Dáil Éireann debate -
Wednesday, 26 Nov 2008

Vol. 668 No. 4

Leaders’ Questions.

Deputy Enda Kenny

The announcement was made yesterday of the resignation of the director general of FÁS. The Government will launch another committee today to deal with cutting down the waste of taxpayers' money. The Taoiseach has 33 Ministers and this is their function. He has cast doubts on the judgment of others in this House, but the only two people who did not seem to realise that something was radically wrong in FÁS were the Taoiseach and the Tánaiste.

Is the Taoiseach fully aware of what has gone on in this organisation? Many years ago he was Minister for Labour and dealt with it then. I have flight records for a round the world trip from Dublin to Frankfurt, Tokyo, Honolulu and San Francisco, and back to Frankfurt and Dublin at a cost of €12,000 of taxpayers' money. I have the records of a major hotel in Dublin, with a booking costing €29,000 for a two and a half week stay. Two banquets were held in the hotel on the same day, one of which cost €8,000 and the other €9,000. I want to make it clear that when this country does business internationally, we expect to measure up to the standards that are required. However, the Taoiseach is in charge of this and what has gone on here is the gross abuse and reckless expenditure of public moneys.

Every Deputy in this House is visited by people on community employment schemes and so on who are trying to get back on FÁS schemes. However, things seem to have gone completely out of control at the top. Can the Taoiseach respond on his own judgment of the director general and his defence of his position? He has representatives on the board, appointed by different Ministers and Departments.

We are now at what I would call a "values revolution", where the taxpayers' money has to be respected as much, if not more, than individual money. The Taoiseach has responsibility for this. In view of the importance of FÁS in the years ahead, does he now believe that the board members should consider their positions?

The Taoiseach

Both I and the Tánaiste have been aware of the processes that were put in place to see what exactly is the problem in these matters. A similar process is also being conducted by an Oireachtas committee. I made the point two days ago that the Tánaiste indicated that an investigation was being conducted by the Comptroller and Auditor General into issues that have taken place, and that the director general would be before the Committee of Public Accounts in the normal way this week. I then went on to say that I know him personally, that he has been an excellent public servant and that I have every confidence in him. That confidence was justified. He is an honourable public servant and he did the honourable thing on behalf of the organisation that he led and tendered his resignation to the board of that organisation. I commend him for that.

He made a significant contribution to the development of services at FÁS during his tenure there, including the One Step Up programme, which has greatly improved the upskilling of the workforce. He tendered his resignation of his own volition because he is a public servant with a good track record. I do not think, no matter the size of the controversy, that it is right for me to reduce that career over that period of time and the good work done down to this issue. He has taken a decision based on accountability for this issue and I commend him for it.

The Tánaiste will report to the Government next Tuesday on what happens next. I understand that the board of FÁS will meet this evening for the purpose of appointing an interim director general of the organisation.

Deputy Enda Kenny

When I raised this issue yesterday, the first point I made was that I would not impugn the personal integrity of anybody. Did the Taoiseach discuss this with the Tánaiste before she contacted Mr. Molloy yesterday in terms of her conversation with him? Does the Taoiseach take the view that the audit committee of FÁS is representative of Ministers and Departments?

If they did not know about this, they should have been in the position of finding out, given that they represent the taxpayer. If they did know about it and its extent, then they are guilty of criminal negligence. This organisation now has a very bad name, even though it has done some great work over the years. In that context, the Taoiseach should ask the members of the board to consider their positions.

We are at the start of a values revolution in Ireland, as I have already said in other fora. In the past, we had the situation where the Taoiseach's predecessor saw no difference between right and wrong in accepting large sums of money over the counter. In this Chamber he told us that members of various boards were appointed on the basis of friendship. Irrespective of the party involved, this is a consequence of being in power for too long.

Deputies

Hear, hear.

Deputy Enda Kenny

The same would apply to any other party in office for too long.

On the basis of the Taoiseach's comments about the former director general's integrity, I assume Mr. Molloy wants to co-operate with the Committee of Public Accounts to get to the bottom of this issue. If the Taoiseach did have a conversation with Mr. Molloy, did he point out to him that there would be no agreement on severance pay or a golden handshake until there is co-operation with the Committee of Public Accounts, which represents the people and taxpayers? We cannot have a situation where the director general resigns and makes no further comment to a committee of this House, representing the people, on the profligacy that went on. That is fundamental to the start of clearing up this matter.

The Taoiseach will make appointments to another committee today, known colloquially as "An Bord Snip". It is a function of Ministers — and is part of what they are paid to do, along with setting out policy — to call in Secretaries General and Accounting Officers to deal with these matters. The Government does not need any more committees to point out what should be done. It is up to Ministers to identify where the waste lies and root it out.

Does the Taoiseach agree that there should be no agreement on severance pay or a golden handshake for the former director general of FÁS until and unless there is full co-operation with the Committee of Public Accounts? Did the Taoiseach discuss this matter with the Tánaiste before she spoke to the director general?

The Taoiseach

I wish to point out, on the basis that Deputy Kenny is not impugning anyone's integrity, that the outgoing director general has been co-operating with the committees.

Deputy Pádraic McCormack

That is not so.

The Taoiseach

Any suggestion that he has not co-operated is incorrect.

Deputy Pádraic McCormack

He is not providing information to the committee.

The Taoiseach

Deputies cannot, on the one hand, say they are not impugning a person's integrity and then suggest that if co-operation is forthcoming, all will be well. Co-operation has been forthcoming.

Deputy Pádraic McCormack

That is not so.

Deputy Brian Hayes

It has not been forthcoming.

The Taoiseach

The chairman and the director general of FÁS have welcomed the fact that the Tánaiste asked the Comptroller and Auditor General, on foot of the public procurement report, to prepare further reports on other matters, including the question of the corporate services division. That is the factual position.

Deputy Pádraic McCormack

It is not so.

The Taoiseach

It is so. In relation to——-

An Ceann Comhairle

Please allow the Taoiseach to reply to Leader's questions.

The Taoiseach

I am not answerable to Deputy McCormack during Leaders' questions.

Deputy Pádraic McCormack

I am a member of the Committee of Public Accounts and I know what has gone on.

The Taoiseach

I do not agree with the Deputy because Mr. Molloy has been co-operating.

Deputy James Reilly

That is an opinion, not a fact.

Deputy Pádraic McCormack

He had blanked-out pages.

Deputy Brian Hayes

The Taoiseach is offering his opinion, not facts.

The Taoiseach

Deputies are saying that people's integrity will not be impugned. They are aware that in relation to that redaction, it was agreed between the legal advisors of the Committee of Public Accounts and of FÁS, on the basis——

Deputy Pádraic McCormack

That is not so.

The Taoiseach

——of the Data Protection Act.

Deputy Brian Hayes

That is not so. The Taoiseach is wrong again.

The Taoiseach

That is the information that the deputy chairman has indicated to the public.

Deputy Pádraic McCormack

That is wrong.

The Taoiseach

To return to the point at issue, rather than be distracted by these matters, the director general tendered his resignation and I understand the severance arrangements are in line with public sector norms. That is the normal procedure and Mr. Molloy would have that entitlement, the same as everybody else in that position. The board of the FÁS organisation will be meeting this evening. The Committee of Public Accounts will be holding its scheduled meetings and the arrangements for the attendance of FÁS officials is a matter for that organisation. Equally, it is a matter for the Committee of Public Accounts to decide what to do in this new situation. I am not going to get into any of that because it is a matter for the committee.

The director general, of his own volition, tendered his resignation. I commend him for making that decision, which he has done in the interests of the organisation he served and led. He has done a lot of good work in that organisation and in other Departments. I wish we were all in a position to say that we did everything perfectly, but none of us are able to say that. However, Mr. Molloy has taken on the accountability issue, for which I commend him. While there might be an avalanche of abuse against him personally — whatever way people want to play it is a matter for themselves — the honourable thing was done here. He has done it correctly——

Deputy Paul Kehoe

We are only protecting taxpayers.

The Taoiseach

——and his career over that period commends him as a good public servant. In respect of specific issues, he has dealt with them honourably.

Deputy Paul Connaughton

What about the board?

The Taoiseach

The Tánaiste will report to the Cabinet next week regarding the board and any matter that arises in that context. I wish to make clear that FÁS will continue to co-operate with any ongoing investigations into these matters.

Deputy Eamon Gilmore

Mr. Molloy has done the honourable thing by offering his resignation. I am sure that was a difficult decision for him and I wish him well. From time to time, when things go wrong, we get resignations of senior public servants. However, what we do not get, particularly from Fianna Fáil in Government, is any resignation by Ministers or any sense that there is ministerial accountability. The amount of money spent on electronic voting was 100 times greater than the expenses in FÁS under scrutiny, for example, but there was no ministerial resignation or accountability to this House for that. What we get — the Taoiseach gave it to us again here this morning — is the suggestion that when something goes wrong in a State agency, it has nothing to do with Ministers. We are assured that the Minister will investigate and there will be a report to Government. Then the issue disappears.

Let me remind the House how this works. A State agency, whether it is FÁS or any other agency, is accountable to the Minister and the Minister is accountable to the people for the spending of taxpayers' money through this House. In respect of FÁS, there is ministerial responsibility. The Labour Services Act of 1987 states specifically that the remuneration and expenses of staff in FÁS must be approved by the Minister and the Minister for Finance. This also applies to the board of FÁS. This is outlined in section 7 of the Act and again in the Schedule to that Act. Furthermore, there is a provision in the legislation that gives the Minister power to give directions to FÁS in respect of expenditure on specific items.

Let us be clear about this. The Minister for Enterprise, Trade and Employment had responsibility for the expenses regime which applied in FÁS, because the Minister had to approve it. There were three Ministers for Enterprise, Trade and Employment over the period in question, namely, the current Tánaiste, Deputy Mary Coughlan — who has only been in the job a very short time — the current Minister for Foreign Affairs, Deputy Micheál Martin and the current Minister for Health and Children, Deputy Mary Harney.

Did the Minister for Enterprise, Trade and Employment approve the expenses regime which applied in FÁS, under which some of the top executives benefitted? I heard Mr. Molloy on radio on Monday last say the arrangements in place were "entitlements". Did the Minister approve them? If the Minister did not approve them, then I seek an explanation from the Taoiseach as to why three Ministers — I do not know which one was responsible here — were negligent in their duty in overseeing the organisation, as the Minister is required by law to do. FÁS is not a free agent. It is responsible to the Minister, who must approve its expenses regime and who is, in turn, accountable and answerable to this House for that approval. I want an answer on that today.

The Taoiseach

My understanding is that the rules regarding travel and subsistence in the Civil Service are set out in circular No. 11-1982 as amended by circular No. 18-2006. In 1998, the Department of Finance issued a letter to all Departments and offices regarding travel. The travel and subsistence policy in FÁS is a matter in the first instance for the board of FÁS and the Department of Enterprise, Trade and Employment. These are the arrangements that apply. I do not think the Deputy is suggesting that the Minister would clear individual expenses of persons in FÁS; if that is the suggestion I do not think it is a proper governance principle. There are codes in place regarding these matters which should have been applied, in the first instance by the board and then brought to the attention of the Minister. On foot of a report from the Comptroller and Auditor General, the Minister asked for a further investigation in the corporate services division that deals with these issues so that we can get to the bottom of what exactly was going on. This is an exercise of accountability by the Minister on the agency concerned but I do not think it is right to attribute personal responsibility on the expense sheets to the Minister.

Deputy Pádraic McCormack

What about the board?

Deputy Seymour Crawford

What about the Greens?

An Ceann Comhairle

Deputy Gilmore without interruption.

Deputy Eamon Gilmore

The Taoiseach's answer is not good enough at all. Telling the taxpayer, who has to pay for this, about circular letters is not an adequate answer.

Deputy Joan Burton

We are going around in circles.

Deputy Eamon Gilmore

The Act which was passed by the Oireachtas, the representatives of the people, which set up FÁS, says without any doubt or ambiguity that it is the job of the Minister to approve the expenses regime in FÁS.

Deputy Noel Dempsey

Does it use the word——

Deputy Eamon Gilmore

I will read it for the Minister. Section 7(2)(a) states, “Such remuneration and allowances for expenses incurred by him . . . [this means any member of staff] . . . as An Foras or the subsidiary, as the case may be, with the consent of the Minister and the Minister for Finance”. It is explicitly clear that the approval of expenses regimes in FÁS, as established by this Act, is a job for the Minister for Enterprise, Trade and Employment.

I will ask the Taoiseach a direct question. Did the Minister approve travel by first class by senior executive staff of FÁS? This is the Minister's job. This is not a matter of FÁS deciding this of its own volition. The arrangement for expenses remuneration in FÁS is a matter for which the Minister has responsibility. I want to know whether this was approved by the Minister and if it was not approved by the Minister, what has a succession of Ministers in that Department been doing over the 11 years in which the Taoiseach's party has been in office?

The Taoiseach

As I said to Deputy Gilmore, the specifics of the expenses regime that would apply to Departments, offices or agencies are under the remit of Departments. In 1998, the Department of Finance issued a letter. To answer the Deputy's question, the Labour Services Act 1987 refers to the Minister for Enterprise, Trade and Employment and the Minister for Finance. In 1998 the Department of Finance issued correspondence to all Departments and offices regarding the foreign travel issue and this is the regime that applies. It is a matter for the board and the management who are in charge of the day to day operations and implementation of Government policy in respect of that agency to ensure it is complied with. The issue now arising is that the evidence suggests prima facie that it was not being complied with. The question is what accountability arises as a result of this non-compliance. The director general has made a decision himself as head of the day to day operations of the agency regarding what he believes he should do in these circumstances and I commend him on that.

Deputy Paul Connaughton

He is gone now.

The Taoiseach

With regard to any other aspect of the issue, the Tánaiste on her return will report to Government and the Government will decide what, if any, other matters are required here to ensure the full public confidence in those who work conscientiously in this organisation to provide the services which it is statutorily required to provide.

Deputy Pádraic McCormack

Does the Taoiseach have confidence in the board?