Minister of Public Expenditure raps Údarás na Gaeltachta for lack of transparency

Minister of Public Expenditure and Reform, Brendan Howlin, has rapped Údarás na Gaeltachta on the knuckles for failing to release vital information on spending of public money affecting Donegal and other Gaeltacht areas.

Following a refusal by Údarás to provide details on hefty pension payments to former executives that accounts for more than half its annual budget under a Freedom of Information (FOI) request I filed, formal written parliamentary questions were submitted by TDs angry about the lack of transparency by the Gaeltacht economic development group.

FOI

Such questions culminated in one by Mary Lou McDonald, Sinn Fein TD and member of the Public Accounts Committee (PAC) on my behalf, directly to the Minister, “To ask the Minister for Public Expenditure and Reform in view of his stated commitment to transparency and accountability in the spending of public moneys, his views that it is acceptable for a public body fully funded by the Exchequer to withhold from the public record details of public service pension arrangements on retirement for senior managers; and if he will legislate to require all publicly funded bodies to make such information public in the interests of open Government.”

A formal written response has just been received from Minister Howlin, in which he, in effect, tacitly states that Údarás was wrong to turn down my FOI request seeking details of pensions for former executives paid wholly out of public funds, and that it should release the information forthwith.

The Minister writes, “Under the 2014 (Freedom of Information) Act, the terms and conditions of any individual who holds or held any office or other position remunerated from public funds in a public body, rather than just those of a Director or member of staff as provided for under the 1997 Act, are not afforded the protections under the Act in relation to personal information. On that basis, the type of information to which the Deputy’s question refers i.e. public service pension arrangements on retirement for senior managers which would be part of remuneration, would be available from a public body that was subject to FOI, other than where a specific exemption applies against the release of such information.

The Minister elaborates further, “Under the Freedom of Information Act 2014, as was the case in the original Freedom of Information Act in 1997, an exemption from the provisions of Freedom Of Information (FOI) is provided for personal information. The 2014 Act also expanded the definition of what does not constitute personal information in the context of FOI.”

In answer to McDonald’s question as to whether the Minister “will legislate to require all publicly funded bodies to make such information public in the interests of open Government,” the Minister writes, “Given the matter is already provided for by the Freedom of Information Act 2014, I do not consider further legislative action is required.

As we have seen with scandal-hit FAS and other Irish state bodies that abused peoples’ trust and misspent public money, the only way to prevent corruption is by creating greater transparency. The government coalition of Fine Gael and Labour made this a central issue in their electoral platform. In the three years since they took office, little progress has been made.

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Several weeks ago, Ireland was placed 31st position ‘in the league of transparent nations’ following research by the World Wide Web Foundation. It is the worst of any European nation, even behind countries such as Russia, Mexico and Brazil. The group’s categorized Ireland as a country that faces challenges to “mainstreaming open data across government and institutionalizing it as a sustainable practice.” It also said “core data on how the government is spending taxpayers’ money and how public services are performing remains inaccessible or pay-walled even though such information is critical to fight corruption and promote fair competition is even harder to get.”

Tim Berners-Lee, Web, founder of the Web Foundation and the London-based Open Data Institute, said, “Governments continue to shy away from publishing the very data that can be used to enhance accountability and trust” and highlighted the power of open data “to put power in the hands of citizens.”

Údarás is a classic case in point.

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Dinny McGinley, former junior minister for the Gaeltacht, wrote back in a vague response to my FOI request saying simply that Údarás had informed him it was “a data controller, defined under the Acts as a person who either alone or with others controls the contents and use of personal data.

For so many years untouchable hidden behind a veil of Irish-language support, Údarás perhaps is in many ways no different to FAS in terms of greed and individual self-interests. According to Údarás sources, former board members in Donegal remained in boardroom meetings during discussions on lucrative payments to their very own companies and organisations. In addition, not one but at least three Donegal Údarás board members have been up before the Standards in Public Office Commission on corruption charges relating to double dipping on expenses. When one considers the expense claims for board members, particularly under the long-time chairmanship of Liam Cunningham from Glencolmbcille (from 2005 to 2010 he received more than 155,000 euro in fees and expenses, according to Highland Radio), one has an idea of the unchecked, proliferate spending that went on.

Some details as already reported by Highland Radio –

  • Four former Donegal members of the Údarás board each received in excess of 100,000 euro each, over a four-year period, in travel expenses.
  • Fianna Fáil member Daithi Alcorn earned nearly €120,000 between 2005 and 2009;
  • Fianna Fail Senator Brian O Domhnaill received €115,000 while independent Donegal member Padraig O Dochartaigh received €105,000.

Over one billion euro of public money has already gone into supporting Udaras na Gaeltachta yet unemployment rates in Gaetachts are consistently highest in the nation.

Misspending of public money (an issue brought up by the former head of the PAC, see 3-part series article series), includes all-expenses trips to Las Vegas for Udaras board members and their spouses – supposedly to meet a delegation of the IDA;

In truth, Údarás was – and perhaps still is – a cash cow for well-to-do insiders in west Donegal.

It is long past time Údarás prepared proper annual reports instead of the porous documents it now produces that disguise the spending picture and that it holds open public meetings to allow the people of the Gaeltacht to know exactly how their hard-earned money is being spent.

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‘Whatever you say, say nothing!’ – motto of Údarás na Gaeltachta

‘People have no right to ask how we spend their money.’

That’s the attitude of Údarás na Gaeltachta, which has once again refused to release key information about how it spends public funds.

Udaras

A Senate committee revealed that Údarás pays millions of euro every year in pensions to former executives, some of whom were local Donegal employees including Cathal MacSuibhne, former regional manager based in Gaoth Dobhair.

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Sinn Fein’s Trevor Ó Clochartaigh, a member of that Senate committee, exclaimed, “I nearly fell off the chair when I heard that almost half the current expenditure goes on pension payments to 136 people who are no longer employed by the organisation. Small wonder Údarás is not able to function more effectively.

He added, “This raises serious concerns regarding the levels of monies being paid and who is receiving them.”

Under transparency rules, other public bodies have made a breakdown of such pension figures available for examination, but in response to a Freedom of Information (FOI) request I made, Údarás refused to do so, citing gobbledegook about data protection.

As a result, having brought the matter to the attention of a number of TDs, the Údarás pension issue has risen to the highest levels of national government, to the office of Brendan Howlin, Minister for Public Expenditure.

I can reveal in this blog that on my behalf various leading politicians including Public Accounts Committee (PAC) member, Mary Lou McDonald, have attempted to find out the individual pension figures but Údarás has stonewalled every request, preventing their release.

MaryLou

How it happened

Údarás responded to my initial FOI request last year seeking details on pension and lump sum payments to former executives in a letter signed by Padraic O’Conghaile – a ‘cinnteoir’ at the organisation’s headquarters in Galway.

In the letter, he wrote, “I am refusing these records as they relate to the pension of an individual under Section 28.1 (Personal Information). The FOI Act defines personal information as information about an identifiable individual that: ‘would, in the ordinary course of events, be known only to individuals or members of the family or friends, of the individual.’ I believe that the right to privacy of these persons with regard to such information far outweighs any public interest there may be in this matter.

The fact, that all the pensions and payments are publicly-funded and thus not “known only to individuals or members of the family or friends, of the individual” as he asserts – did not seem to enter Mr. O’Conghaile’s thinking. Or, perhaps, did, but he refused to acknowledge it.

Following this response, I requested several TD’s to present formal written parliamentary questions in the Dail on the same issue.

For example, Mary Lou McDonald, a member of the Public Accounts Committee (PAC), submitted her parliamentary question to the Minister for Arts, Heritage and the Gaeltacht asking the Minister to “reference the specific provisions of the Data Protection Acts 1988 and 2003 to which he referred (supporting Údarás’ denial of information); the basis on which he believes Údarás na Gaeltachta does not, unlike in the case of all other senior managers across the civil and public sector, have to make public the details of public service pension arrangements on retirement for senior management.

Dinny McGinley, then junior minister, wrote back in a vague response saying simply that Údarás had informed him it was “a data controller, defined under the Acts as a person who either alone or with others controls the contents and use of personal data.

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Put in simple words, it means Údarás, while deriving all its funding from public money, considers ‘People have no right to ask how we spend their money.’ McGinley’s response also has no logical meaning whatsoever under present Irish law. Instead it is a classic delaying tactic. The former Minister did not bother to question it or seek elaboration.

That response led McDonald to submit a follow-up question, this time to Minister Howlin, reading, “given the Minister’s stated commitment to transparency and accountability in the spending of public monies, whether in his view it is acceptable for a public body fully funded by the exchequer to withhold from the public record details of public service pension arrangements on retirement for senior managers; and if he is prepared to legislate to require all publicly funded bodies to make such information public in the interests of open government.

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It is most disappointing that a simple request to a fully publicly funded body about its spending has led to such a reactionary response from an organisation such as Údarás, which is responsible for the economic, social and cultural development of the Gaeltacht.

Such utter lack of transparency and disregard for public concerns has already led to such widespread corruptive practices as those at FAS when it was discovered hundreds of thousands of euro went on lavish holidays including first-class travel and expensive rounds of golf for executives and their wives. Údarás itself has yet to account for trips paid out of public funds for board members, executives and wives to visit attractive international destinations, including Las Vegas.

Public money is a precious thing and every penny of it ought to be properly accounted for and judiciously spent.

I will reprint Minister Howlin’s response on this blog when it is received. It should provide a most interesting read.

Yet another Irish political fiasco

I was shocked to read in a leading Donegal newspaper editorial over the last few days that John McNulty had behaved ‘with dignity’ over his recent Fine Gael botched Senate nomination.

Let’s call a spade a spade.

The last thing Mr. McNulty behaved with was dignity. He condoned the onward march of cronyism and ‘stroke politics’ thus giving his full support to this age-old blight on Irish society.

John McNulty – guilty as charged, complicity to hoodwink. Photo courtesy Independent Newspaper.

Selling Mars bars at a Mace grocery shop in Stranorlar hardly qualifies Mr. McNulty to contribute much, if anything, to the development of the Irish Museum of Modern Art (IMMA) (unless his business is merely a front for a secret network of art collectors storing priceless Van Gogh’s under the petrol pumps). There are many throughout the country with decades of high-level experience in the arts sector and thus much more qualified than he.

Yet when Fine Gael spin-doctors whispered in his ear they’d pull a few strings and shove him on the (already full) board, thus giving him an easier ride into the Senate, he leapt like a deer in heat, omitting to point out the simple fact that he was completely unqualified for such a key position.

In doing so, the 37-year-old Kilcar man is as guilty as those people – mainly under Fianna Fail’s governing stewardship – who greedily grabbed places on other boards such as FAS and the Central Remedial Clinic and proceeded to claim hefty payments and generous expenses on the backs of struggling tax-payers. (Fianna Fail actually rushed 182 of their members on to public boards in the dying days of its last reign).

It must also be remembered that, far from being a credible Senate nominee, Mr. McNulty failed to even get elected to Donegal County Council having won just over 800 votes in May, less than half of the quota required for the six-seat electoral area. In fact, he finished the race at the rear of the pack at a distant 10th place.

Choosing him shows just how desperate Fine Gael are to shore up its political representation in Donegal, especially with the additional failure of John Curran, its choice for the Udaras board, to get elected to the local council (in great part over his willingness to hand over more than a million euro of tax-payers money to the Catholic nuns to run an addiction center in Falcarragh when there’s already one in Donegal, and after the dead babies scandal in Tuam). With Donegal South-West deputy Dinny McGinley due to retire at the next election, Curran’s failure and now McNulty’s means there’s nobody in place as a successor.

John Curran – until recent local elections, was being groomed as potential successor to TD Dinny McGinley?

Public boards or private clubs?

In a bizarre twist to the tale, Fine Gael Arts Minister Heather Humphreys said in the Dail this week that Mr. McNulty was appointed to the board of IMMA “on the balance of talent and experience.” That’s a joke. The minister then added that she and her party were committed “to using the public appointments procedure in line with the guidelines.” That’s an even bigger joke. It recently emerged that at least two of the six appointees to the Board of the Heritage Council last year were made by her colleague Minister Jimmy Deenihan in contravention of that very same formal application process.

Further, a 2012 report by the Institute of Directors In Ireland on state boards showed concern at the lack of transparency around the appointment process and the lack of consideration given to the skills required to fill them. Since then, board positions have featured on Government department websites and advertised via the Public Appointments Service but some describe this as ‘pure window-dressing’. The McNulty situation, and perhaps the Curran one too, are cases in point.

Plain-speaking (maybe too plain) Minister for Health Leo Varadkar said election to the parliament of a candidate who has withdrawn – as McNulty has done to avoid further embarrassment – would not be good thing for the political process. Duh, really?

Obviously, the only way forward is to make the recruitment process entirely transparent, minimise government involvement in choosing appointees, and actively engage individuals with the appropriate skill set to fulfill these positions.

Fine Gael’s Arts Minister Heather Humphreys in the Dail struggling to deflect accusations of cronyism and stroke politics. Photo courtesy RTE News

No crying over spilled milk

Ultimately, however, we have only ourselves to blame.

Most of those who voted for Fine Gael over Fianna Fail three years ago knew deep in their hearts exactly what they were doing. Being conservative, as we Irish are by virtue of our Catholic upbringing, we voted for one party knowing full well deep down it was little different to the other. Then we deigned to pat ourselves on the back for ‘taking a bold stand.’

What baloney! Ours was nothing less than a cowardly act.

To make matters worse, when we had the chance to regain some degree of pride and do away with a Senate that is, and always has been since the foundation of the state, a complete and utter waste of public money, we declined to follow our instincts and put pen to paper. How could any of us vote for such an anachronistic and discriminatory institution highlighted by the fact that with so many worthy universities and colleges throughout Ireland, only two – Trinity College Dublin and the National University of Ireland – are permitted to have Senators? Not to mention that 11 Senators are simply appointed on the whim of the Taoiseach. No elections, no vote.

Padding expenses? Investigations well underway on shenanigans of Fianna Fail’s Brian O’Domhnaill: Handsome salary as Senator not enough?

Today the Irish Senate, unlike the American one, stands as a perfect model of cronyism and stroke politics, with even appointed party members such as Donegal’s very own Fianna Fáil Senator Brian Ó Domhnaill under investigation for milking the system by duplicating expenses.

We tossed away the opportunity to fling the Senate into the bin of history where it firmly belongs. Let’s not now cry over spilled milk. Like McNulty’s reluctance to apologise publicly for his complicity in attempting to hoodwink us ordinary folk, it’s so undignified.

 

Udaras na Gaeltachta consider challenges of creating new jobs

Meeting for the first time this morning (Friday), members of the new board of Udaras na Gaeltachta face the challenging tasks of analysing the organisation’s performance and brainstorming on ways to accomplish the goals for which the Irish-language body was established.

One priority is employment in Gaeltacht areas. “Job creation and language promotion go hand-in-hand,” Anna Ni Ghallchoir, 55, the new chairperson, told the Donegal News. “With my new board colleagues, I will be examining very closely if past strategies have been successful and come up with innovative ones to help us move forward.”

Depending on whom you speak to, Udaras has either an acceptable record on job creation, or a very poor one, reflecting the age-old comment that statistics are like sausages – they look good but you’re never quite sure what’s in them.

New jobs versus lost jobs

With total funding of around one billion euro so far, Udaras reported it had created 6,970 jobs as of last year in what it terms ‘client companies,’ defined as any company receiving support. When examined in the context of unemployment in Gaeltacht regions, this represents 7.75 per cent of the population there. As of last year, Udaras’ website shows it supported 1,876 jobs in the Donegal Gaeltacht, which represents 7.89 per cent of almost 24,000 people. Donegal Gaeltacht has the second largest number of Irish speakers, but ranks fifth in jobs created among the seven Gaeltacht regions.

Liam O‘Cuinneagain, Udaras chairperson for the last ten years, told the Donegal News he is “satisfied with our job creation performance,” adding, “It’s not easy to get companies to locate to rural Ireland, in part because of its remoteness and lack of transport links and limited skill-sets there.” As evidence in Donegal, he points to sectors Udaras has invested in – seafood processing, call centres (VHI), IT, sea angling, boat repair, even potato-crisp/fast food manufacturing (Largo Foods).

Other business analysts, however, are less satisfied with Udaras’ performance, including Tom Fitzgerald, fluent Irish speaker and business owner employing 50 people at Bard na nGleann, his information-management company in Béal Átha’n Ghaorthaidh in the Cork Gaeltacht. “A strong, well-run economic development organisation is important for the preservation and promotion of the Irish-language and for job creation in marginalized areas such as the Gaeltachts, including Donegal, but there’s no shying away from facts, Udaras is an extraordinarily expensive organisation,” Fitzgerald, whose company has an annual turnover of between one and two million euro, told the Donegal News. “There is little evidence of effectiveness in the statistics. By normal business practice standards, Udaras’ record so far is very poor.”

Expenditure

Fitzgerald points to the fact that the total number of jobs Údarás says it created was lower in 2010 than in 1996. “Furthermore, there’s no indication that the amount of money spent by Údarás in a single year has any impact on job creation in the Gaeltacht.  For example: Údarás spent more than 84 million euro in 2002 according to its own annual report. Yet there is no corresponding spike in jobs either in that year or following years.”

O‘Cuinneagain says during his tenure as chairperson, “cost per job was around eight thousand euro.” However, a simple look at Udaras’s total expenditure for the last ten years (613.5 million euro) relative to the number of jobs it reports creating by the end of last year (6,970) equates to 88,000 euro cost per job. As only around 10 per cent of budget goes to language-cultural activities, the final cost per job figure may be as much as ten times higher than stated. In Donegal, a case study in job costs is Largo Foods, headquartered in Ashbourne, Meath, but with facilities in the Gaoth Dobhair Industrial Estate. According to Udaras, it has received over 6.2 million euro in funding between 1999 and 2011 – with another half-million euro to be paid soon for automated equipment. Udaras said last year the company employed 120 people. Taking those figures, that works out to be over 55,000 euro investment per job created, not considering funding from other bodies for Largo. Ironically, following the installation of the automated equipment earlier this year, media reported 36 jobs were lost at Largo.

As some of Udaras’s ‘client companies’ are also the ‘client companies’ of other organisations, foreign and domestic, from whom they receive additional support, it is difficult to evaluate what specific job numbers Udaras contributions amount to. “The term ‘client companies’ is a loose one, easily manipulated to suit purpose,” said Fitzgerald. “Some organisations that partly support companies in the Gaeltachts often claim all the jobs as their own making, which is quite misleading.”

O’Cuinneagain acknowledges that criticisms of Udaras for not supporting enough micro companies – entrepreneurs wishing to hire a handful of people – are valid. “We’re not getting what we should be getting – smaller businesses,” he said. “We’ve focused too much trying to get big companies that might employ hundreds. Even though the finance and support system is there, Udaras has not been welcoming enough. Staff have not been as pro-active as they should be, have not scoured their Gaeltacht communities to find such entrepreneurs. Unfortunately, we have remained in a culture of factory jobs.”

Asked why, the director of Oideas Gael, a language group in Glencolmcille, lay the blame on factors outside Udaras ranging from lack of business teaching in education “Greek and Latin instead of entrepreneurialism” to lack of bank finance. But he did not rule out the possibility that as funding a small company with thousands of euro amounted to nearly as much paperwork for Udaras staff as funding large companies with millions of euro, there may have be a Udaras propensity for avoiding small business applications. Asked if the push for larger companies could have been simply a strategy to keep employment figures up and for Udaras to retain its all-important job-creation remit, which accounts for most of its annual budget, he said, “That’s ridiculous, sounds more like a conspiracy theory to me.”

Fitzgerald’s opinion differs, “About the only goal that Údarás is measured on is the creation of 800 or so new jobs per year, so they focus on doing just that. The problem is that this strategy doesn’t take into account what kind of jobs they are. In theory, Údarás is better off creating jobs that disappear quickly so they can place the same people again in a year or two.”

Analysts also say the Udaras board members may not have had enough business experience to spearhead a successful jobs-creation strategy. Of the Donegal members on the previous board, none could be identified as having long-time corporate management experience. O’Cuinneagain waved aside concerns that the previous national board was too large, numbering twenty, which some analysts said made it unwieldy to manage and hampered decision-making. “I did not find our board meetings too difficult to manage, but then again my experience as a teacher in inner city Dublin for many years helped a lot,” he said.

Lack of fiscal clarity within Udaras concerns some observers.

“I spent several years studying the organisation and found its finances extremely difficult to understand,” one leading business researcher told the Donegal News. “I also found frequent errors in its calculations. Some figures on spending simply did not add up. There’s really no excuse for that when we have so many accounting software programs such as Excel at our disposal.”

When the Donegal News requested a breakdown of Udaras spending for the seven Gaeltacht regions, particularly Donegal, for the last three years, Siubhán Nic Grianna, national communications and marketing manager, responded, “The distribution of total monies is not segregated on a county by county or Gaeltacht by Gaeltacht basis therefore I cannot provide breakdown for Donegal for this period.”

Bernard Allen, former TD and head of the multi-party Public Accounts Committee (PAC), which oversees the proper spending of public money, told the Donegal News that lack of transparency at Udaras may have hindered job-creation efforts. “We found its expenses system to be incomprehensible and could not understand how it was spending so much money on trips for so-called job creation efforts.”  Referring to the scandal over misspending by another state body, he added, “Udaras’ expenses read like a mini-FAS and it seemed to stymy our efforts to find out the truth and avoid disclosing pertinent facts and figures to us, especially related to board member, staff and associated expenses. With better accounting practices, perhaps its job creation efforts could have been more effective. ”

Some questions concerning expenses, including 30,000 euro over two years on trips to Halifax, Canada, to look at seaweed projects, costly business-class flights, trips to many international cities including Las Vegas, Shanghai, Los Angeles and Chicago, and expenses for spouses – which is counter to existing regulations – have still not been fully answered, Allen said.

Nic Grianna said such concerns lack basis. Describing the first story in this newspaper series as, “a slanted view, full of insinuations,” she added, “There was no reprimand from the Public Accounts Committee (PAC). We are very open and transparent and explained everything. There has been no abuse of public money.” In response, Allen said simply, “We did not get all our questions answered satisfactorily and a national election was called and the PAC disbanded before we could investigate fully.” Even though the information is in the public domain, Nic Grianna declined a request for a breakdown of pensions for 136 Udaras former executives costing around 4.3 million euro this year, half of this year’s current budget. Efforts to contact retired executives Cathal MacSuibhne in Donegal and CEO Padraig O’hAolain through Udaras for comment, were unsuccessful.

With allegations of cronyism and clintelism tainting many public bodies, O’Cuinneagain said he did not experience conflicts of interest while Udaras chairperson. “My organisation, Oideas Gael, did not receive any money from Udaras so I certainly did not feel the need to excuse myself from board discussions on funding, nor did any of the other board members as they did not receive any money either.”

As the Udaras board meeting gets underway this morning, Sean O’Cuirean, a new member from Falcarragh, remains optimistic. “A good thing about this board is that there are a new set of eyes looking at the situation. Such fresh perspectives often result in greater success and money well spent.”

Published in Donegal News