Farm Ireland

Saturday 23 June 2018

Supporters of Downey lift lid on IFA chaos

The association is facing into an election with the money issue still burning, writes Maeve Sheehan

Eddie Downey
Eddie Downey
Maeve Sheehan

Maeve Sheehan

Next Thursday, farmers will cast their final votes for a new president of the Irish Farmers' Organisation. The organisation hopes the new incumbent will heal the wounds left by the executive pay scandal that rocked the farming juggernaut to the core. But in several corners of the country, grassroots farmers scratch away at the scabs - not least in the home county of Eddie Downey, the former IFA president, who found himself in the eye of the storm, resigned and later claimed that he had been "thrown under a bus" by his colleagues.

When the scandal broke in November, farmers' anger was directed at the general secretary Pat Smith's €535,000 salary - but it was his €2m exit package that enraged them. Eddie Downey, who was president, signed the agreement.

At a presidential debate in Meath last month, where Eddie Downey farms poultry, one farmer read what purported to be the leaked salary details of Smith's predecessor.

Other farmers lined up to defend Downey - one saying he deserved an "apology" from the IFA and another claiming Downey had not been supported by his own board when he most needed it.

Despite the IFA's best efforts to move on, with a new remuneration committee and promises of better governance, the money issue hasn't gone away.

This weekend, supporters of Eddie Downey revealed new details of what went on behind the scenes in the dramatic eight days in November when Smith's leaked salary details catapulted the IFA into what one officer called the biggest "trauma" in its history.

Smith was a hard-nosed general secretary, the commercial driving force who squeezed every bit of financial juice out of the farming union.

He was "abrasive", a "bull" of a man but "brilliant", according to various sources.

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Details of his massive salary were in the ether and Derek Deane, chairman of Carlow IFA, put them in the public domain and pressed for full disclosure.

Against this backdrop, on November 18, Eddie Downey walked down the corridor from his president's office in the IFA's Dublin headquarters to the financial controller's office and asked for the file on Pat Smith.

You won't like it, he was told. All the more reason to see it, Downey replied.

According to supporters of Downey, when he read the file, he concluded that Smith had to go.

According to informed sources, Downey, the IFA's financial controller Ken Heade, the IFA's treasurer, Jer Bergin, and the legal advisor, James Staines, went across to the Sheldon hotel on the Naas Road to discuss Pat Smith's "situation".

Sources close to Downey claim that after a discussion, the IFA president left the hotel, went straight to Pat Smith's office and told him it was "over". He asked Smith to go on gardening leave, Smith said he would resign and the financial negotiations ensued.

What happened next is disputed. Downey's supporters claim that the president asked the financial controller to do the calculations, prepare documents and was "in the room" when the exit agreement that gave Smith €1m and €100,000 over 10 years was signed.

His supporters say that afterwards he briefed the deputy president, Tim O'Leary and Jer Bergin, although he did not disclose the amount for confidentiality reasons.

They say the IFA president believed he had the approval of the other IFA officers when he agreed the deal.

However, sources in the IFA say the size of Pat Smith's severance package was agreed between Smith and Downey and they claim that Downey "went beyond" any advice that was given to him. The others were unaware of the size of the exit package until after the fact and did not sign it.

Smith went and the following day Downey put Smith's €535,000 salary package into the public domain at an emergency meeting. Downey's €147,000 president's salary came out later. But the severance package proved the rub.

When Downey resigned six days later, it was not because he had signed Smith's severance package, according to supporters, but because he could see that he could no longer rely upon the support of his key IFA colleagues.

The IFA later disowned the severance deal and the council voted not to pay it. Afterwards, media reported that the agreement was not signed by the treasurer, the financial controller or the deputy president, Tim O'Leary, who, according to one report, were "understood to have opposed the deal".

After that, Downey gave a round of interviews, claiming a "misrepresentation of facts", that he "had to follow a legal process", hadn't acted alone and had been "thrown under a bus". Then he retreated.

The irony for Downey was that the IFA was already dealing with the salary issue when the bomb went off. A new remuneration committee had been approved, bonus payments to Smith were stalled and his salary and the president's were lower than under previous IFA presidents.

"Eddie Downey was holding the parcel when the bomb went off. In fact, Eddie Downey was defusing the bomb," said one source.

The IFA said this weekend that Smith "has taken legal proceedings against the association in pursuit of his claim."

Eddie Downey said: "I just can't comment at this moment but it is my intention to clarify a number of issues one day."

Money and governance will remain centre stage for the new president. Pat Smith, who is now suing the IFA for his severance, promises further headaches for the organisation should the case end up going to full hearing - not least in terms of legal costs.

The candidates are: Henry Burns from Laois; Joe Healy from Galway; Flor McCarthy from Kerry. All three agree that the salary of the next general secretary should be transparent and that past salaries should be reviewed if legally possible and if the council wants that.

"Whoever is elected is going to find it impossible to get away from this," said an industry source, "this election is definitely about the money."

Sunday Independent