Ex-CRC chairman Nugent willing to appear before PAC

Varadkar is latest Minister to call on former chief executive Paul Kiely to return money

Former chairman and chief executive of the Central Remedial Clinic Jim Nugent  is understood to be be willing to appear before the Dáil Public Accounts Committee  again to answer questions about the ongoing scandal at the charity.  Photograph: The Irish Times

Former chairman and chief executive of the Central Remedial Clinic Jim Nugent is understood to be be willing to appear before the Dáil Public Accounts Committee again to answer questions about the ongoing scandal at the charity. Photograph: The Irish Times

Mon, Jan 20, 2014, 13:07

A former chairman and chief executive of the Central Remedial Clinic (CRC) is willing to appear before the Dáil Public Accounts Committee (PAC) again to answer questions about the ongoing scandal at the charity.

The Irish Times understands that Jim Nugent, who was chairman until the entire board resigned before Christmas, is preparing to answer questions from TDs.

Mr Nugent was also acting chief executive for a brief period following the resignation of Paul Kiely, who retired as head of the charity with a lump sum and pension pay off worth € 740,000.

Minister for Transport Leo Varadkar has become the latest member of the Cabinet to call on former the chief executive of the Central Remedial Clinic Paul Kiely to return money he received as part of his pay-off from the clinic.

Mr Varadkar said those in receipt of large pay-offs from public bodies frequently had employment law backing their position and their entitlements.

Speaking today he said: “I don’t think this is just a matter of law. It is also a matter of principle. I know it has been suggested that the person in question might pay back some of the money he was given, as a gesture really, to show understanding of how upset people are”.

Asked if he believed Mr Kiely should repay some of the money, Mr Varadkar replied: “I think it would be appropriate”.

Mr Varadkar’s comments follow a call from Minister for Health James Reilly, for Mr Kiely to return some money, while Minister for Finance Michael Noonan said “on the face of it” he would agree that money should be repaid.

Hamilton Goulding, son of CRC founder Lady Valerie Goulding, who was Mr Nugent’s predecessor as chairman, has said he will also answer questions at the PAC.

Mr Goulding told The Irish Times yesterday the top-up payments to senior executives and the “uncomfortable” severance payment to Mr Kiely were the only issues and said he was “absolutely confident” that the clinic was run in a correct fashion.

The committee is to call all former members of the board to appear before it, but it is understood there has been little or limited contact between members of the board since they resigned last month. They are in effect now acting on their own.

It is also understood all members of the board were furnished with documentation in advance of a CRC board meeting on March 25th last year, when directors approved Mr Kiely’s pay-off, which outline the reasoning for Mr Kiely’s package.

Mr Nugent was present at the meeting which approved the package.

Members of the board were provided with the presentation in advance of the meeting and it is understood at least some of them would have retained the board documents in their personal records. Mr Goulding has already said he will provide all documentation he has to the PAC.

Fine Gael deputy and PAC member Simon Harris claimed they “had been misled, possibly lied to” at a previous PAC meeting when Mr Kiely, Mr Nugent and David Martin, another director, appeared before TDs.

PAC chairman John McGuinness said recalling the board was necessary because the evidence was in his view “conflicting, not credible and, in one instance, misleading”.

The Fianna Fáil TD who chairs the public spending watchdog said that following its public hearings and subsequent media interviews with former chairman Hamilton Goulding, there was a substantial number of “unsettling questions” surrounding governance, transparency and operations at the CRC as well as the salary and pension arrangements for Mr Kiely.

Mr McGuinness said yesterday the committee would be writing to all the former board members, asking them to attend fresh hearings.

This comes after the HSE disclosed last week that Mr Kiely’s severance package amounted to some €740,000, despite him telling the PAC last month he was given a lump sum of €200,000.

It also emerged that the funding for the package was paid by the Friends and Supporters of the CRC, its fundraising arms.

Referring to Mr Goulding’s disclosure that he was unaware of Mr Kiely’s salary until a year after becoming chair, Mr McGuinness said: “It’s hard to believe a chairman of a board would not know how much the CEO was getting.”

Another issue was the relationship between the CRC, the Friends and Supporters of CRC, as well as the related company CRC Medical Devices.

“There are governance issues and it is important that we learn about who knew what among the range of directors sitting on the three entities,” he said.

He also said he had no doubt Mr Kiely had “misled the committee” about his severance package.

Mr Harris said Mr Goulding needed to answer questions about why the board did not ask Mr Kiely to take a pay cut, how it responded to HSE correspondence on non-compliance and on the manner in which Mr Conlan was recruited as chief executive.

Mr Goulding said yesterday he would provide any documentation he possessed in relation to the CRC. Defending the board’s handling of Mr Kiely’s severance arrangement in a series of interviews over the weekend, he said it had saved the CRC money in the long-term.

“It would have cost €2.1 million to keep him on . . . [the rationale was] if we let him go now, paying this uncomfortable sum, it is a benefit of €1.4 million over the next six years,” he told RTÉ.

Mr Goulding also strongly rejected claims that there had been inappropriate foreign travel or use of credit cards.

In a statement this weekend, the HSE said the administrator it had appointed to oversee the CRC, John Cregan, would also identify any legacy issues on “salary rates and compliance with public pay policy, pension schemes and pension payments”.