Charity secretly gave 17 executives lump sums
John of God audit finds €300k claims for travel, missing receipts and ‘illegible’ expenses forms
AN INTERNAL audit report into lump sum top-up payments made to 14 senior managers in the State-funded charity St John of God has found that there are at least another three former managers who received top-ups. The audit also suggests that there could be even more than 17 managers in total who got top-ups. The Irish Mail on Sunday revealed last year how CEO John Pepper and finance director Annamarie McGill were among 14 St John of God executives who shared more than €1.8million in secret buy-outs of pay entitlements in November 2013. A final audit into the controversy has found that the practice is ‘probably’ more widespread in the group and three further retired managers were likely given similar ‘top-ups’.
According to the document, ‘in internal audit’s opinion, the 17 senior managers may not represent the full extent of the payments of top-ups by St John of God and it is probable that top-ups were paid to other senior managers’.
The HSE will now seek ‘full disclosure’ on all similar arrangements in the organisation.
The audit found the lump sum payments were made after the Vatican instructed the St John of God organisation to deal with potential outstanding liabilities in advance of a planned restructuring. It also found that three of the senior managers who were part of the original 14 who received the €1.8million left St John of God between 2015 and 2017 and that there was no clawback of their lump sums despite the fact they were designed to buy out their entitlements until retirement.
One manager left in 2015, just 13 months after receiving a €93,000 lump sum – which was calculated on the basis that this person had 16.6 years to retirement.
Another left in 2015 after also getting a lump sum of €93,000, based on 16.25 years to retirement. However, this person only stayed another 18 months after receiving this.
And another left this year just 40 months after receiving a lump sum of €121,000 based on 18 years to retirement.
The report also reveals how one of the 14 senior managers hired a relative’s company to carry out architectural work on a premises. The audit also looked in depth into credit card spending, expenses and other spending.
It found that expenses forms were ‘illegible’ and that there was no standard claim form.
It was also not possible to clarify if mileage forms were correct, that overpayments to expenses were made, that mileage for funerals was claimed, and that glasses worth €450 were brought in line with company policy.
Retirement gifts were also put on expenses, there was a €500 gift token also expensed, and clothes worth €500 were bought with no evidence that the personal money was paid back, it was found.
A clamping fine was paid on credit cards, and in total the managers went on 323 flights
‘At least another three top-ups’ There were 394 travel claims
to destinations, including Chicago and New York, and across the EU.
There were 394 travel and expense claims totalling almost €300,000, and receipts were not available for all expenses, it was found.
On the issue of the €1.8million lump sum payment, the audit found that in November 2013, St John of God wrote to the HSE saying it was compliant with public pay policy.
But eight days later, the group agreed upon the new ‘compensation payment’, which was then paid out the very next day.
St John of God told the internal audit that the ‘reason for the compensation payments to 12 of the 14 senior managers was to remove a risk that the order might have a liability to pay pensions in the future on an additional top-up portion’ of the various managers’ salaries.
But the audit states that it was not appropriate and that ‘the contracts of all senior managers clearly identified that the additional salary topups were not reckonable for any pension benefits’.
The audit found that the employees signed no waivers or conditions for the payments, something which the HSE said is ‘highly irregular’.
The fact there were no terms and conditions attached to these payments is ‘difficult to comprehend,’ the HSE said.
The payments have raised ‘fundamental issues of trust’ between St John’s and the HSE, it was found. The final report also reveals how the State-funded charity demanded the HSE’s reference to its ‘lack of candour’ be deleted from the report.
A spokesman for St John of God told the Irish Daily Mail last night that ‘the report is detailed and it will take time to properly review and assess the numerous findings’.