Fás boss payoff €900k over the norm

FORMER Fás boss Rody Molloy got a severance package worth almost €900,000 more than would have been payable to a comparable public servant taking early retirement.

A report by the State spending watchdog, the Comptroller and Auditor General, has confirmed the generous nature of the Government-approved package.

Mr Molloy resigned as director-general of Fás in November 2008 amid controversy over lavish travel and expense bills incurred at the state training agency.

According to the report – the latest in a series by the Comptroller on Fás – Mr Molloy resigned on a pension worth €111,245 a year. In addition, he received a once-off lump sum of €333,735, a “payment in lieu of notice” worth €55,622 and an “ex-gratia payment” also worth €55,622.

He was also allowed retain a car worth €20,800.

The Department of Finance has consistently defended the “golden handshake”, saying it was agreed mainly on the basis of guidelines which allow for pay-offs to chief executive officers whose contracts are being terminated.

But the Comptroller found that the settlement “exceeded” by €76,422 the maximum terms generally available in such instances.

And it exceeded by an estimated €892,269 the sum that would have been payable to a comparable public servant taking early retirement.

“The value of the settlement, including payments in lieu of notice, exceeded the amount that would have been payable under the terms of a general Department of Finance sanction for chief executive officers on fixed-term contracts whose contracts were being terminated or not renewed and compensation under his contract by an estimated €76,422 and it exceeded the amount that would be payable to a comparable public servant taking early retirement by an estimated €892,269,” the report said.

Elsewhere, it found:

* Fás spent around €3m on flights between 2002 and 2008, but around one-third of these flights were booked outside internal procedures.

* Fás spent €21,000 on flights for Mr Molloy’s wife so that she could accompany him on eight trips abroad.

* Between 2002 and 2008, Fás paid €35,000 for tickets to events such as matches and concerts, including €2,255 spent on hospitality at a Robbie Williams concert in 2006.

* There was “a lack of regard for economy” such as “large amounts of alcohol” on lunch bills.

Last night, Fine Gael said legislation was required to prevent ministers “handing out any more €892,000 golden handshakes”. Labour called for “better corporate governance” of State bodies, while Sinn Féin said the report showed Fás had been giving “a two-fingered salute” to taxpayers.

Tánaiste Mary Coughlan said that since becoming aware of the “serious issues” at Fás, she had acted “effectively and with consistency” to address them. She said a new director general and board had been appointed and controls had been put in place at the organisation.