TAOISEACH BRIAN Cowen and senior Ministers have defended the political judgment of Tánaiste Mary Coughlan in the face of mounting criticism of her handling of the severance package agreed with the former director general of Fás, Rody Molloy.
Mr Cowen yesterday deflected criticism of Ms Coughlan’s decision to approve a “golden handshake” for Mr Molloy last November, which enhanced the long-term value of his pension by an estimated €1 million.
Mr Cowen and other Ministers, including Minister for Justice Dermot Ahern and Green Party leader John Gormley, strongly denied the Cabinet was aware of the details of the package.
“Formal Cabinet approval did not apply in respect of these matters,” said Mr Cowen during a visit to Galway. Asked if he had been consulted, he said he had not been aware of the negotiated terms.
He said Mr Molloy had accepted responsibility as director general of Fás for the issues that had arisen in relation to corporate governance. People resigning early had “certain rights and entitlements”.
Mr Molloy yesterday tendered his resignation as the chairman of the Institute of Public Administration (IPA). The IPA said the position had been an honorary one.
Ms Coughlan, the Minister for Enterprise, Trade and Employment, was facing growing pressure to explain the exact circumstances surrounding Mr Molloy’s departure from Fás and why legal advice was not sought by the department.
Fine Gael leader Enda Kenny said it beggared belief the Cabinet was not aware of the situation regarding the removal of Mr Molloy. “It is incomprehensible that a decision like that was taken without getting legal advice. The Tánaiste should go in before the Public Accounts Committee next week and explain the full truth,” he said. Labour Party TD Róisín Shortall questioned the tenability of the Tánaiste’s position. “I cannot see how Ms Coughlan can continue in the position that she is in,” she said.
In a statement last night, the Minister’s department said: “The issue of legal advice in respect of any possible legal action by Mr Molloy did not arise, as, although present, concern over legal action was not the deciding factor.”
The Irish Times has learned that last week, the day after Ms Coughlan told reporters she would accept the resignation of the Fás board if it was offered, a press statement was prepared by her department “to clarify some issues relating to the board of Fás”. In the proposed press release, which was given to Fás board members at noon, she said she “wanted the current board to continue to do its work” and was “satisfied that the board is responding appropriately” to the reports on spending at Fás. Hours later Fás chairman Peter McLoone was told the press release had not been issued. “We will get back to you if we issue anything,” he was told.