Business Irish

Sunday 19 November 2017

Nick Webb: Plat du jour: curried favour

WE'LL be paying for poxy government decisions for the next decade or more. But how is policy decided?

Apart from politicians and civil servants, who has access to the corridors of power? Who can get to bend the ear of the country's top civil servants, the unelected cabal of Sir Humphreys who actually run the country?

Under the Freedom of Information Act, I've been able to get my hands on the appointments diaries of the Secretary-General of the Department of Finance -- the single-most important civil servant in the country. It makes for extraordinary reading, and all for the price of a cheap round.

The documents reveal who Secretary-General David Doyle and his recent replacement, Kevin Cardiff, have been lunching with or meeting for the last four years, the most highly caffeinated period of recent history that saw the economic bubble get bigger and bigger before a loud and calamitous pop.

Who were these guys listening to over the last four years? Who helped form the opinions and decisions that saw the country lurch from boom to bust?

Spin doctors and lobbyists had a free run of the Department of Finance. One visitor was former PD insider Stephen O'Byrnes -- whose company has represented a spectrum of big-business interests ranging from the US multinational mouthpiece -- the American Chamber of Commerce -- to Bank of Ireland, KBC Bank, Energia and PA Consulting.

Former Wilson Hartnell boss Mary Finan was also in and out to see Doyle. Wilson Hartnell was the former employer of Anglo chairman Alan Dukes. Finan has been involved with such semi-states as the Dublin Docklands Development Authority, ESRI and RTE -- as well as big corporates such as Barry O'Callaghan's EMPG and DCC during the Jim Flavin days. Eircom's own 'director of regulatory affairs', Pat Galvin, has also had the secretary-general's attention. Eircom's batphone to the department is working well. Of all the private-sector companies in the country, it has bagged the most meetings with the big enchilada in finance. Other than the banks, of course.

The banks may have been banjaxed, but they knew how to fight their corner. Sure, they could have been nationalised. Anglo could have been put into administration and the bondholders flayed. But no, they had the right kind of access. They were able to make their case for survival to the right people.

Former Fianna Fail general secretary Pat Farrell could find his way around the corridors of power in his sleep. He's also the chief executive of the Irish Banking Federation, the main lobby group for the banks. And he's been in a lot. Especially as things started to go brown.

In July 2008, as bank shares cratered after the meltdown at Bear Stearns and Britain's nationalisation of Northern Rock, Doyle and his boss, Finance Minister Brian Lenihan, were pencilled in for a dinner with Farrell.

Doyle's diary noted that the minister was to meet AIB's then chief executive, Eugene Sheehy, and his counterpart at Bank of Ireland, Brian Goggin, at the start of September 2008 as things got critical.

Former Revenue chief Frank Daly popped in two days after the collapse of Lehman Brothers on September 15. He would be appointed to the board of Anglo Irish Bank some weeks later.

The week ahead of the government guarantee of September 30, 2008, was unremarkable according to Doyle's diary -- though one appointment after 4pm on Thursday, September 25, was blacked out by the department. Two days after the guarantee, on Wednesday, October 1, Doyle met with Ulster Bank's Cormac McCarthy and the bank's Irish chairman, Sean Dorgan.

Dorgan, the former IDA chief executive, could have regaled Doyle with tales from the private sector as, since leaving the IDA, he has joined the boards of Ireland's biggest retailer Tesco, insurance company FBD, British airplane and missile manufacturer Short Brothers as well as Michael Kelly's financial software company, Fineos.

Dorgan would also meet up for lunch in the Cellar Restaurant of the Merrion Hotel in June 2009. He would also meet up with Doyle's replacement, Kevin Cardiff, on the morning of March 29 this year.

The weeks and months after the guarantee saw Doyle spend lots of time with bankers. Some were met for cosy chats over lunch in nice restaurants; others had to call to the office.

Shortly after his appointment to Anglo Irish Bank, Alan Dukes was pencilled in for lunch with Doyle in Hugo's on Merrion Row. Bank lobbyist Pat Farrell had another lunch with Doyle in January 2009 -- this time in the rather excellent Pearl.

Anglo's Donal O'Connor was visited in his office that week. They went out to lunch in September 2009 in La Mere Zou on St Stephen's Green.

The banks may have been banjaxed, but they knew how to fight their corner

Doyle left his position at the end of January this year to be replaced by Kevin Cardiff. The banks still have regular access to the top floor of the Department of Finance, as Cardiff's diaries show.

The new secretary-general was scheduled to attend the Royal Bank of Scotland reception and dinner in the National Gallery at the end of May this year. RBS's Irish bauble, Ulster Bank, sent its chief executive Cormac McCarthy in for a cuppa with Cardiff the following Monday.

His diary featured a March 2010 dinner date in L'Ecrivain with banker Willie Slattery, chief executive of State Street (Ireland), one of the biggest employers in the IFSC and also a major critic of Nama.

Earlier this year, Slattery described the organisation as "crazy", too secretive and said it could waste as much as €15bn. That would have been a good lunch to eavesdrop on.

As the economy collapsed, big business got busy. Despite a bombed-out property sector, the chairman of one of the country's biggest commercial property advisers was one of David Doyle's most regularly scheduled lunch dates -- Peter Malone, chairman of CB Richard Ellis.

Malone is also chairman of the National Roads Authority, as well as the body that decides how much civil servants should be paid. The pair dined in some of the capital's finest eateries, including Peploes, the Unicorn and Brownes Brasserie.

The changing of the guard didn't see any let up in Eircom's access to the higher echelons of power. A high-level delegation, including chairman Ned Sullivan and chief executive Paul Donovan, came in to lobby Kevin Cardiff in May of this year.

The semi-states also got to make their case. Some in more opulent fashion than others. Doyle lunched with the VHI top team in Chapter One and Peploes, but had to make do with the chow at ESB HQ with the former chairman Tadgh O'Donoghue in early 2008.

ESB chairman Lochlann Quinn was due for a chat with Cardiff in April this year. ESB chief executive Padraig McManus got an hour the following month.

One highly significant but not-very-well-known visitor was the London investment banker Russell Chambers, who spent time with Cardiff in March this year. UBS executive Chambers played a key role in the flotation of Eircom in 1999 when at Merrill Lynch and was also one of the advisers when Aer Lingus floated in 2006. Could they have had a chat about flogging off some other bits of State infrastructure like Bord Gais or ESB?

While the Department of Finance mandarins have been kow-towing with the banks, Eircom, lobbyists and other big corporate interests, there is one glaring omission among the pages and pages of scheduled meetings. Where are the small businesses? Where are the entrepreneurs? Perhaps they couldn't be bothered . . . the entrepreneurs that is.

Sunday Independent

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