A review is being undertaken by Waterford Institute of Technology (WIT) into arrangements relating to spin-off research companies based there.
The situation was outlined at the Dáil Public Accounts Committee, which heard that the Department of Education expects to hear shortly about the findings.
Sinn Féin TD David Cullinane raised the issue and asked if it is appropriate that the college received just €1.3m of the €64m sale price of a company co-located at WIT.
Christy Mannion, principal officer in the department’s higher education division, said the issues under consideration by the review include a role WIT president, Mr Donnelly, may have had previously.
Mr Donnelly was previously WIT’s head of research and innovation, and was a founding member of a number of spin-offt companies that include mobile software firm Feedhenry, which was sold eight months before he became college president in April 2015.
Department general secretary, Seán Ó Foghlú, had deferred to his colleague as he explained that his brother has been involved as a WIT employee, in the spin-off of the company.
But in reply to Mr Cullinane, asking if a college president should keep a distance from involvement in spin-off and co-located companies, given how such firms can benefit from research staff and grants, he said he would answer in principle rather than specifically in relation to WIT.
“It would all depend on a number of factors, such as when the person took the interest in the first place,” said Mr Ó Foghlú.
Mr Cullinane emphasised that he is not alleging any wrongdoing in the matters. He raised concerns about the portion of the sale proceeds that went to the college.
“In this instance, it was sold for very significant money. The institute got a tiny fraction of that. This is an institute which we are told is in deficit. It’s also one where its core funding has been cut quite substantially since 2008.
“In terms of public accountability and people who would be in senior positions in the institute, who might have either a role in being a director or shareholding, surely we would have a right to know did they benefit personally from this, how much they benefited from.”
While that information might not be in the public domain, Mr Mannion said it is open to the Department of Education to find out about the arrangements entered between the company and the college before a sale: “You asked about the Waterford share in the spinout.
"We can find out the processes that were involved in negotiation of that figure, and see if that’s in keeping with the protocols that are set out in relation to this matter.”
Mr Ó Foghlú had earlier explained that national protocols on commercialisation of research in third-level colleges require them to have policies and procedures to minimise or manage potential, or actual, conflicts of interest.
Mr Mannion said he believes the WIT governing body is to receive the internal review over the next week: “It’s looking to make sure that all the relevant policies, protocols and procedures have been complied with, and statutory governance processes have been applied.
“Obviously if the review concludes that there has been issues raised that are not appropriate, obviously we wouldn’t be happy with it, and we’d have to deal further with it at that stage.”
© Irish Examiner Ltd. All rights reserved