Mr. Hamilton Goulding:

Looking at the issue from the internal point of view, it is almost surprising that we are talking about it, because in the year leading up to this the cost of the senior management team had been reduced by approximately €340,000. At the time of Mr. Kiely’s retirement, another person also left, so one had two people leaving and the total value of their salaries amounted to approximately €340,000. That was on top of the saving from that group of another €350,000. We were looking at a situation in which the management group costs that had existed at the same time the previous year had gone down by about €700,000, and we were replacing that with a cost of €125,000. We thought to ourselves, just looking at it in isolation, that it was a fantastic result. We thought it also brought us quite substantially along the road towards compliance with the approved pay scales. We did not think we would get there in one jump.

When we were considering the appointment of a new chief executive - the problem has been resolved now and there was a solution, but it did not seem viable to us at the time - we did not wish to invite somebody to take a job in which the top six subordinate people of whom the person would have charge were paid 30% more than the new chief executive. We would have been asking the person to take a job at less than the salary earned by the people he or she would supervise.

Our first interest was in seeing if we could get a candidate from within the company. That was ruled out, effectively, because one would have had to ask someone to apply for the job of chief executive but tell him or her it would involve a pay cut. That is where we were coming from. As I said previously, there was a poor performance in terms of liaison with the HSE. That is really the reason we got a bit blinkered and said we had to get a really good person. We knew we had overstepped the mark a bit. I was very conscious of that and I said we needed to try to patch it up a little bit. We did have a meeting in September of that year with three officers from the HSE and we were told that was pretty bad stuff, but it accepted that the result was very good and it was considered that we should put the situation behind us. Effectively, although we had clearly transgressed, it seemed to us that we had got a good result. We got a man of extraordinary experience whom everyone agreed was suitable and we thought that the situation had been resolved. It is not a perfect story, but that is what happened.