Cork Institute of Technology (CIT) may face financial penalties for spending €13,000 on a retirement function for its president which featured a dolphin-shaped ice sculpture.
A report by the Higher Education Authority (HEA) has found that about half the money spent was outside official spending rules. Consequently, the institute may face having an equivalent sum deducted from its next State-funded grant.
Dr Graham Love, head of the Higher Education Authority, told the Dáil's Public Accounts Committee on Thursday that his board will determine what sanction could be imposed on the institute.
The committee previously heard that an ice sculpture in the shape of a dolphin was among the expenses picked up by the taxpayer for Dr Brendan Murphy’s retirement party, where “tables, frames, drapes, carpets and the audio visual set-up” cost €5,500.
CIT’s current president Dr Barry O’Connor told the committee that “lessons have been learned” and that an individual should not be in a position to organise their own retirement party.
Under new rules, the vice-president for finance will need to sign-off on any expenses incurred by the president. These expenses will also be reported annually to a finance committee of Cork Institute of Technology’s governing body.
Footing the bill
While Dr Love said one option open to the authority's board was to deduct funds from Cork institute's next grant, Sinn Féin TD David Cullinane said this meant the taxpayer would end up footing the bill.
“The bottom line here is taxpayers paid for this €13,000 event . . . at the end of the day, it doesn’t matter whether it’s the HEA or CIT: a public body is going to foot the bill, irrespective of what the board does. There’s really no sanction whatsoever,” said Mr Cullinane.
He added that there was nothing to stop any future president or institution doing the same thing all over again.
Dr Love, however, said there was reputational damage from this kind of spending and it was important for an institution “not to find itself in this kind of space”.
He added that under changes to the funding model for higher education, there will also be a new penalty system for serious and material breaches of spending rules.
The expenditure was incurred at a time when CIT was facing what the institution conceded was a very “challenging financial position”.
The committee heard that Cork Institute of Technology reported a deficit of €1.2 million in 2015, with State funding down by about 28 per cent over the previous seven years. Student numbers increased by about 13 per cent over the same period.
Surplus of €700,000
However, it said the institute managed to turn around a projected deficit of €2.3 million into a surplus of €700,000 through a range of cost-cutting and revenue-generating measures.
“CIT’s financial position is a positive reflection of the contribution made by the institute’s staff and students to achieve significant reductions in expenditure and increases in throughput over the period,” said Dr O’Connor. “These reductions resulted in significant pay cuts to staff through the financial measures introduced, significant increases in the contribution by students and also a major strain on the provision of services to students.”
The committee also heard of confusion over the volume of protected disclosures made against CIT over allegations of overspending and mismanagement.
Fianna Fáil’s Marc McSharry insisted there were serious conflicts of interest in the way the institute of technology had dealt with whistleblowers’ claims, given that some individuals named in allegations were responsible for organising an investigation into the complaints.
CIT, however, insisted that it dealt appropriately with all allegations and protected disclosures, in line with official guidelines. This included using an independent firm of solicitors and and consultants to examine a range of claims against the institute.
The allegations were found to be groundless, it said.
