James Reilly says charity should seek repayment from ex-CEO

Administrator says group shielded senior executives from public pay cuts

Minister for Health James Reilly has called on the Central Remedial Clinic to seek a repayment of money from its former chief executive Paul Kiely and other senior figures

Minister for Health James Reilly has called on the Central Remedial Clinic to seek a repayment of money from its former chief executive Paul Kiely and other senior figures

Fri, Jun 20, 2014, 01:00

Minister for Health James Reilly has called on the Central Remedial Clinic to seek a repayment of money from its former chief executive Paul Kiely and other senior figures after a report exposed serious flaws in CRC pay policies.

Dr Reilly’s intervention comes on foot of damning findings by CRC’s interim administrator John Cregan, appointed by the HSE to run the organisation late last year after the resignation of its board and chief executive in the midst of controversy over pay and benefits for senior staff.

In his report published yesterday, Mr Cregan dismissed the “spurious” grounds on which the CRC had shielded senior executives from public pay cuts as the economy crashed.

Last night the Minister for Health said the report demonstrated the need for good governance at the CRC.

“In regard to payments made to former senior figures, if calculations have been incorrect it is reasonable for the taxpayer and the charity to seek a return of the money,” said Dr Reilly.

‘Overstated’

The top-up payments affair led to Mr Kiely’s early retirement with a €741,000 severance payment one year ago. However, Mr Cregan said the package was incorrectly calculated according to Mr Kiely’s “overstated” pay.

The deal was cast in line with his €234,449 salary, but Mr Kiely’s annual pay at that time should have been €199,282 after the 2010 public pay cut and it should have been in line to drop another €14,578 under the Haddington Road pact.

He said it had not been necessary to refer anything at the CRC to any third party and said there was no basis for involving the Office of the Director of Corporate Enforcement, which oversees compliance with company law.

This was welcomed by former CRC chairman Hamilton Goulding. A statement issued on his behalf said the report exonerated the CRC of wrongdoing.

“It vindicates both himself as chair and the board generally of the serious allegations of wrongdoing made earlier in the year, including suggestions that they should be investigated by the gardaí.”

Exit terms

The report said Mr Kiely himself presented his exit terms to the then CRC chairman and these were adopted “without amendment” by the board. The administrator argued that money paid in excess of the reduced rate should be recovered, saying Mr Kiely “would have been familiar with a public pay policy diligently applied” to other CRC staff.

“In the event of these monies being repaid or otherwise recovered . . . it may then be possible to revalue the CRC Plan pension benefits,” said Mr Cregan.

He said the CRC stonewalled requests for details on Mr Kiely’s pay from the HSE, which was its main funder.

He also called for the winding up of CRC’s affiliate, the Friends & Supporters of the CRC, and the transfer of its functions back to the CRC. The “only rationale” for the establishment of the Friends & Supporters body was to maximise HSE funding for CRC services, he said.

Fianna Fáil health spokesman Billy Kelleher said the public was angry and appalled at the disclosures, saying the report should go to the ODCE and to the Revenue.