Irish Horse Racing Regulatory Board at Public Accounts Committee
Full Transcript:
Deputy Marc Ó Cathasaigh
I know Mr. O’Loughlin finds himself in a difficult situation on this. I wish to ask about the voluntary leave aspect, because this is, of course, analogous to some of the drip feed we heard concerning the matter we will be dealing with later this afternoon. Did Mr. O’Brien ask to take leave or was he asked to take leave? It is a period of voluntary leave he has taken.
Mr. Darragh O’Loughlin
Deputy Marc Ó Cathasaigh
Did he ask to take leave or was he asked to take leave?
Mr. Darragh O’Loughlin
I would prefer not to answer that question because to do so could potentially prejudice an investigation or review that has not yet taken place. My answer to this question might give rise to opinions being formed in relation to the matter.
Deputy Marc Ó Cathasaigh
I thank Mr. O’Loughlin. I understand that answer.
Turning to the witnesses from the Department, it does sound to me like Mr. O’Loughlin, as soon as this issue was uncovered, acted very speedily and informed all the relevant people. Will the Department have input, in respect of the terms of reference, into this independent review? Is the Department content that an independent review, commissioned by the IHRB, is sufficient in this respect of this issue? The Department has an insight into it that we, unfortunately, do not. Does the Department feel that it will take a strong role itself in terms of this issue? I refer again to the issue we will be dealing with this afternoon, in regard to which the relevant Department and Minister decided a full departmental external review was merited. Will Mr. Conroy give me his opinion on this aspect?
Mr. Gordon Conroy
There are several points there. The first concerns the review itself. We want it to be conducted as a matter of urgency. As a Department, we have committed to conducting a review of the governance arrangements around the horse and greyhound fund. My opinion is that when we get this review it may feed into our terms of reference in that regard. I also point out that the governance of the IHRB is, in the first instance, provided by HRI.
Deputy Marc Ó Cathasaigh
Okay. I am not long on this committee but we do see similar themes emerging from the different sessions.
Moving to the Comptroller and Auditor General, I have a quick question regarding this contract of employment issue. I just wish to clarify this point. Is it the case that Mr. McCarthy was not furnished with the document or that it was confirmed to him that such a document does not, in fact, exist?
Mr. Seamus McCarthy
We certainly did not receive it. We did ask for it. My understanding is that it does not exist. We were furnished with a contract of employment relating to 1997, but that was with the Turf Club.
Deputy Marc Ó Cathasaigh
This was as CFO.
Mr. Seamus McCarthy
As CFO. Given the establishment of a company in 2018 to take on the regulatory role, I would have expected that anybody coming into a position in a new company would have received a new contract of employment.
Deputy Marc Ó Cathasaigh
I will put the same question to Mr. O’Loughlin. Which is the case in this instance? Has the Comptroller and Auditor General asked for a document and not been furnished with it or is it the case that such a document, this contract of employment, does not, in fact, exist?
Mr. Darragh O’Loughlin
Any document or information sought by the Comptroller and Auditor General has always been speedily provided to his office. In the case of any document not provided, therefore, this has to be because either it does not exist or it is not in our possession.
Deputy Marc Ó Cathasaigh
Okay, but then you have also told this committee, in respect of the request from the Department to provide the full details of salary, etc., that this information could not be furnished because of a contractual obligation not to disclose. This request has, essentially, been stonewalled.
How can Mr. O’Loughlin stand over that statement when he cannot provide the document?
Mr. Darragh O’Loughlin
What I said was in the absence of a contractual provision waiving the right to privacy and consenting to the publication of the salary, the advice we received is that we would find ourselves in breach of data protection and privacy law and the Payment of Wages Act because all employees have a right to privacy.
Deputy Marc Ó Cathasaigh
Can I ask if the Comptroller and Auditor General would agree with that assessment?
Mr. Seamus McCarthy
I obviously do not give legal opinions but certainly the issue has arisen previously about disclosure of information relating to people paid out of the public purse. My understanding is there is an expectation, particularly with the more senior people, that information should be provided and can be provided.
Deputy Marc Ó Cathasaigh
Am I correct that discussions are ongoing with the Department about ceasing this ministerial derogation from the code of practice of governance of State bodies to which Mr. O’Loughlin’s opening statement said the organisation said it was committed. Is IHRB still negotiating whether this disclosure will happen into the future?
Mr. Darragh O’Loughlin
No, the correspondence referred to related to the statements for 2021. As I already outlined to the committee and my colleagues in the Department of Agriculture, Food and the Marine have confirmed, the as-yet unaudited financial statements for 2022 contain all of the relevant disclosures.
Deputy Marc Ó Cathasaigh
Okay. I just find it difficult to reconcile the stonewalling of a request from the Department when so much of the funding is derived from the Department and Mr. O’Loughlin’s opening statement that the IRHB “abides by the underlying principles of good governance – accountability, transparency [and] probity”. We are not seeing that transparency at all.
I will turn to the issue around the exit package. There is this contribution from the Turf Club which does not appear as a contribution from the Turf Club but gets folded in to IHRB’s general funding. Do I understand that correctly? It does not appear in that payment to the exiting CEO. It is not detailed as a separate contribution from the Turf Club, is it?
Mr. Darragh O’Loughlin
In the payment to the CEO there was a single sum of money put through the payroll system so as to ensure it was properly taxed but the contribution from the Turf Club is called out in our accounts under “other income”.
Deputy Marc Ó Cathasaigh
It is detailed as “other income”.
Mr. Darragh O’Loughlin
Deputy Marc Ó Cathasaigh
What further detail is provided?
Mr. Darragh O’Loughlin
There is no further detail provided in the accounts other than it is other income.
Deputy Marc Ó Cathasaigh
IHRB regulates activities such as betting. Well, it regulates activities such as handicapping —–
Mr. Darragh O’Loughlin
Deputy Marc Ó Cathasaigh
—– which can have an impact on races. Would that be immediately and transparently apparent? Deputy O’Connor would have far more experience of racing than I would. I know very little about it. If I was going to place a bet on a race, would it be immediately evident to me as a rank-and-file punter going in to place a few bob on a race, would it be immediately evident to me the impact of handicapping on the likely outcome of the race?
Mr. Darragh O’Loughlin
I know probably less about horse racing than the Deputy does but —–
Deputy Marc Ó Cathasaigh
Is it appropriate in that context to accept a payment of that nature and that size when the IHRB’s regulatory function can have an impact on the outcome of races?
Mr. Darragh O’Loughlin
I am struggling to see the link between handicapping and this but notwithstanding that, I am not here to defend the governance arrangements that were in place at that time and in particular around the transaction we are discussing.
Deputy Marc Ó Cathasaigh
Okay. The contribution was folded in, recorded as “other income” with no other information, and then paid out as part of this exit package. Did that contribution then also cover other liabilities that would go with that, such as tax and social protection payment, employers’ PRSI, which are the other costs that come attendant with making a payment to an employee?
Mr. Darragh O’Loughlin
Yes, which is why the figure under “other income” appears to be higher than the additional contribution to the retirement because the difference is made up of employers’ PRSI and related costs. An issue did arise in relation to the employers’ PRSI. I do not know if the Deputy would like me to me to explain it or the Comptroller and Auditor General.
Mr. Seamus McCarthy
We also asked for a copy of the correspondence or the agreement with the Turf Club in relation to the amount of money being transferred. There is not a document governing it.
Deputy Marc Ó Cathasaigh
So we do not —–
Mr. Seamus McCarthy
I cannot explain anything further about it. Obviously, there are calculations around the amount that was paid to the individual but they are a separate matter.
Deputy Marc Ó Cathasaigh
Finally, in the very few seconds remaining, yes, Mr. O’Loughlin is new in the role. However, I have to assume that decisions made, particularly regarding the request coming in from the Minister for full disclosure of details of a person’s salary, were discussed at a board level. I have to assume, then, that was subsequently minuted. Has Mr. O’Loughlin reviewed the minutes of the meetings that dealt with the Minister’s correspondence?
Mr. Darragh O’Loughlin
Deputy Marc Ó Cathasaigh
Would that not be of central importance considering it was a discussion that predated Mr. O’Loughlin’s entry to the role that was going to be discussed today?
Mr. Darragh O’Loughlin
My understanding is the matter was raised at board level but that decisions were not taken at board or that no decision I am aware of was minuted at board, is as much as I can say.
Deputy Marc Ó Cathasaigh
It is extraordinary that in relation to a decision relating to correspondence from the Minister of the Department that provides the preponderance of IHRB’s funding that no decision was recorded at board level and minuted. I find that astonishing to be quite honest.
