Oireachtas Joint and Select Committees
Wednesday, 11 June 2025
Joint Oireachtas Committee on Arts, Media, Communications, Culture and Sport
Arts Council Grant Management IT System: Discussion
2:00 am
Alan Kelly (Tipperary North, Labour)
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I have no apologies from any of our colleagues.
Today's meeting concerns matters relating to the termination of the Arts Council grant management IT system. The meeting has been convened with the chair of the board of the Arts Council and relevant members of the executive team alongside relevant officials from the Department of Culture, Communications and Sport to discuss matters relating to the termination of the Arts Council grant management IT system. I warmly welcome the following witnesses: Ms Maura McGrath, chair of the board; Ms Maureen Kennelly, director; Mr. Poly Anyanwu, business transformation programme director; and Mr. Martin O'Sullivan, deputy director, finance director and company secretary, Arts Council; and Mr. Feargal Ó Coigligh, Secretary General; Mr. Conor Falvey, assistant secretary; Mr. John Kelly, principal officer; and Ms Sinéad O'Hara, principal officer, Department of Culture, Communications and Sport, and notably no longer arts.
The format of the meeting is that I will invite our witnesses to deliver an opening statement which is limited to five minutes. That will then be followed by questions from members of the committee. As the witnesses are probably aware, the committee may publish the opening statements online. Is that agreed, colleagues? Agreed.
Before I proceed to questions from the members, I remind them that while the committee has received correspondence from and concerning individuals and other organisations and companies in advance of this engagement regarding some of the items that have been flagged for discussion, the names of individuals or identifiable entities or any personal information relating to them should not be discussed publicly in today's session.
I also wish to clarify some limitations relating to parliamentary privilege and the practice of the Houses as regards references witnesses may make to other persons in their evidence. The evidence of witnesses physically present or who give evidence from within the parliamentary precincts is protected pursuant to both the Constitution and statute by absolute privilege in respect of the presentation they make to the committee. This means that they have an absolute defence against any defamation action for anything they say at this meeting. However, they are expected not to abuse this privilege, and it is my duty as Chair to ensure that this privilege is not abused. Therefore, if their 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 any such direction.
Members are reminded of the long-standing parliamentary practice to the effect that they should not comment on, criticise or make charges against a person outside the Houses or an official either by name or in such a way as to make him or her identifiable.
I now ask for the opening statements in the following order: Mr. Feargal Ó Coigligh on behalf of the Department and then a joint statement from Ms Maura McGrath, chair of the board of the Arts Council, and its director, Ms Maureen Kennelly. Then we will proceed to questions and answers with members. Depending on how many members are here, we will start off with six minutes, but if more members do not arrive we may push that out to eight to ten minutes. Before I ask the witnesses to make their opening statements, I am due in the Dáil Chamber for a few minutes so I will ask Senator Ní Chuilinn to take over from me in the Chair for the next while. This is your first time taking over as Vice Chair, Senator, so congratulations.
Evanne Ní Chuilinn (Fine Gael)
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First, I have a Cathaoirleach's declaration here that I need to read into the record. In accordance with Standing Orders, I wish to make the following declaration: I do solemnly declare that I will duly and faithfully and to the best of my knowledge and ability execute the office of Leas-Chathaoirleach of the Committee on Arts, Media, Communications, Culture and Sport without fear of favour, apply the rules as laid down by the House in an impartial and fair manner, and maintain order and uphold the rights and privileges of members in accordance with the Constitution and Standing Orders.
We move to the opening statements now. Mr. Ó Coigligh is first.
Mr. Feargal Ó Coigligh:
Táim thar a bheith sásta a bheith anseo ar son na Roinne agus chun aon cheist atá ag an gcoiste a fhreagairt.
The policy goals of the Department of Culture, Communications and Sport in relation to arts and culture are to enhance access to and participation in the arts, culture and film sectors in Ireland and support those sectors in the delivery of their social and economic contribution to Irish life. In recent years this has seen a strong policy focus on increasing support for professional arts practice, with significant increases in funding for the Arts Council, Screen Ireland and Culture Ireland and the introduction of the basic income for the arts research programme. Governance, oversight, resourcing, management of grants, policymaking and legislation for arts and culture are therefore core responsibilities for the Department. The Department takes these responsibilities seriously and commits significant resources, and has established procedures in place, to support compliance with the code of practice for the governance of State bodies, the public spending code and public financial procedures.
Notwithstanding these arrangements, the Arts Council annual report for 2023, published in February of this year, revealed that the council's business transformation project, in respect of which expenditure of €6.675 million had been incurred, had failed and that there was an estimated loss in value in respect of the project noted by the Comptroller and Auditor General amounting to €5.3 million. Last July, on receipt of the annual report, I initiated an examination of the business transformation project by a senior official, and former head of the internal audit unit of the Department, to establish the full facts around this failure. The Department published her report in February in conjunction with the Arts Council annual report and accounts. The report, which runs to 97 pages, contains 17 main findings and 36 recommendations. The findings point to a range of failures of governance by the Arts Council but also, critically, to failings by the Department in its oversight role in respect of the project.
Subsequent to publication, the Minister established a review of governance and organisational culture in the Arts Council, chaired by Professor Niamh Brennan. In parallel, the Department has put in place a review of its own governance and oversight functions, building on the work carried out by the Institute of Public Administration, IPA, over the past year.
By way of background, the intention of the Arts Council in seeking to upgrade its IT systems was and remains an entirely worthy objective. Its current systems are cumbersome, offer a poor user experience for artists and do not allow the council to gather the data necessary to adequately assess the impact of its funding decisions. In upgrading this system to gather such data, the council was seeking to address the conclusions of a value-for-money study of the Arts Council conducted by the Department a decade ago. In some instances, the governance failings of the Arts Council were mirrored by oversight shortcomings in the Department. The examination found that the council lacked the capacity to properly assess its requirements as it embarked on the project. The Department similarly lacked the IT capacity for the lifetime of the project to properly assess the technical and financial feasibility of the council proposals. The Arts Council failed to seek or obtain sanction for increases in the budget and resources it was applying to the project in 2021, 2022 and 2023.
In this period, the Department received regular updates from the council on its plans to increase the budget for the project. However, the Department failed to require the Arts Council to meet its obligations under the sanction which was provided. No process was in place in the Department in this period to ensure that the information obtained relating to the cost overrun on the project, either directly through correspondence or in quarterly liaison meetings, was escalated to the Secretary General or the Minister.
The Department has since put in place new monitoring arrangements around compliance to ensure that this could not happen again in respect of an ICT project sanctioned by the Department in an agency under its remit. The Arts Council and the Department are committed to the implementation of the recommendations set out in the report on the examination of the business transformation project.
Equally we are engaging with the review being undertaken by the advisory committee led by Professor Niamh Brennan and will ensure that all recommendations emerging from the review are delivered, including those that are relevant to the Department.
The work of the Arts Council is fundamental to the development of the arts in Ireland for the benefit of all the people of Ireland. It is a matter of profound regret that this project has failed and that such a significant amount of public money has been written off. The report on the examination of the project, which I commissioned and which the Department published in full, sought to establish the facts and provide the greatest level of transparency on the circumstances behind the failure of the project. The further review is now being undertaken seek to ensure that there is confidence in the governance of the Arts Council and in the Department’s own oversight and governance arrangements. In this regard I have recently established a specialised governance unit within the Department to embed one consistent high-quality approach to our oversight function across all our agencies.
As the Department takes on its new functions as the Department of Culture, Communications and Sport, I can assure the committee that we will place the highest emphasis on fulfilling our oversight responsibilities in relation to all our bodies over the coming years.
Táim sásta aon cheisteanna a fhreagairt.
Ms Maura McGrath:
As chair appointed last June, this was not the issue I expected to be dealing with but, along with the Arts Council executive team, I am here to provide full transparent information, to be accountable for our actions and to engage constructively with the committee - in other words to put right and move forward.
This project was not and is not an optional extra. It began out of necessity and it remains a necessity to be addressed. However, the expectation for small State bodies set up for specialist purposes to carry the load on complex IT projects should be questioned. It does not make sense for every State body to have an outsized ICT capacity in terms of the personnel required to deliver.
As chair of the Arts Council, I wish to support artists and arts organisations and the extraordinary work they do. They undertake this incredible work often for little reward. The board of the Arts Council is aware of the challenges within the sector. This context makes any loss of funds extremely disappointing and regrettable. I say to the arts community today that I will do everything in my power during my term to advocate for the continued development of the arts in Ireland.
What the board wants, working with our executive team and with the Minister, Deputy O’Donovan, and his officials, is to ensure that we have an arts council that is expert, functional, efficient and alive with the sense of mission given to us by the Oireachtas in the Arts Act.
A full examination report was published by our line Department as referred to by the Secretary General. We accept the findings and are in the process of implementing many of its recommendations. In addition, the external review being undertaken and led by Professor Niamh Brennan may provide further opportunities for reform. We have co-operated fully to date and will implement any further recommendations.
I accept that this is a setback. The project has cost time and money, and has worried artists. I see our accountability today as the necessary step to restore confidence and to go forward to better deliver for artists and the extraordinary art they make for us, the audience.
I will hand over to Maureen Kennelly, Arts Council director.
Ms Maureen Kennelly:
Ar dtús, ba mhaith liom a rá go bhfuilimid fíor-bhrónach mar gheall ar an tionscadal seo. I am joined by the deputy director, Martin O'Sullivan, and by our director of business transformation, Poly Anyanwu.
This was not just the development of a grant management system; the project sought to merge five systems into one, to secure and enhance our grant management system and integrate others, particularly our financial system. Our intention was to bring forward an improved service to the arts sector and to improve our reporting and analysis of the impact of our funding.
A lack of senior internal expertise, poor performance by our contractors and the impact of Covid-19, all contributed to the project failure. I reiterate our deep regret at the loss of public funds. We have commenced legal proceedings against two contractors and are in the pre-action stage with two others. We are vigorously pursuing our cases to reduce the loss to the taxpayer.
I have taken action to ensure this cannot happen again. We now have senior ICT expertise in-house. We have identified and implemented improvements to our procurement and project management processes. We are in the process of implementing all recommendations relevant to us from the Department’s examination.
This matter was never hidden by the Arts Council. We reported on the project to our line Department and submitted our accounts on time.
Throughout this project the Arts Council has consistently delivered on its work, through our flagship programmes, partnerships, advisory work and direct grant aid. Last year, for example, we awarded grants to 588 organisations and just under 2,000 individuals through a variety of grant schemes in every county in the country. We also supported 140 festivals, 318 schools and 31 local authorities.
The Arts Council has been supporting the development of the arts in Ireland for 74 years. Art is critical to the health of our country and to the well-being of its citizens.
I understand how the arts sector and audiences feel let down by the Arts Council in this particular project. I realise we need to restore trust and confidence as a matter of urgency. I also know that our work in developing the arts during the lifetime of this project has been successful. In 2019, the Arts Council received 3,000 funding applications and last year we received 8,600. With Government support, we have increased the number, location and types of arts activities we support throughout the country.
This one project failed, but I have faith in the organisation and in my colleagues to continue to support the development of the arts in Ireland in a robust manner for years to come.
My colleagues and I are happy to answer any questions members have.
Evanne Ní Chuilinn (Fine Gael)
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We will move on to questions from members. Rather than sticking with six minutes, is it agreed that we will go with eight minutes? Agreed.
Joanna Byrne (Louth, Sinn Fein)
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I welcome the witnesses. I had an opportunity to engage with the Arts Council and the Department on this issue at the public accounts committee last week. The briefing document provided to us from the Arts Council today details extensively the timeline and the processes that led to the IT system write-off. It is clear in black and white that people in the Arts Council engaged with the Office of Government Procurement. The Department of public expenditure and reform signed off on the project. They engaged with the Office of the Government Chief Information Officer and crucially they engaged with and informed the Department of the issues they were facing going right back to April 2021 and on multiple locations after that up to 2024. It was not until 2025 that the Minister decided to make an announcement on it.
My first questions are directed to Mr. Ó Coigligh. The timeline and chain of events are outlined in black and white. It is very telling that the Arts Council was pretty transparent on this at every opportunity. With that in mind, is it credible for Ministers to give statements that they had no idea there was such a huge problem and about the loss of millions of euro on this project?
Mr. Feargal Ó Coigligh:
The chair of the Arts Council said she wants to be completely transparent and we want to be completely transparent. We want to be completely transparent in relation to our failings. That is why I commissioned the report and that is why we published the report with no redactions. There is nothing hidden in this. The failure of the Department to escalate what we knew is set out. We should have stepped in much earlier when it became clear that this project had run into serious difficulty. We absolutely accept those failings.
Regarding whether Ministers knew, unfortunately it was not escalated to the Secretary General - to me or to my predecessor - nor to the Minister who was in position at the time. Unfortunately, that knowledge only became known at that level in late June 2024.
Joanna Byrne (Louth, Sinn Fein)
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In his opening statement Mr. Ó Coigligh said that governance, oversight and resourcing, among other things, are all core responsibilities for the Department.
Despite being made aware of concerns on multiple occasions, it seems this was all overlooked. Mr. Ó Coigligh has attested to that himself in his admission of failings of the Department at that stage. The IT companies that failed to do their jobs are being pursued legally by the Arts Council for money they did not earn. Who in the Department was held accountable for this?
Joanna Byrne (Louth, Sinn Fein)
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Mr. Ó Coigligh was not Accounting Officer at the time.
Mr. Feargal Ó Coigligh:
No, but I am now. I am legally accountable for the Department and for its actions. I speak for the Department. In light of these failings, we are taking measures to ensure they do not happen again and to make sure we have the skills, processes and resources to fulfil our functions to the highest degree. For example, in relation to ICT projects, we have put in place a tracker whereby a project of this nature which is funded by the Department is brought to the attention of the management board at least twice a year. I have put in place a brand new governance unit, staffed by one of our most senior principal officers, to bring both consistency and high-quality oversight to our functions.
I have recognised the issues that have arisen in this report and have addressed them. We will address them further. We are working with the Institute of Public Administration to review work it did last year, which I also commissioned as a result of the issues that arose in RTÉ. That was commissioned to make sure we are implementing those changes and to make sure any other issues that arise from this report and, indeed, the work of Professor Niamh Brennan, is addressed by the Department.
To put that in context, the Department is going through a significant transformation. We have lost our tourism and Gaeltacht functions. We have been given a communications function, which involves a significant body of more than 100 staff. That is a major economic function. As an organisation, we are going through significant change. As Accounting Officer and Secretary General, I have to make sure that we are fit for purpose to deliver the services we are charged with delivering. I am absolutely determined to do that.
Joanna Byrne (Louth, Sinn Fein)
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That is very welcome. Mr. Ó Coigligh's intervention and the measures he has taken are very proactive and overdue, obviously, particularly when we look at what happened in this instance. To be clear, there is reform under way in the Department but no single person or team has been specifically held accountable for these failures. In other words, blame has not been apportioned?
Mr. Feargal Ó Coigligh:
The Department failed. It would be wrong to point the finger at one individual. For example, from the initial failings addressed in the report about the review of the project when it was put in place in 2018 - I was an assistant secretary in the Department at the time on the arts and culture side - it was clear we did not have the capability to review the business case. I do not think you can point to an individual member of staff and say they should have done a better job. We did not have the-----
Joanna Byrne (Louth, Sinn Fein)
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There were failures. That is a valid point. The Department failed, yet it seems, as a result of everything that is going on - such as the report that is in front of us today and the engagement that took place at the Committee of Public Accounts last week - that the Arts Council is being made a scapegoat. In particular, Ms. Kennelly has been thrown under the bus by the Minister by not having her contract renewed. Blame for the failures relating to this project seems to have been apportioned to the Arts Council. I am of the view that there was full transparency at every stage, from 2021 right up to 2024, on the part of the Arts Council. Yet, it is okay for the Department to state that it failed but that nobody within it is to blame. It is the Arts Council that is suffering and it is the director who has suffered. In turn, thousands of artists in this country are not getting the service they desire and deserve because of the failures in the Department. I do not think it cuts the mustard to state that the Department failed but that nobody was held accountable. Sorry, Chair, I understand I am over time.
Evanne Ní Chuilinn (Fine Gael)
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I will remind the Deputy to be careful about making charges against people.
Sinéad Gibney (Dublin Rathdown, Social Democrats)
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I thank all the witnesses for being here and for their statements. Apologies that I was a couple of minutes late.
My first couple of questions are for the Arts Council. Nearly all mentions of the project under discussion today are redacted from the minutes that are available on the Arts Council's website. In nearly all of the minutes for meetings held during the most contentious period between 2021 and 2024, large sections are blacked out. Unredacted minutes released to The Currency under freedom of information show that many of those redactions were about the IT project, including significant concerns raised by the board. This includes the board's position at a September 2022 meeting to the effect that certain governance matters needed further consideration. The following month, the board outlined its continued concern about delivery of the project. By March 2023, it had asked for a paper which it stated needed to address all reputational concerns. Why were details of these concerns redacted and to what extent were they relayed to the Department? If they were relayed to the Department, when did this happen? What actions were taken on foot of them? Obviously, that second question is for the Department.
Ms Maureen Kennelly:
I will start. The redactions were there because of commercial sensitivity around the project. In late 2022, we started a legal process against two of the contractors. Obviously, we had to be very careful in terms of what was being released publicly. In parallel, conversations, dialogue and email correspondence were ongoing with the Department all the way through. It was alerted to these changes and these concerns the Arts Council had.
Sinéad Gibney (Dublin Rathdown, Social Democrats)
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The Department was fully informed the whole way through.
Sinéad Gibney (Dublin Rathdown, Social Democrats)
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Does Mr. Ó Coigligh have anything to add to the second part of my question, what actions were taken on foot of those revelations?
Mr. Feargal Ó Coigligh:
If you look at chapter 7 of the report I commissioned, you can see the flow of information. There is a recurring pattern to the effect that the project has run into difficulty, that extra funding is being applied but that it is okay, is in hand and has gone green again. There is a repeated pattern where it is stated that there is a problem but "Don't worry about it". In May 2022, there was a report to the Department that the project was online and that all was good. In June of that year, we got a report that user acceptance testing had failed.
Sinéad Gibney (Dublin Rathdown, Social Democrats)
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What actions were taken, though? I looked at the report, but what were the actions?
Sinéad Gibney (Dublin Rathdown, Social Democrats)
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Thank you. I am going to leave it there, because I have a few more issues to delve into. Either Ms McGrath or Ms Kennelly made a point of questioning the appropriateness of expectations of small expert agencies leading on complex IT projects. It was also stated that one of the explanations for the project management failure was that the Council did not have and was unable to secure expert IT resources until the appointment of two IT directors in 2024. This narrative has omitted the period of engagement of its head of IT between 2021 and 2022 and the key, year long CIO appointment in 2023. Why are those key IT personnel omitted from the narrative surrounding the IT systems failure? Do they not satisfy at least some of the requirements for IT expertise? Should we not be putting greater weight on the wider approach to risk and due diligence within the organisation?
Sinéad Gibney (Dublin Rathdown, Social Democrats)
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On the HEO appointment, did Ms Kennelly seek sanction for a higher grade initially?
Ms Maureen Kennelly:
Yes. We had a workforce plan that we gave to the Department in November 2021. I consistently highlighted that the key, critical appointment in that was the senior IT resource. I did that all throughout 2022. To answer the next question, the CIO who was brought in back in 2023 was brought in externally. It was not an internal staff member. That was because we were still trying to get the Department to give us the approval at the senior grade.
Sinéad Gibney (Dublin Rathdown, Social Democrats)
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The Arts Council was also in a position to engage the OGCIO via its parent Department at any stage in the design and management of the project. Why was that not done until after the surfacing of the total failure of the project and the associated financial cost?
Ms Maureen Kennelly:
It was approached at the very start, back in 2019, and a person was appointed to be part of the stakeholder group. That person attended a preliminary meeting. Unfortunately, he attended no further meetings. A degree of correspondence went from the Arts Council to the OGCIO to see where that person was. Unfortunately, no responses were received. Further contact with the OGCIO was made in early 2022 when we had received sanction at PO level for an internal IT resource.
I asked the OGCIO to help us with shaping the job specification, which it did. It was in late 2023 that I appealed directly to the OGCIO. Unfortunately, because of the invisibility of the OGCIO throughout the project, I did not know until that time that, in fact, it would have been there to help. It is a more general failing that past projects with failures like this are not shared more widely across government.
Sinéad Gibney (Dublin Rathdown, Social Democrats)
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Speaking of past projects, has the Arts Council done an audit of other significant projects, IT based or otherwise, during the past six years to identify whether any other projects were subject to significant overspends or write-downs or did not result in a functional result?
Sinéad Gibney (Dublin Rathdown, Social Democrats)
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Okay. Who was the decision-maker, or decision-makers, who decided not to take the off-the-shelf IT solution in the first place?
Sinéad Gibney (Dublin Rathdown, Social Democrats)
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Sorry, I am under pressure for time. Was there an internal decision-maker who decided, with all of that consultation, to not go with an off-the-shelf solution?
Mr. Martin O'Sullivan:
Obviously the board was fully across this and a business case was prepared and submitted to the Department with the board's knowledge. It was based on the work done by two external consultants in terms of shaping the ask, and a recommendation was made. We examined a number of different options in the business case and the preferred option was put forward, which was accepted by the Department.
Sinéad Gibney (Dublin Rathdown, Social Democrats)
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Of the board or somebody internally, who was the decision-maker who put this forward?
Evanne Ní Chuilinn (Fine Gael)
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It was the former director. The Deputy is out of time but we will go around again.
Sinéad Gibney (Dublin Rathdown, Social Democrats)
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Okay, apologies.
Evanne Ní Chuilinn (Fine Gael)
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We will move on to Deputy Cleere.
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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I am conscious of the time so will be as brief as I can. To get into the specifics, the original budget was €2.97 million with a delivery date of June 2021. Is that correct? It was revised to €3.5 million with a delivery date of quarter 2 of 2022. The costs then rose to an outrageous €6.5 million by the time the Arts Council pulled the plug in June 2024. All the signs here are of a compulsive gambler chasing the next hit. Who was in charge? What does the Arts Council have to say to the Irish people for this monumental waste of Irish taxpayers' money?
Ms Maureen Kennelly:
I want to reiterate the regret. Obviously, none of us set out with the intention of this happening. It is deeply regrettable. We are in a legal process. We initiated proceedings against two of the contractors and we are at pre-stage with two others. Our legal advisers suggest we have a good claim. I reassure the Deputy we will not be unstinting in our efforts to try to recoup this money on behalf of the taxpayer.
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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I will come back to Ms Kennelly on the legal process in a second but I note remarks of the Secretary General, who stated:
The Arts Council failed to seek or attain sanction for increases in the budget and resources it was applying to the project in 2021, 2022 and 2023 ... The Department failed to require the Arts Council to meet its obligations under the sanction which was provided and underlying all of this there was no process in place by the Department ... to escalate to the Secretary General or to the Minister.
This is a shitshow, excuse the language. Let us call a spade a spade.
Ms Maureen Kennelly:
While we were keeping our Department informed, and that was from myself primarily through the principal officer, her inquiry was, "Do you have enough capital? Keep going, these things are tough." I think there is a general awareness that IT projects are notoriously complex and she was supportive of us. We had the requisite capital funds to continue with the project.
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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What I have here is the Arts Council, the Department and the line Minister and nobody is taking responsibility. Nobody is taking accountability. Everyone is passing the buck from one to the next. That is what it looks like. The Irish Government gave €140 million to the Arts Council and this particular project is probably 5% or 6% of that annual budget. It is not acceptable. I need to move on because I have other questions to ask.
Ms Kennelly mentioned the legal side of things. Before I come to that, how many companies or contractors were involved in this particular IT project?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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Ms Kennelly stated, "We have commenced legal proceedings against two contractors and are in the pre-action stage in relation to two others", and the Arts Council is vigorously pursuing its cases to reduce the loss to the taxpayer. What are the names of the contractors from which the Arts Council is pursuing legal redress?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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I am sure Ms Kennelly can do so. In the case of the national children's hospital we all know the contractor is BAM.
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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Are those the names of the two contractors the Arts Council is pursuing legal redress from?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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For absolute transparency, will Ms Kennelly confirm for the committee whether there is any connection whatsoever between either of those contractors and the Arts Council?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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When did the process commence regarding the legal proceedings?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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I note two more contractors have been added. When were they added?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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Was it in February or March?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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Would it be fair to ask, would the Arts Council have pursued legal redress on those additional contractors if this had not become public knowledge?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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The Arts Council was able to make a decision in 2021 on the initial two contractors and court proceedings started in 2021 and then these two additional contractors were added.
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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Apologies; it was 2022. These two additional ones were added in February or March of this year.
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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One of the two new contractors.
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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How many contractors were there in total? I know Ms Kennelly said four accounted for €5 million but how many contractors were there in total?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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Okay. That is fair. There are 21 contractors. Would the Arts Council be happy with the work of all 21? Is it just the four contractors it is pursuing legal redress from?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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The point I am trying to make is whether there is anything to prevent these contractors, these cowboys, we will say, from going to look for State work again when they have completely underperformed, in that the Arts Council would not be taking a legal case against them otherwise?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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Yes, and including the four contractors.
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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Yes, but is there anything to stop those from applying for other contracted jobs with different Departments or agencies?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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Speaking of the Arts Council, a 2021 workforce plan was mentioned. What was the cost of that workforce plan? I think it was approximately €40,000.
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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It was approximately €40,000 and the recommendation was to double staff. Am I correct in saying that?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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How many staff are in the Arts Council now?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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How many staff were there before the workforce plan?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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There was a serious doubling of the Arts Council workforce.
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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It is significant.
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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I am conscious of the time. Apologies. What was the nature of the roles that were taken on?
Ms Maureen Kennelly:
We brought on new people in the Irish language and new people in the access office. We have two people working full-time helping artists with disabilities to make good applications. Our application rate went from 3,000 to 8,666, so obviously we needed a vastly increased number of people to look after those applications.
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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Did the Arts Council not think of hiring somebody with an ICT background?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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The Arts Council went from 58 to 122 staff and never took on an additional ICT person. I note from Ms Kennelly's comments that the Arts Council now has senior ICT expertise in-house.
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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When were they hired?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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What is the cost in that regard?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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Okay, so that is in addition.
Evanne Ní Chuilinn (Fine Gael)
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Just a reminder to make sure we do not make charges against non-members in regard to the use of the word "cowboy" and to watch the parliamentary language. You are not in a dressing room now, Chap.
Evanne Ní Chuilinn (Fine Gael)
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That is all right. We will move on to Deputy Ó Snodaigh.
Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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I will continue with the Arts Council. I was looking through the sequence of events. The project started way back in May 2017. At that stage it was said "there was an increasing risk from hardware and software which was nearing the end of life, and it was becoming increasingly difficult to support and enhance some components of the architecture". Eight years later, given the failure of this, I presume the Arts Council is still dealing with an IT system that is clunking along or dying on its feet.
Mr. Polycarp Anyanwu:
When I came into the role, when I first joined the Arts Council, we had to work with the existing system. We upgraded the operating systems from 2003 to 2012, enhanced the processing capabilities of that system and right now we are taking it to the cloud. We have a more stable system operating. However, the issues that led to the request for the upgrade of the grant-management systems is still there. The operating systems are dated and the platform is dated. They were .NET 2.0. Now we have .NET 10 and all that is still there. There is a security risk in the systems. There are a lot of vulnerabilities. It is stable but it is still not the best that we deserve. If an artist makes an application, it takes five days to get an artist registration number to be able to submit an application. One has to use four different systems in the course of the application. It is not an ideal situation for artists. They suffer a lot to submit applications in the current system.
Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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Over the years, I have received quite a number of complaints about artists struggling with the system trying to deal with applications. Obviously that is worse if the Arts Council is dealing with a lot more money and staff. The witnesses also mentioned that part of the work on the system that was intended was not only around the customer interface or management but also finance which I presume is also HR.
Mr. Polycarp Anyanwu:
Yes. It was intended to have five systems together, including the finance system. When I joined the business transformation programme, along with my other colleague, in early 2024, we had to do a cost-benefit analysis around whether we should continue with the system under development or were there other alternatives. It became clear to us that instead of trying to get more resources to internally work on the existing system we considered the issue of support for the systems and what is good practice at this stage. We decided to go for the commercial off-the-shelf for the grant-management system and finance system. Then we viewed the interface integration between the two. That would help us achieve what we were trying to achieve in 2018 in a much cheaper and more risk-free way.
Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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I presume the off-the-shelf option has an annual cost rather than a once-off cost of the other system, which would have been controlled by the Arts Council. The off-the-shelf interfaced the two systems of finance and HR systems and then the customer database or management system. What is the cost expected to be?
Mr. Polycarp Anyanwu:
We analysed the cost implication of the subscriptions to the commercial off-the-shelf. There is a fraction of the support cost than we would have had if we had continued with the system on that development. It is not as though if we went live with the VTP the way it is now, it would be support free. No. We already had a contract for supports because most of it is bespoke. If it is bespoke we still need the people who did the design to come and look at it if there are issues and provide support so it was not free support like that. We analysed it. Going commercial off-the-shelf you pay a subscription and then the vendor makes sure there are no bugs in the system and it is support is provided if you pay for your subscription. That was a better alternative for us.
Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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When is the new system expected to go live? It was said the old system was clunky and needed to transfer it at some stage. This is so that the artists can be assured that there will be a new system and it will be managed better and maybe the Palestinians can apply because at the moment they cannot apply. If someone says he or she is a Palestinian artist, then he or she cannot apply.
Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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How long has that request been with the Department?
Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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With all this chaos and an increased budget to the Arts Council, there still is not a system that the witnesses would be happy with.
Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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I will turn to the Department. I have looked through the document recommendations. The biggest thing that comes out of it is how convoluted the process was. No organisation, whether it is under the Department of arts or many of the other Departments where we are finding out there are IT problems, should be expected to have the IT expertise. Is one of the key recommendations from this, from RTÉ, HIQA, the RTB and all the other ones that are still to be announced, that there should be a centralised agency within the State that does the job it is supposed to in helping organisations set up IT processes?
Mr. Feargal Ó Coigligh:
This was very much focused on the Arts Council. The Chair has raised legitimate questions more generally about small bodies delivering ICT projects. That is a very valid point. One of the recommendations is to ensure that if the Arts Council embarks on this again using public money, it is set up to deliver it but to control it. Looking at the history of the project, there was a lot of project creep. The scope of the project expanded and the complexity expanded. There was a whole issue around not only delivering a complex ICT project but also making it more and more complex as it went ahead. That is a fundamental issue too. There is the issue of the expertise and the issue of the project scope. Even without a centralised body to do everything on behalf of all public bodies, there is a question mark around how one ensures that the projects are properly managed. There are things we can do and there are new safeguards in place. For example, if we were to embark on that again today, we would be required to set up a completely external peer group which has no skin in the game to just look at it and be able to say “No, that won’t work” or “That will work” and ask the tough questions. We did not have that in place at the time.
Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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Like an IT expert?
Evanne Ní Chuilinn (Fine Gael)
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We are out of time. Sorry, Deputy. We can come around again.
Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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I will come back to it.
Malcolm Noonan (Green Party)
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The witnesses are welcome. I have to leave as I have important questions at the climate committee too, so I am trying to cover all angles. I have just a couple of questions because many of them have been addressed. There is no doubt that the Arts Council underwent a huge transformation over recent years and it has been transformative for the arts sector. I want to wish Ms Kennelly all the very best. She has led that transformation and done a remarkable job.
On foot of the last question on the role of the Office of Government Procurement, this was a capital spend in relation to the IT system that was inherited from a previous Minister. Are there questions or issues the Office of Government Procurement needs to be answerable on in relation to this?
Mr. Feargal Ó Coigligh:
In relation to the review of the original business case, anyone involved, including myself has questions to ask. Senator Noonan was a former Minister of State, Senator Noonan and I was in his previous Department for five years. I was there at the very beginning, so I went back to the original documentation and looked at the business case.
The business case speaks in very confident terms about putting in place a project manager and delivering a steering group. It looks fine to someone like myself without the ICT expertise. I said that it was under control, when clearly it was not. I did not have an appreciation of this at the time. Our Department did not have the ICT expertise, because I think the highest grade person in the Department was at HEO level. We were struggling to service our own needs. Our own internal ICT project looked at it and had a few questions but thought that it made sense. The Office of the Government Chief Information Officer, OGCIO, looked at it again. With the benefit of hindsight, all of us should have looked at it more closely, not just in terms of the ambition, because we all support the ambition and the system is still needed, but in terms of skills needed to deliver it. That is what we did not interrogate sufficiently at the time.
Malcolm Noonan (Green Party)
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Regarding the expansion of the Arts Council staffing, has there been a swell in the middle management level that perhaps we are not seeing in the sector more widely? This is not a criticism but when I look at the theatre sector, which I have an involvement in, it has had a very poor uplift since 2008. I know the Minister has committed to a review but did that have any involvement in this particular situation, given that that swell has taken place? The Arts Council has grown exponentially. I saw this with the NPWS and that it can create as many challenges as it can create opportunities, because you are growing at a much faster rate from a very low base. There is no doubt that the funding uplift that the Arts Council received over the term of the last Government has been hugely transformative but that can create its own challenges.
Ms Maureen Kennelly:
It was transformative. It went from €80 million in 2019 to its current level of €140 million. Naturally, I understand people saying that our staffing cohort expanded very significantly because it did indeed. I want to underline that the remit also massively expanded. The Arts Council now runs Culture Night, which is accessed by 1.4 million people every year. We run a fantastic programme called Creative Places involving 19 towns which have previously been neglected by very little investment. We run Creative Schools. Some 28% of schools across Ireland take part in it. Looking after children and young people is very much a priority for the current Arts Council.
I mentioned previously about the 3,000 applications going up to 8,600. There are good new imperatives, such as equality, diversity and inclusion and climate action that the Arts Council needs to pay attention to. The previous Minister did fantastic work in this regard. I worked in the sector for 32 years and I am very aware of leading small organisations, with just three or four people. I can imagine looking at something and saying, "Oh my gosh. That looks amazing but how does the Arts Council expect me to do my work on this threadbare, skeleton staff?" The number of strategically funded organisations rose by 52% between 2019 and 2024. This is still not enough but we were able to make significant increases to people so that they could enhance and strengthen their core.
Malcolm Noonan (Green Party)
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Okay. I have two final questions. Going back to the Department, the Minister has stated that he is considering a review of governance and culture. What would that look like? Will we see the terms of reference of that? How is the "arm's length" principle enshrined in the Arts Act 2003 to be protected in light of the Minister's refusal to allow a recommendation from the board of the Arts Council for an extension of the director's contract? I am not talking about a full renewal but an acceptable extension until Professor Niamh Brennan's review is completed.
Mr. Feargal Ó Coigligh:
I will answer the second question first. The "arm's length" principle, in particular the independence of the Arts Council in decision making, is in relation to its functions as a funding body. The legislation sets out clearly that the appointment of a director is a matter for the board, subject to the consent of the Minister for public expenditure and reform. That is a typical type of measure. The Minister exercised this function in the manner he deemed fit in the circumstances. That is the way these things operate.
Regarding the governance review, that is now under way and is being led by Professor Brennan, accompanied by Mr. John McCarthy, former Secretary General in the Department of housing and Dr. Margaret Cullen. The Department is assisting that review in terms of the secretariat. I understand that the work is well advanced but it is being read independently. I know they have engaged with a lot of people within the Arts Council, the sector and the Department. I expect they will report back in the autumn with recommendations, which I think will be interesting for all of us to read.
Garret Ahearn (Fine Gael)
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I am sorry I missed the start of the meeting but I had read the opening statements. In her reply to Deputy Cleere, Ms Kennelly said that a request had been made for extra staff which included ICT staff. When was this request sent to the Department?
Garret Ahearn (Fine Gael)
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This question is for the Department. When was a decision made on that and who made it and why was a decision made not to fund ICT staff?
Garret Ahearn (Fine Gael)
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Does Mr. Ó Coigligh disagree that it was not funded?
Mr. Feargal Ó Coigligh:
No, we funded ICT staff but not at the level of principal officer, because that would not have been appropriate. We advised the Arts Council in July and October 2022 and in April 2023, that it should advertise the post at assistant principal higher level and if that did not succeed-----
Garret Ahearn (Fine Gael)
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Yes, but there was ICT staff approval.
Garret Ahearn (Fine Gael)
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So when Ms Kennelly said initially that it was not approved was slightly misleading. Is that the case?
Garret Ahearn (Fine Gael)
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Yes, so the salary was downgraded but the role of someone for ICT, which was requested, was approved. From Mr. Ó Coigligh's perspective it was approved. Is that not so?
Garret Ahearn (Fine Gael)
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To be clear, a request was put in and approved but just at a lower level.
Garret Ahearn (Fine Gael)
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Yes, but before that the Arts Council had nothing.
Garret Ahearn (Fine Gael)
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So the Department approved at a certain level.
It was mentioned earlier the Ms Kennelly is finishing up in June. It was incorrectly stated that the proposal was not put forward. A request was put in by the Arts Council for a five-year term and the Minister proposed a shorter term to Ms Kennelly which she did not agree to. Why did she not want to continue? Was there a difference in conditions or anything like that from the Department and the Minister?
Ms Maureen Kennelly:
Yes, the contract which was for up to nine months was heavily conditioned and it was clear that it would be a final contract. The board made a strong business case to the Department in December 2024 for a renewal of my five-year term, which is normative across the cultural sector and certainly for all of my predecessors in the Arts Council. The Minister did not approve it. Subsequently, the board asked him to defer the decision on the renewal until the findings of the Brennan report were completed. Unfortunately, he also refused that and the Department said that there was no mechanism to defer such a decision. On the back of that, the Department then offered me a very heavily conditioned, up to nine months' term, during which the recruitment for my successor would take place. In fact, it was clear that it might not even be a nine-month term and I felt that it was unacceptable.
Garret Ahearn (Fine Gael)
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In her role does Ms Kennelly feel she has the confidence from the Minister?
Garret Ahearn (Fine Gael)
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Does he have confidence in Ms Kennelly?
Garret Ahearn (Fine Gael)
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It is a feeling, so Ms Kennelly will know herself.
Garret Ahearn (Fine Gael)
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Did the legal case commence in 2021?
Garret Ahearn (Fine Gael)
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So there are two ongoing and two more to come. That is at total of 21 organisations. Deputy Cleere asked whether there is any conflict of interest between those organisations and the Arts Council and it was said there is not.
To be clear, 21 organisations have been involved. Is there any conflict of interest between the Arts Council and any of those 21 organisations?
Garret Ahearn (Fine Gael)
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The court case started in 2022 and the lawyers acting for the Arts Council said the council had a very good case. Obviously that is what any lawyer would say to his or her client. How much has the court case cost so far?
Garret Ahearn (Fine Gael)
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What is the expected costs for the Arts Council?
Garret Ahearn (Fine Gael)
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Mr. O'Sullivan did not answer my question. What are the expected costs?
Garret Ahearn (Fine Gael)
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Can Mr. O'Sullivan give a ballpark figure?
Garret Ahearn (Fine Gael)
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Is the Department supportive of the legal case?
Garret Ahearn (Fine Gael)
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Is the Department supportive of it?
Garret Ahearn (Fine Gael)
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Is the Department supportive of it?
Alan Kelly (Tipperary North, Labour)
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Would the Secretary General mind answering the question? Is the Department supportive of it?
Garret Ahearn (Fine Gael)
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At the moment is the Department supportive of it?
Garret Ahearn (Fine Gael)
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The costs will come back to the Department.
Alan Kelly (Tipperary North, Labour)
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I again ask the Secretary General to answer the question please. Is the Department supportive? Either it is or it is not and it is not conditional.
Garret Ahearn (Fine Gael)
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In those discussions, has the Secretary General expressed concerns about taking legal action, the cost of legal action and the impact that has on taxpayers' money?
Garret Ahearn (Fine Gael)
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Is there anyone in the Department who has concerns about taking legal action?
Garret Ahearn (Fine Gael)
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Has anyone within the Department outlined their concerns about legal costs to the Secretary General?
Garret Ahearn (Fine Gael)
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Does the Secretary General consider this further expenditure?
Garret Ahearn (Fine Gael)
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So the view of the Department is no further expenditure should be incurred from now.
Garret Ahearn (Fine Gael)
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So no more than €60,000 should be spent on legal fees.
Garret Ahearn (Fine Gael)
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Is it simply the Department's view that there should be no extra funding done?
Alan Kelly (Tipperary North, Labour)
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I am not sure we got to the bottom of the matter but let us move on. We might return to the topic and I might return to it myself.
The next person due to speak was Senator Alison Comyn who was to join us online for the first time. As we cannot get the Senator online we will move on to the next speaker who is Senator Ní Chuilinn.
Evanne Ní Chuilinn (Fine Gael)
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First, I greatly appreciate the arts. I grew up in a house that was obsessed with the arts. I was in orchestras, choirs and dance schools but appreciate good governance. I think the Arts Council would accept there is learning for everyone around governance failings over the last couple of years. It is an awful lot of money to fall through the tracks.
I will pick up on the points that Deputy Cleere made about the original costs. The revised fee was €3.5 million and it was then abandoned after a cost of €6.5 million but then there was acceptance of an off-the-shelf system. There was some discussion on the sign-up and the subscription. Does the director know how much the off-the-shelf system would cost?
Evanne Ní Chuilinn (Fine Gael)
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So we have a loss of €6.5 million. Am I correct that €1.5 million still has to be paid?
Evanne Ní Chuilinn (Fine Gael)
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Am I correct that the very least that is going to be paid for an off-the-shelf Joe Bloggs system is €8 million plus a subscription fee every year?
Evanne Ní Chuilinn (Fine Gael)
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That is given what has been lost so far.
Evanne Ní Chuilinn (Fine Gael)
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If the Arts Council is allowed to take legal redress. That is an awful lot of money. As the loss accrued who had oversight in terms of finance?
Ms Maureen Kennelly:
There was a stakeholder board in place. My colleague, Martin O'Sullivan, was the project sponsor. When I realised that the project was seriously coming off the rails I changed the structure and personnel involved in the project. That was at the back end of 2022 and I took over as project sponsor at that stage.
Evanne Ní Chuilinn (Fine Gael)
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The Arts Council must sign up to the code of governance and the delegation will be familiar with competency-based appointments. Which board member of the Arts Council brings a fiduciary or accounting and finance oversight or competency?
Evanne Ní Chuilinn (Fine Gael)
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I am asking about the board that was in place when all of this money was falling through cracks.
Evanne Ní Chuilinn (Fine Gael)
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Who was the accountancy or accounting person on the board?
Evanne Ní Chuilinn (Fine Gael)
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I have asked about board of the Arts Council. In terms of good governance, competency-based appointments are very important.
Evanne Ní Chuilinn (Fine Gael)
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I clearly asked who was the person who had oversight of this money as it was falling through the cracks.
Evanne Ní Chuilinn (Fine Gael)
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There should be a competency-based appointment on the board in terms of finance. Who was that person when the money was falling through the cracks?
Evanne Ní Chuilinn (Fine Gael)
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I am a little bit worried about the governance because €141 million is an awful lot of money and €8 million went down the drain as it was spent on a system that is not really fit for purpose.
Is Ms McGrath a member of any other boards at present? Was she a member of any other boards at this time?
Evanne Ní Chuilinn (Fine Gael)
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How long has Ms McGrath been chair of the National Concert Hall?
Evanne Ní Chuilinn (Fine Gael)
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During all of that time was Ms McGrath chair of the National Concert Hall and chair of the Arts Council?
Evanne Ní Chuilinn (Fine Gael)
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Was there an overlap of a year?
Evanne Ní Chuilinn (Fine Gael)
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And the appointment is nearly finished.
Evanne Ní Chuilinn (Fine Gael)
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So Ms McGrath was on two boards. As chair of the Arts Council, has Ms McGrath approved funding, for example, for artists who would perform in the National Concert Hall, which would create revenue for the National Concert Hall?
Ms Maura McGrath:
Absolutely. A conflict of interest is a very essential aspect of every governance board, as the Senator well knows. We have a very strict code of ethics with regard to that.
We were asked this question at the Committee of Public Accounts. There is a list of organisations where there was a conflict of interest and we do this at our board's plenary, as we call it in the Arts Council.
Evanne Ní Chuilinn (Fine Gael)
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I am just conscious of time. I did ask a specific question on whether the Arts Council funded an artist who performed at the National Concert Hall.
Evanne Ní Chuilinn (Fine Gael)
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Yes. A conflict of interest is obviously very important. I noted it was said earlier, in the opening statement I think, that the Arts Council funds or supports 2,000 individual artists, which is brilliant. Regarding the make-up of this total, does the Arts Council fund traditional musicians?
Evanne Ní Chuilinn (Fine Gael)
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What does "a small extent" mean out of 2,000 artists?
Evanne Ní Chuilinn (Fine Gael)
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Yes, but a dozen sounds a bit low. The arts sector is the arts and it is important there is inclusivity and oversight of where this money is going.
Turning to the witnesses from the Department, do they know when the external review, being led by Niamh Brennan, of the governance and organisational culture at the Arts Council will conclude?
Evanne Ní Chuilinn (Fine Gael)
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Does Mr. Ó Coigligh know how much it will cost?
Evanne Ní Chuilinn (Fine Gael)
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I understand. Returning to Ms McGrath, regarding the opening statement in relation to ICT and how small bodies should not need to have experts in ICT in-house, does she accept that a State body should have good governance no matter how big or small an organisation it is?
Evanne Ní Chuilinn (Fine Gael)
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I know, but that is more of a professional look. I think there are many question marks over the composition of the board and the governance of the organisation. Does Ms McGrath accept that, whatever about having to have an ICT competency, there is really a need to have certain competencies represented on the board and that the code of good governance needs to be applied?
Evanne Ní Chuilinn (Fine Gael)
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Is Ms McGrath happy with the governance of the Arts Council now?
Evanne Ní Chuilinn (Fine Gael)
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I am referring to the governance of the organisation. Is Ms McGrath happy-----
Alan Kelly (Tipperary North, Labour)
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I call Deputy Malcolm Byrne.
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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I welcome our witnesses. Before we delve into some of the issues, I am enormously appreciative in general of the work the Arts Council has been doing. There has been a step change in terms of funding and support for the arts here. We do have some serious issues that we need to address, and I will come to those challenges, but it is important to put it on the record - notwithstanding those issues and we do have to ask about them - that I thought Maureen Kennelly provided great leadership in the arts community. I was disappointed that the board's recommendation to extend her term, as is normal, was not taken on by the Minister. I wish to say that I do have confidence in her leadership, the staff and the board. This is not to say there are no criticisms and this is to be accepted. It is important, however, to recognise much of the good work that has been done, particularly under the last Government. I hope it will continue under the current Minister. I refer to the Arts Council's funding having significantly increased and the introduction of the basic income scheme for artists.
The challenge I referred to relates to all that. I was on the previous iteration of this committee and recall asking a question about the Arts Council taking on all these additional resources and if it believed it had sufficient numbers of staff to be able to support all these new schemes. I am conscious that question was asked. Having posed the query during a meeting of the last committee, I will ask it again here. Does Ms Kennelly think there was a sufficient level of staffing given all the new challenges placed on the Arts Council?
Ms Maureen Kennelly:
I recall the Deputy asking that question the last time. It is a struggle and always a challenge. The staff complement of the Arts Council was seriously depleted after the last economic crash. The budget for the Arts Council went down significantly. Effectively, then, we were just building the staff back up. While the number seems quite startling in terms of the increase, in fact it was just getting it back to a base level. As our remit had expanded and we had a vastly increased number of applicants, we needed far more staff. As I said before, the senior IT resource was the critical one. Just to remind ourselves, the intention with this undertaking concerns the artists and is to bring forward a system so the arts community can make better applications to us. It is to ensure artists will not be spending undue time doing so and we will be able to open up the field to a far wider range of artists who will not find our systems forbidding.
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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I do recall it. The reason this IT system came in was because there were many complaints from artists about the application process.
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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By the way, I certainly share the desire to see funding extended to comedy and musical theatre, which we talked about, and broadening the remit of the Arts Council. My question is less about the governance issue and more about other aspects, including who advised on the IT system. If I am going to purchase a new laptop or have something installed in my house, I know I am not a techie. Who did the Arts Council get in to advise on the best system to put in place?
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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I get that. We all get the business case. I know I need advice when I need a new laptop, so who advised the Arts Council on its system and identified the one that needed to be installed?
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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Mr. O'Sullivan gets my point, though. Ultimately, whose was the recommendation that this was the system to go with?
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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The business case was signed but people work on the basis of the advice they are given. Ultimately, who told the director this was the system to go with?
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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The reliance was on that basis and the Department was happy with that process.
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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Who gave the thumbs up to the Minister to go ahead with it?
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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I ask Mr. Ó Coigligh to forgive me. Perhaps he is an expert in technology and these systems-----
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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Ultimately, however, there must be somebody who provides advice. We all rely on somebody who tells us what system we should go with. Who was the technology expert who said that?
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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I appreciate that, but somebody ultimately had to give advice. We all rely on somebody down the line.
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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I did hear some of Mr. Ó Coigligh's earlier contribution. This strikes me, however, as a situation where people were doing things because the file was passed up to them and then passed on again. Ultimately, however, we all rely on advice and the question is who said this was the best system. I do not know if this was in the Arts Council or in the Department.
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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It was the consultant's recommendation. It was what the consultant said and it was not interrogated by anybody in the Arts Council or anybody in the Department.
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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It was interrogated on a business case but what about on a technical case? If I buy a laptop, the business case is whether I can afford it or how I will fund it and the technical case is whether it will meet the needs.
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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Mr. Ó Coigligh looked at the business case. In other words, it is the old line about the critic knowing the price of everything but the value of nothing. It is a crucial question. We can pay any amount for a computing system but if it does not do its job-----
Mr. Feargal Ó Coigligh:
I commissioned the report because I was shocked at the loss of expenditure in this case. I wanted to know what happened. One of the findings was that, at the very initiation of the process, there were significant failures in terms of the ability of the Arts Council and the Department-----
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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I am now worried there was nobody technical, including in the Department, if the Department was aware of the case.
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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Does it have them now?
Micheál Carrigy (Longford-Westmeath, Fine Gael)
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I apologise for being late. I will follow up on what Deputy Byrne has said. Who is responsible for the Department not having sufficient persons to be able to interpret whether this was correct? It is Groundhog Day again here. A number of weeks ago we had issues involving a multimillion euro loss in RTÉ, which occurred later than this and which also involved an IT system project. Somebody is responsible. Who is responsible? It cannot be the case that nobody is responsible. Somebody has to be responsible for a multimillion euro loss to the taxpayer between the Department and the Arts Council. If the Department did not have somebody professionally qualified to assess a multimillion euro project, somebody is not doing their job. Who is that person?
Mr. Feargal Ó Coigligh:
We are looking back at a period in 2017 when the country was coming out of significant recession. The director of the Arts Council mentioned it was under-resourced in terms of personnel. At that time we were a very small Department comprising culture, heritage and the Gaeltacht. We were under-resourced in terms of our ICT cohort.
Micheál Carrigy (Longford-Westmeath, Fine Gael)
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Whose responsibility was it? Who made the decision not to have it properly assessed? Somebody had to make a decision. A multimillion euro-----
Micheál Carrigy (Longford-Westmeath, Fine Gael)
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I do not want to cut across Mr. Ó Coigligh but he said this was at a time when funding was tight and we were coming out of recession. We were looking at a multimillion euro project when money was tight. This money was going to be spent and we did not have a proper project manager on it when it was allowed to happen, and we did not have it properly professionally assessed in the Department. Who in the Department was responsible for this? Somebody has to be responsible for taxpayers' money. We cannot blame it on recessions and that we did not have people. There is a responsibility on people. People are well paid in the Department, an awful lot better than any of us sitting here, to do these jobs and the job was not done. Who was responsible?
Mr. Feargal Ó Coigligh:
I am the Accounting Officer for the Department and I am speaking on behalf of the Department. I am taking responsibility for the failures of the Department as addressed in the report which I commissioned. That is how accountability works. We are here today to provide transparency on what went wrong. I commissioned a report carried out by the former head of internal audit. We published that report. There is not one word redacted from the report. I have not heard anybody taking issue with the findings in the report. The report is not pleasant reading for the Department nor for the Arts Council. This is how we take responsibility and accountability for what went wrong: identify what went wrong and make sure it does not happen again.
Micheál Carrigy (Longford-Westmeath, Fine Gael)
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It did happen. It happened with RTÉ. Its representatives were in here only a few weeks ago. We have two cases relating to RTÉ and the Arts Council, both involving IT projects and both under the Department, and cumulatively there was a loss of more than €5 million to the taxpayer.
Micheál Carrigy (Longford-Westmeath, Fine Gael)
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What are the consequences of this?
Mr. Feargal Ó Coigligh:
The consequences are to ensure we can provide assurance to the public that this will not happen again and that we have systems, training, oversight arrangements and governance in place whereby our agencies are fit for purpose to provide the confidence that this cannot happen again. This is the best assurance we can give the public.
Micheál Carrigy (Longford-Westmeath, Fine Gael)
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There are no consequences for those who were responsible for a multimillion euro loss to the taxpayer. We move on and we say everything is okay until something else happens again.
Mr. Feargal Ó Coigligh:
The Department is taking responsibility for our failings in this regard and we are taking the steps to ensure it does not happen again. Since I have come in as Secretary General I have made changes. I have appointed a new senior head of IT at principal officer level and I have set up a new governance unit. This is how I am responding to the failures identified in the report. The Minister has set up a separate governance review of the Arts Council to look at the failures there.
Micheál Carrigy (Longford-Westmeath, Fine Gael)
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It is very hard for anyone watching this and taxpayers listening to this to hear there was a multimillion euro loss and there is no accountability for anybody. We change things and we move on and we say it will not happen again.
Micheál Carrigy (Longford-Westmeath, Fine Gael)
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What changes have been made in the Arts Council?
Ms Maureen Kennelly:
We have brought on two senior IT people. We have new procurement processes. We have new project management processes. We absolutely want to make sure that such a thing could never occur again. I am confident we have the processes in place to make sure this could not recur. There will be far more expertise in-house and far better and stricter processes in terms of contract management because that was a major failing of this.
Ms Maura McGrath:
I want to add to this. Monitoring and measuring are crucial for any project, irrespective of size or scale. This is the essential learning as I look back. I have a background in IT in Bank of Ireland. This is why I made my earlier comment that I believe it is essential for projects such as this that proven expertise is available to advise. That was not there. That was a weakness, and going forward it is essential this is tracked, measured and monitored under audit and finance and at board level. This is the only commitment I can give Deputy Carrigy today.
Micheál Carrigy (Longford-Westmeath, Fine Gael)
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Does Ms McGrath have every confidence with regard to other projects that have been undertaken through the Arts Council, and with regard to all of the spend, which is quite a large purse of money of more than €100 million, if I am correct-----
Micheál Carrigy (Longford-Westmeath, Fine Gael)
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-----and with regard to all avenues where this money is spent and allocated and any projects undertaken apart from this?
Ms Maura McGrath:
This is a very important question. It is an opportunity to reassure the sector, which is of primary importance. The specialism of the Arts Council has not been damaged through this project. It is essential to say this. As we have said in this room for the past hour and a half, there were failings of governance at a number of stages when certain things were not called out and where the risk register was, perhaps, not followed through with the diligence to raise it to the level required. That is what secures taxpayers' money. This is very much in hand.
Micheál Carrigy (Longford-Westmeath, Fine Gael)
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With regard to the basic artists' income scheme, there are various types of artists, such as those involved in music and art. Is this opportunity available to all areas?
Alan Kelly (Tipperary North, Labour)
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I ask the witnesses to be very brief.
Micheál Carrigy (Longford-Westmeath, Fine Gael)
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Ms Kennelly is happy that it covers all sectors countrywide.
Alan Kelly (Tipperary North, Labour)
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I am sorry but I must move on to the next speaker.
Alison Comyn (Fianna Fail)
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I apologise that I have only arrived now. I managed to catch the vast majority of their contribution online. I was not available to be called; I was entertained on a call at the time.
I thank the witnesses for their candid responses to all the questions. Many of my queries have been answered.
What I really would like to know is the impact directly on the artists. If I missed this, again, I apologise. What impact directly on artists and the grant process did the termination have and what impact on the ongoing grant applications and the administration process did it have?
Ms Maureen Kennelly:
To be clear, this money was coming from the Department via capital funds. The expenditure of €6.675 million did not have any impact on grant aid that going to individual artists or organisations. I want to make that absolutely clear.
In terms of the current system, I will pass to my colleague, Mr. Anyanwu. Our imperatives were twin in terms of bringing in this new system. It was creaking on its hinges. It was out of warranty. We knew that we needed a new system but also we knew that it was clunky and cumbersome for applicants. We were worried about its usability, but Mr. Anyanwu came on board and has been able to make some fantastic mitigations to it.
Mr. Polycarp Anyanwu:
What we did in the first two years was to enhance the platform that it had been running on. We are going to now take it to the cloud. What I have sourced to do is, if we run into a very big hitch or maybe it is hard or there is a problem, we can restore it in a different location and continue to process. We have enhanced the reliability. However, the vulnerabilities and all the issues around security and clunkiness, and it being not user-friendly, are all there. That is what we are seeking to address by getting a commercial off-the-shelf grant management system. A commercial off-the-shelf grant management system, from my own estimation and the experience of other public bodies that have implemented them in Ireland, will not take us multiple years to implement. After six months or, say nine months, we are going to start doing a pilot run of a commercial off-the-shelf grant management system. When we evaluated that, we thought that is a better use of public money instead of continuing to try to remedy the existing situation.
Alison Comyn (Fianna Fail)
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How well informed were the artists or those who may have applied for grants of that transitionary period and how did the Arts Council support them during that?
Ms Maureen Kennelly:
That was a concern of ours because we had been talking about this project for quite some time, well before my own time, indeed, with the Arts Council. We were at pains to communicate with individual artists and organisations about the changes that we hoped to introduce but I want to reassure people there was no effect on the service to artists. There was never a case whereby the system collapsed and artists could not be paid. Obviously, that would be carnage. That never happened. There was never a situation whereby we could not accept applications to the system because of the good work that Mr. Anyanwu and other colleagues did. I would underline that the kernel of this is about a service for artists and arts organisations.
Alison Comyn (Fianna Fail)
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Apologies if I missed anybody mentioning data. We know it is more valuable than gold. I am talking about the data that was previously held in the system. How is it currently being managed and protected?
Mr. Polycarp Anyanwu:
As I said, we were very good to enhance the operating environment of our applications. It is now running in the cloud and back-ups are built to kick-in properly but the upcoming digital strategy is also to have a data warehouse. We are beginning to view the data warehouse that we are going to aggregate all these data that we have over the years.
Alison Comyn (Fianna Fail)
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How can the Arts Council guarantee that nothing was lost, or even grant applications? I am wondering about the integrity or accessibility of historical grant applications.
Alison Comyn (Fianna Fail)
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I have a final question for Mr. Ó Coigligh. My colleague Deputy Carrigy asked who would take responsibility and Mr. Ó Coigligh himself took responsibility. Does he believe that his position is tenable given that responsibility he has taken?
Mr. Feargal Ó Coigligh:
The issue here is to ensure that the Department gives good public service and we are giving excellent public service to sporting organisations and cultural and artistic organisations up and down the country. We are now taking on the brief of communications to ensure that this country has a world-class communications system and, of course, a media system as well. We are working strongly across all our sectors. I have more than 500 staff who are giving their all.
Mistakes get made. People are operating under pressure. Balls were dropped. In this case, people got sucked into the narrative that, "One more push and we will get it across the line." That is a huge amount of what happened here. On behalf of the Department, I am confident that we will learn the lessons from this case and that we will continue to deliver strongly on behalf of all the people of Ireland across all the services that we deliver.
Alison Comyn (Fianna Fail)
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Does Mr. Ó Coigligh firmly believe that he is certain to remain?
Alison Comyn (Fianna Fail)
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I have one final clear message to artists. Throughout the centuries, artists have struggled. They are still struggling. We are talking about basic income and I would certainly like to be pushing for a capital fund for artists similar to the sports funding. What is the Arts Council's clear message to artists off the back of such a financial travesty?
Ms Maureen Kennelly:
We want to allay their concerns about them. First, we want to express our deep regret and to allay concerns that this will impact on the funding. We have expressed regularly to the Department since it happened that this must not impact the artistic sector. This was an outlier. It was one exceptional project that failed but the arts community cannot suffer as a result.
Ms Maura McGrath:
I would like to endorse that, if I could. That is really important because, as the Senator said, sometimes artists' existence can be quite meagre. We have a responsibility to not only protect them, but to support them. That is central to the mission of the Arts Council, which I believe fundamentally in.
Alison Comyn (Fianna Fail)
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Can Ms McGrath assure that this is not a setback to whatever funding there may be?
Ms Maura McGrath:
Absolutely. This has no impact. This was separate. Believe it or not, as I said earlier, the work and the expertise of the Arts Council is totally and utterly preserved. Our main dominant feature, as the Senator knows, or what might be called our core competency, is to deliver to the artists. That is maintained and sustained and will be.
Alan Kelly (Tipperary North, Labour)
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As we have gone through the full list, I have a few observations and questions.
Observing what happened when the Arts Council came before the Committee on Public Accounts and again today, it is a big issue that this came to light but in many ways Ms Kennelly is almost a sacrificial lamb for what is after happening here. I feel a great deal of concern regarding what has transpired here. Deputy Joanna Byrne, while I was away, said Ms Kennelly had been thrown under the bus. I have serious questions about governance in the Department. In fact, the Minister will be in front of us on 2 July. With the agreement of colleagues, we might put governance dating back a period of time as an issue to discuss when he is here. Obviously, the Minister has been in office a certain amount of time but there is governance going back a while.
I am a former IT business manager. I worked in a semi-State company in that capacity. I have some background in large-scale IT projects. The idea that every organisation of whatever scale will have the expertise across every area of defined IT required is not realistic.
Turning to the Secretary General, we have had issues. Granted, he distinguished that RTÉ is a separate semi-State company but we have had issues relating to the National Gallery and the Arts Council. We also had issues with another project, CMS, which happened prior to the reference date that the Minister applied in relation to the number of years going back in RTÉ as well. There seems to be an issue here within not only the Department, but across semi-State companies in respect of IT projects. This is a risk for the taxpayer in the State and I hope the Department of public expenditure is looking at this.
If we can identify four projects within a short space of time that fall under the aegis of the Department, then what in the name of God is going on in the rest of the public service in the context of IT projects? That is a serious concern. Has the Secretary General, in his time in a senior role in the service, been aware of or involved in any other IT projects where there were large-scale losses? He is smiling at me.
Alan Kelly (Tipperary North, Labour)
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Has he experienced anything like this before?
Alan Kelly (Tipperary North, Labour)
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This is the RTB project.
Alan Kelly (Tipperary North, Labour)
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I am not saying that Mr. Ó Coigligh commissioned the project. He should not worry.
Alan Kelly (Tipperary North, Labour)
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There is a track record here. I do not mean that in respect of Mr. Ó Coigligh, but he is aware that this keeps happening.
Alan Kelly (Tipperary North, Labour)
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Mr. Ó Coigligh was an assistant secretary in the Department.
Alan Kelly (Tipperary North, Labour)
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When this was commissioned.
Alan Kelly (Tipperary North, Labour)
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Mr. Ó Coigligh has enough experience to know there needs to be a complete change in governance in respect of all of this. He has compiled his report and made his statements, but I am not convinced. As a committee, we are going to have to look at governance going forward.
I will ask a question of Ms Kennelly. From all the evidence I have seen, she made significant attempts to engage with the Department on this issue. In total, how much correspondence would she say she had with the Department?
Alan Kelly (Tipperary North, Labour)
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Did Ms Kennelly feel let down when the Department would not support her, given it was not a core part of her role? The Department would not give her somebody senior to help with the project.
Alan Kelly (Tipperary North, Labour)
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Did Ms Kennelly feel she was let down?
Alan Kelly (Tipperary North, Labour)
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Why does Ms Kennelly think the Department did not support her?
Ms Maureen Kennelly:
It was during the Covid-19 pandemic, and I guess the Department was extremely busy. It took on an awful lot of extra duties. It probably did not have the understanding of the project. I am not sure. It is difficult in the public sector in terms of staffing. It is always a challenge.
Alan Kelly (Tipperary North, Labour)
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Who in the Department did Ms Kennelly primarily correspond with?
Alan Kelly (Tipperary North, Labour)
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Did Ms Kennelly feel she was supported by the principal officer?
Alan Kelly (Tipperary North, Labour)
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Was it Ms Kennelly's impression that Ms Nash was not getting support from above in the Department?
Alan Kelly (Tipperary North, Labour)
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It was not being escalated.
Alan Kelly (Tipperary North, Labour)
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What Ms Nash was saying and doing did not come across as the same thing.
Alan Kelly (Tipperary North, Labour)
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That is a significant issue. The committee may wish to bring in other witnesses at a later date. I ask the Secretary General if what has been outlined by Ms Kennelly is normal. There were some 60 pieces of correspondence. This is important. There were some 60 pieces of correspondence. I am not saying they were all at the same level. The principal officer did not elevate it.
Alan Kelly (Tipperary North, Labour)
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That is a direct contradiction of evidence.
Alan Kelly (Tipperary North, Labour)
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Is Mr. Ó Coigligh going to contradict that?
Alan Kelly (Tipperary North, Labour)
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That is fine. Why was the issue not escalated?
Alan Kelly (Tipperary North, Labour)
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I have managed tonnes of large-scale, multimillion euro IT projects. The issues become more costly when they are not intercepted early in the cycle.
Alan Kelly (Tipperary North, Labour)
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That did not happen here.
Alan Kelly (Tipperary North, Labour)
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It has been outlined by Ms Kennelly, whose evidence I completely accept, that this was not escalated early on and that was why we ended up where we did. Does Ms McGrath have full confidence in Ms Kennelly?
Alan Kelly (Tipperary North, Labour)
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The board has full confidence.
Alan Kelly (Tipperary North, Labour)
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The Secretary General said earlier that there is no mechanism for deferral. Why is that?
Alan Kelly (Tipperary North, Labour)
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Across the public service, I could list tonnes of examples where there was a deferral or push-on.
Alan Kelly (Tipperary North, Labour)
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We will do a bit of research and come back to Mr. Ó Coigligh. I have one more thing to address before I ask other Deputies and Senators to come in again. Ms McGrath asked for this. She asked for the contract to be deferred and recommended-----
Alan Kelly (Tipperary North, Labour)
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I am sure a lot of this went on during the pandemic. Ms McGrath wanted a five-year contract. I will ask a direct question. I hope Ms McGrath does not mind that in the spirit of today. Does she believe that if we were not dealing with the impact that this project has had on public awareness, and the concern about how the issue was dealt with by the Department, an alternative view was possible for the Minister and the Department regarding extending Ms Kennelly's contract or giving her a new contract? In other words, does she believe that her recommendation as chair would have been accepted only for this issue?
Ms Maura McGrath:
It is understandable, given the political response that came forward after it emerged that the failure of an IT project at the Arts Council had cost €5.3 million, which is a significant amount of funding. Public statements made at that time had an influence on the decisions that the Minister made.
Alan Kelly (Tipperary North, Labour)
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Ms McGrath believes there could have been a different decision.
Alan Kelly (Tipperary North, Labour)
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That is very honest of Ms McGrath and I thank her. I call Deputy Joanna Byrne. I will limit contributions to three minutes and perhaps two questions.
Joanna Byrne (Louth, Sinn Fein)
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My question is for Ms McGrath. The issue was touched on by a colleague earlier and was raised at a meeting of the Committee of Public Accounts last week. It relates to the conflict of interest with the National Concert Hall. Ms McGrath was emphatic that there is no conflict of interest. She mentioned a project earlier from which she exempted herself. It seems that the Arts Council funds several partnership festivals and initiatives that are directly linked with the National Concert Hall. From a quick glance, there is Tradition Now, which is a partnership with the National Concert Hall, and New Music Dublin, which is a collaborative programme between the National Concert Hall, RTÉ and the Arts Council. That latter only exists because of substantial support from both partner organisations. The Liam O'Flynn Award is jointly run by the Arts Council and the National Concert Hall. If we return to the conversation we had last week about strategic funding, several strategically funded Arts Council clients are resident in the National Concert Hall, including Music Network, Chamber Choir Ireland, the Irish Baroque Orchestra, the Crash Ensemble, and probably many more if we delve into it. Is Ms McGrath certain, in the context of the statement she made, that there is no conflict of interest? Artists would query that and point to an ongoing and substantial relationship between the Arts Council and the National Concert Hall. They have raised legitimate concerns around impartiality and conflicts of interest.
Ms Maura McGrath:
I thank the Deputy for the question. When I was before the Committee of Public Accounts last week, I answered the question in respect of colleagues in the Arts Council who would have an association with the National Concert Hall. I directly answered that question, and that absolutely still stands. The important thing about the National Concert Hall is that there are residencies for groups who are in the concert hall. There are rooms there. The Deputy has mentioned a number of those groups. In my view, there is no conflict of interest. I always absent myself. I have only been at one round of funding in the Arts Council since I came in and have otherwise absented myself.
The Deputy's point in respect of Generation Ireland is right.
There are two festivals there, and there is a link between the concert hall and Generation Ireland. I am not only clear but assured in my own integrity with regard to conflict of interest.
Joanna Byrne (Louth, Sinn Fein)
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Fantastic. I have a query regarding to something in the annual report regarding rent costs the Arts Council spends. Can the witnesses highlight where and why it is paying rent and who the landlords are?
Joanna Byrne (Louth, Sinn Fein)
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Has the Arts Council engaged with the OPW on perhaps utilising some of its properties?
Joanna Byrne (Louth, Sinn Fein)
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Is the rent comparable to what is paid by other non-semi-State applicants in the area?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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I will be brief, as I am conscious of time. I want to focus in on the €60,000 from the legal redress element of it. When exactly did the Department step in to discuss the future direction of legal cases and tell the Arts Council not to incur any more costs?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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Did the Arts Council consult with the Department before starting legal proceedings?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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I appreciate Ms Kennelly's input there because on the one hand, the Arts Council will want to recoup the money - which is obvious, and fair play - but the Department might not even be allowing it to continue to pursue it. The Arts Council feels it has a very strong case, and the Department is saying it is going to pull back.
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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Would the Department not have sought that before?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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Okay. I will move on to my next piece. On the costing of this, it was originally €2.9 million-odd going back to 2021. The cost has ballooned and everybody here is responsible in some way, whether it is the Arts Council or the Department. I am not putting anyone off the hook here. Some €6.7 million has gone down the swanny. Forget about it; it is gone. We have two additional staff who were hired at roughly, give or take, €200,000 per annum. That is the cost to the State going forward, and adds on to the doubling of staff. We have €60,000 spent on legal cases that may or may not be recoupable. We have a streamlined system that cost €1.5 million upfront, with an ongoing cost of €240,000 per annum. We are looking at a situation now where this is well over €10 million. It started off as a €2 million project, and the headline thing is €5.5 million and then €6.5 million but we are now way over €10 million. All I see is the Department blaming the Arts Council and the Arts Council blaming the Department. Everyone passes the buck and the Minister is nowhere to be seen.
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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Would Mr. Ó Coigligh accept that public funds were mismanaged?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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I am under pressure for time. Would Mr. Ó Coigligh accept that public funds were mismanaged?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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Chair, I am looking for a "yes" or "no" answer, please.
Alan Kelly (Tipperary North, Labour)
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I am sorry, Secretary General. This is the second time, and it is very unusual I have to interrupt twice, particularly the same person. Will you answer the question directly please?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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It is €10 million.
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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This is my last question before I go. I am really conscious of time. There were obviously huge communication issues between the Department and the Arts Council. What is the Department going to do to sort them out?
Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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I will put the same question to the witnesses from the Arts Council because I know it is frustrating for them as well.
Garret Ahearn (Fine Gael)
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I was looking at the 13 members of the current board. Eight of them were appointed in the last six months of the term of the last Government, so the previous Minister would have appointed them. Four of them were appointed in the last four weeks of that term. It is quite unusual, I would think. Were some of this decisions speeded up by the Department to be done before the election?
Garret Ahearn (Fine Gael)
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Of those 13, particularly the eight new ones, which ones come from an accounting background?
Garret Ahearn (Fine Gael)
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I have the 13 names here. It is public knowledge.
Alan Kelly (Tipperary North, Labour)
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They are serving on the board.
Garret Ahearn (Fine Gael)
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Okay. On the court case, I figured the Secretary General might not answer questions again. He said the Department has referred it to the auditor and the Attorney General to review. When will they come back with a recommendation?
Garret Ahearn (Fine Gael)
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When does the Department expect them to come back?
Garret Ahearn (Fine Gael)
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In that initial engagement, has the Department outlined its view that no further funding should be spent?
Garret Ahearn (Fine Gael)
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They are aware of the Department's position.
Garret Ahearn (Fine Gael)
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Okay. If the auditor and Attorney General comes back to agree with the Department's position that no further money should be spent, no case should be brought forward and no more taxpayer's money should be wasted, will the Department relay that to the Arts Council?
Garret Ahearn (Fine Gael)
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The Department could come back with one or two recommendations to go ahead or not go ahead.
Garret Ahearn (Fine Gael)
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The Department is seeking advice on its position that no other taxpayer's money should be spent on this. If the Attorney General comes back and agrees with it, the Department will obviously inform the Arts Council to say that. If the Department comes back to say that its recommendation is not to continue with the court case, what is the Arts Council's position?
Garret Ahearn (Fine Gael)
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Would the Arts Council continue with the case?
Garret Ahearn (Fine Gael)
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When Ms McGrath talks about the €8 million that has been spent on the project and the hope to recoup money through this court case, this possible court case might never happen considering we have a Department that, I would say, is likely very concerned about extra cost given its position to the auditor and the Attorney General, with a 50:50 possibility of them coming back to say the Arts Council should not go ahead with it.
Garret Ahearn (Fine Gael)
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Yes, so it is over €8 million in total.
Garret Ahearn (Fine Gael)
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I have one final question, and it is probably a case of getting it in writing. On conflict and interest and decisions the Arts Councils and the board make, we spoke about the concert hall. With regard to any decisions they make, is there a conflict of interest in terms of relationships between family members, husbands and wives or sons and daughters? Can all of that, over the last ten years, be given to the committee in writing?
Alan Kelly (Tipperary North, Labour)
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Deputy Ó Snodaigh is next, and apologies, I should have called him last.
Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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Despite the figure being less than 1% of the Arts Council budget in that period, it is still a substantial amount of €6.7 million.
Did any of the senior team of the Arts Council or of the Department in 2017, 2018 or 2019 look at or recommend the cheaper off-the-shelf model before the contracts were signed? That is key to much of this.
Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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I know there were people in the Arts Council and in the area suggesting an alternative. Was the business case made for an off-the-shelf model?
Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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Who recommended the business case?
Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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This is the director who also signed the business case to move to Westland Row. That collapsed at a cost to the Arts Council as well in that period.
Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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There were costs involved in it. It was the same period. For a director of the Arts Council, is it the norm for a period to be extended? Is it for five years or two years? What is the norm?
Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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When will the Department make a decision on the proposal for an off-the-shelf thing, given Mr. Anyanwu has said there are exposures there and action needs to be taken?
Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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He could decide not to sanction it, the Arts Council would not function properly because of the clunky system and Mr. Anyanwu would have to cobble things together.
Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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We had the same case in RTÉ. The HR system it is planning to buy is out of date already. That seems to be the way the Departments are working.
Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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I have a quick question. The answer can be "Yes" or "No". Was the dropping of "Arts" from the title of the Department the Minister's revenge on the Arts Council or was it because, as the media has said, he did not want the Department to have an acronym like "SCAM" or "SMACC"?
Mr. Feargal Ó Coigligh:
The Department had previously been the Department of Culture, Heritage and the Gaeltacht without the word "Arts" in it. The previous title, "Department of Tourism, Culture, Arts, Gaeltacht, Sport and Media", was seen to be a mouthful and the Minister was anxious we had a departmental name that was accessible. "Culture" is the term used in most similar European ministries: Ministère de la Culture in France, Ministero della Cultura in Italy and the culture council at EU level. "Culture" is the normal word used. Those are the reasons.
Evanne Ní Chuilinn (Fine Gael)
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I am conscious of the artists out there who are worried about their funding and their careers. At the end of the day, these are people's careers. Can we get a guarantee or commitment from the council or Department that individual artists currently being funded will not be affected by this upheaval in funding?
Evanne Ní Chuilinn (Fine Gael)
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Did Mr. Ó Coigligh give a recommendation to the Minister or consult the Minister on Ms Kennelly's contract? Was there a piece of advice or a recommendation from the Department to the Minister not to renew?
Evanne Ní Chuilinn (Fine Gael)
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It is a ministerial decision, first and foremost. Okay.
Senator Ahearn asked for ten years of conflict of interest. That is a lot of paperwork and a lot of things to chase up.
Is the chair aware, off the top of her head, of a family member of any board member or of the previous chair being funded by the Arts Council?
Ms Maura McGrath:
I am not, is the honest answer at the moment. However, I believe conflict of interest is an essential ingredient of good governance because it brings all sorts of concerns for other people in the sector. I have in front of me the single page on conflict of interest that goes into our annual report. It refers to all board members. I was going to hand over to the company secretary because below the board members there is a conflict of interest which would impact on executives and staff. That is an important part as well.
Mr. Martin O'Sullivan:
Section 2.9 of our code of governance framework, which is published on our website, sets out clearly the conflict of interest procedures for the Arts Council. That covers council, staff, advisers. It is something we monitor extremely carefully. Essentially, 90% of our grants go through peer panels. A very small proportion of our grants go direct to council, albeit the bigger ones. I assure the Senator conflict of interest is very developed in the Arts Council.
Evanne Ní Chuilinn (Fine Gael)
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So Mr. O'Sullivan is happy no family member or person connected to a board member was ever funded by the-----
Evanne Ní Chuilinn (Fine Gael)
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It sounds like the Arts Council has rigorous systems in place.
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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Mr. Ó Coigligh was asked if it was a ministerial decision regarding Ms Kennelly's continued appointment. Did the Minister ask for Mr. Ó Coigligh's advice?
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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What was the advice to the Minister?
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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So it was entirely the Minister, but there were discussions within the Department.
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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The Minister will obviously rely on----
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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Okay. We had in the last committee as well with regard to certain decisions, for instance-----
Alan Kelly (Tipperary North, Labour)
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Sorry, I just want to clarify. I will give the Deputy back his time. I will not press Mr. Ó Coigligh for an answer because I understand it was a ministerial decision, but did he give advice to the Minister in writing or was it all oral?
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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Ms Kennelly outlined that in arts organisations it is the norm that a further five-year term would be provided. As I understand it, that is the case.
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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How often does it happen that it is not the case?
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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When there is a discussion on the extension of contracts of the-----
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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So it is. With regard to roles in any other arts organisations, have similar discussions happened during Mr. Ó Coigligh's time in the Department?
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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In no case, in other words, was a full extension not offered during Mr. Ó Coigligh's time.
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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Why nine months?
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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So the Minister with no advice decided on a contract of only nine extra months.
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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I just want to be clear. The board recommended and was happy to extend the contract. It was a unanimous decision of the board. Is that correct? It went to the Department. The Minister does not get to see anything until it is brought to him. I accept it was a ministerial decision. In terms of the recruitment process, will the job description of the next director be in any way different?
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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Will the Department be making any recommendations regarding a change in the job description?
Mr. Feargal Ó Coigligh:
That is something we will have to review. There is an issue of timing and of reflecting on the skill set required. There will be significant liaising with the chair, because the chair identifies the skill sets the council needs need on behalf of the board. In other words, there will be a process of dialogue that will-----
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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I am sorry. Mr. Ó Coigligh is talking about the skill set, so it is obviously felt that the current director should not continue within nine months. I disagree with the decision, but I respect it is the Minister's. There is clearly a reason the Minister made that decision, though. Will Mr. Ó Coigligh outline why that is the case. What different skill set to the current director is expected?
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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Should we ask the Minister directly why he made that decision?
Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
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We should indicate that we will seek those reasons when we meet the Minister.
Alan Kelly (Tipperary North, Labour)
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I agree. We should find out the reasoning behind it, to justify it and to see what difference would be made by a new appointment and the skill sets required. We will also be raising governance issues with regard to the whole Department going back a considerable period of time.
Micheál Carrigy (Longford-Westmeath, Fine Gael)
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I previously asked the Secretary General who was responsible, but in the discussions afterwards, we found out that there were 60 pieces of correspondence that came from the Arts Council to the Department and a person at principal officer level did not deal with them, pass them on or highlight the concerns. I will not name the person, but it has been said already. Would that person then have been responsible for this issue not being dealt with by not raising it or sending it up the chain?
Micheál Carrigy (Longford-Westmeath, Fine Gael)
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By saying that, I think Mr. Ó Coigligh is going to.
Mr. Feargal Ó Coigligh:
When this came to my attention as Accounting Officer, I was shocked about the scale of the loss and I commissioned a report to see the facts of what happened. That report, which we published with no word redacted, sets out clearly the failures with the management, governance, initiation and oversight of this project at departmental and Arts Council levels.
Micheál Carrigy (Longford-Westmeath, Fine Gael)
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What role is that principal officer in now?
Micheál Carrigy (Longford-Westmeath, Fine Gael)
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I think it is a fair question for me to ask, representing the taxpayer. What level is that person at? The individual is still employed in the Department. I am not naming anybody. What position does the person hold now in the Department?
Micheál Carrigy (Longford-Westmeath, Fine Gael)
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At principal officer level or at a higher level?
Micheál Carrigy (Longford-Westmeath, Fine Gael)
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The principal officer did not pass on the information that the Arts Council had sent 60 pieces of correspondence. The individual is still at principal office level.
Alan Kelly (Tipperary North, Labour)
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It sounds incredible. It sounds unbelievable to all of us on the committee. That just sounds like a Department that is totally and utterly dysfunctional.
Alan Kelly (Tipperary North, Labour)
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Does Mr. Ó Coigligh know what? It is even more dysfunctional that he does not agree. Sixty pieces of correspondence - Mr. Ó Coigligh has given evidence here that he accepts Ms Kennelly's evidence - went through to a principal officer and were not escalated, as Deputy Carrigy has outlined. That is dysfunctional. For a Secretary General to then say it is not dysfunctional is more deeply worrying-----
Alan Kelly (Tipperary North, Labour)
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Sorry. I will ask Deputy Carrigy-----
Alan Kelly (Tipperary North, Labour)
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I do not mind if Mr. Ó Coigligh does not agree. I am just giving my assumption.
Micheál Carrigy (Longford-Westmeath, Fine Gael)
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Does the National Gallery come under the Secretary General's remit?
Micheál Carrigy (Longford-Westmeath, Fine Gael)
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Is there any issue, or does Mr. Ó Coigligh have any concern or knowledge, regarding a loss on an X-ray machine that was purchased but is not functioning in the National Gallery, which comes under his remit?
Mr. Feargal Ó Coigligh:
This was subject to significant discussion at the PAC a couple of weeks ago. The machine, which the Department funded, will be operational by the end of this year. Public funds were provided for the purchase of the machine. The machine was purchased, but the gallery was unable to provide a suitable location to house it and get it operational, so it lay unused for a number of years. That is now being addressed.
Micheál Carrigy (Longford-Westmeath, Fine Gael)
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Is the person who ordered that to be purchased still employed in the Department or in the National Gallery?
Mr. Feargal Ó Coigligh:
This was a proposal to the Department by the National Gallery to seek funding for a number of projects. Under a departmental digitalisation scheme, the Department funded a number of cultural institutions for a number of projects based on a business case provided by the National Gallery.
Micheál Carrigy (Longford-Westmeath, Fine Gael)
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It put forward a business case, which the Department accepted, for the purchase of a machine that could not fit into the building that we wanted it in.
Micheál Carrigy (Longford-Westmeath, Fine Gael)
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Somebody is responsible for putting the wrong business case forward.
Alan Kelly (Tipperary North, Labour)
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We will probably end up returning to that. Before we conclude, I thank all the witnesses. This was an extraordinary meeting for reasons that I, as Chair, did not necessarily assume at the beginning. I thought some of the contradictions in the evidence were alarming. There are serious governance issues that go back a considerable period of time we are going to have to return to. There are also thematic issues with IT projects across the public service, which we will also probably have to stir the pot on because there are quite a number of agencies under this Department. I also find the ethos of how the Department has dealt with this issue concerning. I am not happy with the manner in which some of the replies were given to some questions, particularly in later evidence.
As it is the last time, and this is probably one of the few good things to come out of this, I thank Ms Kennelly on behalf of everybody for her service to the Arts Council over the past number of years. At the end of the day, this is the arts committee. I thank her for her service through the years and wish her the best for the future.
I thank all the witnesses for attending. I look forward to meeting a number of them again in the near future.