Fás director says C&AG 'failed' to pick up problems

THE OFFICE of the Comptroller & Auditor General (C&AG) would not get its contract renewed if Fás was a private company and the C&AG was its external auditor, a director of the State training authority said yesterday.

Niall Saul told a corporate governance conference in Dublin that the C&AG was the “external auditor” to Fás but had failed to pick up any of the problems there until they were documented by internal audit.

He said a number of parties had been called before the Dáil Committee of Public Accounts (PAC) to be questioned about failings at Fás but not the C&AG. “It’s not being held answerable for what I consider to be a failure on its part.”

The C&AG John Buckley on Thursday published the latest in a number of reports on Fás. It documents expenditure on travel and hospitality for which no obvious business reason exists, and inadequate monitoring of a €126 million training programme funded by Fás that made extensive use of third-party organisations to deliver the training.

“For all of the years of the existence of Fás, the C&AG had been in there for 10 weeks every year in the normal way that external audit comes in,” Mr Saul said. When he joined the board of Fás in 2006, “I specifically asked were there areas they had concerns about and at no stage [prior to internal audit reporting on them] has the C&AG identified serious problems.” In fact, it had provided letters praising controls in Fás.

He said a number of disciplinary investigations would now occur concerning “a range of people” within Fás.

Mr Saul said it was his experience that standards of control in the public service are at a level “that you would have to be uncomfortable with”.

He said Government allocates an annual budget to bodies such as Fás and there is “a drive to spend the money. There is a culture in the public service that, if you are giving money back at the end of the year, you are failing; if you spend it all, it’s a success.”

This culture contributes to the type of scenario that has been seen at Fás, he said.

Tánaiste and Minister for Enterprise Trade and Employment Mary Coughlan, speaking to reporters outside the conference, defended her decision in relation to the package paid to the former director general of Fás, Rody Molloy, when he resigned in 2008.

Mr Buckley in his report on Fás said the package was worth €892,269 more than what a comparable public servant taking early retirement would have been given.

It was worth €76,422 more than the maximum that could be given to an officer such as Mr Molloy whose contract was being terminated, under guidelines on such matters circulated by the Department of Finance in 1998.

Ms Coughlan said Mr Molloy was given the package because “we wanted to move on and it was in the best interest of the organisation that Mr Molloy move . . . And, of course, we did not want to find ourselves in a litigious situation where we would still be discussing this situation in a court context”.