Saturday 10 December 2016

John Greene: Questions and contradictions present a troubling picture

Published 24/07/2016 | 17:00

The Curragh. Photo: Paul Mohan/Sportsfile
The Curragh. Photo: Paul Mohan/Sportsfile

The reappointment last week of Brian Kavanagh as chief executive of Horse Racing Ireland for another five years has raised a few eyebrows.

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Kavanagh's 14 years at the helm of the commercial state body had been due to finish in September of this year but the additional term was confirmed at a board meeting on Thursday.

‘Perhaps Brian Kavanagh is the best man for the job, and there are few at the moment who are saying he isn’t, but right now that is hardly the point’. Photo: Martin Nolan
‘Perhaps Brian Kavanagh is the best man for the job, and there are few at the moment who are saying he isn’t, but right now that is hardly the point’. Photo: Martin Nolan

Sanction to grant the extension was required from two government ministers, the Minister for Public Expenditure and Reform, Paschal Donohoe, and the Minister for Agriculture, Food and the Marine, Michael Creed. Having given the green light in recent weeks, both ministers have been at pains to point out that it was ultimately a decision for the board of Horse Racing Ireland.

Under rules around semi-state bodies, CEOs are restricted to one term of office of seven years' duration, but those rules had been relaxed to allow Kavanagh a second term. However, the Department of Finance had insisted that there would be no further relaxing of the rules to allow for a third stint in the position.

A newspaper report in February 2012 revealed that officials in the Department of Finance had been lobbied by officials in the Department of Agriculture to allow for the possibility of a third term given Kavanagh's expertise and the specialist nature of the industry.

The report, in the Irish Examiner, stated: "Briefing memos, released under the Freedom of Information Act, show that finance staff felt a further relaxation of the rules for Mr Kavanagh would undermine government policy. It said that the fact Mr Kavanagh was well regarded for his work was not a valid reason for keeping him on because it assumed there was nobody who could do a better job. The petitioning on behalf of Mr Kavanagh occurred after the Department of Agriculture had already secured a second term for him, against the wishes of the Department of Finance."

Despite this, it recently became evident that a third term was being considered. Over the last few months there has been a concerted campaign to reappoint Kavanagh, largely based on his wealth of experience in the racing industry at home and abroad. He is also now a central figure in the massive €65m redevelopment of the Curragh. There is also Kavanagh's familiarity with important legislation, namely the Horse Racing Ireland Act 2016.

Certainly, the wind is behind Kavanagh in terms of timing as the industry emerges from some very difficult years. Recently-issued statistics for the first six months of the year showed increases across several key areas, such as the number of horses in training, the number of entries in races, and the number of new owners, while there were also important gains in terms of prize money and race sponsorship.

Welcoming these figures almost two weeks ago, Kavanagh said that "signs of progress were evident towards the end of 2015 and have continued in the first six months of 2016".

It is against this backdrop, as well as significant racecourse investment in a number of tracks - the most high-profile of which is the Curragh - that Kavanagh has been reappointed.

But the questions which surround this reappointment are less concerned with his ability to do the job, and more to do with the process, and also important issues of governance, as well as the fact that it is an apparent breach of government guidelines. This is where the focus lies now, because this is a road Irish sport has been down before.

The principal question is this: if a third term had initially been ruled out by the Department of Finance because it undermined government policy, what has changed? And, more to the point, why wasn't there an open competition? If this had occurred, and Kavanagh had emerged as the clear and outstanding candidate following such a process, then the argument for offering a third term is significantly more enhanced. Instead, we are left with an element of confusion and contradiction which raises more questions.

For instance, two weeks ago, in answer to a question from Fianna Fáil's Dara Calleary, Paschal Donohoe said he had sanctioned the extension because "a business case was submitted to my Department by the Board of Horse Racing Ireland that was strongly supported by the Minister of Agriculture, Food and the Marine".

The minister added: "The case made indicated that the extension was required because of the substantial importance of the role played by the CEO of HRI in the thoroughbred horse industry, the expertise, experience and qualifications brought by the current CEO to the post and the continuity the appointment would provide for the implementation of the strategic plan for the development of this important industry."

On the same day, Labour's Willie Penrose asked Michael Creed if, given government guidelines, steps were being taken "to advertise, by way of open competition, the important position of chief executive of Horse Racing Ireland, as the current holder of the position has already served 14 years as chief executive".

The minister's answer was brief: "The office of the present Chief Executive Officer of Horse Racing Ireland is due to expire in September 2016. The filling of this important post after that date is currently under consideration."

So here we have two government ministers, from the same party, giving answers which do not appear to tally.

In the wake of this, another worrying and more troubling contradiction emerged, with opposition politicians strongly suggesting that the board of HRI had not in fact been consulted about the request to government to sanction a contract extension for the chief executive, raising the possibility of more serious governance concerns.

Last week, Stephen Donnelly tabled two questions to the Minister for Agriculture, Food and the Marine. The two questions were:

"To ask the Minister for Agriculture, Food and the Marine if he is aware that when his Department consented to award an extended five-year contract to a chief executive officer of a commercial State body, who has served for 14 years with that body, the chairman of the board concerned had reportedly not sought the views of the board when he consulted the Department of Agriculture, Food and the Marine; that it is also reported that the board of Horse Racing Ireland was not consulted prior to the submission of the business case to the Department of Agriculture, Food and the Marine; and if he will make a statement on the matter."

And:

"To ask the Minister for Agriculture, Food and the Marine if he is aware that the board of Horse Racing Ireland, HRI, has reported that it was not aware of a business case which was supplied to his Department by the chairman of HRI or that the approval of the board was not sought by the chairman on advice that he received from officials in the Department; and if he will make a statement on the matter."

If Donnelly is correct in suggesting that the board of HRI had not been consulted about a case being made in the name of the board to the two ministers on Kavanagh's behalf then this is surely a serious matter as it raises the possibility of ministerial decisions being made based on a false premise. If he is not, then the record must be corrected promptly. This has not happened yet and neither question was answered directly.

Thomas Byrne, meanwhile, asked for details of when the board meeting which approved the business case presented to the two ministers took place while Charlie McConalogue sought details of what was in that business case.

Questions must also be asked of the executive and the board over the last five years given that the September 2016 end date had been long since been signalled. What level of succession planning - a basic function of any properly functioning entity - has been in place?

All in all, these apparent contradictions present a troubling picture at a time when transparency and a culture of new politics is being espoused. As well as being a sport of great national interest, the horse racing industry is a hugely important one to the Irish economy. Perhaps Kavanagh is the best man for the job, and there are few at the moment who are saying he isn't, but right now that is hardly the point. No, the point is that Irish sport, and indeed Irish political life, has been dogged by issues around good practice and good governance and this latest episode raises enough questions to leave you wondering what, if anything, has changed.

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