Potential conflict of interest was not declared
A SENIOR Health Service Executive manager failed to declare a potential conflict of interest when he was involved in awarding an outside firm a contract worth more than €200,000, a audit report revealed.
Pearse Costello, of Delgany Co Wicklow, was the human resources director and assistant chief executive at the East Coast Area Health Board between 2000 and 2004.
Mr Costello awarded a contract to a UK firm even though he and the principal of that company were co-directors in a separate business.
He himself took a career break in 2004 for "domestic" reasons. But within months he had set up two companies, Pearse Costello Ltd and Synergenius Ltd, which offered consultancy work in the area of human resources.
These companies were given contracts by the HSE worth over €470,000, one of which included the investigation of HSE staff members who were the subject of complaints.
The audit report, completed last November, said the selection of his companies was in breach of the HSE procurement rules and his company involvement in investigating complaints in the Dublin mid-Leinster region, where he was previously a human resources manager, undermined the perception of independence. The auditors found that Mr Costello breached the terms of his career break. Given that he was previously involved in deciding who could go on a career break, the auditors said it was reasonable to assume he knew its terms.
After his career break expired in 2007, he was offered two positions as manager but he turned them down. An arbitration took place and Mr Costello was taken back on a salary of €119,000 to work on a management project.
While the mediation on his return was under way, his company continued to be employed from May to June 2009 to investigate three complaints. He was not based in a HSE office but worked via email.
The Department of Finance sanctioned an additional 10 years' service for pensionable purposes and he retired on October 2009.
Mr Costello told the auditors that he awarded the contract to the firm, whose principal he was involved with in a separate company, on the basis of its professional service. His association with the other company was clear to the health board from letterhead notepaper.
Referring to his own consultancy services to the HSE while on a career break, he said he was encouraged by a senior health official to set up a business and undertake work for the HSE. The audit into Mr Costello began in 2010.
Mr Costello was not available for comment yesterday. A member of his family said he was on holiday abroad.