THE ROW:

Watchdog to renew investigation into spending

Mary Coughlan, the enterprise minister, last week asked the taxpayers’ watchdog to find out whether the state’s training and employment authority has been wasteful in its management of a €1 billion budget. The Comptroller & Auditor General (C&AG) will, it is expected, especially probe how Fas’s corporate-affairs department spent its money over the past eight years. The C&AG criticised Fas in a previous investigation for failing to generate value for money for taxpayers when dealing with its main advertising agency.

The state agency now faces a second investigation, this time by the Oireachtas’s Public Accounts Committee (PAC). Senior executives including Rody Molloy, its director general, will be brought before the committee for hearings in the next two weeks.

THE ISSUE:

Overspending by Fas was highlighted months ago

Enda Kenny, the leader of Fine Gael, used Dail privilege last June to highlight alleged irregularities in how Fas was spending its €9m annual budget for advertising and public relations. Coughlan said at the time that Fas had already dealt with the matter, suggesting there was no need for further action.

Last week Leo Varadkar, the Fine Gael enterprise spokesman, told the Dail that irregularities and mismanagement at Fas went further than its corporate-affairs division. The C&AG has found that one contract for Opportunities 2002, Fas’s annual jobs fair, was awarded for twice as much as was paid previously or since for the same work. The establishment of a €1.7m website in 2000 is said to have cost €1m more than it should have.

THE REAL ISSUE:

Why did Coughlan finally send in the auditors?

Coughlan’s decision to ask for further investigation is an embarrassing U-turn for the minister, Fine Gael claimed, given that she has been resisting demands for an inquiry for months.

Her timing was significant. It appears Coughlan finally relented in order to stave off parliamentary questioning when the Dail resumed after the summer last week. While she insisted that she has confidence in the board of management of Fas, her decision will discomfit them. It tried to put a brave face on the decision by “welcoming” the investigation, saying it might prevent further damage from selected leaks from audit reports.

Bernard Allen, the PAC chairman, accused Coughlan of ignoring for months media allegations of how Fas handled contracts.

THE BIGGER PICTURE:

Fas is back in business

Fas is the pivotal agency when it comes to reskilling Ireland’s unemployed. The growth in its budget during the boom years was perplexing, given that Ireland had virtually full employment. Now that the country is in recession, there’s work for it to do. Since Brian Cowen became taoiseach last May, more than 45,000 people have lost their jobs.

If the C&AG finds evidence of further irregularities, it will have serious implications for senior Fas staff. It may also prompt a political decision to change the composition of the board. Fas has already been criticised by politicians for its performance in other areas. Some 57% of people referred to the agency by social welfare officials in the first three months of this year are still without a job.

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