Legal concern 'not a factor' in Fás package

CONCERN ABOUT Rody Molloy taking legal action was not the deciding factor in negotiating his severance package as Fás chief executive, Minister for Enterprise, Trade and Employment Mary Coughlan told the Dáil.

She said that if the Fás board had dismissed Mr Molloy, the procedures involved would have been time consuming and, in the absence of due and fair process, could possibly have ended up in court action being taken.

Ms Coughlan added that there had been considerable comment, inside and outside the House, relating to the issue of whether or not legal advice was obtained and whether it was necessary to obtain legal advice.

“I want to make it clear to the House that in relation to the issue of legal advice in respect of the veracity of any possible legal action by Mr Molloy, this did not arise, as, although present, concern over legal action was not the deciding factor,” she added.

Ms Coughlan said that Mr Molloy’s severance package was broadly in line with the package he could have claimed under his employment contract had it been terminated by the Fás board.

“I can assure the House that the decision taken to agree to the addition of years to his pension entitlement was not taken lightly,” she added.

Ms Coughlan said that the measures Fás had implemented to improve financial control and governance across the organisation included the restructuring and tightening of controls in the corporate affairs function, which was at the centre of the Comptroller and Auditor General’s investigation.

A revised structure for Fás’s internal audit had been put in place and all credit cards, except the one which was used to purchase books and periodicals, had been cancelled, she said.

The Minister was responding to a Labour Private Member’s motion criticising the Government’s handling of the Fás controversy.

Labour’s Róisín Shortall said that in any other jurisdiction, Ms Coughlan would no longer be a Minister.

She said that Ms Coughlan had agreed a sweetheart deal with Mr Molloy on the basis that he would go away quietly and and that the “debacle” surrounding the organisation would fizzle out.

“Not only did the Tánaiste behave recklessly in throwing away €1.1 million of taxpayers’ money, not only did she act ultra vires, but she has now set a very dangerous precedent for other cases which amounts to a general blanket acknowledgement that resigning CEOs are entitled to certain rights and entitlements, irrespective of the true facts and circumstances surrounding their departure,”she added.

She said Ms Coughlan needed to make a statement regarding the role of the Fás board in respect of Mr Molloy’s severance payment.

Ms Shortall said she wanted to ask the Fianna Fáil and Green Party backbenchers if they thought the package was justified.