I am joined today by the Minister of State, Deputy Brendan Griffin, who will also make an opening statement. I thank the committee for its tireless work on this matter and for the light it has shone on serious issues within the FAI. Investigative journalists have also played a commendable role, particularly Mark Tighe, whom I wish to thank. I apologise to the committee for failing to provide my opening statement in advance as requested. As I am sure members will appreciate, this has been a very fluid situation, including significant developments as late as this morning, which would have overtaken any script provided earlier.
I regret that there has been a cloud over Irish sport, especially Irish soccer, since 17 March, St. Patrick's Day, when news broke about the loan of €100,000 to the FAI by its then chief executive, John Delaney. On 19 March, we wrote to Sport Ireland, directing it to engage with the FAI to clarify matters of concern. Since then, there has been intensive activity between the FAI, Sport Ireland and my Department. The decision of the board of Sport Ireland to withhold and suspend funding to the FAI was an extraordinary moment for Irish sport. I do not have to remind the committee of the scale and reach of the FAI. This is an organisation with more than 200 employees, and an annual turnover of close to €60 million. It is also an organisation with several thousand clubs, the national governing body, NGB, for the most popular team sport in Ireland by participation rate. While it may not be among our native sports, soccer is a sport which is at the heart of Irish life and culture.
It would be remiss of me not to mention the importance of due process and natural justice when dealing with these matters. While members of the committee are unfettered, the response by the officials of my Department, Sport Ireland, the Minister of State, and by me must be considered and appropriate. Having said that, I watched the FAI's engagement with the committee and I have monitored developments since then. Last week's appearance and events over the weekend have been very disappointing. Yesterday's announcement that the former CEO had voluntarily stepped aside pending an "independent" investigation fell far short of expectations.
While it is the case that due process is hugely important, the committee will not be surprised that I have become increasingly concerned with these developments. Here we have a clear case of the FAI admitting it failed to abide by the conditions for receipt of State funding. We had a shambolic appearance by the FAI at this committee last week at which even the most basic questions, for whatever reasons, went unanswered. Concerns remain around a financial transaction, basic levels of corporate governance, the creation of the new executive vice president role, issues of a substantial nature being considered by the Office of the Director of Corporate Enforcement and other developments which would suggest that all is far from well.
The Minister of State, Deputy Griffin, and I have made our serious concerns known. We have impressed upon Sport Ireland the need for root and branch reform of corporate governance. Over the weekend, I also spoke publicly about the need for strong corporate governance as a precondition for ongoing State funding, including capital works. As late as last night, we reiterated to Sport Ireland the need for regime change.
As a result of the ongoing pressure, I am pleased to confirm to the committee that in the past few hours, the FAI has written to me, indicating decisive action is being taken. I will now read the FAI’s letter into the record of the meeting:
I would like to first of all apologise to you and your colleagues for any embarrassment caused through the association’s engagement with the Oireachtas committee in relation to recent controversies. I can assure you no disrespect was intended by me or the association in relation to our engagement at the committee. Whilst I am acutely aware that our “response” to date has caused considerable frustration and has not appeased public demands for action, I have a responsibility to ensure that we act legally and follow due process in relation to both employment matters and our engagement with the Office of the Director of Corporate Enforcement.
Since the controversies first arose, the board of the association formed a sub-committee to progress all issues involved and this sub-committee has been working hard to try to ensure all matters are fully investigated and that progress is made. The need to reform governance structures is recognised and it is intended that we will put in place both structures and processes that meet best practice from both a corporate and sporting body perspective. We have already taken significant action in this regard.
We have commissioned Mazars to undertake an in-depth review of all the matters of concern. This is a fully independent exercise which will be carried out to the highest professional standards and will be forensic in its approach. We are pursuing all steps, with legal advice, in relation to ensuring that all matters that arise from this review are actioned as appropriate.
The processes that have been put in place are significant and will have far-reaching effect. They will, of necessity, however, take some time, having due regard to the need for detailed examination and to respect the rights of all individuals who may be involved.
In relation to the board structure, we have engaged with Sport Ireland in relation to both the membership of and terms of reference for a new governance group which will, among other issues, bring forward proposals for the restructuring of the board and other governance requirements.
We have asked that this group commence work immediately and bring forward recommendations as speedily as possible. It is our intention that recommendations in relation to restructuring the board will be brought to the membership for their consideration and adoption at our annual general meeting in July (or at an extraordinary general meeting, if the work of the group facilitates an earlier date). At that point, when a new structure has been put in place, it is the intention that the existing board will step down to allow for a new board to be constituted in the best interests of football.
It is our considered view that it is imperative that the board would be allowed to facilitate the management of these processes to conclusion and this will address, in a very real way, all of the concerns that have been raised in recent weeks. It also provides that this resolution is managed in conformity with UEFA and FIFA statutes regarding governance.
In the interest of all players, coaches, volunteers, fans, employees, sponsors and Government stakeholders, we are utterly committed to ensuring that the FAI moves to a position where trust and confidence is restored. I hope that this letter will provide some assurance in that regard.
President [of the FAI]
I welcome the fact that the Football Association of Ireland is engaging with Sport Ireland in a process and that they have now indicated that the board will step down. I believe that an emergency general meeting should be called before the July date as soon as the active investigations have been concluded to facilitate a transition to a new board by way of transparent elections. Given the ever growing lack of public confidence in the FAI, this move is to be welcomed and it is hopefully the first step on the road to rebuilding trust in this important national governing body of sport.
Considering the issues over which most of this board has presided, and the fact of those issues being obvious even before the various investigations have started, it is clearly time for a regime change. As regards Government funding, I welcome the swift and decisive action of the board of Sport Ireland to suspend and withhold the funding. I can add that there will be no further Government funding for the FAI until we see real change and reform in the association's corporate governance and until we have received credible answers. With regard to future allocations under the sports capital programme and the large scale sport infrastructure fund, I will be closely monitoring developments on corporate governance and the conditions that must be met before Sport Ireland's funding to the association is reinstated. In this regard, no new capital payments will be made by my Department to the FAI until I am satisfied with the new measures put in place.
I am pleased that the FAI will work with Mazars to overhaul the association's governance. It is well known that I have great difficulty with organisations conducting internal reviews and investigations so I welcome the invitation by the FAI to Sport Ireland to input to the terms of reference of the Mazars exercise. I trust that the FAI will continue to liaise with Sport Ireland throughout this challenging process and in implementing any changes recommended therein.
As Minister, I have responsibility for a considerable number of appointments to State boards and I am well aware of the importance of appointing individuals with a broad range of skills and experience, especially financial and legal expertise in this context. The FAI should take meaningful steps to improve the process for the election of its board and implement any recommendations with regard to the appointment of independent directors.
As we have heard, Irish football includes a broad range of stakeholders extending far beyond the FAI headquarters at the National Sports Campus. On the new board it would be appropriate to include representatives of the players - male and female - supporters, coaches, volunteers and leagues.
It has been abundantly clear in recent weeks that there is an immense frustration throughout grassroots soccer in Ireland. We have seen protests at recent international matches and at League of Ireland fixtures. Every committee member has received a vast number of letters and emails from volunteers and supporters across the country who are furious with the leadership of the association and the way it has responded to the recent controversy. Many have highlighted other issues that are important for the future of soccer in Ireland, such as youth development, participation of women and girls as well as the challenges faced by League of Ireland clubs. It is now time to convene a stakeholders' forum to allow representatives from every level of football in Ireland, including the international teams, the schoolboy leagues, the local community clubs and those playing in the League of Ireland Premier Division, to come together to shape the future for their association and their sport. This is quite the crisis for the FAI but it is also an opportunity to develop an inclusive vision for the development of soccer in Ireland. The Minister of State with responsibility for sport, Deputy Griffin, and I will facilitate that long overdue conversation. I would welcome the committee's observations and any questions committee members have.