Saturday 27 December 2014

CRC scandal Kiely 'won't give back' the charity cash

Mystery over whereabouts of the documents detailing origin of €742,000 severance deal

Published 19/01/2014 | 02:30

Legal threat on CRC salary cuts...Paul Kiely (left) the former chief executive of the Dublin based Central Remedial Clinic and acting chief executive Jim Nugent (right) leaving Leinster House after giving evidence to The Public Accounts Committee. PRESS ASSOCIATION Photo. Picture date: Wednesday December 11, 2013. Scandal-struck Central Remedial Clinic (CRC) chiefs said they face being sued if they enforce salary cuts on bosses getting top-ups from public donations. See PA story POLITICS TopUps Ireland. Photo credit should read: Niall Carson/PA Wire...A
Paul Kiely (left) the former chief executive of the Dublin based Central Remedial Clinic and acting chief executive Jim Nugent (right) leaving Leinster House after giving evidence at PAC last month

THE former chief executive of the Central Remedial Clinic (CRC), Paul Kiely, has indicated to friends he will not be paying back his €742,000 retirement package, the Sunday Independent has learnt.

Mr Kiely has retained a legal team to deal with the fallout from the Central Remedial Clinic debacle, which culminated last week in the startling disclosures about his pension package, which was funded by charitable donations.

The focus of the HSE investigation into the CRC is shifting to the whereabouts of documents surrounding the financial settlement reached by the board of the organisation with Mr Kiely last year.

However, aside from the minutes of the board meeting at which that decision was made -- which make no reference to how the figures were arrived at -- further documentation has yet to emerge.

In particular, the HSE is looking for a copy of the 'presentation' made by the chairman of the board, Hamilton Goulding, to the members last March. The minutes of the remuneration sub-committee are also being sought.

The HSE's specially appointed interim administrator to the CRC, John Cregan, will be meeting with the clinic's auditors, Ernst & Young, next week to see what documentation it has on file.

Finance Minister Michael Noonan yesterday became the latest senior government figure to demand that Mr Kiely hand back the money, but a source close to the former CEO said this was unlikely.

"Based on my understanding of Paul's situation and the legally binding agreements involved, Mr Noonan would have difficulty in retrieving these monies," the source told the Sunday Independent.

The CRC scandal was disclosed at the Public Accounts Committee (PAC) last week.

An audit by the HSE has revealed that Mr Kiely's pay-off included €200,000 tax-free, €273,336 which was taxable and €268,689 paid to Mercer's consultants to top up his pension fund as though he had worked until November 2016.

Mr Kiely had previously only admitted to a pension pot of €200,000. The money was secured from donations and paid out of accounts held by the Friends and Supporters of the CRC.

Mr Kiely has not spoken publicly since his appearance at the PAC in December.

It is not known if Mr Kiely is currently in the country but one friend last night said he believed the embattled former CRC chief was in London this weekend staying with a priest he knows from his college days.

Mr Kiely also frequently stays with his daughter, who lives in Bristol.

Mr Kiely told the PAC that he had planned to spend a month with his daughter before Christmas but had to cut the trip short to appear before the committee.

But Mr Kiely appears to be adamant that his package is above board and was fair.

A source told the Sunday Independent: "His contract of employment brought him to the age of 65. The agreement they came to was that he would leave early, with three years' pay. Under the terms of his contract, he would have been entitled to six years' pay.

"He is not in receipt of any monies yet. He will not start to draw his pension down until he reaches the age of 65. He is 59 now."

Sources close to Mr Kiely expressed their surprise that he had answered questions in relation to his pension as it was never a pension tied to the health service.

One said they thought that Mr Kiely had been a little naive in responding to questions on it. He joined the private pension scheme in 1977 and made full contributions to it ever since.

Mr Kiely's days had been numbered since Mr Goulding arrived at the CRC after leaving Aer Lingus.

A source said: "They didn't see eye to eye and Jim Nugent was brought in to try and resolve matters but was unable to. He did not leave voluntarily, he was pushed."

Mercer pension consultants worked out the entitlements Mr Kiely had under his pension according to the terms of his contract, which a source close to him said was "rock solid".

Another informed source close to Mr Kiely said last night that his legal advisors were willing to sit down with the members of the interim board of the CRC to discuss the situation.

The source reiterated, however, that Mr Kiely's contract and the legal agreements in place were absolutely binding and solid.

Mr Kiely is under mounting pressure to relinquish the €742,000 pension package that was paid for by charity lottery funds.

A former director of the CRC called on Mr Kiely to consider repaying some or all his gold-plated package to the clinic.

Former Fianna Fail minister Vincent Brady told this newspaper: "I think that certainly, in view of the amount of money involved, he should seriously consider giving some of it back or making a substantial donation to the clinic."

Mr Brady, a long-standing board member, said he had been unaware of Mr Kiely's pension package until the details were disclosed at the Public Accounts Committee last week.

He continued: "I did know a pension package was agreed. But we did not get any details of what that package was.

"In retrospect, the whole thing was ridiculous. We should have got the details and we should have requested them."

Mr Brady said there was not a culture of questioning on the board of the CRC.

He added: "Board meetings were very short. Everything was presented as being rosy in the garden. No financial details were ever given in the minutes of the meetings."

Mr Noonan added his voice to those of fellow cabinet ministers and opposition TDs, saying that the €742,000 retirement package awarded to Mr Kiely should now be paid back.

The Finance Minister said the financial management practices within the clinic for disabled children and adults were "astounding and absolutely shocking".

When asked if the money should be repaid, Mr Noonan replied: "On the face of it, it should, yes."

Fianna Fail TD John McGuinness, the PAC chairman, suggested a further investigation might be needed over the affair, with the Office of the Director of Corporate Enforcement and gardai being called in.

 

RONALD QUINLAN, FIONNAN SHEAHAN, and MAEVE SHEEHAN

Irish Independent

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