FAS chief quits in row over US trips
Embattled FAS chief Rody Molloy last night quit his job in the row over lavish expenses-paid trips to the US.
The resignation is a considerable embarrassment to Taoiseach Brian Cowen, as just 24 hours beforehand he had expressed full confidence in a man he described as "an excellent public servant".
Mr Molloy stood down after coming under intense pressure from some of his own senior board members, who joined opposition parties in voicing their view it was time to go, the Irish Independent understands.
But Mr Cowen's failure to publicly back Mr Molloy, and his rowing back on his support yesterday, simply added to the crisis over the FAS director-general's position.
Fine Gael leader Enda Kenny said Mr Cowen's backing of Mr Molloy showed his "appalling lack of judgment" and the party is expected to demand more resignations from the FAS board.
The Taoiseach's distancing of himself from the FAS chief was completed when he demanded an urgent report into the lavish spending on travel and accommodation by the State agency's senior executives.
Following the public outrage over the FAS spending scandal, Mr Cowen accepted that wastage of money had taken place by saying that "certain items of expenditure" should not have happened.
Behind the scenes, contact was ongoing between FAS and the Government until last night to pave the way for his departure. Tanaiste Mary Coughlan, who is on a trade mission in Dubai, was being kept briefed on the developing situation and she officially announced the decision.
While there are no details available yet on Mr Molloy's severance package, it is believed to be only in line with public sector norms and Ms Coughlan took a strong line on this aspect of the resignation.
Mr Molloy leaves before the appearance by FAS chiefs at the Dail Public Accounts Committee tomorrow.
It is also understood there were further revelations about FAS expenses to come to light in the coming days, under the Freedom of Information Act.
FAS board members feared the ongoing controversy over his expensive trips to the US would prevent the organisation from getting on with the task of drawing up a strategy for dealing with rising unemployment.
Fine Gael leader Enda Kenny pointed to Mr Cowen's backing of Mr Molloy, saying it showed his "poor judgment".
"The larger issue is the Taoiseach's appalling lack of judgment on this matter. He repeatedly failed to grasp the seriousness of the issues and the shocking abuse of taxpayers' money. I will be returning to this issue in the Dail today to continue Fine Gael's prosecution of this issue," he said.
And Fine Gael's Leo Varadkar said there were still questions to be answered by the board of FAS, despite the resignation.
"Rody Molloy has done the decent thing and there are others who should do the same. There are members of the board of FAS who were asleep," he said.
In a brief statement last night, Tanaiste Mary Coughlan confirmed Mr Molloy's departure and paid tribute to his tenure in charge.
The Tanaiste thanked him for his many years of public service both in the Department of Enterprise, Trade and Employment and, for the past eight years, as director-general of FAS.
Ms Coughlan also acknowledged Mr Molloy's major contribution to the development of FAS during his tenure. FAS said it was "with regret" that the board accepted Mr Molloy's resignation.
FAS chairman Peter McLoone said he wanted to acknowledge this was a difficult personal decision for Mr Molloy, and "that he has made it in the best interests of FAS".
"The board would like to thank Mr Molloy for the major contribution he has made to the development of FAS during his stewardship, which came during a time of significant change," he said.
An acting director-general for an interim period will be announced shortly.
FAS also said it will continue its co-operation with the Dail Public Accounts Committee's investigations and the forthcoming inquiry by the Comptroller and Auditor General into "past events".
An emergency meeting of the FAS board has been called for this evening. FAS sources said last night his defence of the trips on the Pat Kenny radio show was disastrous.
"He did nothing wrong, but travelling business class with his wife sent out all the wrong signals," one source said.
In a further widening of the probe into possible "splurging" on overseas travel, Mr Cowen has ordered ministers to check with all agencies under their control to ensure they are not breaking official travel guidelines.