Timing is everything.
At a time when your sector and the entire economy is in real financial trouble, along comes a story which says the boss of your organisation has been overpaid.
And not just this year and last, but all the way back to 2011.
Such is the scenario now facing Trinity College Dublin fellows, academics, and students.
Steeped in history and tradition, Ireland’s oldest university has been in recent years grappling with the need to modernise its practices while coping with a drastic reduction in its funding from the State.
Our report comes at a time when core public funding per student remains 40% less than it was a decade ago in the third level sector.
At a time when the Higher Education Authority has said the Covid-19 pandemic would have “immense financial consequences” for the sector, with losses of around €508m for 2020 and 2021.
At a time when the Government’s response to such financial losses was to say there is “no commitment or expectation of additional funding for the education sector at the present time”.
“All additional costs/offsetting of revenue losses would need to be met from within existing budgetary allocations and through cost-saving measures/prioritisation of expenditure,” the response said.
While almost half of the forecast losses are due to an expected downturn in the number of international students coming to Ireland, there is more.
Colleges are also budgeting for a €69m drop in other forms of income, such as from employers who pay for employee training. They also expect to lose €44m in research funding and another €34m in student accommodation revenue. Some €15m is expected to be lost in commercial activities, such as visitor attractions and conferences.
Our story reveals the salary paid to Dr Paddy Prendergast, the 44th Provost of TCD, in situ since 2011, is “in breach” of what the Department of Education allowed.
A report conducted by external auditors for the college has confirmed that the “college does not have approval for the payment of benefits in kind. Consequently, the total remuneration exceeds the 2011 approval implication”.
“The college is in breach of the approval provided by the Department of Education and Skills in relation to the Provost’s salary,” the report finds.
The audit report details how the college sought a “derogation” from the department to account for the fact the Provost lives on campus, but this was not given.
The report states that approval was provided by the Department of Education and Skills for the salary of the Provost in 2011.
“The approval specifies that the total remuneration approved includes basic salary allowances and all other benefits in cash (such as bonuses and or performance-related awards) or kind (such as, but not limited to, company car, medical plan, individual and or family), provision of a residence and or payment of household expenses, together with general terms in regard to superannuation holiday sick leave etc,” the document states.
“As raised on previous audit, the 2019 audit team noted that the provost, is in receipt of benefits and claims related to household expenses, which is in addition to the pay rate approved by the Department,” the audit states.
“For the 2018 audit, the college shows that he had sought a derogation from the Department of Education and Skills due to the unique circumstances the Trinity Provost has in being required to live on campus,” the document reveals.
For the 2019 audit, the audit team requested an update, and were advised by the deputy HR director that there has been no reply from the department.
“The college has previously raised the issue with the department and it has been confirmed that the college does not have approval for the payment of benefits in kind. Consequently, the total remuneration exceeds the 2011 approval implication. The college is in breach of the approval provided by the Department of Education and Skills in relation to the Provost’s salary,” the document concludes.
The matter was given a “high rating” in terms of importance and recommended the “college addresses this issue, as a matter of urgency.” The audit included a management response which said it is important to note that this is a unique position as the Provost is required to reside on campus as part of his role.
While TCD management said it noted the position of the department, it stated the monetary amount involved is “immaterial” and the Provost pays tax on the benefits-in-kind demand.
Even though it was turned down in 2018, the college said it will continue to engage with the department to seek a derogation on this matter and human resources will meet with the Provost on this issue.
While TCD management has said the amount of money involved is small and “immaterial,” some within the hallowed halls of the college are deeply unhappy with the damage this incident could do.
“On one hand we are looking for more money and on the other, we as a college are in breach when it comes to the Provost’s salary,” said one senior figure.
The audit also found a large number of issues raised in previous audits not yet dealt with.
“We know that a total of 52 orders/recommendations remain outstanding, most of which have been outstanding for a number of years. Having a large body of order committee recommendations outstanding makes for a diminished internal controlled environment,” the report concludes.
For example, there was an internal audit review of cybersecurity carried out in 2016.
In February 2019, a cybersecurity risk assessment update was completed, which highlighted that many of the risks identified in the 2016 review have not been actioned. “This demonstrates that internal audit recommendations and agreed action plans are not being implemented, and that the follow-up process appears to be ineffective implication,” the report concludes.
The audit also identified expenditure totalling €1.2m, which was not procured in compliance with public procurement guidelines relating to four suppliers, ranging from €30,000 to €1.1m.
“Non-compliant expenditure represents a breach of procurement guidelines and can represent and result in poor value for money being achieved, there is a risk that the statement on the governance and internal controls are not adequately addressed,” the audit report concludes.
This is not the first controversy on Dr Prendergast’s watch. In 2014, a major rebranding of the college ran into the sand amid strong opposition from senior fellows and staff at the college.
For more than 400 years, Trinity College has been to the fore of Irish education and has a fine and well-deserved reputation for its premier place in the hierarchy of Irish universities.
But it is clear from its own auditor’s report, Trinity is far from perfect and needs to get its house in order.