Thursday, 28 March 2019
Saincheisteanna Tráthúla - Topical Issue Debate
Football Association of Ireland
We have all been taken aback by the ongoing corporate governance and financial issues within the Football Association of Ireland, FAI. I strongly believe now is the time to set the course right, set the record straight, and commence a truly independent examination of management and finances which further State funding will be contingent upon. That means investigating everything from top to bottom, including lease deals, associated companies, boardroom expenses, etc. It is clear that corporate governance within the FAI is shambolic.
Six weeks ago, Jonathan Hall Associates was appointed to provide a report on senior management structures and the role of chief executive officer, CEO, as the FAI plans for the launch of a new strategic report. No terms of reference have been published to date and, indeed, the FAI has not even responded to the Oireachtas Joint Committee on Transport, Tourism and Sport's request for that report. Incredibly, within six weeks, that report has been produced in its entirety, with no redrafting required and its contents acted upon, via a unanimous vote of the board, culminating in the announcement of a brand new position for John Delaney. This absolutely stinks.
I met an expert in sporting governance who is currently undertaking such a review within a sporting body in another jurisdiction. That review is coming to a conclusion. It took a year. How could this review take only six weeks? Why did the FAI act on it so quickly? Why can the FAI not supply us with this report, given that is has unanimously acted on an element of it? Does the Minister believe this is good corporate governance? Does he believe that taxpayer's money is being deployed effectively? Does he not believe that now is the time for an independent examination into FAI corporate governance and finances? It is time we examined where taxpayer's money is going, as there are clear omissions in the information being given.
On finance, I have spoken with current and former employees of the FAI and am disturbed by what I hear and the documents I saw. While the committee continues working with these sources and readying itself to ask questions about what has previously happened within the FAI at its meeting on 10 April 2019, we need to act now to safeguard taxpayers' money in the future by taking this course of action. If the FAI will not clean up its house, we should at least work to protect the taxpayer.
In the Minister's recent response to a parliamentary question I put to him, he said:
There is no requirement for the organisation mentioned by the Deputy to submit its financial statements to my Department. In line with the terms and conditions of grant funding provided to it by Sport Ireland, the organisation is required to submit a copy of its financial statements to Sport Ireland.
This is a straight question. Is it time to change that requirement?
We see in the public domain today, once again, that for 2019 the FAI requested an early draw down of State funding from Sport Ireland. This is not the first time it has happened and no explanations have been forthcoming. We also saw the revelation of an undeclared director's loan by Mark Tighe in The Sunday Times. The question has to be asked as to why this was necessary. Is it the only time it happened? Why was it not declared? Has the Minister spoken to Sport Ireland on these important matters? Does he have any concerns with regard to the undeclared director's loan? Does he not agree that further taxpayer funding should be contingent on an independent examiner and an independent examination?
The original issue which thrust this story into the public domain was one of borrowed money, but it is quite clear that the board of the FAI is now only existing on borrowed time. These are important questions, they deserve an answer and they deserve a public answer.
I thank the Deputy for raising this very important matter. As he knows, Sport Ireland is the statutory body with responsibility for the development of sport in Ireland. This includes responsibility for the allocation of funding across its various programmes and governance oversight of the national governing bodies, NGBs, of sport. All sporting bodies funded by Sport Ireland are required to comply with standards of good governance, including financial oversight and Sport Ireland periodically reviews governance and oversight in the bodies it supports.
The recent media reports to which the Deputy referred, regarding a loan provided to the FAI by its CEO, have raised serious questions about governance and financial controls in the FAI. Sport Ireland is currently engaged with the association to clarify these matters and when the necessary clarifications have been received from the FAI, Sport Ireland will submit a report to me. In the interests of due process and natural justice, it is important that Sport Ireland's engagement with the FAI would be given the necessary time to ensure that all matters are considered thoroughly. Therefore, I do not wish to make any comment on any possible outcome from this ongoing process.
Sport Ireland provides funding to the FAI primarily through the field sports grant. This funding is directed towards participation and games development programmes and is broadly aimed at encouraging and creating more opportunities for young people to participate in soccer. In 2018, €2.56 million was provided for this purpose. In 2018, the FAI also received funding of €142,500 through the women in sport programme; €195,000 in support of the women's national team; €22,500 to support the running of Cerebral Palsy Ireland football; and €20,000 in dormant accounts funding. In total, Sport Ireland provided over €2.9 million in current funding to the FAI in 2018. The total funding provided in 2017 was over €2.7 million.
Sport Ireland has robust arrangements in place in relation to the funding it provides to sporting bodies, including the FAI. As part of Sport Ireland's normal processes and procedures relating to the annual grant cycle, NGBs in receipt of grant funding are required to submit to Sport Ireland a copy of their financial statements. This must include a statement from their auditor that each grant was expended in accordance with the approved submission for the grant funding. Given the amount of funding involved, the FAI, along with the GAA and the IRFU, are generally audited by Sport Ireland's internal auditors every three years. The most recent audit of the FAI was completed in 2016 and a further audit is due to take place later this year.
On my Department's sports capital programme, SCP, the FAI has benefitted from some limited funding over the years with a total of €190,000 allocated directly to the organisation since 2015. A separate grant of €160,000 was allocated in 2015 to AUL-FAI Ltd for the development of a natural playing surface at the Athletic Union League, AUL, complex in Clonshaugh.
I am satisfied that the existing controls in place for all grant payments under the SCP are robust. As we have seen in the past, failures of governance within sporting bodies unfortunately damage the reputation of Irish sport as a whole. This is why it is so important that we ensure strong governance across all associations. Sport Ireland has made it clear that all sporting bodies must take the necessary steps to comply with the governance code for the community, voluntary and charity sector. I know many sporting bodies are making good progress towards achieving this and I encourage them to continue their efforts.
In football terms, the response here was what we call a set piece. There was no deviation from the scripted answer and there were no answers to the questions I posed so I may as well ask them again.
We saw the revelation of an undeclared director's loan. The question has to be asked: why was this necessary? Is it the only time it happened? Why was it not declared? Has the Minister spoken to Sport Ireland on these important matters? Does he have any concerns with regard to the undeclared director's loan? Does he not agree that further taxpayer funding, in his opinion as Minister, should be contingent on an independent examiner going forward? That is not a matter for Sport Ireland. That is not a matter to hide behind. That is a policy decision. The Minister sets that. That is a question for the Minister to answer. How could this review only take six weeks? Why did the FAI act so quickly? Does the Minister believe that this is good corporate governance? That is also an opinion and a point for the Minister to make. Does the Minister believe that taxpayers' money is being deployed effectively, based on what he has seen? Does the Minister not believe that now is the time for an independent examination into FAI corporate governance and finances?
It is time we looked at where taxpayers' money is going as there are clear omissions in the information being given from the FAI to Sport Ireland and to the committee on which I sit.
Nobody in this House has a greater commitment to corporate governance than I have but I want to see a fair procedure here. I will not say anything which would in any way prejudice the clarifications which are being sought by Sport Ireland for me and for me to reveal to the Deputy when they are published. It is very important that a body such as Sport Ireland is left to do this work, to do this properly and to do it thoroughly. Everybody must be properly heard and when we get the results, they will be published by me without fear or favour to anybody and they will be open to the Deputy and to the committee to examine, but it would be utterly wrong for me to answer the questions which the Deputy is asking here because they are being asked, on the Deputy's behalf as well, by Sport Ireland at this very moment and it will report at a very early stage. At that stage, I will make those results open to everybody to discuss and I will be quite happy to comment on them myself.