Thursday 23 October 2014

Mary Lou: Pay set up at Rehab 'kind of shocking'

Shane Phelan, Public Affairs Editor

Published 27/02/2014 | 11:43

THE pay set up at Rehab Group has been described as "kind of shocking" by a member of the Dail's spending watchdog.

Mary Lou McDonald made the comment at a hearing of the Public Accounts Committee, which is hearing from Rehab chief executive Angela Kerins.

The Sinn Fein TD said that most of Rehab's staff had to take pay cut as it had been linked by the group to public sector pay rates. However, senior management were not linked to the same pay scales.

"I find that jars with me. I imagine it would jar with a lot of people looking at your organisation - that some are more equal than others," she said.

"I find it kind of shocking," she added.

Ms McDonald also said people were "shocked" at the level of her pay received by Mrs Kerins, currently €240,000.

She criticised Mrs Kerins for not ensuring Rehab's remuneration committee and its former chief executive Frank Flannery were present at the PAC today, as had been requested.

Mrs Kerins said they had not been brought as there were others better placed to answer the committee's queries.

Ms McDonald put it to Mrs Kerins that she earned more than US President Barack Obama and Taoiseach Enda Kenny and asked her to explain how her salary was arrived at.

Mrs Kerins said she was a private citizen and didn't want to give out any further information about her salary.

She said it was set by a remuneration committee and she had no input.

The Rehab boss also defended the methods used to set senior executive salaries, saying independent advice was taken on this. She insisted these salaries were 20pc below the market median for similar companies.

Mrs Kerins also questioned the relevance of having Mr Flannery, a Fine Gael strategist who was Rehab boss until seven years ago, present. Ms McDonald asked what Mr Flannery's pension arrangements were, but Mrs Kerins said she did not know.

She said her pension arrangements would be very different from Mr Flannery's as there was no longer a defined benefit scheme at the group.

Ms McDonald also asked Mrs Kerins about stories that she had used helicopters to fly to events. Mrs Kerins replied: "Any time I have ever been in one it hasn't been mine and it hasn't cost me anything."

Earlier, Mrs Kerins said it is examining ways to publish further details of senior executive salaries.

The charity and commercial group chief executive was speaking as the PAC examines how €83m in annual state funding given to Rehab companies is put to use.

Mrs Kerins, who under political pressure from Taoiseach Enda Kenny and other Cabinet members revealed last week her own salary, said: "We are now looking at other ways of publishing salary data."

She said there had been much comment on the issue of late.

"The last few weeks have taken a large toll on the Rehab Group and our clients," she said.

"We are wondering what we have done wrong."

Mrs Kerins defended her salary level, which jumped by €6,000 on the sum she was paid in 2011.

She described her organisation structure as "unique" as it straddles both the charity and commercial sectors.

"Our structure is unusual and yes we are unique, but that makes us no less valuable," she said.

The Rehab chief executive maintained its independence allowed it to defend its ethos.

Mrs Kerins quoted an analogy Transport Minister Leo Varadkar made in recent weeks that Rehab was similar a semi-state body.

Mrs Kerins said this was true in terms of staff numbers and the size of its operation, which has 2,300 employees in Ireland and 1,200 abroad across disability and recycling sectors.

She pointed out the average chief executive salary at semi states in 2011 was €291,000.

However, her presentation to the committee did not mention that there is now a €250,000 salary cap on pay in commercial semi states.

Earlier, Department of Justice secretary general Brian Purcell said Rehab had been clearly told that funding under the Charitable Lotteries Fund - a scheme set up to compensate charity lotteries following the setting up of the National Lottery - could not be spent for administrative purposes.

She described suggestions that money paid from the Charitable Lotteries Fund had been used on public relations and hospitality as "entirely false".

She said that the money referred to had been spent on advocacy for clients and that less than €200 had been spent on hospitality, which amounted to teas and coffees.

"There were no lavish lunches with politicians," she said.

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