Oireachtas Joint and Select Committees

Thursday, 17 June 2021

Public Accounts Committee

University of Limerick: Financial Statements 2019

Professor Kerstin Mey(Interim President, University of Limerick) called and examined.

9:30 am

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Apologies have been received from Deputies Carthy, Hourigan and Sherlock. I welcome all of our witnesses to the meeting. Due to the current situation in respect of Covid-19, only the clerk, support staff and I are in the committee room. Members of the committee are attending remotely from within the precincts of Leinster House. This is due to the constitutional requirement that in order to participate in public meetings members must be physically present within the confines of the place where the Parliament has chosen to sit, namely, Leinster House or the convention centre. I will ask members to confirm their location before contributing to ensure they are complying with that constitutional requirement. The Comptroller and Auditor General, Mr. Seamus McCarthy, is a permanent witness to the committee and is attending remotely.

Today we examine the 2019 financial statements of the University of Limerick. Areas of interest to members, of which the university's representatives have been made aware, include protected disclosures, the contracting of retired staff, the remuneration and paid notice period of the president, the new student centre and the university's Limerick city campus. We are joined remotely from within the precincts of Leinster House by the following officials from the University of Limerick, UL: Professor Kerstin Mey, interim president; Mr. Andrew Flaherty, director of the human resources division; and Ms Rosemary Fogarty, financial controller in the area of operations. The witnesses are all very welcome and I thank them for the briefing material they have prepared for the committee. When we begin to engage, I will ask members and witnesses to mute themselves when not contributing so that any background noise will not be picked up. As usual, I remind all of those in attendance to have their mobile phones turned off or on silent mode.

Before we start, I wish to explain some limitations regarding parliamentary privilege and the practices of the Houses as regards reference witnesses may make to other persons in their evidence. As the witnesses are, within the precincts of Leinster House they are protected by absolute privilege in respect of the presentations they make to the committee. This means that they have an absolute defence against any defamation actions in respect of anything they say at the meeting. They are, however, expected not to abuse this privilege. As Chair, it is my duty to ensure it is not abused. Therefore, if the witnesses' statements are potentially defamatory in respect of an identifiable person or entity, they will be directed to discontinue their remarks. It is imperative that they comply with such directions.

Members are reminded of the provisions of Standing Order 218 that the committee shall refrain from inquiring into the merits of a policy or policies of the Government, or a Minister of the Government, or the merits of the objectives of such policies. Members are also reminded of the long-standing parliamentary practice that they should not comment on, criticise or make charges against any person outside the Houses or an official either by name or in such a way as to make him or her identifiable.

To assist the broadcasting and debates services, I ask that members direct their questions to a specific witness. If the question is not directed to a specific witness, I ask each witness to identify himself or herself when first contributing.

Mr. Seamus McCarthy:

The University of Limerick’s group financial statements for 2018-2019 show income totalling €279 million. Of this, income in respect of recurrent State grant and pension funding totalled €82 million. Academic fees accounted for €103 million, almost a third of which was received directly from the Higher Education Authority. Research income recognised in the year totalled €34 million, with almost €26 million of this coming from State sources. Other operating income of €43 million was derived from a range of sources, with 40% coming from rental of student accommodation.

The university group’s expenditure in the year totalled €281 million. Pay and pension costs accounted for two thirds of the expenditure total. Other operating costs were €75 million, while depreciation accounted for just under €20 million. Overall, the group incurred a deficit of €2.1 million in the year. However, this must be considered against the group’s accumulated revenue reserves of almost €252 million at the end of September 2019.

My audit opinion on the financial statements was unqualified. However, I draw attention to the recognition in the financial statements of a deferred pension funding asset. In effect, the university is assuming that State funding will be available in the future to meet the pension entitlements already accrued by current and former staff. This is a standard practice for Irish universities in compiling their financial statements. My audit report also draws attention to the university’s disclosure in section 9 of its governance statement of instances where the procurement of goods and services was not in compliance with the relevant procurement procedures.

The financial statements of the University of Limerick Foundation are not consolidated in the group financial statements, on the basis that the foundation is not controlled by the University of Limerick. However, the audited financial statements of the foundation for 2018-19 are appended to the group financial statements for information purposes. These indicate that the principal activity of the foundation is the furtherance of education and research, and in particular the furtherance of education and research carried out by the University of Limerick and other educational, research and development bodies associated with the University of Limerick. The foundation’s balance sheet indicates that, at the end of August 2019, the foundation had cash of around €20 million.

Note 26 of the group financial statements discloses the transactions between the university group and the foundation in the year. This indicates that the university received income of €2.6 million from the foundation for specific purposes. The university contributed €350,000 towards the running costs of the foundation.

Like a number of the other universities, the University of Limerick appoints commercial auditors to carry out audits of the group companies and of the consolidated financial statements. In the interests of avoiding duplication of effort, I seek to rely on the work of the commercial auditors to the extent that is appropriate and, by agreement, staff of my office review their working papers as evidence for the purposes of my audit. While this makes the audit process somewhat more complex and prolonged than normal, it is effective. Nevertheless, there may be circumstances where my office seeks additional assurance and evidence and I form my own opinion independent of that of the commercial auditors.

Members may wish to note that my audit of the group’s financial statements for 2019-20 is not yet completed. We received a full set of draft financial statements, including a draft statement of governance and a draft statement on internal control, in mid-March 2021. Our audit fieldwork, including review of the commercial auditors’ working papers, has now been completed and the audit file has recently been submitted to me for review. There are a number of matters where my office has sought additional information and back-up documentation from the university. When these have been received and reviewed, I will be in a position to clear the account for certification.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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I will now call on Professor Mey. Time is limited but I have read her opening statement and it is quite concise. She has five minutes.

Professor Kerstin Mey:

I welcome the opportunity to meet with the committee and to address questions members may have in relation to the 2019 accounts, the issue of protected disclosures and other matters as outlined in the meeting request and follow-up note. I am accompanied by Mr. Andrew Flaherty, chief corporate officer, and Ms Rosemary Fogarty, financial controller.

I became interim president of the University in September of last year. It was my honour to be the first female appointed to the role of a university president in over four centuries of higher education in Ireland. Prior to joining UL in 2018, I held senior roles as pro-vice chancellor and dean of the Westminster School of Media, Arts and Design, University of Westminster, and, before then, director of research and enterprise for the University for the Creative Arts in England.

Members will appreciate that my accent is not that of a Limerick native. I was born and raised in Berlin but, like everybody who comes to Limerick, I am immensely proud of the region and of the university and I am very conscious of my responsibility as chief officer to help strengthen this wonderful institution so that it can continue to play a transformative role not just in the mid west but in Ireland and further afield in the decades ahead.

The Covid pandemic has meant that the past 15 months have been a very challenging time for the university sector, as it has been for society at large. While dealing with the practical challenges posed by Covid-19 has dominated our activities during this period, we have also been very conscious of the need to make progress on other issues. In this context, together with the chancellor and the governing authority, I am very aware that the reputation of the university in recent years has been buffeted too often by controversy and disharmony.

I am also conscious that our relationship with this committee has not been as constructive or harmonious as it should have been, and I want to assure members that I will do all I can to make our relationship with the committee a positive one of trust going forward. The root cause of many of these issues lies in the areas of culture and governance which have been a major focus since I became interim president.

On culture, my goal is to reset the organisational culture and to build a new spirit of openness and trust within the university community so that every member of that community feels valued, supported and empowered by a shared purpose. To strive and thrive we require the talents of all and an inclusive and supportive climate where anyone can come forward with new ideas for improvement and can raise awareness of errors, weaknesses and wrongdoing without any fear of retribution. In an inclusive, supportive and proactively learning organisation, whistleblowing and protected disclosure – while always available - will no longer be needed.

To this extent, I have endeavoured to stimulate two-way communication processes between the campus community and senior management, to make improvements to financial reporting and data provision for evidence-based decision-making, and to introduce an inclusive consultation process on our strategic plan, UL@50. I am pleased to report that the participation in this process has been very encouraging, with 130 individual submissions and 57 group consultations in the first phase and evidence of a strong desire to participate in the second phase, which will inform the recalibration of our strategic plan.

In terms of governance, I can confirm that the recommendations from both the Mazars and Thorn reports have been implemented in full and we are now completing the implementation of the Code of Governance of Irish Universities 2019 and taking into account the recommendations made by Quality and Qualifications Ireland, QQI, in CINNTE Institutional Review 2020. We have also completed an overhaul of UL's policy management framework, ensuring consistent policy development, approval and review processes in line with best practice. We completed an external evaluation of the governing authority in 2020 by the Institute of Public Administration, with a draft report issued in early 2021 and the subsequent implementation of recommendations.

We have completed training on an annual governance statement and a statement of internal control for all senior managers by external experts, and introduced a new internal audit structure through the appointment of an in-house internal auditor. We have also introduced an enhanced risk management structure, namely, the audit and risk committee of the governing authority, which now invites owners of local risk registers as a standing item. Risk management is also a standing agenda item on the executive committee and governing authority. Finally, we have addressed the structure and size of the executive committee to strengthen governance and ensure a broader representation of all areas of the university in decision-making and, through a flatter structure, create a more distributed leadership to safeguard delivery on strategic initiatives. The new structure includes the appointment of a chief financial and performance officer through open competition.

I will address three issues that I know have been and are of concern to this committee. At our previous meeting in 2019, Deputy MacSharry put it to the then president that he should consider reporting a potential incident of fraud at the university to the Garda. I can confirm that following that meeting, my predecessor sought legal advice in respect of the relevant issue. The university briefed the Garda on the matter and we have co-operated fully with it on the issue since.

At that same meeting, there was a lot of discussion about the plight of two members of staff who had identified as whistleblowers. I can confirm we have reached agreement on one individual and the matter is completely resolved with approval from the Department. In the second case, the individual agreed to the terms of a full and final settlement but subsequently raised concerns about tax liabilities and has not yet signed the settlement that had been agreed.

Finally, there has been some recent speculation about the purchase of the Dunnes Stores site and building in Limerick city by the university for the development of a city campus and the fact that no formal written valuation report for the site before the acquisition is on file. The governing authority has asked KPMG to conduct an independent review of the governance around that purchase and we will share the outcomes of that review with the committee when it concludes.

I cannot say we have reached the end of what has been a difficult period for the university, but I can say with confidence we are making real progress. We understand we have to work hard to earn and maintain the trust of all our stakeholders, including this committee. We are committed to doing so, as am I. I thank members for their attention.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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I thank Professor Mey. I ask members and witnesses to stick to their time in order that all the members of the committee will get their piece.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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I thank our guests. Time is short with the way in which the Covid world has structured meetings of the Committee of Public Accounts these days, so I may cut in on them in their answers at times. This may seem rude and I apologise for that, but it may be necessary.

Is it the university's current position that the former president lied to the Committee of Public Accounts?

Professor Kerstin Mey:

The committee has received correspondence from the chancellor on the matter-----

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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What is Professor Mey's position, as interim president? I have a copy of the chancellor's letter to hand, but I want to know, for the record and for the benefit of the public, whether it is the university's position that the previous president lied to the Committee of Public Accounts.

Professor Kerstin Mey:

No.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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He did not lie. Is that correct?

Professor Kerstin Mey:

I have nothing to add to the chancellor's letter to the committee dated 14 June.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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The chancellor stated, "I understand that the evidence was not correct and that a correction or clarification was thereafter made to the Committee by one of the persons who attended the meeting on behalf of the University." I do not have the academic qualifications of our panellists, but if it looks like a duck and quacks like a duck, it is usually a duck. Is it the university’s position that the previous president lied? That appears to me to be what the chancellor is saying.

Mr. Andrew Flaherty:

I might add a little to that. I think what the chancellor has said is that there was a correction from a member of the university team who was there on the day. I do not believe that correction was from the president but from somebody else. I do not believe the correction to the evidence came from the president. It is related to a protected disclosure, so the people here today are not fully aware of the details and ins and outs of that protected disclosure. My understanding is that it was not the president's evidence that was corrected but rather that an individual who attended along with the president corrected their evidence. That is my understanding.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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That is not my understanding-----

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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I must remind the Deputy to be careful when referring to people who are not present in regard to any accusations being made or the language used.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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I thank the Chairman. While he is absolutely correct, we have parliamentary privilege, which sometimes must be used in the interests of the public. It seems to me that we were lied to and misled that day. As Mr. Flaherty rightly said, the matter was the subject of a protected disclosure. I am conscious the interim president has acknowledged with candour the difficulties we have had in the past and the lack of harmony in our relationship and that she and her colleagues are committed to improving that. I will return to that later.

The issue related to a position I had asked about at the time, namely, the director of strategic projects. I was told this was a new position and someone had sought to correct the record. They told us this in correspondence that came to the committee and was demoted by the committee, but it also came to me personally. The correspondence clearly stated, and this has emerged since, that that role already existed and the person doing it was doing a very good job, such that the Higher Education Authority had acknowledged how successful the person was, going back to a report in 2017. Is the university's position today different from that?

Mr. Andrew Flaherty:

I believe the corrections to the evidence-----

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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That question was for the president.

Professor Kerstin Mey:

The corrections were made by an individual to the evidence given before the committee, and the matter has been subject to a protected disclosure, which is confidential.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Which has concluded.

Professor Kerstin Mey:

Which has concluded, yes-----

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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The McKenna report concluded it. Is that correct?

Professor Kerstin Mey:

Yes.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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According to the correspondence that came to me, the McKenna report found that the author was entirely satisfied, and found as a matter of fact, that the duties and responsibilities pertaining to the role of director of strategic projects and transformation were being carried out by a named person. I will not use the name but we know who we are talking about. The report went on to state the author was satisfied, and found as a matter of fact, that no consideration had been given by the then president to the fact the person was carrying out the role. It outlined that the author found it staggering no such discussions had taken place with the person in that role in advance of the role being advertised.

I know there is a protected disclosure and that it has concluded. Has the person been restored to that role?

Professor Kerstin Mey:

May I seek the Chair's guidance as to whether I am permitted to answer the question as it would clearly identify an individual?

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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I ask Professor Mey to answer the question as fully as possible and maybe use a letter of the alphabet - I know three have been used already - in her answer. I think the committee would like an answer to the question.

Mr. Andrew Flaherty:

Perhaps I can respond to that. I will deal with the last part of Deputy MacSharry's question. The individual is now in a new position which is similar to that which he would have held originally. The individual is in a new position and I believe the matter is fully resolved to that individual's satisfaction.

The McKenna report is complete. It has six findings. In the interest of transparency and to give a feel of what came out of it I will give a high level understanding -----

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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No, Mr. Flaherty will not, with respect. What he can do is furnish the entire report to the committee, if he wishes, and I would like to formally ask for that. I am only interested in the areas that I have highlighted, which are the sum total of our engagement back on that day; I was misled, I was wronged in terms of the answer given and so were other people who were on the university staff, in my view. The McKenna report unequivocally bore that out. The chancellor unequivocally told us that incorrect information was given and now Mr. Flaherty is telling me that in effect that person has not been restored to that position but a new position now exists that is very similar. Is that the evidence that is going to be given today? Is that the truth?

Mr. Andrew Flaherty:

That is the evidence. That is the situation at the moment. I am very cautious about what I am saying because I do not want to identify any particular individual, as I am sure the Deputy will appreciate. What I can say is that the individual in question, to my knowledge and from most recent conversations, is very happy with the outcome and -----

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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I am not concerned about the level of happiness of that person, I am concerned about the taxpayer only. There is no questioning the academic prowess of UL. Sadly what we have seen in terms of governance would not amount to that of a hedge school in a banana republic. So far this morning, I am not getting any confidence in line with the words of the interim president around what has changed and I will go further.

There was a second part alluded to in my research to that protected disclosure which related to the McKenna report. In some correspondence that I read, that was withdrawn. Is that the case?

Mr. Andrew Flaherty:

Sorry, could the Deputy repeat the question? Was what withdrawn?

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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There was a second or other parts of the protected disclosure to which we are referring now, which were withdrawn, is that the case?

Mr. Andrew Flaherty:

Yes, that is correct. In the protected disclosure that was submitted, elements were substantially similar to other protected disclosures which were being investigated by Mairead McKenna. As a result, the elements that were similar were added to the McKenna investigation and were investigated there. The individual received a copy of the findings and based on the findings felt that the other parts of the protected disclosure were resolved to their satisfaction. The individual felt the complete protected disclosure was resolved to satisfaction as the findings came out in favour of that individual.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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It is strange that they would not have written to the Committee of Public Accounts to tell them that, does Mr. Flaherty not think?

Mr. Andrew Flaherty:

I cannot comment on that, from another individual.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Would there have been any coercion or encouragement to withdraw a protected disclosure?

Mr. Andrew Flaherty:

Absolutely not, no.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Mr. Flaherty can unequivocally say that.

Mr. Andrew Flaherty:

I can say it from myself, yes, and I believe that in the process that was carried out in UL, there was no question of that.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Does Mr. Flaherty handle all the communications for the interim president?

Mr. Andrew Flaherty:

No.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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What is Mr. Flaherty's title again? It is chief -----

Mr. Andrew Flaherty:

Chief commercial officer.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Was there an open recruitment process for that role?

Mr. Andrew Flaherty:

I was appointed to the role in October last year.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Was there a recruitment process?

Mr. Andrew Flaherty:

No, I was asked to take on additional responsibilities.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Who appointed Mr. Flaherty to that?

Mr. Andrew Flaherty:

The interim president.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Oh, I see. Can I ask the president if she has appointed other people without a recruitment process?

Professor Kerstin Mey:

As I alluded to in my opening statement, when I took on the role as interim president I restructured the executive to address the strengths in governance, to create a broader base to take on strategic initiatives. Based on my responsibility and remit as interim president as defined in the Higher Education Act, and Universities Act 1997, section 24 and schedule 4, I have reassigned certain duties to individuals where the skill sets were available. Where the skill set was not available internally, these positions went to open recruitment.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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There are currently three heads of finance on staff. There is Ms Fogarty, who is with us, Mr. Field and Mr. O'Brien. Is that right?

Professor Kerstin Mey:

That is not correct.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Oh right. They were all formerly in that role though, were they not?

Professor Kerstin Mey:

Mr. O'Brien was the chief operations officer in the previous structure heading up all professional support units to whom the director of management, planning and reporting reported. Ms Fogarty is our financial controller which is a different task from financial reporting.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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I have other questions on that that I might get to on a second round but I will conclude with the following. Professor Mey mentioned in her opening statement that the other protected disclosures are concluded and that terms and conditions were concluded with person C as well but that they had not yet signed, is that the case?

Professor Kerstin Mey:

Yes, Deputy, that is what I said.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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During last night, person C made direct contact with me and has authorised me to say the following:

Last night I read an article about the university meeting with the public accounts committee on 17 June 2021. I was sick to my stomach and shook by what the University of Limerick has said about me in the article and assume this is what they are going to tell the PAC about me. I believe this is another appalling tactic on their part. The university statement about me in this article is a lie, it is wrong, it is deceptive and misleading. I believe this was done to try and paint a false and wrong picture of me. They have done this for so long and seem to keep getting away with it.

It goes on very substantially for two pages. It says that person C never consented to be part of a mediation process and has never been in a mediation process with the university at any time. Later, it takes particular issue with the interim president and her wording and states that there was a lot of discussion about the plight of two members of staff who had been identified as whistleblowers. Is the interim president not willing to accept that they are whistleblowers? While I hope to get in on a second round towards the end of the meeting, I am bound to say that the interim president's opening words are empty to me. I do not find them convincing based on evidence available to me and it is business as usual at UL.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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I want to touch on the previous president's role and the fact he was paid for some four or five months continuously after he had resigned the role. Were there any other additional costs associated with settlements, legal or otherwise?

Professor Kerstin Mey:

I thank the Deputy for her question. I will seek the guidance of the Chairman as to whether I am permitted to answer the question as it clearly identifies an individual.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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It has been reported extensively so-----

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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Let me ask something else.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Just a second. I think the question is fair and the Deputy will expect an answer to it.

Professor Kerstin Mey:

Will the Deputy repeat the question?

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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Were there any other additional costs to that resignation or settlements, legal or otherwise?

Professor Kerstin Mey:

Legal costs.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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Settlements. Legal settlements or otherwise.

Professor Kerstin Mey:

Legal costs.

Professor Kerstin Mey:

No settlement.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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No settlement. Any legal costs?

Professor Kerstin Mey:

Legal costs.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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Any additional costs whatsoever?

Professor Kerstin Mey:

No, other than salary in lieu of notice.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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Would it be standard practice for the university to pay a notice period for all employees?

Professor Kerstin Mey:

Yes.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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For all employees who resign from their position.

Professor Kerstin Mey:

Who gave notice and resigned from a position.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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That would be standard practice. For how long would the period of payments be? The previous president was paid for four or five months in that he was paid until the end of the year. Would that be standard practice for all employees?

Professor Kerstin Mey:

That is correct. It depends on the notice period stipulated in the contract.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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The contract, I understand, was for one year. Am I correct in that?

Professor Kerstin Mey:

I will hand over to Mr. Flaherty.

Mr. Andrew Flaherty:

The contract in question did not have a notice period in it. To give as thorough an answer as I can, the contract in question was a ten-year contract and the contract was silent on the issue of notice. As a result of being silent, it would have given an entitlement to the individual to either give or receive reasonable notice at common law, so the expectation would be that reasonable notice is given. Six months' notice was given. Dr. Fitzgerald signalled his intention to resign in May and he subsequently gave six months' notice. He was involved in the university for the first two months and the governing authority made a decision to pay in lieu of notice the last four months to the president in order to allow us to appoint an interim president at an extraordinary time because of Covid and what we were facing into. He was paid. It would not be normal but, under the extraordinary circumstances, it was decided it was in the best interest of the university.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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Would all contracts, like the former president's, not have a notice period?

Mr. Andrew Flaherty:

Yes, all contracts do have a notice period but the contract issued-----

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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Why was it that the president's did not?

Mr. Andrew Flaherty:

I cannot answer that. It was not a standard contract that was issued and it was issued before my time. I am not sure.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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Can Mr. Flaherty revert to us with the information?

Mr. Andrew Flaherty:

I will check that information and come back to the committee.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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I want to get back to the issue of the Dunnes Stores site. Am I correct in saying no independent valuation was carried out prior to that?

Professor Kerstin Mey:

No written independent valuation report is on file with the university.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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There is no written independent valuation report. Was none carried out?

Professor Kerstin Mey:

The governing authority has commissioned KPMG to review the governance-----

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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I know that. Was or was not an independent valuation carried out? It is a "Yes" or "No" answer. If there is no written report, is it a fact no independent valuation was carried out?

Professor Kerstin Mey:

The fact is there is no written report on file. That does not necessarily mean there was no-----

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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If there was one, why would there not be a written report on file?

Professor Kerstin Mey:

KPMG has been commissioned to conduct a full review of the governance around the purchase of that site.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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We know that now. I am asking about the standard practice. If an independent valuation was carried out on something of this magnitude of cost, would it be kept on file?

Professor Kerstin Mey:

Yes.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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So best practice was not adhered to in this instance.

Professor Kerstin Mey:

As I said, we are having a full investigation of the governance.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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Would Professor Mey agree that best practice was clearly not adhered to in this instance?

Professor Kerstin Mey:

Yes.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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Okay. I want to move on to the role of the financial officer. I understand the university has now appointed a chief financial officer whereas the responsibility previously lay with the chief operating officer and vice president for finance. Why has there been such instability around the role of a finance officer?

Professor Kerstin Mey:

We have appointed a chief finance and performance officer in order to bring together the finances with an integrated planning process in the university. That is a relatively new role and, in fact, a new role profile for the university sector in Ireland to support a holistic planning approach and to build a data information piece.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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With all due respect-----

Professor Kerstin Mey:

It is integrated with the financial reporting functions.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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With all due respect, that is not exactly answering my question. Was the creation of new positions and transfers of responsibility linked to any form of financial reporting or even misreporting to the governing authority, the Higher Education Authority, HEA, or the Department?

Professor Kerstin Mey:

The restructuring of the executive was linked to enhance the governance and to support a flatter structure. Our previous executive committee had been relatively small, with a lot of burden lying on the shoulders of the-----

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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My question was in regard to whether the creation of new positions and transfers of responsibility was linked to any form of financial reporting or misreporting to either the governing authority, the HEA or the Department. That is a "Yes" or "No".

Professor Kerstin Mey:

No.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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Did the McKenna report make any recommendations prohibiting the creation of roles for specific individuals? "Yes" or "No".

Professor Kerstin Mey:

Yes.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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Was the role of chief corporate officer created and filled without any advertising or competition?

Professor Kerstin Mey:

That is correct. It was a reassignment of duties based on the skill set already in that situation.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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The role of chief corporate officer was created and filled without any form of advertising or competition.

Professor Kerstin Mey:

It was done as a re-advertisement as part of the authority of the president.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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I would appreciate it if we could get a "Yes" or "No" answer to our questions.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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The Deputy should proceed.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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How many protected disclosures related to the recruitment process around this role?

Professor Kerstin Mey:

I am not aware of any.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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Does that mean there were no protected disclosures related to the recruitment process around that role? Is Professor Mey saying categorically there were none?

Professor Kerstin Mey:

To the recruitment process of chief finance and performing officer.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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No, I am talking about the chief corporate officer.

Professor Kerstin Mey:

No.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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And around the chief financial officer.

Professor Kerstin Mey:

No.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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Absolutely none. Professor Mey can say that categorically.

Professor Kerstin Mey:

Yes. Not that I am aware of.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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Not that Professor Mey is aware of. Are the other witnesses aware of any?

Mr. Andrew Flaherty:

Not for either of the positions the Deputy has mentioned. Absolutely not. Not that I am aware of.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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For what positions were there protected disclosures?

Mr. Andrew Flaherty:

The protected disclosures we talked about in the McKenna report related to a specific position.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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What was that position?

Mr. Andrew Flaherty:

It would clearly identify an individual if I answered so I ask the Chair for guidance.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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I am just asking Mr. Flaherty about the position, not the name of the individual.

Mr. Andrew Flaherty:

The name of the position will clearly identify the individual. I am happy to give it with the Chairman's advice.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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I ask that Mr. Flaherty answer the question without naming the individual.

Mr. Andrew Flaherty:

It will identify the individual. The role in question was the role of strategic projects and transformation.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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We are going over time. I will let Deputy Munster in for a second round.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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Can I wrap up? The Chair indicated that I had a couple of minutes left.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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I did.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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From where we stand, with the university represented today, we see historical issues with the treatment of whistleblowers, although it appears a number of cases have been resolved. One is outstanding. Whether they are resolved or not, I find repugnant the reports that the whistleblowers were offered cash to simply resign. There are questions about the purchase of land which seems to have been purchased at a price inflated by more than 250%. We are not getting answers to those questions. Salaries have increased dramatically. There are irregularities related to salaries in the transition between presidents and no answers in that regard either. There is an ongoing pension probe. There is mismanagement with the president's residence and €4,000 spent on bed linen. It is nuts and it speaks volumes about the manner in which the University of Limerick is managed. I wish we had more time to get into this.

The Committee of Public Accounts generally spends most of its time dealing with national bodies. Various members of the committee have concerns about other third level institutions. We will bring in the Higher Education Authority to discuss matters as a whole. We all felt it necessary to bring representatives of the University of Limerick before the committee again. What does that say about its management? There is a grave concern, which has been compounded by the fact that members of the governing body only found out about the witnesses' appearance before the committee through the media in the last few days, despite the invitation having been issued three weeks ago. It speaks volumes about the manner in which the university is managed.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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I welcome the witnesses and wish Professor Mey good luck in her role. She has not been before the committee since she was appointed.

I will focus on the KPMG report. Professor Mey says she will provide it to the committee once she has received it. We will require the witnesses to appear again once they have received it. It is a pity we did not have the report for today's meeting.

How did the university select the Dunnes Stores site? My understanding is that the Limerick opera site was chosen and that there would be an application to the HEA for funding. Would the university just tell the HEA that another site had been picked without a valuation having been provided? It is difficult to get my head around the process that would have been followed for the valuation and site selection. Will Professor Mey address that?

Professor Kerstin Mey:

The university has endeavoured for a long time to develop a city campus. As the Deputy may know, all of the higher education institutions in Limerick are on the periphery, so to speak, so it is not evident that Limerick is a university town. We felt that we could make the biggest contribution to the transformation by having a city campus as well as our Castletroy campus. A number of regeneration sites were assessed in collaboration with Limerick City and County Council. There was interest in Dunnes Stores-----

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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I have limited time.

Professor Kerstin Mey:

It was not for sale, so the opera site was the preferred site at the time.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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I presume the university would have to apply to either the HEA or the Department of Education to fund this. Did it provide them with valuations of any description?

Professor Kerstin Mey:

The purchase of the Dunnes Stores site and building would be funded from the university capital. We would have to apply for funding to develop the campus in full.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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Did the university have to provide documentation about what that would cost, including the valuation of the site?

Professor Kerstin Mey:

When it comes to that, yes.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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There would be paperwork on that. Does the university engage a consultant for its estate or property?

Professor Kerstin Mey:

Yes.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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Has the university continuously used the same consultant?

Professor Kerstin Mey:

Yes.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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Who did the valuations? Was it the consultant?

Professor Kerstin Mey:

As I said, we have commissioned a report from KPMG about the governance issues relating to the purchase of the Dunnes Stores site and building.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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It sounds as if this is being treated like Monopoly money. This is public money and the valuation appears to be far in excess of the value of the site. Does the university have many other properties in addition to the campus? Does it have overseas properties?

Professor Kerstin Mey:

No.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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The university is using the same consultant all the time to manage the properties. Is that on a commission basis? Is it tendered for? How does that happen?

Professor Kerstin Mey:

I ask the Chair for advice about whether I can answer the question since it identifies an individual.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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The university is hiring a consultant. It is a contract. Please credit us with a little intelligence.

Professor Kerstin Mey:

The consultant has been on a contract since June 2019. That was arrived at through a tender. It was paid and notified in the 2018-19 account as non-compliance.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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Was it notified for non-compliance?

Professor Kerstin Mey:

Yes.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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What was the nature of the non-compliance?

Professor Kerstin Mey:

It was that there was not a tendered contract in place for the sum of money.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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That does not fill us with confidence. Was the Dunnes Stores site ever raised in a protected disclosure?

Professor Kerstin Mey:

No.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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What due diligence or oversight was in place to ensure the university would get value for money on this?

Professor Kerstin Mey:

The Deputy is asking for details about the governance of the purchase process. We are committed to providing the committee with full information and we will share the outcomes of the investigation report.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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There is an investigation under way, which is fine, but there is also information available in addition to that investigation or review by KPMG. If the university did a review of another property, what due diligence regime is in place?

Professor Kerstin Mey:

Normal due diligence would be to have a valuation report.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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The first thing the university would go for is a valuation report.

Photo of Colm BurkeColm Burke (Cork North Central, Fine Gael)
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I thank the witnesses.

I wish Professor Mey every success in her role as president of the university.

I return to the issue of the purchase of a site in the city centre. I have served on a number of boards and it has always been the practice, especially when it is a State board, that when property is being bought, there would normally be a report from two different sets of consultants in order to get a fair and accurate valuation. Is that the process at the university now?

Professor Kerstin Mey:

We have not acquired property since then but we would seek to obtain a written valuation report.

Photo of Colm BurkeColm Burke (Cork North Central, Fine Gael)
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Was that from one valuation expert or two?

Professor Kerstin Mey:

I cannot answer the question.

Photo of Colm BurkeColm Burke (Cork North Central, Fine Gael)
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My experience has been that we would always seek a valuation from two different experts.

Professor Kerstin Mey:

I accept that, but I cannot answer the question.

Photo of Colm BurkeColm Burke (Cork North Central, Fine Gael)
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Professor Mey stated that an external evaluation of the governing authority had been conducted by the Institute of Public Affairs in 2020, with a report issued in early 2021. What changes were set out in that report? To what extent have those proposed changes been put in place?

Professor Kerstin Mey:

It is an effectiveness review of the governing authority. The recommendations pertaining to reporting, sub-committees and so on are currently being put in place.

Photo of Colm BurkeColm Burke (Cork North Central, Fine Gael)
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Is there a timescale for the implementation of the recommendations?

Professor Kerstin Mey:

Yes, we want to conclude it this year.

Photo of Colm BurkeColm Burke (Cork North Central, Fine Gael)
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What kinds of major changes and checks and balances are proposed in the report? We do not have a copy of it.

Professor Kerstin Mey:

They are changes pertaining to the effectiveness of the governing authority in terms of reporting, minutes and so on, as well as to sub-committees.

Photo of Colm BurkeColm Burke (Cork North Central, Fine Gael)
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Has the report raised concerns that there was not adequate scrutiny of decisions being made?

Professor Kerstin Mey:

It is a standard practice to have an effectiveness review of governing bodies - in fact, of committee on the whole.

Photo of Colm BurkeColm Burke (Cork North Central, Fine Gael)
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Did the report establish that there was not an effective mechanism in place in regard to those committees that previously existed?

Professor Kerstin Mey:

No, it strengthens the mechanism that already existed.

Photo of Colm BurkeColm Burke (Cork North Central, Fine Gael)
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If it is proposing changes, however, it must also have identified deficiencies.

Professor Kerstin Mey:

We are always learning. We always endeavour to improve and enhance our governance. That is an important matter and we always endeavour to work more efficiently. It is part of a standard process.

Photo of Colm BurkeColm Burke (Cork North Central, Fine Gael)
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Turning to the foundation, my understanding is that €20 million in cash is available in the foundation. How is the governance of the foundation worked on from within the university? If that amount of money is available, it is obviously important that there also be strong governance of that foundation. How is that managed and what is the input from the structures within the university?

Professor Kerstin Mey:

UL Foundation is a separate entity to the university. I will hand over to Ms Fogarty on this matter.

Ms Rosemary Fogarty:

We looked at UL Foundation and shared information on it with the Comptroller and Auditor General a number of years ago in this context. From an accounting perspective, there are rules under various accounting standards as to whether something is consolidated. The main points are about control and, a layer below that, dominant influence and control. We looked at that under a number of objectives. We do not control the board or the members. Donations that come from the foundation are donor specific rather than open to the discretion of the university to decide what to do with the money. In instances where the foundation gets funding that is open to the discretion of the university, it is the foundation's board that makes the discretion, not me-----

Photo of Colm BurkeColm Burke (Cork North Central, Fine Gael)
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To whom is the board answerable?

Ms Rosemary Fogarty:

Its members, who are not the university.

Photo of Colm BurkeColm Burke (Cork North Central, Fine Gael)
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We are talking about fairly substantial funds. There must, therefore, be transparency in that regard. Surely there is information available to the general public regarding how those funds are managed.

Ms Rosemary Fogarty:

That is why we do not consolidate the funds or control them. That is a question that would have to be put to the foundation board, unfortunately, but that is the key point as to why it is not consolidated. We include in our accounts as much information as we can about the foundation.

Photo of Colm BurkeColm Burke (Cork North Central, Fine Gael)
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Is there a representative from the university on the board of the foundation?

Ms Rosemary Fogarty:

To my knowledge, there are two, namely, the chancellor and the president. The last time I looked, there were 22 members, but I will have to check that because it was a while back.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Will Ms Fogarty clarify that for the committee following the meeting in order that Deputy Burke will have a full answer to the question?

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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I thank the witnesses for their attendance. What has been the impact on the university's subsidiary companies that run the on-campus student accommodation from the reimbursement to students who in the end could not take up their accommodation due to Covid?

Professor Kerstin Mey:

Student accommodation on campus is run by Plassey Village, the campus centre group. . The accommodation issues with regard to Covid-19 had a significant impact on students, of course, and also on our subsidiary-----

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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Does Professor Mey have the figure to hand?

Professor Kerstin Mey:

Yes. In the academic year 2019-20, some 2,206 students were reimbursed for accommodation at a cost €3.4 million. In the 2020-21 academic year, 765 students were reimbursed at a cost of €1.24 million. That amounts to almost €5 million in total.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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I wrote to the university and received a reply in November 2020. At that stage, on 26 November, it had received applications for rent refunds from only 264 students, 61 had been processed and the value was €455,887. How did the number of students increase to 2,000 students in the period thereafter?

Professor Kerstin Mey:

There are 2,840 beds on campus. The Deputy may recall that the academic year 2019-20 saw the-----

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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I am referring to that academic year. The university wrote to me on 26 November 2020.

Professor Kerstin Mey:

Yes. That pertains to the academic year 2020-21 where we reimbursed 765 students altogether for the academic year. That was not for the first semester. The academic year runs over two semesters.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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That is fine. However, ultimately I had a lot of correspondence from, and engagement with, UL students who were very unhappy about how they were dealt with, as was I because I did not find the correspondence. As a matter of fact, they were completely disregarded. Much of it was down to the management and schedules set down by UL. I do not believe the university treated the students very well.

I will come to another question about the president's residence. What procedures are in place for the residence, which I believe has been completely refurbished, regarding the operational costs for maintenance?

Professor Kerstin Mey:

That is the Deputy's second point. I cannot confirm. The operational costs are managed as part of the workflow of building an estate as it is a campus building.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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It is a campus building. Does Professor Mey have any idea of the cost of upkeep for the president's residence?

Professor Kerstin Mey:

I will give the figure for the upkeep of the-----

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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Before Professor Mey gives me the figure, have any refurbishments, adjustments or costs been applied since she took residence?

Professor Kerstin Mey:

I have not taken residence of the president's house.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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How does that work? Is there nobody in it?

Professor Kerstin Mey:

There is nobody in it. At the moment, as the Deputy knows, we have all been encouraged to work remotely.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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In that case, do Professor Mey's accommodation costs have to be paid for?

Professor Kerstin Mey:

No, I have not had my accommodation costs paid for.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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Can Professor Mey take up the residence if she wishes and receives no compensation if she does not take it up?

Professor Kerstin Mey:

No. Can I clarify? I am the interim president. As interim president, I did not have to take up the residence. A president proper, if I may say that, would have to take up residence and a big process would be applied.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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How long has nobody been resident in the president's residence?

Professor Kerstin Mey:

Since the summer.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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The Deputy is over time.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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Am I finished?

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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I ask the Deputy to be brief as she has gone over time.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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I will come back in.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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I will let Deputy Murphy back in again later. Deputies Dillon and McAuliffe are not present.

I have some questions before we move to the second round. Regarding legal costs and legal expenditure by the university, I note there was a legal bill for the academic year 2018-19 of €360,000. How much of that related to protected disclosures?

Professor Kerstin Mey:

I will have to come back with the exact figure.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Can Ms Fogarty, the financial controller, say?

Ms Rosemary Fogarty:

I ask the Chair to give me one second. I have the figure here somewhere. There are two legal items: legal employment advices of €390,000 and legal of €360,000. The €390,000 related to issues coming forward from previous reports and previous-----

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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How much of it related to protected disclosures?

Ms Rosemary Fogarty:

-----like the implementation of various recommendations under previous reports. The legal of €360,000 includes a number of items and a number of different legal advisers. The Chair will understand we have a framework for legal services and we deal with different legal events depending on the area of legal advice. They are all rolled into one.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Can I ask Ms Fogarty-----

Ms Rosemary Fogarty:

I will have to follow back with the information on the exact amount that relates to protected disclosures because I have a total per firm-----

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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How much of it related to legal advice on protected disclosures?

Ms Rosemary Fogarty:

I do not have it itemised in that way, unfortunately. It is itemised by firm. I would have to check in case firms were providing advice on two matters.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Is it correct to estimate the figure at €200,000 for legal fees and work relating to protected disclosures for that year?

Ms Rosemary Fogarty:

I could not say it was correct. I would be-----

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Would it be in the region of that sum?

Ms Rosemary Fogarty:

It probably is, but I will come back with detailed information to the committee.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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To confirm this is correct, €200,000 in legal fees was paid that year around the issue of protected disclosures. I have another question on legal fees. The former president left his role in August 2020. We have established that he was paid his notice until December 2020; some of the other Deputies focused on that. Were there legal costs associated with the resignation of the president?

Ms Rosemary Fogarty:

I will pass that over to Mr. Flaherty because I do not have that detail.

Mr. Andrew Flaherty:

Yes. There were legal costs associated with that.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Were those legal costs excessive?

Mr. Andrew Flaherty:

I do not have the exact number in front of me, but they were in the region of €35,000, inclusive of VAT.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Is it not odd that there were such legal fees around it given the fact that the former president left, you could say, in a fairly comfortable position? He was paid as far out as December 2020. Why was there so much in legal fees and legal involvement in that?

Mr. Andrew Flaherty:

From the university perspective, I cannot comment on why the president felt the need for a legal team as part of the resignation process. As part of that, it was agreed between both sides that the legal fees would be covered but the need for legal in that situation is unusual.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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I will move to the Dunnes Stores issue. Professor Mey confirmed there were no written valuations but did not confirm whether there were verbal valuations. Surely, if there was a verbal valuation, which would be unusual in itself, there would be some record of it on a file somewhere, given the amount involved. I take it from Professor Mey's answers there was no verbal valuation. This was pursued earlier in the meeting, but it was not clear whether anyone was asked even for an opinion about this. Getting the views of two different property consultants, given the amount, would be normal, but from what Professor Mey said, in this case the university is in a situation where it still only gets one rather than two. In this case, she clarified it did not get any. Is that correct?

Professor Kerstin Mey:

Before I-----

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Is it "Yes" or "No"? Professor Mey has clarified-----

Professor Kerstin Mey:

I would like to clarify. We do not have a written valuation report on file. That does not mean there was not opinion involved in the valuation of the Dunnes Stores site. As I said, KPMG is looking into the governance of the purchase process and we will share the outcomes of that process with the committee. With regard to the fact of two independent written valuations for a property purchase, I agreed with the previous Deputy who asked the question that this is best practice.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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The point is, in this case, there was neither written nor verbal valuations. It does not appear even an opinion was noted. There is no evidence, or even a record, of an opinion being sought, verbally. Nobody was asked, even on a street corner, why the cost, which was valued a very short time previously at a much lower cost of €3 million, all of a sudden arrived at €8 million. The governing authority of the university, as I understand it, has 28 members.

I want a "yes" or "no" answer. This is not to be in any way abrupt with the witnesses but because of the time limits we operate under with Covid-19 restrictions. Did any members of the governing authority raise concerns around the lack of due diligence with respect to the purchase of the Dunnes Stores site?

Professor Kerstin Mey:

Yes. Concerns were raised.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Okay. Did the governing authority approve the purchase of the site?

Professor Kerstin Mey:

Yes, it did.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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It did. The witness can state that this morning categorically, so I thank her. The witness has confirmed that advice was received from the consultant who did some negotiating around the deal. Was that consultant on a percentage or was that how payment for consultancy fees operated? In other words, if the site was valued at €1 million, the consultant would get a percentage of €1 million and if it was valued at €10 million, it would get a percentage of that? In this case, in a short period the value went from €3 million to €8 million. Was the arrangement that the consultant was paid via a percentage of the purchase price?

Professor Kerstin Mey:

No.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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It was stated earlier that this was purchased from the university's purse. Did the Higher Education Authority receive a costed development plan for the former Dunnes Stores site? My understanding is the authority received a costed purchase and development plan for the opera site. Did it receive such a plan for the Dunnes Stores site?

Professor Kerstin Mey:

It received notification of a change of site following our application to the higher education strategic investment fund, HESIF, made for the opera site in the first place.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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I am not clear from that answer whether the Higher Education Authority received a costed development plan from the university regarding the full development of the Dunnes Stores site.

Professor Kerstin Mey:

I will have to come back to the committee with the full information on that.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Is Mr Flaherty, or perhaps more appropriately, Ms Fogarty, in a position to answer that question?

Ms Rosemary Fogarty:

In my role as financial controller in the University of Limerick, I do not really have any responsibility for capital projects. It sits on the management, planning and reporting side so I am not familiar with the detail, unfortunately. I am not in a position to answer as part of my day-to-day role.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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I understand you are the financial controller.

Mr. Andrew Flaherty:

I am not in a position to answer but I will clarify a reply to a question that you asked a couple of times about verbal valuations on the property. It is my understanding a valuer was involved with the process and retained. Valuations were given on the property, although there is no written valuation on file. That is to confirm that there were verbals but not-----

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Is there a record of that of the valuation file and from whom the valuation was gotten?

Mr. Andrew Flaherty:

Yes. There are records of correspondence between the consultant and property valuer.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Will you revert to the committee with that information?

Mr. Andrew Flaherty:

We can indeed. Absolutely.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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There is ongoing investigation of this by KPMG. The public information indicates the chancellor of the University of Limerick was appointed to KPMG's public interest committee in December 2019. Is that correct?

Mr. Andrew Flaherty:

I believe so.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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The chancellor of the university, Ms Mary Harney, is still serving on the public interest committee of KPMG, the consultancy firm that is carrying out the examination of the purchase of the Dunnes Stores site and the lack of due diligence around that. Is that correct?

Mr. Andrew Flaherty:

My understanding is she was appointed to the committee but I am not sure if she is still serving. I am not aware but I will come back to confirm if that is the case.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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I thank the witness. If Deputies Devlin, Carroll MacNeill or McAuliffe have not joined us-----

Professor Kerstin Mey:

Before proceeding, I would like to correct the record. The Dunnes site was included in the protected disclosure. I apologise for providing the wrong answer.

Photo of Cormac DevlinCormac Devlin (Dún Laoghaire, Fianna Fail)
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I apologise as I am deputising for another Deputy at another votable committee. I defer my time to colleagues on this occasion.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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I thank the Deputy. We can go back through the rota again. Deputy MacSharry was the lead speaker so he can have another four minutes.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Is the protected disclosure relating to the Dunnes Stores site currently under investigation?

Mr. Andrew Flaherty:

My understanding is the Dunnes Stores site was mentioned in the protected disclosure that formed part of the Mairead McGuinness investigation. I believe the individual withdrew part of the protected disclosure. I believe it was in that protected disclosure.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Did the witness mean Mairead McKenna?

Mr. Andrew Flaherty:

Yes, Mairead McKenna. The Deputy asked a question about the person subsequently withdrawing the remainder of the protected disclosure. I believe that is the one it was contained in.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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What is the reaction of the interim president to what I had to say about person C contacting me during the night and what I read into the record? It amounts to what was in her opening statement being inaccurate and false, "a lie" is what she called it.

Professor Kerstin Mey:

I thank the Deputy. I cannot comment on the views of the individual, obviously. We want to resolve the process in full and we have committed to that. We have undertaken significant efforts to arrive at a full solution of the process. I still hope that is possible.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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The witness can imagine how we feel, or can she?

Professor Kerstin Mey:

Yes.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Professor Mey is saying one thing and we have been contacted and told the opposite. There is also, of course, the history and culture alluded to by the witness. Have any disclosers been asked to or coerced into signing non-disclosure agreements?

Professor Kerstin Mey:

Not that I am aware of.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Is anybody else aware of it?

Professor Kerstin Mey:

Apologies, but is the Deputy referring to non-disclosure confidentiality clauses?

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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No, I mean what I said. These are non-disclosure agreements, NDAs.

Professor Kerstin Mey:

I do not have the full information. I will get back to the Deputy on that.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Could I get a reply from Mr. Flaherty?

Mr. Andrew Flaherty:

I do not have that information to hand. We will check it and come back to the Deputy.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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As a matter of policy in the university, does it employ such policies? Does it look for non-disclosure agreements?

Mr. Andrew Flaherty:

We do not have a policy on that but it is not uncommon, if settlement agreements are reached, for there to be confidentiality clauses. That does not happen in all cases.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Okay. With the six protected disclosures that exist since 2016, according to the university, are there are any non-disclosure agreements relevant?

Mr. Andrew Flaherty:

We will certainly check that and get back to the committee. As they are protected disclosures, very few people have access to them. We will have to check each one before getting back to the Deputy.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Yes. I would say it would take 20 minutes to check all six.

Mr. Andrew Flaherty:

That is it.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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We look forward to getting that. I asked earlier that the McKenna report be made available to the Committee of Public Accounts in its entirety, and if necessary that the permission of the people relevant to it is sought to that end.

Does the university seek the permission of the people relevant to it? I am a little bit confused. Earlier on, the president said it was normal to pay notice periods and Mr. Flaherty said it was not normal. Which is it?

Mr. Andrew Flaherty:

If I said that, I will correct it. We pay notice. If somebody gives notice, we are contractually obliged to pay that period. It is standard one would pay. If somebody gives his or her notice period, it is a contractual obligation and it is standard we would pay that.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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It is €50,000 extra. One resigns in July, leaves in August and gets €50,000-plus between then and September even though one has resigned. If I resign, no one has to pay me anything.

Mr. Andrew Flaherty:

I am not sure what the question is there.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Will Deputy MacSharry put a question? We will get a reply from Mr. Flaherty.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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If somebody resigns from a position in the University of Limerick, UL, no matter who he or she is, be it the janitor or person C, is he or she paid a notice period of six months?

Mr. Andrew Flaherty:

No, he or she is paid in line with his or her contract.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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All right, so this was a gilt-edged contract which said €4,000 for bedsheets, €50,000 after one resigns and one can appoint-----

(Interruptions).

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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We lost the sound.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Can the contract be made available, on a confidential basis, to the Committee of Public Accounts or the Comptroller and Auditor General to look at?

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Deputy Munster has four minutes.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Can I get an answer to that?

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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The sound was poor.

Professor Kerstin Mey:

My apologies, we are hardly audible. There is noise pollution in this room. I did not get the Deputy's final question. I am happy to answer it. Can Deputy MacSharry please repeat it?

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Can Deputy MacSharry put the question again, concisely?

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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I want to know if we can get sight of the contract for the now-exited president, to see how all of these add-ons and bonuses were included on a confidential basis and not for public session, and if the Comptroller and Auditor General can be provided with the same, so we can see in this contract, no matter what the circumstances in which a person exits, he or she is entitled to get six months pay.

Professor Kerstin Mey:

The Comptroller and Auditor General has been provided with the president's contract.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Can we be provided with it? Perhaps Mr McCarthy can answer that.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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I will ask Professor Mey to answer that question. It is appropriate she answers it. Can a copy be supplied to the Committee of Public Accounts?

Professor Kerstin Mey:

It can be.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Deputy Munster has four minutes.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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Would the university's paying the president's legal costs not be highly unusual? What was the reason for the legal costs in the first instance?

Professor Kerstin Mey:

Yes, we paid the legal costs, as was said before. My understanding is the legal costs related to the contract.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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What, specifically, in the contract?

Mr. Andrew Flaherty:

I will come in there to give Deputy Munster an update. As we said earlier, the contract was silent on notice, which obviously caused a problem. The legal costs were incurred in the discussions and negotiations around what reasonable notice may be. It was incurred in that space. That was part of the reason the governing authority, GA, approved the payment of those costs.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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With regard to an employee or member of staff who has asked to enter into a mediation process, there is a document he or she was asked to sign which included a confidentiality clause. I thought Mr. Flaherty said there was no confidentiality clause. Can Mr. Flaherty explain what that document entails and why a person asked to enter into mediation was asked to sign a document with a confidentiality clause in it?

Mr. Andrew Flaherty:

It is not a policy that every document would have one. They are on a case-by-case basis. Depending on the case in question, there may or may not be a confidentiality clause.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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Can Mr. Flaherty give us an example of a case in which it would be deemed fit to have a confidentiality clause?

Mr. Andrew Flaherty:

If one had ongoing discussions with multiple people on the same topic and was close to an agreement with one or multiple people, it would not be unusual to have a confidentiality clause to protect the university in the negotiations with the remaining people.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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I imagine we will hear more about that.

Professor Kerstin Mey:

When the Chair asked Professor Mey whether any member of the governing authority or the executive committee had concerns around due diligence with the purchase of the Dunnes Stores site, her response was that there were concerns. Had the executive committee of the university discussed the purchase, prior to its approval?

Professor Kerstin Mey:

No.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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Why was that? Can Professor Mey give us a reason why it was not included?

Professor Kerstin Mey:

I cannot comment on that. I do not condone the practice, but on that occasion, it was not discussed with the executive committee. It went straight to the governing authority.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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Is that highly unusual?

Professor Kerstin Mey:

It is unusual, but it is also a significant commercial undertaking to purchase a site.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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Would it be best practice to include the executive committee?

Professor Kerstin Mey:

It would be best practice.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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Would Professor Mey acknowledge that in excluding the executive committee from decision formation, the practice was to railroad through the decision approval? Would that have been the reason?

Professor Kerstin Mey:

I would not support that. As Deputy Munster said, it is unusual, but there may be a number of reasons for that.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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However, it is not best practice.

Professor Kerstin Mey:

It is not best practice.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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It most certainly is not.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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I call Deputy Catherine Murphy.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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Deputy Catherine Murphy sent a message to say she would have to join the meeting. I do not think she is with us yet.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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That is fine. I call Deputy Colm Burke.

Photo of Colm BurkeColm Burke (Cork North Central, Fine Gael)
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There are a number of different strands to the management of any institution, such as the University of Limerick. With regard to property, I understand how the funding for the president's house came from a philanthropist. Is the registration of the ownership of those properties vested in the university or are there different companies holding some of these properties? Has there been a full audit done on what is owned by the university and what is owned by companies which are not in the control of the university?

Professor Kerstin Mey:

I will bring Ms Fogarty in here.

Ms Rosemary Fogarty:

The president's house is owned by the university. In general, all of the academic buildings and the buildings in the university are owned by the university. Plassey Campus Centre and its subsidiaries own the accommodation or residences. A number of years back, the Plassey Campus Centre, PCC, bought a unit near the university called Park Point as an investment property. The university has a building which is leased to Munster Rugby. That is in our accounts as an investment asset. Obviously, there is the Dunnes Stores transaction, which is owned by the university. In broad terms, the subsidiaries have the residences and Park Point and the rest of stock of buildings is in the accounts of the university.

The Comptroller and Auditor General and the commercial auditors, PwC, look at all our transactions and fixed asset additions each year, which include land and buildings in all entities, whether it is subsidiaries or the university. We have a breakdown of it and they have a breakdown built up from the audits over a number of years.

Photo of Colm BurkeColm Burke (Cork North Central, Fine Gael)
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There was a property not close to the university which was owned by it and vacant for ten years.

Are any properties that are now in the ownership of the university not being fully utilised?

Ms Rosemary Fogarty:

I think the Deputy is referring the president's former residence in Killaloe, which was disposed of recently. We bought a property at the main entrance, through a bid process in the 2019-2020 accounts, called Larkin House. It is a strategic property located at the front gate and it adjoins lands we own immediately behind it. It is vacant but it is intended for strategic use down the line. I am not aware of any other properties.

Photo of Colm BurkeColm Burke (Cork North Central, Fine Gael)
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Are audits carried out on the use of properties? Leaving a property vacant for 20 years, for example, is a substantial period.

Ms Rosemary Fogarty:

I am not aware of an audit on properties being vacant or anything like what the Deputy suggested having been undertaken. The matter would probably reside in the buildings and estates section of the university, so I am not in a position to answer.

Photo of Colm BurkeColm Burke (Cork North Central, Fine Gael)
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When money is made available for research to be carried out within the university, what type of agreement is in place regarding the results of that research? What are the benefits for the university? I acknowledge there are obviously benefits for the people carrying out the research, but what are the overall long-term benefits for the university itself?

Professor Kerstin Mey:

Any research funded by and conducted in the university is reported to the funders and internally to our research strategy board and the executive. The research we carry out is in most cases of benefit to the economy and society at large, while for us, the benefits of research are that we can maintain our education programmes at the cutting edge of knowledge. We can develop new education programmes and liaise with external stakeholders to foster new knowledge generation and knowledge exchange.

Photo of Colm BurkeColm Burke (Cork North Central, Fine Gael)
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Are processes in place in regard to where research is carried out such that somebody who was initially involved in the research can set up his or her own separate entity and use the benefits of that research?

Professor Kerstin Mey:

I think the Deputy is referring to the setting up of spin-out companies on campus. The university supports entrepreneurship to apply knowledge in that regard.

Photo of Colm BurkeColm Burke (Cork North Central, Fine Gael)
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Is Professor Mey satisfied that enough safeguards are in place such that the maximum benefit can be ensured? I fully accept there has to be benefit for the people carrying out the research, but is there maximum benefit for the university as well such that it will not lose out if there is a major research project, for example? I am sure it happens all the time that new projects are successful. Are enough procedures and mechanisms in place to ensure the university gets the benefit of that research?

Professor Kerstin Mey:

I think the Deputy is referring to the intellectual property policy that sets out how the university benefits from the commercialisation of intellectual property. We have recently reviewed and revised our intellectual property policy. I am satisfied we have sufficient checks and balances in place.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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I ask that the university respond to this question in writing. What has the university spent since 2016 on the investigation of the protected disclosures received from employees? Does the cost include the legal advice of either side?

What was the purchase price of the house adjacent to the university and the 1.1 acres purchased?

Professor Kerstin Mey:

The Deputy is referring to Larkin House. I will get the exact figure in a moment.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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What was the value of the president's residence when sold?

Professor Kerstin Mey:

It was €780,000.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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Was there an additional cost in the purchase? Were funds needed?

Professor Kerstin Mey:

No, the proceeds from the sale of the Killaloe house covered the purchase of Larkin House.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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In those valuations, was the same consultant who purchased the Dunnes Stores site used?

Professor Kerstin Mey:

No, an independent valuation was obtained for the Killaloe house by Harry Brann.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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What were the legal costs associated with those transactions?

Professor Kerstin Mey:

We will send to the committee the exact figures for the legal costs.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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The university might also break down what the properties were bought for, sold for and so on.

Professor Kerstin Mey:

Yes.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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Who was the consultant for the Dunnes Store site purchase?

Professor Kerstin Mey:

I will put that in writing.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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In regard to the fees from the procurement process, the university might also outline that all the procurement criteria were followed and how it believes they have been fulfilled.

I return to the issue of student fees and reimbursements. Professor Mey outlined figures for what has been paid out, but what has been the impact on university funds?

Professor Kerstin Mey:

The impact of Covid-19 on college funds has been significant in terms of our investments-----

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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Is there a figure?

Professor Kerstin Mey:

The committee has a copy of our 2019-2020 figures-----

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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Yes, but do we have an overall figure?

Ms Rosemary Fogarty:

I might come in here. I am confused by the question. The Deputy asked about the impact of the refunds on the subsidiaries. Was that the question?

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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Yes. I am trying to establish how much was taken in versus what was paid back, and the percentage of students who might have received a refund.

Ms Rosemary Fogarty:

In 2019-2020, for which our accounts are complete, the subsidiary incurred a loss of €8 million and the university had a surplus of €4.7 million, leaving an overall consolidated surplus of €3.9 million. The impact of the refunds from a subsidiary perspective was a loss of €800,000. For context, in the previous year, 2018-19, the subsidiaries made a profit of €1.9 million. That was a swing of €2.7 million, which is consistent with the value of the refunds the president spoke about earlier. That is the movement.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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What percentage of students received a refund?

Ms Rosemary Fogarty:

I think the president gave that number earlier. There were 2,206 students as against 2,800 beds, if I can put it that way. We will confirm that in writing.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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I have a couple of questions in the brief time that remains, and other members might raise their hand if they wish to contribute further. To return to the issue of the Dunnes Stores site, our guests might clarify something for us.

Professor Mey will understand that, because of the technology, answers may not be as clear as they might be, through no fault of her own or anyone else. Could she clarify whether the consultant received a percentage? Were its fees based on the purchase price? Was it a case of the larger the purchase price, the greater the consultancy fee?

Professor Kerstin Mey:

No.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Is Professor May aware that the consultant who handled that case for the university previously acted for the Dunnes Stores seller?

Professor Kerstin Mey:

I am not aware of that.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Professor Mey is not aware of it. Has it ever been mentioned that the consultant may have been acting for the seller of the site previously?

Professor Kerstin Mey:

I can only repeat that I am not aware of it.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Prior to the purchase of the Dunnes Stores site, UL made a request to the HEA regarding the purchase of the Opera site, which was very much a landmark site, for the same purpose. Why was the plan changed so suddenly? The timeline was extraordinarily short. What happened there?

Professor Kerstin Mey:

To be clear, we made the funds available for the purchase of the Opera site. That site was identified at the time as a preferred site out of a number of regeneration sites that were available in Limerick. The Dunnes Stores site was not available for sale, although strategically of great interest. From what I understand, it became available and the university purchased it.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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At what stage is the development now? How far advanced is the university with the Dunnes Stores site? What is the timeline for bringing it into use?

Professor Kerstin Mey:

We have purchased the Dunnes Stores site and the buildings. Part of the building is undergoing mitigation works, so to speak, to open it in September for operations in the city centre. We have received support for the master planning with a view to starting as soon as we can.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Part of it will be brought into use in September 2021.

Professor Kerstin Mey:

Yes, that is correct.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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I thank Professor Mey for that.

I have a couple of questions on property-related matters. It was reported last year, as I recall, that UL pulled out of buying a Georgian house in Ranelagh, Dublin. It was valued at €5 million. I understand UL had paid a deposit but received it back. Is that correct?

Ms Rosemary Fogarty:

I can confirm that we did get the deposit back.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Am I correct that the chancellor may have advised against the purchase of the property because of how it would be perceived by the public? Is that correct?

Ms Rosemary Fogarty:

I had absolutely no role whatsoever in the transaction. I just know, from an accounting perspective, that we got the deposit back. I am unable to answer, unfortunately. I apologise.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Has Ms Fogarty no idea whether the chancellor may have raised concerns about the public perception of the purchase and whether that was the reason the university pulled out of the sale?

Ms Rosemary Fogarty:

I have no idea. I apologise but I am not involved in that at all.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Is it the case that UL is still pursuing the purchase of property in Dublin and making inquiries about it?

Professor Kerstin Mey:

As far as I am aware, we are not currently pursuing the purchase of a building in Dublin.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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From what the president is saying, UL has basically given up on the purchase of properties in Dublin.

Professor Kerstin Mey:

At the moment, we are concentrating on realising our strategic developments in Limerick.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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I read in theSunday Independentthat a John Moroney is UL's property consultant. Is that correct?

Mr. Andrew Flaherty:

That Is correct.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Is Mr. Moroney a sole trader? Does he run a company?

Professor Kerstin Mey:

It is a company.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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What is the company called?

Ms Rosemary Fogarty:

John Moroney Limited.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Is John Moroney Limited registered with the Property Services Regulatory Authority?

Ms Rosemary Fogarty:

I do not know the answer to that. The procurement process was not carried out by the university; it was carried out by the Office of Government Procurement, OGP, infrastructure. It would have gone through this. I can check and revert to the Deputy.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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That would be good. Would the university's own due diligence involve looking for Mr. Moroney's company's licence as a property services provider?

Ms Rosemary Fogarty:

Those matters would usually be dealt with through the procurement process. It was handled by the OGP infrastructure, namely the education procurement service, EPS. I will check with that office and revert to the Deputy.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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The Chairman asked how fees would be agreed. Is there a retainer figure involving a decision to pay someone €80,000 per year to look after all the UL property deeds, for example? How is it determined?

Ms Rosemary Fogarty:

My understanding is that there are daily and hourly rates agreed. The work is billed based on time but I will confirm all those elements for the committee in written correspondence.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Would it be reasonable to say the firm got in the region of €120,000 in the relevant accounting period?

Ms Rosemary Fogarty:

It got paid more than that because there were moneys due from previous years. The payment was higher. Some of the transactions related to a period before the tender was in place. That is disclosed in our information on procurement non-compliance concerning 2018 and 2019. We wrote to the committee about that in early January and set out the details. It is the first line item in the table from that letter.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Were there more fees concerning Larkin House?

Ms Rosemary Fogarty:

Yes.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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When was the tender process to appoint John Moroney Limited?

Ms Rosemary Fogarty:

The contract was concluded in June 2019.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Did Ms Fogarty say it was done centrally by the OGP?

Ms Rosemary Fogarty:

The office has sourcing responsibility for the public sector so, where possible, we interact with it and its process. It was not able to run the competition for us so it referred it to the EPS, which is a hub of the OGP structure. The EPS ran the procurement for the university.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Can I ask about the valuation? Mr. Flaherty referred to a valuation. Did the university pay for a valuation? What was the firm?

Mr. Andrew Flaherty:

GVM was engaged. The managing partner there was certainly one of the partners. GVM was engaged and there was a transaction fee.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Was that paid?

Ms Rosemary Fogarty:

Yes.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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How much was that?

Ms Rosemary Fogarty:

It was €9,500 plus VAT.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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For a verbal valuation?

Ms Rosemary Fogarty:

I actually do not know the extent of that. I know the invoice was approved for payment and that the payment was made.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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It would be a pretty good wage for a verbal valuation. How is it that UL has not rung GVM's managing partner and asked whether a copy of the €9,500 valuation could be sent to it? I am sure there is not a partner in a company in the world who gets €9,500 for an opinion over the telephone. Therefore, I assume there is a document. Has Mr. Flaherty called GVM and asked it for that?

Mr. Andrew Flaherty:

No, I do not believe so. The current review-----

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Is there any reason given all the recent media coverage and the fact that the witnesses knew they were coming in here today?

Mr. Andrew Flaherty:

That is part of the rationale. We are not looking to backfill gaps, if the Deputy knows what I mean. What we-----

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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I am really pleased to hear that but Mr. Flaherty has led me to believe that although €9,500 was paid for the service, there is no paper trail other than the bill. What exactly was GVM paid the €9,500 for?

Mr. Andrew Flaherty:

The best thing for us to do is to revert to the committee with confirmation of the services given and the involvement in the transaction.

Is Mr. Flaherty saying no document exists? I hope that GVM is not scurrying around doing up a €9,500 valuation at this stage. I am bound to say that I do not find this very credible. I will conclude with three other points. I am going to ask the witnesses to send information to us.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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The Deputy should be brief.

Photo of Marc MacSharryMarc MacSharry (Sligo-Leitrim, Fianna Fail)
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Yes, I will be very brief. I see during Covid we managed to spend €1.02 million on entertainment. I cannot wait to see the breakdown. Could the witnesses send us that? In the previous year, €1.7 million was spent but there was no Covid then. The university still managed to spend €1.02 million on entertainment in 2019-20, although half of the year was affected by Covid. It must have been party central down at UL for that period.

The other information I want to get is a nauseatingly detailed breakdown of the €496,000 for the strategic project change management and advisory services. In particular, I want a breakdown of all costs associated with the person who took up that role - moving to Limerick, being put up in Limerick, any settlement assistance or anything financially or in lieu. Was the person put up in an apartment? Were they looked after? Were they wined and dined? Was there a food allowance, a clothing allowance, a moving allowance or a travel allowance, and everything else under the €496,000?

I thank the witnesses for coming in. It is a tough day for them. I am trying to be as fair as I can, but I believe we have made no progress.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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I want to pick up on what Deputy MacSharry has asked Professor Mey about the valuation process, just so I am correct in understanding it. A valuation was given for the Dunnes Stores site but it was never put in writing. Is that correct?

Professor Kerstin Mey:

We have no written record on file.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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How does anyone know what the valuation was if there is no written record? What did the witnesses go to the solicitors who were doing the conveyancing with to close a deal where there was nothing in writing to give the valuation?

Professor Kerstin Mey:

I think we have answered the questions. They were verbal opinions. We shared the outcome of the KPMG report on the governance of the purchase with the committee.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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Clearly, "the lack of governance" is better terminology to use. Without putting words in anybody's mouth, do the witnesses agree that it is not credible to expect that there is no written record of any meetings where the valuation of this site was discussed? I appreciate that the university is tackling governance, but this is not just governance. From a commercial transaction perspective, using publicly funded moneys, it is not credible to say that there is no written record on a valuation worth millions of euro. Is that fair to say? Do the witnesses agree with that?

Mr. Andrew Flaherty:

We have absolutely no official valuation from the company involved but there are emails.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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In Mr. Flaherty's official capacity, does he think it is credible that there is no written record?

Mr. Andrew Flaherty:

There is a written record in emails about the valuation and what the building was worth, but there is no definitive valuation on it. There is correspondence between the valuer and the consultant involved. There are records of that correspondence, which have been shared with KPMG to review in full and come back with its findings.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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Is that review not yet complete?

Mr. Andrew Flaherty:

It is not complete but I believe it will be completed relatively soon.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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I assume Mr. Flaherty cannot share anything with this committee until the review is complete. Is that his stance?

Mr. Andrew Flaherty:

Yes, we do not have anything to share yet. I have not got the report yet.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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Does Mr. Flaherty have the emails?

Mr. Andrew Flaherty:

Yes, there are emails.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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Is it appropriate, Chair, that those emails could be shared with the committee?

Mr. Andrew Flaherty:

I would be happy to do so as part of the final report. To be fair, I would like the report to come out and then issue them at that point in time and not cut across it.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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In endorsing Deputy MacSharry's question, I presume those emails will be required for the transaction fee note from the consultant. To establish credibility, we are going to have to see it, not just the KPMG report but the history of what has happened. I presume that the witnesses have gone to great lengths to address corporate governance issues. We cannot address something unless we admit there is a problem in the first place, and it can only be addressed on the basis that it can be improved upon. Does Professor Mey agree with that?

Professor Kerstin Mey:

There is always scope for improvement. Yes, I agree with the Deputy.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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It is a shame discussing this once the horse has bolted, but I would expect then-----

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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We have gone over time.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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I will be brief, Chair.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Very brief.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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Regarding the other property transactions such as the acquisition and disposal of the president's residence, even though the corporate governance review is not yet complete, I expect it will be highly compliant on everything that was involved in those transactions. Is Professor Mey happy with that?

Professor Kerstin Mey:

I think Deputy Murphy is talking about the disposal of the former president's house.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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Yes, and the acquisition of the next property, the 1.1 acres.

Professor Kerstin Mey:

Larkin's land, yes.

Photo of Verona MurphyVerona Murphy (Wexford, Independent)
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Is Professor Mey happy that the acquisition is highly compliant with all governance and procurement processes?

Professor Kerstin Mey:

To my knowledge, yes.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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Specifically what procurement process was used to appoint the person who negotiated the deal for the Dunnes Stores site?

Professor Kerstin Mey:

At that point the person was on a contract with the university. We have notified that to the Comptroller and Auditor General as non-compliant.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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I am sorry, but I did not quite hear that.

Professor Kerstin Mey:

We have notified that to the Comptroller and Auditor General as non-compliant up to June 2019 when a tender through the OGP was concluded.

Photo of Imelda MunsterImelda Munster (Louth, Sinn Fein)
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Am I correct that the procurement process as a whole was non-compliant?

Professor Kerstin Mey:

Yes.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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I have a couple of questions before we conclude. The president confirmed earlier that there was no written quotation on file on the large financial transaction regarding the Dunnes Stores site, which involved substantial public funding. From my limited experience, anyone who has served on the board of a company would know that if the fire extinguishers in a modestly sized building were going to be changed at a value of €2,000 or €3,000, the board would ask the manager to get at least two written quotations and present them to it at the next meeting. I appreciate that Professor Mey is new in the job. She outlined that in her opening statement, and she accepted that things have not been good or the way they should be. What I say to her is not meant in any lecturing way, but I think I am expressing the view of the committee that how things have been managed to date at UL is very unsatisfactory. It is public money. I acknowledge Professor Mey is aware of that. We are all public servants. We will probably revisit these matters again. I ask that substantial progress be made. I understand that it can be difficult to deal with issues retrospectively. We can see there are difficulties in a number of areas.

I understand there were recommendations in the McKenna report regarding the creation of specific roles for individuals. Is that correct?

Professor Kerstin Mey:

Yes.

Mr. Andrew Flaherty:

To confirm, the recommendation is that there should be no appointments outside of the normal policy. In that context, the recruitment policy would apply.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Am I correct in saying that the role of chief corporate officer was created following that recommendation and filled by Professor Mey?

Professor Kerstin Mey:

It was a reassignment of duties.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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It was done without advertisement or competition. Is that right?

Professor Kerstin Mey:

It was a reassignment of duties, not recruitment.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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It was a reassignment of duties. That meant being taken away from other duties. If one takes on new duties-----

Professor Kerstin Mey:

It was added on.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Whether it was a sideways shift or not does not matter. The point that I am making is that a role of chief corporate officer was created. Is that correct?

Professor Kerstin Mey:

Yes.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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Am I correct in stating that it was filled without being advertised and without competition?

Professor Kerstin Mey:

Yes.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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I thank Professor Mey for her evidence on that matter. I ask the witnesses to bear with me for a moment. I know it has been a difficult meeting. They set out in their opening statement that they will make progress on many of these matters and we wish them well on that. I thank the witnesses from University of Limerick for joining us. I thank the staff at the university because I imagine that substantial work went into preparing for today's meeting, particularly in the context of the information provided. I thank the Comptroller and Auditor General and his staff for attending and for assisting the committee in preparing for the meeting.

Is it agreed that the clerk will seek any follow-up information and carry out any agreed actions from the meeting? Agreed. Is it agreed that we will note and publish the opening statements and the briefings provided for today's meeting? Agreed.

The witnesses withdrew.

The committee adjourned at 11.32 a.m. until 9.30 a.m. on Tuesday, 22 June 2021.