the CEO and certain members of his executive. I understand members of the committee already have copies of the various minutes which I believe clearly show the frustrations and concerns of the board. We had firmly believed these criticisms would be addressed by the CEO. Despite the concerns expressed by me and certain members of the board, no contact was made with me to seek advice or discuss how the changes which the board believed were necessary would be implemented. In fact, it appears that despite more than three hours of heated discussion in which it was obvious that the board was dissatisfied with the way matters were being handled, all of the views and comments made were effectively ignored by the CEO. There is no doubt that this did not augur well for the December meeting.
The December meeting which was held at Shelbourne Park on 9 December 2005 and lasted six hours clearly illustrated to members that their views were being ignored. However, it also showed how the board's yearly surplus was being eroded with a forecasted outturn of €4,044,681, some €950,000 less than in 2004. This resulted in the board instructing the executives to take a number of remedial steps to ensure the haemorrhaging of cash ceased. Morale, not only among staff and track personnel which previously had been very good but also among board members, was suffering.
It had become clear to members that the instructions being given to the CEO and certain executives were not being heeded and that this matter needed to be addressed. In our opinion, Mr. Tynan had not the desire, ability or people skills required to implement the instructions and he knew that his position had become untenable. He had been considering his position since September and in what I consider was no more than a smokescreen wrote to the Minister, Deputy O'Donoghue, on 18 January making totally unfounded and scurrilous allegations against the board to strengthen his exit position. This letter naturally caused huge anger and bewilderment among board members who were still awaiting answers to numerous important matters they had raised with Mr. Tynan some months earlier. In my opinion and that of my six fellow board members, the sequence of events, as properly recorded in the minutes and records of Bord na gCon, clearly illustrates that Mr. Tynan was unable to carry out the role of CEO effectively according to the board's strategy and that he knew that his position had become untenable.
The board meeting of 26 January was called on 17 January to address the serious issues that continued to arise and the CEO's failure to effect the requisite changes. The calling of the meeting predated both Mr. Tynan's letter of grievance and correspondence to the Minister. The CEO's failure to address issues which have undermined the entire industry could have ruined all that had been achieved in the preceding nine years. I believed, with my colleagues and a committed staff up and down the country, that the substantial success the industry achieved in those years would be threatened if these matters were not addressed as a matter of urgency.
The meeting took place on 26 January at Shelbourne Park. As members of the committee will see, we move meetings around from Limerick to Cork to Shelbourne Park, to give various board members less travelling time. Mr. Tynan maintained that he had no obligation to discuss this with the board as he had referred his grievance through the board's employee complaints and grievance procedure. This refusal to assist the board only made matters worse. In all my years in business I have never considered it right or appropriate for a CEO to behave like this and it was a further display of his unsuitability for the position.
It was clear to me and my fellow board members that there was a fundamental breakdown of the relationship between the CEO and the board. I had, in fact, formed this view after the meeting in December when I was made aware that he had discussed his possible resignation with his colleague and financial controller, Mr. Michael Foley, who can confirm these facts. This discussion resulted in Mr. Foley discussing possible packages available to him if he were to leave. However, I was prepared to work with Mr. Tynan if he duly effected the direction of the board, not simply his own. I believe his failure to effect the decisions of the board and take on board the views echoed in October and December resulted in his position becoming untenable. His failure to advise both me and the board of his grievances in order that they might be addressed effectively meant that there was a fundamental breakdown in our relationship, a breakdown which, if we had not acted immediately, would have further damaged the industry.
As chairman and director of many companies, both now and in the past 20 years, I am aware of the requirement for due process but I am equally cognisant of the need for decisive action. I believe the requirement for decisive action in the overall interests of the industry significantly outweighs the ongoing damage that would have continued to be inflicted if Mr. Tynan had remained in position any longer. I stress the costs incurred by the board in terminating his contract were not significant in the light of the damage and cash flow deficit that the board was likely to incur under his continued stewardship. My overriding concern was to effect these decisions which were right for the industry, even if it had to be at the expense of adopting an alternative procedure. The industry needed clear guidance and direction, something it would not achieve under Mr. Tynan's direction. If he had been left in position pending formal investigation, the process of change might have been significantly delayed and very costly if any element of the procedures were to be challenged through the legal process. Members of the committee are all aware of how long legal processes take and how expensive they are. I am also aware that the courts are less likely to interfere with the effective running of an organisation once decisions regarding its stewardship have actually been taken. I stress the board took a unanimous decision to dismiss Mr. Tynan after fully debating the issue. I advised Mr. Tynan of this decision.
There has been a lot of comment about staff morale, as outlined in Mr. Dalton's report. During my time as chairman I always set out to have high morale among the staff. In the many years I have been there I believe it has improved out of all proportion. This was the position when Mr. Tynan joined as chief executive officer. Morale was extremely high. It is ironic that the minutes of Mr. Tynan's first meeting in October 2004 show that he investigated morale and stated it was high and that there were only three minor HR issues to be resolved.
Subsequently, to the board's considerable disquiet, the letter from Mr. Tynan to the Minister of 18 January miraculously fell into the hands of Mr. Charlie Bird of RTE who I stress proceeded to erroneously link the dismissal of Aidan Tynan with his stance on the EPO decision. Fundamentally, that is why we are here today. I ask myself the question, if we had just sacked the CEO and there was not an EPO decision, whether we would be here today. I would not be and members of the committee would be talking to Mr. Foley. I believe Charlie Bird started all this but I intend to finish it. Because I am taking a legal action against Mr. Bird and RTE, I cannot comment further at this stage.
On the EPO issue, I wish to address the basis of the control committee's decision not to publish the world's first EPO positive results. I will set out the background to the board's testing procedure and deal with the respective cases of Barefoot Jenny and Westmead Rumble. The board's laboratory only commenced EPO testing in 1995. We are not aware of any other laboratory testing for EPO positive in greyhounds. That we have the capability to do so is indicative of the board's commitment to best practice. The committee heard the wonderful betting figures I illustrated earlier. Those figures would not be as wonderful if it were not for the absolute integrity that exists in the greyhound industry. Punters are not fools. They are not mugs. They want integrity. They have seen integrity. They have got integrity.
In 1999, 1,000 samples were taken at our greyhound tracks. In other words, 1,000 greyhounds were tested. In 2005, this figure had increased to 6,115. Despite the increase in the level of testing, the percentage of positive tests decreased from 2.3% in 2003 to 1.1 % in 2005. We have invested €318,000 in laboratory facilities over the past five years. We have doubled the laboratory resource since 1999. In other words, there are now twice as many laboratory employees and laboratory expenses have doubled. We consider that increase to be worthwhile. Punters will confirm that there is a great deal of integrity in the industry, by and large.
The decision not to publish the positive EPO test was taken by a four to one majority decision of the control committee. As I have been saying over recent months, the duration of Mr. Tynan's total contribution to the control committee meeting of 21 November 2005, which lasted approximately nine hours, was between 60 and 90 seconds. It baffles me that he decided he was in a position to send a letter to the Minister querying the board's testing procedures, etc. The then chief executive spoke for approximately one and a half minutes over the course of a nine-hour meeting. The decision that was taken at that meeting, after careful consideration, was deemed by the majority of those present to be in the best interests of the industry. In other words, four members of the board decided that the details of that particular case should not be published.
At all times, the committee acted within its legal entitlement not to publish those details. Section 43(8) of the Greyhound Industry Act 1958 clearly states that: "The Board may publish in any manner which it considers proper the result of any investigation made under this section." I repeat that a majority of the control committee — in other words, all the board members — decided at that time not to publish the results of the test in the best interests of the sport. Mr. Tynan's contribution of one and a half minutes was made after I asked him what he would do in the situation. It is debatable whether he even intended to contribute at all.
The first case the committee deliberated on was that of Barefoot Jenny. The committee members heard veterinary evidence from Mr. Maher, who is a well-known veterinary practitioner. He said that the substance was administered for medical reasons, in particular to address a low blood count. The board also considered the advice of Dr. Jim Healy, who is its head of laboratory function. He confirmed that an effect of EPO could be to raise the red blood cell count in greyhounds. After long and serious deliberation, the committee agreed, on a four to one majority. that the findings in question should not be published. It did not take that decision lightly. It was far too serious a decision to take lightly. It took into account the fact that owners and trainers had been administering EPO for medicinal purposes. It took the view that certain owners and trainers were unaware that EPO was a banned substance.
This was the first time a greyhound had tested positive for EPO. Given that no previous guidelines had been issued by the board in respect of EPO, and in light of the general lack of knowledge in this regard within the industry, the board decided it would be unfair to publish the details in question. In other words, nobody knew we had been testing and we had not published any guidelines. If a similar result emerged in a sport like athletics or cycling on foot of the first test to have been carried out and in the absence of published guidelines, one would be taken to the courts and cleaned out if one decided to publish the details. Dr. Comiskey, who was present at my press conference, is the foremost drug expert in Irish athletics. He said that Bord na gCon's procedures were exemplary and that the board was to be congratulated on them because they were way ahead of the testing procedures in athletics in certain regards.
The committee decided that a positive test for EPO was a serious offence. We took the necessary steps to ensure that the obstacles which prevented the publication of any information in this case were immediately reviewed. We did not just sit back and decide not to publish the results. Looking back, I cannot believe we were so good. I mean that. We decided that a full set of guidelines for all known illegal substances, including EPO, and the relevant penalties in each case should be highlighted and published in the two greyhound publications. This was subsequently done. We insisted that every licensed trainer in Ireland should be issued with a copy of the guidelines. This was also done. We agreed that the fine for the use of EPO should be increased to a minimum of €1,000 and that offenders should bear the cost of testing, which is estimated at €2,000. We also decided that details of such offences would be published.
At the meeting in question, we spent a great deal of time considering our past and future responsibilities. If people suggest that Bord na gCon acted in an irresponsible manner, all I can say is that they must be some geniuses. We did more than any other committee would have done. We took it very seriously. Perhaps I am talking on the basis of my way of looking at things. I insist that I think we dealt with the issue in a very serious manner.
The non-disclosure of the positive test in the case of Westmead Rumble followed from the decision not to disclose the positive information in the case of Barefoot Jenny. Mr. Kiely freely admitted his guilt when it was suggested that he had administered a prohibited substance. He admitted that he had used it on several other occasions for medicinal purposes. He pointed out that he did not know EPO was a banned substance, however. The committee imposed the maximum fine of €1,000 in each case. In Mr. Kiely's case, a forfeiture of €4,500 of prize money was also imposed. The sums of money in question are quite large in greyhound terms. We are not talking about the sport of kings. We are talking about greyhound racing. Mr. Kiely lost €5,500.
The committee's approach to publication in the Westmead Rumble case was consistent with its approach in the Barefoot Jenny case. Both trainers were told they would get a red card — they would be banned — if they came before the control committee at a future date. I hope the members of this committee agree that Bord na gCon took the EPO matter very seriously and that the fines and forfeits of prize money were substantial for the trainers concerned. I am firmly of the view that the board's approach shows that despite Mr. Aidan Tynan's allegations, the Irish greyhound industry takes the issue of drug abuse in the sport seriously.
The Irish industry is a world leader in this field. As Mr. Tynan admitted to the Minister, "the Board had previously allocated the necessary resources to give the laboratory this capability and it has become the first in the world to have been able to identify the presence of EPO in greyhounds". I draw attention to Mr. Tynan's use of the phrase "first in the world". We are world leaders in everything, including EPO detection.
I will read a statement that is not part of the document I submitted to the committee. It is quite a reactive statement. I hope the Chairman does not mind me reading it out.
