Fás board kept in dark for months about EU probe into funds

THE board of Fás was kept in the dark for months about an EU probe into how the state training agency was using millions of euro of social funds which have now been withdrawn.

The Department of Finance was also unaware that at least €57 million of EU grants were under threat, while discussions were taking place between the European Commission and the Department of Enterprise.

The Taoiseach said at the weekend that the problems identified by the European Commission revealed in recent days were because of “legacy issues” at the troubled training agency.

But the Irish Examiner can show that the board of Fás were not informed by management of the EU inquiries as late as February – five months after the first EU audit was carried out.

Director general of Fás, Paul O’Toole, told the Public Accounts Committee (PAC) last February that the board had not been informed of the concerns expressed by the EU.

EU funding of €211m was allocated to Ireland for the period 2007 to 2013, while €407m was allocated for 2000 to 2006.

The European Commission carried out an audit of how this money was used which was discussed at a meeting in Dublin last December when it was decided to conduct a second audit.

This was carried out in March and led to a €57m claim being withdrawn.

The board of Fás will meet today and tomorrow to discuss revelations of “suspected malpractice” in the running of training courses found by an internal Fás investigation.

When he first revealed to the committee that the commission had “raised questions” about how the fund was being used by Fás and there was an “ongoing process” to address these issues, Mr O’Toole was asked if the board was informed. “I do not think it has been informed, certainly not in my time,” he said.

“If it transpires that there are issues in this process, we will bring this matter in full to our audit committee and to our board.”

A new board had been appointed a month previous to the committee meeting.

On the same day, an official from the Department of Finance said she was not informed. Grainne McGuckin said she was unaware that the fund was under threat.

“I am not aware of anybody expressing that view in the Department of Finance at this point,” said Ms McGuckin.

Asked if the department was aware the fund was under threat, she said: “Clearly, if there is any risk associated with that, it has not been brought directly to my attention in my capacity. If there was, obviously, we would liaise directly with the department and discuss it with it. Obviously, it would be an issue. However, I am not aware, as of today of any specific real threat. Maybe the Department of Enterprise, Trade and Employment can confirm that.”

Committee chairman, Bernard Allen (Fine Gael) asked Sean Gorman, secretary general of the Department of Enterprise: “Has the Department of Enterprise, Trade and Employment communicated with the Department of Finance on this?”

Mr Gorman responded: “I have not. We are in the middle of the process with the European Commission at this stage so we do not know where it will come out.”