Thursday 23 October 2014

Rehab Crisis: Now Dail spending watchdog refers new allegations to gardai

Shane Phelan, Public Affairs Editor

Published 13/03/2014 | 12:14

PAC chair John McGuinness

THE Dail's spending watchdog has referred a letter to gardai that it received from a former property developer relating to his alleged involvement with Rehab Group.

The letter was submitted to the Public Accounts Committee by John Kelly.

The details of the letter have not been officially disclosed.

PAC chairman John McGuinness said: "The statement contains a number of serious allegations against individuals who have or had associations with Rehab Group."

Mr McGuinness said the matters raised in the letter were outside the committee's remit and had now been forwarded to the gardai. "They could potentially involve criminal wrongdoing," he said.

He said the document was now no longer considered "a document of the committee" and as a result the information contained in it was not protected by privilege.

At the PAC's meeting this morning Mr McGuinness also said replies to queries submitted to the fell short of what had been asked for.

He said there were no details of what was paid to former chief executive Frank Flannery, while details of his pension were also not supplied.

Mr McGuinness also said the salaries disclosed - including 12 individuals earning over €100,000 - were out of line with the charity sector and appeared to be above public sector norms.

Information supplied in relation to a report by pay consultants Towers Watson "does not provide a basis for determining salaries".

Rehab had said this report was used by its remuneration committee to guide it in setting pay levels, including the €240,000 paid to chief executive Angela Kerins.

Mr McGuinness said the committee had decided to recall Rehab to appear before the committee on April 10.

He said they would be requesting the presence of Ms Kerins, Mr Flannery, Rehab chairman Brian Kerr, the group's remuneration committee and its director of finance.

Neither Mr Flannery nor the remuneration committee appeared when Rehab came before the committee a fortnight ago, despite a PAC request that they do so.

Independent TD Shane Ross described written responses to questions provided by Rehab to the committee since that meeting as "totally unsatisfactory".

"The response is a smokescreen. It doesn't delve into what we are looking for," he said.

Mr Ross said specific pay details had been"deliberately withheld" by Rehab.

He said it was "quite shoddy" and that the committee had not been told who was being paid what.

Mr Ross said the committee wanted the correct information and did not want Rehab coming before it again and "stalling for six hours".

Another committee member, Labour TD Ged Nash, said: "I was quite astonished by the scant information received."

He said the way the information was presented to the committee had been to "minimise the damage."

Mr McGuinness defended the committee's pursuit of Rehab.

"The information we have asked for is relevant to our investigations into the spending of public money," he said.

Mr McGuinness said he was "taken aback" Rehab had not cooperated in the fullest way possible.

He said they were "doing untold damage to themselves and to the charity sector."

He said at the hearing a fortnight ago, there had been "a certain reluctance to answer questions and some questions had not been answered".

Mr McGuinness said it would be far better for Rehab to give its full cooperation.

He added that there was nothing personal in its inquiries into Mr Flannery, who is a former Fine Gael election strategist.

"In relation to Mr Flannery, it isn't a personal thing. It is a job we have to do."

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