Enterprise ignored early warnings about Fás waste

WARNINGS about waste and mismanagement of a €126 million Fás “slush fund” were ignored by the Department of Enterprise as far back as 2006.

Investigations have been launched by the gardaí and the Oireachtas Public Accounts Committee into the fund which was used to train people in employment. Mismanagement also led to the withdrawal of €57m in EU funds. But documents obtained by Irish Examiner reveal the alarm was raised in August 2006 when a Department of Enterprise official wrote to assistant secretary Dermot Mulligan about concerns that there were not appropriate checks and balances in place for the Fás Competency Development Programme (CDP).

The letter warned some general and vague project proposals were approved and “very significant budgets are being provided to individual organisations”. The official assigned to oversee the scheme said independent, forensic audits should be carried out on projects.

The lack of such audits was the issue of concern to the European Commission, which withdrew Ireland’s share of the European Social Fund, which had previously been used for the CDP.

The European Commission said it was not satisfied with the “paper trail” provided by Fás regarding the use of course funding.

In January 2007, an official asked his seniors to convey to then Enterprise Minister Micheál Martin that he must send a “clear message” to Fás that the department was not happy with the way public money was spent.

The official drafted a letter on behalf of Mr Martin and requested his signature, which he proposed the minister send to the board and management of Fás saying he was “concerned” about the “persistent failure to provide me with requested information on programmes for training workers”.

The letter, which said the state training agency had developed a “casual and disengaged approach”, and could have put a stop to excessive spending, passed through the department but never reached the minister.