From the moment he was elected leader of Fianna Fail and Taoiseach on December 7th, 1979, Charles J. Haughey wanted to take control of party finances. Almost 20 years later, courtesy of painstaking work by the McCracken and Moriarty tribunals, we now know why.
Mr Haughey had debts of £1.143 million when he achieved his life's ambition to become Taoiseach. He beat his arch-rival George Colley by 44 votes to 38. The party was so divided that Mr Haughey had to give Mr Colley a veto over appointments to Justice and Defence before he would give him "qualified support". Padraig Flynn and Albert Reynolds became ministers. Ray Burke remained as minister of State in industry, commerce and energy until Mr Haughey promoted him to Cabinet rank for the first time as minister for the environment in October 1980.
The first public action of the new Taoiseach was his television address to the nation on January 9th, 1980. "I wish to talk to you this evening about the state of the nation's affairs and the picture I have to paint is not, unfortunately, a very cheerful one," it began. "As a community we are living away beyond our means."
Meanwhile, behind the scenes Allied Irish Banks was pressurising Mr Haughey to deal with his own financial affairs. A total of £750,000 was lodged with AIB in January and February 1980, to clear Mr Haughey's £1.143 million debt. It came from a Dublin account, in Guinness and Mahon bank, in the name of his financial adviser, Des Traynor.
While the bank was putting demands on Mr Haughey, Mr Haughey was pressuring Mr Des Hanafin, secretary of Fianna Fail's fundraising committee, to resign. The Fianna Fail general election fund-raising committee (its full title) was, and is, the biggest source of corporate funding for the party. It had replaced Taca, the controversial body abolished by Mr Hanafin in 1969. The affairs of the committee were so confidential that it was not required to publish its income and accounts. It operated from behind closed doors in Room 547 of the Burlington Hotel. Its activities were traditionally never revealed to the party leader.
Within weeks of becoming Taoiseach and party leader, Mr Haughey asked for an accountants' report on the control of ail party finances. The report, marked private and confidential, was delivered to him in his office on March 11th, 1980. Mandated to find out "control weaknesses", the report made certain recommendations about party headquarters and, more particularly, the Fianna Fail fund-raising committee.
This fund is under Fianna Fail control in theory but, in practice, party headquarters know nothing about its workings, according to the report by Daniel M. McGing, then a senior partner in Kean and Co and of its major associate, Coopers and Lybrand.
"Monies formerly received at head office for the trustees' election fund account are now being collected by the Fianna Fail election fund, administered from the Burlington Hotel," Mr McGing said.
He advised: "It might be considered that this situation is a less than desirable one from the point of view of Fianna Fail because although the Burlington Hotel fund is operating under the Fianna Fail name, it would appear that the trustees have no control over its activities or the disposal of its monies".
Nothwithstanding this report, it took Mr Haughey 15 months, considerable aggravation and arm-twisting to secure possession of what was known as The Black Book, the secret record of hundreds of subscribers to Room 547 of the Burlington.
Des Hanafin, George Colley and Des O'Malley knew at the outset of his leadership that Charles Haughey wanted to put his own man in charge of Fianna Fail fund-raising. But Mr Haughey had to be in a position of some strength within the party before he could disband Mr Hanafin's committee. Mr Hanafin was a keen supporter of George Colley and, later in Fianna Fail, Des O'Malley. He had a profound distrust of Mr Haughey's intentions and was never going to hand over The Black Book voluntarily.
At the end of 1979 debts of around £100,000 were outstanding on the European and Cork by-elections. Mr Haughey's first general election (in June 1981) cost Fianna Fail an estimated £1.2 million. The Burlington Hotel committee had been given a target of £600,000. It reached it but, because of overspending in the last week of the campaign, there was a considerable shortfall. The committee raised loans from AIB and the Bank of Ireland. Fianna Fail lost power.
Mr Haughey's second general election, on February 18th, 1982, cost £750,000. A lot of the money promised to pay for it was believed to be awaiting collection when Fianna Fail's financiers fell victim to the latest bout of faction-fighting within the party.
Then a curious thing happened: Mr Haughey acquired a knowledge of the list of subscribers, as distinct from the accounts in The Black Book.
Three or four days before the election was called on January 27th, 1982, Mr Haughey's close friend, solicitor and election agent, Pat O'Connor, sent out fund-raising letters to subscribers on the list. When Mr Hanafin's committee made its appeal to the names on the list, after the campaign had started, it was informed that they had already responded to Mr O'Connor.
The first challenge to Mr Haughey's leadership ail came immediately after the February general election. Des O'Malley publicly challenged him for the party's nomination as Taoiseach when the Dail met on March 9th. Mr O'Malley withdrew at the last moment at a meeting on February 25th. The day after the abortive leadership challenge, on February 26th, 1982, Mr Haughey told Mr Hanafin he was fired. Mr Hanafin claimed Mr Haughey had no right to fire him because the committee was so constituted that it did not come under the control of the leader of Fianna Fail.
A short time afterwards, Mr Haughey was re-elected Taoiseach courtesy of the £80 million Gregory deal. The Colley veto was gone. Sean Doherty was made minister for justice. Bertie Ahern was brought into Government as chief whip and minister of State at the Departments of the Taoiseach and Defence.
He invited the chairman, Ken O'Reilly-Hyland, and all members of the Fianna Fail fund-raising committee, with the exception of Mr Hanafin, to his home in Kinsealy. Seated round the private bar, Mr Haughey got the members of the committee to sign a document instructing Mr Hanafin to hand over the complete fund-raising accounts to Fianna Fail HQ in Upper Mount Street. Only one man, Gerry Creedon of Gypsum Industries, refused to sign.
Mr Hanafin subsequently refused to hand over The Black Book until the fund-raising accounts were audited.
CHARLES Haughey assumed complete control of Fianna Fail's fundraising activities at mid-term in the GUBU government in 1982. Uno Duce, Una Voce ruled and, to borrow P.J. Mara's immortal phrase, there was no more nibbling at the leader's bum. It took some considerable time, however, to reorganise things. Paul Kavanagh became head of the fund-raising committee, working in a voluntary capacity.
Mr Haughey lost the second general election later in 1982 and headed into a five-year spell out of power. He got into financial difficulties again.
In May 1983, £40,000 was transferred from one of Mr P.V. Doyle's accounts for his benefit. A month later, in June 1983, a further £50,000 came to Mr Haughey from the founder of the Doyle hotel group. Mr Haughey had built up an overdraft of £280,000 in Guinness and Mahon bank in Dublin by the time the Labour Ministers resigned from Garret FitzGerald's coalition on January 20th, 1987.
Six cheques from Dunnes Stores, amounting to £32,000, were lodged to Guinness and Mahon for the benefit of Mr Haughey as the 1987 campaign got under way. The election date was set for February 17th. For the fourth election in a row, Mr Haughey didn't win an overall majority.
But he came tantalisingly close with 81 out of the required 83 seats. He formed a minority Fianna Fail government and was blessed with Fine Gael's Tallaght strategy of supporting the government on economic policy. Charles Haughey was in power, unfettered at last, and that's when the cash came in in earnest.
Three months later, in May 1987, £282,500 sterling from Dunnes Stores (Bangor) was lodged in accounts in Guinness and Mahon, the bulk of it to pay off his overdraft. This was revealed by the Moriarty tribunal.
A few months later, probably in November 1987, Mr Haughey's financial adviser, Des Traynor, approached Ben Dunne's accountant, Noel Fox, to say that he was dealing with a significant business problem relating to the Taoiseach. He was trying to put a consortium of about six people together to pay £150,000 each to settle it.
Mr Dunne decided that someone like Mr Haughey couldn't be trawling around putting a consortium together. "I'm prepared to do it myself but it'll take time," Mr Dunne said in reply.
When Mr Traynor came back to say that £205,000 was urgently required, Mr Dunne arranged the payment of £182,630 sterling from Dunnes Stores (Bangor) through Noel Fox to Des Traynor to Guinness Mahon Bank in London in late November 1987. Some £105,000 of it was used to clear a loan which Mr Haughey had with the Agricultural Credit Corporation.
These new payments have been revealed by the Moriarty tribunal. That was the first instalment of the £1.3 million discovered by the McCracken tribunal.
In February 1988, £49,700 was transferred from Mr Doyle for Mr Haughey. He was then almost a year in office.
The second instalment of the £1.3 million, £471,000 sterling, was paid by Mr Dunne through Switzerland through John Furze to an account in Barclays Bank, Knightsbridge, London, on August 1st, 1988.
Then came 1989, the bonanza year for Mr Haughey and some of his ministers. The Taoiseach returned from a trip to the Emperor of Japan on April 26th, just in time for the vote on a private members' motion from the opposition parties seeking to set up a £400,000 trust fund for haemophiliac sufferers who contracted AIDS through blood products. The Government could offer only £250,000. It was defeated. Mr Haughey threatened to call an election a week later.
The second instalment of the £1.3 million, £150,000 in sterling, came into the Ansbacher (Cayman) account in Guinness and Mahon in Dublin for Mr Haughey in early May. He launched his fifth attempt to win an overall majority on May 25th, setting the election date for June 15th, 1989.
In early June the minister for industry, commerce and communications, Ray Burke, received the £30,000 cheque from Rennicks Manufacturing, a subsidiary of Fitzwilton plc. Dr Tony O'Reilly's companies departed from their established practice of donating money to Fianna Fail at election times by giving the cheque directly to a minister. When pursued by Paul Kavanagh, Mr Burke gave £10,000 of the Rennicks money to the party.
In a second donation, Mr Burke received either £30,000, £40,000 or £80,000 around June 12th-June 13th, 1989, according to Mr James Gogarty at the Flood tribunal.
The then minister for the environment, Padraig Flynn, was given a £50,000 donation by the Luton property developer, Tom Gilmartin, in June 1989. Mr Gilmartin claims it was intended for Fianna Fail. Fianna Fail has told the Flood tribunal that it did not receive it.
On June 12th, 1989, Mr Haughey dispensed with one of Fianna Fail's core values when he agreed to form the first Fianna Failled coalition with the Progressive Democrats. But the change in politics didn't stop the payments to finance his lifestyle.
The following February 1990, he was paid the third instalment of Ben Dunne's £1.3 million. He was given the three £70,000 bank drafts by Mr Dunne in November 1991. "Look, that's something for yourself," said Mr Dunne. "Thank you, big fella," said Mr Haughey.
The last payment from Mr Dunne known to the tribunals to date was in November 1992. It totalled £180,000 - £80,000 of which went to Mr Haughey, and £100,000 to Celtic Helicopters, a company owned by his son, Ciaran. Charles Haughey had been ousted by Albert Reynolds nine months earlier.
Seven years out of office as Taoiseach and Fianna Fail leader, it has taken feuds in the Dunne family and the JMSE building company, plus three tribunals, to expose the way in which Charles Haughey used power to his personal advantage.
And most of those around him knew.
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