Author: Gavin Sheridan

Enterprise Ireland expenses for India 2006

More than four weeks ago I put an FOI request to Enterprise Ireland for the following:

1) A list of journalists who visited India with then Tourism Minister John O’Donoghue, at the request of Enterprise Ireland between January 15 and January 24, 2006.

2) A list of all representatives of Enterprise Ireland who visited India between those dates.

3) The total cost of flights, accommodation, hospitality, and any other costs borne by Enterprise Ireland for the trip, and a breakdown of the expenses details claimed by anyone, either from Enterprise Ireland, the press corps, or any member of the Government.

This request was sent at the same time as I sent a request to the Department of Education seeking the expenses of Mary Hanafin for that trip, which I blogged about on October 1. My effort is to try and understand exactly the cost of the entire trade mission to India in 2006. To do this I have to request information from a range of bodies which bore costs for the trip, with Enterprise Ireland among them. More details of this particular trip also appeared in yesterday’s Sunday Tribune.

However the story has also moved on a bit since I received these documents on Friday afternoon. On RTE’s This Week yesterday, Social and Family Affairs Minister Mary Hanafin was asked about the expenses:

So:

Q: Was it 5 star travel minister, and 5 star accommodation throughout?
A: It was certainly business class flights, em, and there were good hotels. But to my knowledge, the Indian government picked up the tab for a lot of the accommodation, em, because obviously from an insurance point of view…

Except, in at least four instances, it was not business class flights. And hotel costs appear to have only been paid for very senior members of the traveling party.

According to the documents I received on Friday, then Enterprise Minister Micheal Martin flew First Class to India at a cost of €7,390.62. Not alone that, his private secretary Bridget Flynn and Assistant Secretary at the Department of Enterprise Brian Whitney also flew first class, at a cost of €7,330.50 each. The chief executive of Enterprise Ireland, Frank Ryan, also flew first class, and also at a cost of €7,330.50 to the taxpayer. All other members of the traveling party, including three journalists, flew business class.

Is it so certain now, Ms Hanafin? Though I imagine her reply would be that she was *only* referring to her own flight.

And you would infer from Ms Hanafin’s answer that she herself flew business class. The documents I received last week from the Department of Education did not specify whether or not this was the case, but her flight did cost €8,990.28. That’s a very expensive business class flight, in comparison to the First Class Enterprise Ireland flights. Perhaps her Department is using a different booking agent, or booked later leading to a higher cost?

I cannot explain the €60.12 discrepancy between Mr Martin’s flight cost and the other three. Nor can I explain why Enterprise Ireland bore the costs for the flights, but not anything else such as hotels, rather than Mr Martin’s then department. Apart from that, one has to wonder why Mr Martin’s two secretaries should have flown First Class, whatever about Mr Martin himself.

Three journalists also went on the trip, Conor Keane, business editor at the Irish Examiner, Tom McEnaney business editor of the Irish Independent and Una McCaffrey, assistant business editor at the Irish Times. Their combined flights and accommodation cost a total of €19,233.48. Other journalists did go on the trip, but their costs were not borne by Enterprise Ireland.

Enterprise Ireland sent 8 members of staff, including chief executive Frank Ryan. These were:

Paschal McGuire, Head of Press and Public Relations
Irene Sadlier, Event Manager
Doreen McKeown, Market Adviser
Frank O’Connor, Education Services Executive
Gerry Murphy, Executive Director, International Sales and Partnering
Paul Roben, Director EI Bio
Theresa Clarke, Event Manager

Excluding the First Class flight of Frank Ryan, the combined Business Class flights for members of staff was €34,318.20. Hotel costs (excluding any costs for journalists) totaled €19,692.36. Combined taxi fares cost €592.75, meals cost €188.30 and subsistence cost €4,734.82. Sundries costs €1,068.96.

This raises yet another question. The hotel costs for the journalists averaged €1,900. The average for EI staff was €2,813. Why the difference? And why, for example, did Gerry Murphy’s hotel costs come to just €85, while Doreen McKeown’s cost €3,561.89? It should also be said that the accommodation costs for John O’Donoghue’s wife came to approximately €1,900, small in comparison to some EI staff members. I am assuming there were other costs involved in their hotel stays.

In total, the taxpayer paid Enterprise Ireland €109,210.99, to send 14 people to India for five days. The taxpayer paid €26,421.14 to the Department of Education for Ms Hanafin and her traveling party.

That puts my running total for the India trade mission (2006) at €135,632.13.

However, when we add in the work of Ken Foxe at the Sunday Tribune (€48,582 at the Department of the Taoiseach and €65,161 at the Department of Foreign Affairs) we get a figure so far of €249,375 for the trip to India.

And I’ve not yet included John O’Donoghue’s expenses.

Original documents received:
Costs spreadsheet
Enterprise Ireland staff travel policy
FOI decision letter
General Staff Guidelines and Regulations Travel Etc Enterprise Ireland

[Disclosure: In my day job, I work for the Irish Examiner. Mark freelances with The Irish Times online desk. TheStory.ie is entirely a voluntary project, done in our spare time]

O'Donoghue's expenses – for the record

[cross posted to gavinsblog.com]

For the record. Total expenses so far revealed (2006 – 2009): more than €700,000.

Incurred as Minister for Arts Sport and Tourism:

JOD Part 1 (India)
JOD Part 2 (Birmingham)
JOD Part 3 (Berlin)
JOD Part 4 (London)
JOD Part 5 (London)
JOD Part 6 (Venice)
JOD Part 7 (Manchester)
JOD Part 8 (New York)
JOD Part 9 (Turin)
JOD Part 10 (Stuttgart)
JOD Part 11 (Paris)

Incurred as Ceann Comhairle, 2007 – 2009:

Explanatory document on CC expenses

Schedule 1 – Allowances and Expenses
Schedule 2 – Domestic flights
Schedule 3 – Details of foreign travel
Schedule 4 – Official entertainment

DOC

Domestic Travel 1
Domestic Travel 2
Domestic Travel 3
Domestic Travel 4
Domestic Travel 5

1 Stop Shop Constituency Expenses

Those NTMA pay scales

Last week I blogged a response I had received from the Department of Finance concerning Government consultations over the establishment of NAMA. The response was prompted by an FOI request, seeking the titles, dates and authors of consultation reports for the Government (seeking the documents themselves would have been refused outright).

What it brought to light, in a small way, was how little in-house expertise the Government has. Reports were written for the Government by Merrill Lynch, PriceWaterhouseCoopers, Arthur Cox, Peter Bacon, Rothschild, and HSBC. If you are wondering who drafted the NAMA legislation, the answer lies somewhere between all of these companies and people, the Department of Finance and the Minister. It would also be fair to say that the Irish banks must have had input into the process, since they are the ones who are being saved from bankruptcy.

Many of these companies though were engaged not by the Department of Finance, but by the National Treasury Management Agency. They are the guys who issue sovereign bonds and manage the national debt, or as their website says:

The 1990 Act empowers the NTMA “to borrow moneys for the Exchequer and to manage the National Debt on behalf of and subject to the control and general superintendence of the Minister for Finance and to perform certain related functions and to provide for connected matters”.

Now my interest is piqued because the salary of NTMA chief executive Michael Somers is secret. The same is true, it appears, of all other staff at the NTMA.

Thanks to some helpful readers, from what I can gather, NTMA pay bands are as follows:

91 members of staff are paid below €80,000 a year.
22 staff are paid between €80,000 and €100,000 a year.
27 staff are paid between €100,000 and €200,000 a year.
9 staff are paid over €200,000 a year.

The average bonus paid in 2008, for work during 2007, was €21,447.

I make that 149 members of staff. I also make that a bonus fund mean of €3.1 million for 2007. If we take the lower tier staff, and take the upper range of figures, we could surmise that at the maximum budget allowed (if people are all paid at the top of the range, which is unlikely) is:

€7.28m
€2.2m
€5.4m

Which would make €14.8m at the maximum allowable wage for all staff collectively. Add that to bonuses of another €3.1m. This excludes the 9 staff, since there is no ceiling there. We are hitting €20m in staff costs alone, minus directors. It is rumoured that Mr Somers earns anywhere between €200,000 and €1,000,000 a year.

The question is this: As a taxpayer am I entitled to know the salary of Mr Somers, and other highly paid staff at the NTMA? Is the public interest better served by this information being available, or is it better served by it being secret? The Government would argue that such high wages are needed to get the skills necessary from the private sector, and if these people were not working in the public sector, they could be earning more in the private sector – therefore we need high wages.

I don’t buy it. Where is the spirit of public service, like we see in the US? I am certain that many of the people working in the finance arms of the Obama administration want to work in service of the State because it is a part of a citizen’s duty. The salaries of many high ranking officials are freely available too. Treasury Secretary Timothy Geithner earns $191,300 a year, minus expenses. Fed chairman Ben Bernanke earns the same amount minus expenses (Although Geithner’s predecessor had an estimated net worth of $500m thanks to his years at Goldman Sachs).

The salaries of people who are being paid by the taxpayer, such as people at the NTMA, should be published on their website. We have to ask ourselves how the public interest is served by keeping this information secret, and if any arguments in favour of secrecy have merit. The interest in their salaries is not prurient, it is simply how accountable systems work. Publish the information, then we know.

No big deal, right?

So the next question is this: Under what section and subsection of the FOI act would a request for salaries be refused?

Mary Hanafin's trip to India

In 2006 the Government went on a trade mission to India. Mary Hanafin as Minister for Education went along. I put in the following FOI request:

1) The Minister’s schedule and appointments between January 1, 2006 and March 1, 2006.

2) A breakdown of flight costs, accommodation costs, hospitality costs, and any other costs borne by the Department for a trip taken by the Minister to India in January 2006, and a breakdown of any expenses claimed.

I will upload the schedule later. The total trip cost €26,421.14. Flights cost €20,912.84. Ms Hanafin’s flight alone cost €8,990.28.

For now, here is the spreadsheet of costs (go to the bottom of the sheet and click “costs India trip” :

Hanafin India 2006

I do not believe removing the names of other people who went on the trip is warranted under Section 28 (1) (personal information). I may appeal this element of the request.

Sean FitzPatrick's loans

The Independent leads tomorrow with a story about €100m in outstanding loans on which former Anglo Irish Bank chairman Sean FitzPatrick is apparently not paying interest. That’s an interest bill of €400,000 a month, but no repayments are being made.

This actually partly relates to my story the other day about Anglo-Irish Nominees Ltd.

We know Mr FitzPatrick had personal loans from Anglo. But those loans did not include lending like the Atrium deal set out here. Money was lent to a company in which he appears to have had a beneficial interest. I wonder how much of Anglo’s lending related to Mr FitzPatrick’s personal interest in investments? This is on top of the personal loans we are already aware of.

The shareholders in Tysan, John Kerry Keane, Paul Coulson, Denis O’Brien, Lindat Limited, Lar Bradshaw, Sean Fitzpatrick, Gary McGann, Paddy Wright, Sean Melly, Pat Gunne, Longstone Estates Limited and Lochlann Quinn, don’t seem to have invested anything in the company apart from €3k share capital.

The liabilities of the company are pretty much all bank loans. The charge indicates there is no personal recourse to the borrowers. Anglo funded €70m of the purchase in 2005 and the 2006 accounts for Balcuik show an “ultimate shareholders loan” of €30m (probably lent by Anglo). The property was then revalued to €137m, handy that, and Anglo increased the borrowings and repaid the €30m to the shareholders. So there is no equity. Anglo get arrangement fees of around €2m and as much interest as possible and probably all of the risk.

And how many more of Anglo’s staff have loans, directly or indirectly, with Anglo?

And how many of these loans are going to be written off at taxpayer expense?

And of course the other question is this:

When Brian Lenihan met Sean FitzPatrick on September 18, 2008, the same day the first PwC report was requested, was Mr Lenihan, or the Regulator or Central Bank, already aware or made aware, of the extent of Mr FitzPatrick’s loans, direct or indirect?

It seems to me that when the results of that first PwC report on Anglo were given to the Government on September 27, just two days before the night of the bank guarantee, the Government, or its regulatory agencies, or Mr Lenihan himself, must have been aware of the extent of Mr FitzPatrick’s loans. The loans were too big for them not to be aware.

And were that the case, Anglo, including all of its deposits and liabilities, was guaranteed despite that knowledge.

Why?

Reports prepared for NAMA

Some time ago I sought the following information from the Department of Finance:

1) The titles, dates and authors of all cost-benefit analyses, impact reports or preparatory reports that have been carried out by the Department in relation to NAMA

2) The titles, dates and authors of all cost-benefit analyses, impact reports or preparatory reports that have been carried out by people or companies working on behalf of, or at the request, of the Department, in relation to NAMA

Outside of the FOI (though I still intend pursuing this information through FOI, whether or not it is rejected) I received the following information:

Merrill Lynch (engaged by NTMA)

A number of reports setting out options for the Irish banking sector, including the treatment of impaired assets

PwC (engaged by Financial Regulator)

Various reports produced by PwC, including due diligence on covered institutions arising from the Government guarantee Scheme and recapitalisation programme (in cases with the input of Jones Lang LaSalle)

Arthur Cox

Various legal assessments of covered institutions arising from the Government guarantee Scheme and recapitalisation programme

Peter Bacon, Special Advisor to the Minister / NTMA

Evaluation of options for resolving property loan impairments and associated capital adequacy of Irish credit institutions: Proposal for a National Asset Management Agency and associated required policy initiatives

Rothschild (engaged by NTMA)

Various reports and inputs into the preparations for the establishment of NAMA

Central Bank & Financial Regulator Reports

Various reports produced within normal operating parameters as well as certain assessments of the impact of contingency proposals

HSBC (engaged by NTMA)

A number of reports produced for the interim NAMA and the Minister

NTMA is a curious entity. Back in May were were promised salary scales for NAMA. Have you seen any? The salary of Mr Somers, the head of the NTMA is also secret, apparently. I feel another FOI request coming on.

Some questions for Mr Lenihan

The Daily Mail and Sunday Times have commented already on Lenihan’s diary as published here last week. The Daily Mail concentrated on the meeting with Stephen Schwarzman of Blackstone on November 12, 2008. The Sunday Times was more concerned with all the constituency work Mr Lenihan was doing when he perhaps should have been doing more important work.

For my own part I’ve been parsing the document to see what dates coincide. I’ve also drafted and sent two follow up FOIs on the basis of information gleaned from Mr Lenihan’s diary. There will likely be follow ups to those too.

However, the diary itself raises a number of questions that I will list here.

1) Why was a meeting with Sean FitzPatrick on September 18 not listed in the diary?

2) Were instructions given by the Minister to PwC, following the meeting with Mr FitzPatrick, to begin its inquiry into Anglo?

2) What was the purpose of the meeting with Pat McLoughlin of IPSO on September 25? Was this related to lobbying in relation to cheque usage and ATM charges?

3) On the night of the bank guarantee, September 25, who was present at the Department of the Taoiseach with Mr Lenihan and Mr Cowen? No names are listed in the diary, but names were reported in the media.

4) What was the purpose of the meeting with Independent News & Media chairman Brian Hillery on October 31, 2008?

5) What was the purpose of the meeting with Ivan Yates on November 5, 2008?

6) What was the purpose of the meeting with Stephen Schwarzman of Blackstone on November 12, 2008, and with James McGuill of the Law Society the same day?

7) What was the purpose of the meeting with Michael Ryan and Paul Ryan of Merrill Lynch on November 13, 2008?

8 ) What was the purpose of the meeting with Andre Orcell of Merrill Lynch and then Lochlainn Quinn on November 24, 2008?

9) What was the purpose of the meeting with Sean FitzPatrick and Donal Drumm of Anglo, on December 16, and why does the diary entry merely list the meeting as “Anglo Irish” instead of their names?

10) Why is there no mention of any meetings with Patrick Neary, the then Financial Regulator, right up until his resignation on the night of Friday, January 9?

11) What was the purpose of the meeting with property developer Stephen Vernon of Green Property on January 30, and with Axel Wieandt of Hypo Real Estate on the same day?

12) What was the purpose of the meeting with Rick Lazio of JP Morgan Chase (who ran against Hilary Clinton in New York in 2000) on April 24?