RTÉ report: Exit package paid to former chief financial officer was not approved by management

An exit package paid to RTÉ's former chief financial officer Breda O’Keeffe had not been brought before the executive board of the broadcaster before being approved, a new independent report has found.

Legal firm McCann Fitzgerald had been commissioned to review previous voluntary exit schemes that the broadcaster had operated, after issues were raised about the packages of some former employees, including Ms O’Keeffe.

The review found that Ms O’Keeffe’s exit under the scheme had been approved by Dee Forbes, then RTÉ director general, rather than the broadcaster’s executive board as required.

Several senior RTÉ managers interviewed for the review said that Ms O’Keeffe’s application for the exit scheme “was not considered or approved” by the executive board, which is RTÉ's senior management team.

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The review concluded that as a result the terms of the exit scheme “were not complied with” in Ms O’Keeffe’s case, however it said this was the fault of RTÉ and Ms Forbes, rather than the former chief financial officer.

Minister for Media Catherine Martin said the report “demonstrates an appalling disregard for the principles of equity, fairness and transparency in the treatment of staff, which prevailed at the time.”

She added: “Earlier today, I met the Director-General, Kevin Bakhurst, and he assured me that the control and oversight reforms, introduced over the past number of months, will ensure that this will not happen again.”

Ms Martin also said: “The report has been forwarded to two independent Expert Advisory Committees which were commissioned by Government to carry out Reviews of Governance, Culture, and HR matters at RTÉ.

“It will help inform their work, which is ongoing, and I await their recommendations.”

The report detailed that Ms O’Keeffe told Ms Forbes in mid-2017 that she wanted to retire from RTÉ and apply for the voluntary exit scheme. Correspondence from September 2017 said that Ms O’Keeffe and Ms Forbes had agreed that the chief financial officer would leave under the scheme.

The report said there was “no reference to the agreement being subject to executive board approval”, as was required under the terms of the exit scheme. Ms O’Keeffe said she had applied for the scheme directly to Ms Forbes, as the director general was her line manager.

The report found RTÉ's head of human resources queried whether it was a “good idea” for the chief financial officer to leave under the exit scheme, and had asked “how this would generate cost savings”. The human resources director told the review Ms Forbes replied that “cost savings would be made and the matter was not discussed further”, the report said.

While the agreement that Ms O’Keeffe would be paid an exit package was made in September 2017, she did not finish up at the broadcaster until March 2020.

The report said Ms O’Keeffe put forward a business case for how RTÉ could save €200,000 under her departure, based on a “named individual” succeeding her.

By the time it was “known with certainty” that such savings would not materialise, Ms O’Keeffe had accepted her exit package, the report said.

When RTÉ decided to advertise for a new chief financial officer externally in July 2019, there was a “high risk” that the business case underpinning Ms O’Keeffe’s exit package “would not materialise,” it said.

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Ms O’Keeffe’s solicitors told the review that RTÉ making cost savings from her exit under the scheme “was entirely the responsibility of the former Director General and not her.” The former senior executive told the review that applicants to the exit scheme were “not responsible for ensuring that cost savings were achieved by their departure,” the review said.

The report said Ms O’Keeffe was unavailable to meet the reviewers, but provided written statements, documentation, and answered follow-up queries. It said Ms Forbes, who resigned from her position last summer, was not available to take part in the review for “medical reasons”.

The report said the “absence of an opportunity” to interview Ms Forbes had “inhibited” the reviewers ability to understand why Ms O’Keeffe’s application was not brought to the executive board for approval.

The report said when Ms O’Keeffe left RTÉ her position had not been made redundant, but was “immediately” filled by Richard Collins, who was in the role until last October.

As a result the report said “the Revenue Commissioners may take the view that RTÉ was not entitled to apply the tax exemption applicable to statutory redundancy payments” on Ms O’Keeffe’s redundancy lump sum payment. It added that this would “be a matter for the Revenue Commissioners to decide”.

In total the review found 10 cases where redundancy payments were made to people under the 2017 scheme, which it believed did not meet the “requirements” to be classed as redundancies.

“The Revenue Commissioners may take the view that RTÉ should not have applied the tax exemption applicable to statutory redundancy payments to the payments received by some or all of these individuals,” the report said.

In a statement, Kevin Bakhurst, RTÉ director general, said the review found the rules of two exit schemes were “observed in all instances save one”.

“I remain shocked by this serious breach of procedure – my aim continues to be the implementation of measures to ensure this cannot happen again,” he said.

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Briefing staff on the report on Wednesday afternoon, Mr Bakhurst said the fact Ms O’Keeffe’s exit package was not brought to the executive board was RTÉ's mistake, rather than a fault of the former financial officer.

One source at the meeting said Mr Bakhurst told the meeting the manner in which the exit package had been agreed, in that it was not brought to the broadcaster’s executive board, was “pretty shocking”. Another source present said the meeting heard how a number of people had refused to engage with McCann Fitzgerald during the review.

The latest revelations come a week after a damaging report on the broadcaster’s Toy Show the Musical production, which found it had made a loss of €2.2 million and had not been signed off by the RTÉ board, or its audit committee.

The controversy facing the broadcaster first erupted last year, when it emerged RTÉ had made undisclosed payments to former Late Late Show presenter Ryan Tubridy amounting to €225,000 over several years.

The Dáil’s spending watchdog, the Public Accounts Committee (PAC) is currently seeking an extension of its remit to allow it to call in witnesses from RTÉ for a fresh round of questions.

The PAC has applied to the Dáil Committee on Parliamentary Privileges and Oversight to allow it to hold meetings to examine issues from the report on staff exit deals and the separate review of Toy Show the Musical.

RTÉ is not usually answerable to the PAC as its accounts are not audited by the Comptroller and Auditor General.

Social Democrats TD and PAC member Catherine Murphy said she is confident the committee will get the go ahead to continue its examination of issues at RTÉ.

Responding to the report on exit packages she said it was “absolutely outrageous” that the exit package paid to Ms O’Keeffe had not been brought before RTÉ's executive board before being approved.

Ms Murphy said she would like to invite Ms O’Keeffe to appear before the PAC saying that she and Ms Forbes “were the only two people who seemed to know about this.”

Ms O’Keefe last year declined an invitation from the PAC telling the committee in a letter that she had no more to add to what she had already said during an appearance at the Oireachtas Media Committee.

Ms Forbes meanwhile has not appeared at Oireachtas committees in relation to the controversies to hit RTÉ last year citing health reasons.

The McCann Fitzgerald report also raised questions about 10 cases where applications for exit under the 2017 Voluntary Exit Programme were approved and termination payments, including statutory redundancy payments, paid.

The report found that these departures “did not … satisfy the requirements of a redundancy within the meaning of the Redundancy Payments Acts.”

RTÉ said: “The report observes that the Revenue Commissioners may take the view that RTÉ should not have applied the tax exemption applicable to statutory redundancy payments to the payments received by some or all of these individuals, and that ‘this will … be a matter for the Revenue Commissioners to determine.’”

Another PAC member, Fianna Fáil TD Cormac Devlin said the committee has had “extensive engagement on several fronts with RTE since the various revelations came to light.”

He said the latest report “probably won’t surprise the vast majority of the public however that won’t take away from the frustration at these further findings.

“I imagine that the majority of the existing and former employees of RTÉ will be further dismayed at the perceived untouchability of the top brass at RTÉ who seemed to have their own rules at that time.”

He added: “For my part, I will be seeking further engagement with RTÉ on this report and on the other reports at our next meeting of the PAC”

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