Molloy refused to accept findings on overspending

FORMER Fás boss Rody Molloy refused to accept the findings of an internal audit report on overspending in 2007, complaining to the board of the agency that the investigation did not show “courtesy” to senior management.

The findings in the report were not made public at the time but eventually triggered a number of investigations by the gardaí, the Comptroller and Auditor General (CAG) and the Dáil’s Public Accounts Committee (PAC).

Mr Molloy, who resigned as director general last November after telling a radio programme he was “entitled” to first-class foreign travel, wrote to the board of Fás with 22 points of disagreement on findings of excessive spending.

The audit was carried out by the board’s internal audit committee following an anonymous letter with a number of allegations sent to then Enterprise Minister Mary Harney.

Mr Molloy complained that “the investigation was extended without the courtesy of advising senior management,” in a letter to Fás board member Niall Saul obtained by Fine Gael this week under the Freedom of Information (FOI) Act.

He expressed concern about “the lack of clear terms of reference, eg the anonymous allegations were investigated and then other allegations arose etc”.

Responding to a finding of poor oversight on advertising and publicity spending, Mr Molloy said: “Some degree of flexibility can oftentimes be necessary if the job is to be done successfully.”

He said: “The rigid application of contractual arrangements and public service procurement practices would not be appropriate in all the circumstances in which the Corporate Affairs Department has to work.”

Mr Molloy also complained to the audit committee about the trawl through emails and said that interviewing people outside of the agency for the audit “caused extraordinary difficulties for Fás management”. He said: “A senior executive from Independent Newspapers met with the director general to express annoyance at internal audit calling him.”