Friday 30 September 2016

Fine Gael feared 'cronyism' row over bank job

Published 22/10/2015 | 02:30

Professor Philip Lane
Professor Philip Lane

Fine Gael ministers were deeply concerned that the appointment of the top civil servant in Brendan Howlin's Department of Public Expenditure to the position of Governor of the Central Bank would have landed them at the centre of a cronyism row.

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"It's a big appointment and the Government would have been criticised if it went to a public servant," said a source.

Finance Minister Michael Noonan opted for an outside candidate in the form of Trinity academic Philip Lane over the Secretary General at the Department of Public Expenditure Robert Watt.

However, Mr Howlin made a point of noting his concerns about the appointment when it was discussed at Cabinet on Tuesday. Although he did not oppose Mr Lane being named as the new governor, he wanted to "put on the record" his view that the position required somebody with vast managerial experience as well as a financial background.

Professor Lane (46) will be in charge of 1,400 staff at the Central Bank, as well as sitting on the board of the European Central Bank in Frankfurt.

"It was no secret in Government circles that Brendan Howlin and Joan Burton wanted Robert Watt to get the job, but to be fair that would have caused a big headache," said a Fine Gael source.

Accusations

"Everyone on the Fine Gael side of the Cabinet was happy with the choice of Philip Lane. There was a fear that if it went the other way we'd be looking at accusations of cronyism."

The Irish Independent understands that there was "very little" between the two candidates in the final round of what was described as a "robust" recruitment drive.

This was the first time there was an open selection process used to select a new Central Bank Governor. Over 100 candidates from Ireland and abroad applied for the job before a shortlist of four was brought before an interview panel.

Mr Noonan spoke to each member of the interview panel individually before making his recommendation to Cabinet.

Fine Gael ministers were surprised by Mr Howlin's decision to speak at Cabinet, but held back from pointing out their own concerns about Mr Watt's candidature.

"Brendan Howlin has been front and centre looking for political reform, so people were surprised that he was batting so strongly for his own man," said the source.

Professor Lane will take over from Patrick Honohan, who is set to retire next month. He holds a PhD in economics from Harvard and has been teaching in Trinity since the late 1990s.

Irish Independent

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