Funds paid to ex-CRC executive could have cut waiting list, says HSE

Gilmore shocked by pension payment and concerned at impact on fund-raising

Former CRC chief executive Paul Kiely whose  €740,000 retirement package has provoked widespread criticism.

Former CRC chief executive Paul Kiely whose €740,000 retirement package has provoked widespread criticism.

Fri, Jan 17, 2014, 14:17

The head of the HSE has said funds given to former Central Remedial Clinic (CRC) chief executive Paul Kiely for his retirement package could have shortened waiting times for clients.

HSE chief executive Tony O’Brien was speaking today about the payment of a €740,000 retirement package to Mr Kiely, which he described as “completely abnormal” and unrelated to any severance arrangements available to public sector employees.

Mr O’Brien said if the retirement package, which was part-funded by funds from charitable organisation Friends and Supporters of the CRC, had been used for the direct benefit of the clients of the CRC “it is absolutely reasonable to suppose that any delays [faced by clients] could be shortened”.

Audio: Martin Wall analyses the CRC payments controversy

Document: CRC board minutes

He described what had happened at the CRC as “absolutely unacceptable” and a “betrayal of its dedicated staff . . . and it is a betrayal of the clients of the CRC”.

Mr O’Brien said: “Those who are responsible for what has happened will be held accountable for that.”

The pension payment has been widely criticised with Tánaiste Eamon Gilmore today expressing his shock and anger at the revelations.

“It is quite different to what we were told [concerning Mr Kiely’s retirement package] before Christmas,” he said.

Mr Gilmore said he was “concerned” about the potential impact of the revelations on the fund-raising activities of CRC and other charities.

Mr O’Brien said the decision to make the pension payment to Mr Kiely, and other decisions taken by the former board of the CRC, were being examined by the interim administrator CRC John Cregan who has been appointed by the HSE to run the its board resigned last month.

“Our interim administrator is continuing a very detailed investigation. He has a large pile of documentation to wade through, he said. “It may lead us to inviting the gardaí in; it may lead us to the office of the director of corporate enforcement; it may lead us to the civil courts.”

Fianna Fáil leader Micheál Martin today called on Government to consider taking full control of the Central Remedial Clinic.

“Yesterday’s revelation that the former Chief Executive of the CRC received €750,000 upon his retirement has left citizens across the country outraged,” he said. “The fact that the leadership of this organisation would decide to spend almost half of that year’s voluntary contributions to personally enrich a colleague demonstrates a catastrophic failure of basic moral judgement and raises very fundamental questions about the sustainability of the current governance model.”

Mr Martin called on the Government to enact charities regulation laws and immediately investigate the governance changes necessary to bring CRC under the direct control of the HSE. “I believe that direct responsibility would give the public the necessary confidence to continue supporting this service.”

During a Public Accounts Committee (PAC) hearing yesterday, Mr Cregan revealed €740,000 was given to Mr Kiely as part of his retirement package. The committee had previously been told only of a €200,000 lump sum payment made to him on his retirement last June after 24 years as chief executive.

The report said Mr Kiely received a €200,000 tax-free lump sum and a further €273,336 in a taxable payment. The report by interim administrator John Cregan said that on top of this “an amount of €268,689 was paid to [pension consultants] Mercer to ensure that Mr Kiely’s pension/lump sum benefits would not be less than if Mr Kiely had continued to remain on as chief executive until November 2016”.

The report detailed the money was paid by the Friends of the CRC charity to the main CRC organisation, and described in the draft internal accounts as a “donation”.

Mr O’Brien said today Hiqa guidelines were being followed in the establishment of a new board and the identification of a new chief executive. “One of the critical weaknesses in governance was that the same people ran the board of the CRC also had total control over the Friends of the CRC.”

He also rejected any suggestion that Mr Kiely’s pension arrangement was in line with what he would have got if he was a member of the public service under the Voluntary Hospitals Superannuation Scheme.

“There is nothing normal at all about these [retirement] payments at all. They are completely abnormal. One of the things we have to work out is who misled who?” he said. “Clearly it is possible that some board members were acting under false information provided by other persons.

“My understanding from the reports available to me is that it was to enable Mr Kiely to have the same pension accrual as if he had worked until his normal retirement date, ie November 2016. That is not normal.”

Mr O’Brien said the effect of the retirement package was to leave Mr Kiely with no financial loss as a result of retiring three years early. “In any event we are very concerned about whether the board had the right to make such decisions and the right to make decisions in this way.”

The HSE has taken legal advice from senior counsel and was not ruling out looking for the return of the money or else seeking the advice or assistance of the Garda in relation to the matter.

The PACis planning to contact Mr Kiely and the former CRC board in a bid to secure more details on the payment of Mr Kiely’s retirement package, last year.

PAC chairman John McGuinness said today that in the wake of yesterday’s revelations during Mr Kiely’s successor Brian Conlan’s hearing, invitations to appear before the committee would be sent out without delay.

“We won’t be concluding on any serious issues that could cause legal difficulty for anyone in the future,” Mr McGuinness told RTÉ’s Morning Ireland.

Mr McGuinness urged Mr Kiely to come forward and return all monies paid in excess to him back to the charity.

Taoiseach Enda Kenny said last night he was appalled by yesterday’s revelations at the Dáil Public Accounts Committee (PAC) about the retirement package provided by the CRC to Mr Kiely. He said it was indicative of a time in Irish politics that he hoped was long gone.