Letters of commiseration for CIE chief

CI╔'S former chairman, Mr Brian Joyce, received many letters of commiseration when appointed to the transport group

CI╔'S former chairman, Mr Brian Joyce, received many letters of commiseration when appointed to the transport group. The post is considered to be among the least attractive in the highest ranks of the semi-State sector and Mr Joyce agreed yesterday that his correspondents were prescient.

Still trying to draw a line under the experience 19 months after his resignation, he faced the Oireachtas inquiry yesterday into a £36 million overrun on a 1997 rail signalling project. Not for the first time, his stewardship of the affair was criticised in strident terms by its solicitor, Mr Michael Carroll. As is his fashion, Mr Joyce bit back, asking why "that man" did not raise his concerns at an earlier stage.

The inquiry is investigating CI╔'s relationship with Esat group, which constructed a telecoms network on Iarnr≤d ╔ireann's railway. It has heard claims that work carried out for Esat undermined the signalling project, still incomplete almost two years after the deadline for European Cohesion funding was passed. Questions about the transfer of a lucrative State asset - access to the railway - to Esat, lie at the heart of the inquiry.

Yet despite working as the most senior legal executive in CI╔, Mr Carroll believed he was out of the loop as far the group's dealings with Esat were concerned. So was an internal project group within the group, he claimed. In addition, Mr Carroll lamented a change in group procedures that meant he could not address CI╔'s board directly.

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That manoeuvre he linked to a new regime appointed in 1995 when CI╔ sought "six of the best" to beef up its management. The group of "bright boys", as one board member put, included its then chief executive, the late Mr Michael McDonnell, and its then director of programmes and projects, Dr Ray Byrne. Both were principal figures behind CI╔'s link with Esat and at one stage, Dr Byrne worked simultaneously for the two organisations.

Mr Carroll was so far from the centre at this time that when business proposals separate to the Esat contract were being discussed, negative references in papers he prepared for the CI╔ board were excised by its executive while positive comments remained. He added, however, that Mr Joyce would not have known about this.

Like Mr Joyce's friends from the world of business, Mr Carroll also wrote to the new chairman on his appointment. The solicitor did not commiserate, but sought to establish a working relationship with Mr Joyce. No such relationship evolved.

While Mr Joyce suggested nothing specific should be read into that, Mr Carroll claimed it was "foolish and reckless" for the chairman of a group such as CI╔ not to seek legal advice directly from its solicitor. Indeed, Mr Carroll believed Mr Joyce had "failed CI╔" and rejected suggestions by the chairman that he lacked the bottle or was not macho enough to raise his concerns at the time.

This was too much for Mr Joyce, who accused Mr Carroll of incoherence and said his comments about excisions from board papers and the CI╔ board being sidelined by the executive were a travesty.

On Monday, Mr Joyce said Dr Byrne was wrong to state in a telephone call in May 1997 to CI╔'s deputy property manager, Mr Niall Grogan, that he had agreed to deal exclusively with Esat.

In evidence yesterday, the group's finance director, Mr Jim Cullen, also cast doubt on what Dr Byrne said at that time. Contrary to an indication that Mr Cullen had "cleared" a link with Esat, he said he had not. Mr Cullen was pleased with the deal, which he said could be worth up to £150 million for CI╔ over 20 years, or at least £100 million.

The inquiry heard yesterday of a minute from an Esat board meeting on May 23rd, which said the CI╔ board would discuss a link with Esat at a meeting on June 4th.

Mr Carroll's predicament was that he only learned of the telecoms initiative on May 19th and considered a link with Esat to be a fait accompli at that time.

The man who led the negotiations for Esat, Mr Leslie Buckley, said he did not consider heads of agreement the company signed with CI╔ a "done deal". Nevertheless, the company, then chaired by Mr Denis O'Brien, was willing to risk £20 million on the venture.