Former FAI finance director says he was unaware of €2m bonus for Delaney
Tony Dignam says FAI chiefs did not listen to his concerns over the association’s finances
Former FAI chief executive John Delaney: The failure to record the proposed bonus is understood to be one of the matters being investigated by the ODCE. Photograph: Niall Carson/PA Wire
Former FAI finance director Tony Dignam says that he had no knowledge of a commitment by the association in 2014 to pay John Delaney a €2 million loyalty bonus if he stayed with the association until 2021.
Though it was confirmed publicly at the time that the association’s then chief executive had signed a new five-year contract, there was no suggestion of a bonus that would, in effect, almost double his salary over the entire period in the event that it was eventually paid.
Over the previous few years Delaney’s salary had, in fact, been gradually reduced from €430,000 per annum to €360,000, with each cut accompanied by much fanfare. “You need to show leadership,” he had said in 2011.
Other senior figures have now confirmed that despite the ongoing financial problems being encountered at the time, the bonus clause was included in the new contract of 2014, as reported in the Sun on Thursday.
The issue is, it seems, a factor in the impasse between Delaney and his employers over his position – or, as is widely anticipated, his departure. The failure to record the proposed bonus, meanwhile, is understood to be one of the matters being investigated by the Office of the Director of Corporate Enforcement (ODCE).
Despite his role, though, Dignam insists that he and his department were routinely excluded from matters relating to the pay and conditions of the association’s leading administrator.
“I didn’t know anything about it,” says the chartered account who is currently a candidate to return to the troubled organisation as its honorary secretary. “It is possible that it was after I left, but I wouldn’t have been told anyway. That sort of thing was very tightly controlled by a clique within the board.”
Asked if he would not have been consulted about whether the organisation could afford such a deal, he is damning about the culture that prevailed at the association in this respect. “No. Decisions were often made without my knowledge and without thinking about affordability.”
Dignam says that decisions on all such sensitive financial matters were essentially driven by then honorary secretary Michael Cody, who was close to Delaney, and, to a lesser extent, Eddie Murray, the then honorary treasurer. Other board members made no real attempt to scrutinise what was put before them for approval.
“There was generally very little interest shown,” he says. “At board meetings they would spend a very short amount of time on the finances and then move on to matters that they regarded as being more important.”
Matter of urgency
The finances, though, were clearly a matter of urgency, he recalls. There was, on the one hand, a very substantial stadium-related debt and. on the other, a failure to generate the sort of cash required to pay off much shorter-term obligations. He maintains that he raised this with everybody he felt able to, but that his warnings were ignored.
“I made every effort I could to convey the seriousness of the situation, but the board didn’t understand it or did not want to know. I highlighted my concerns to John Delaney, Eddie Murray and Michael Cody, which was the process for me if I had issues or concerns; I also brought my concerns to many of the other board members but nobody wanted to know.”
Critically, he says, he strongly disagreed with Delaney’s decision to prioritise the complete repayment of the stadium debt – which after a restructuring stood at just over €50 million in July 2014 – by 2020.
At agms he seemed to outside observers to endorse the strategy at the time but, he says: “I was always careful about what I said. I did say that there was a plan to be debt-free by 2020, which was an ambitious plan with aggressive assumptions which included significant income to come in 2020 from 10-year ticket sales, naming and TV rights.
“But the talk about paying off the stadium in such a short period never made sense to me, not given the wider situation. The accounts for the last eight years have shown huge net current liabilities, of approximately €20 million. That’s a matter of public record. And the association was not generating cash.
“Long-term debt is cheap debt. If you have just taken out a mortgage to buy a house, you would never look to pay that off in 10 years when the effort of doing it was going to leave you with a huge credit-card debt.”
They did what they saw fit and in the end I felt there was nothing I could do to change that
In the end, he says, his frustration over the whole manner in which the association’s finances were treated prompted him to leave what was, he suggests, “an incredibly difficult and frustrating place to work”.
“Other than John, there was no qualified accountant on the board, nor from recollection was there anyone qualified on the finance committee. At council, Paul Cooke and Brendan Dillon were the only two people I can remember who asked questions and both ended up off council.
“They [those in effective control] did what they saw fit and in the end I felt there was nothing I could do to change that and so I decided to move on. In fact, I started to look for a job within eight months of joining the association. Unfortunately it took me almost two years to find a suitable role.”