From Socialist Voice, May 2011

Trade union movement harmed by scandal

by the Editorial Board of Socialist Voice

Socialist Voice, while critical of aspects of ICTU policies and practices, has been reluctant to comment on internal union affairs. This matter, however, is so serious that we feel obliged to comment, as it goes to the heart of trade unionism and hence of working-class values, be they political, moral, or ethical.
The scandal of the HSE “Skills Programme,” with the involvement of SIPTU, has harmed the trade union movement, as Jack O’Connor has admitted. It has damaged its reputation, its honesty, and its potential for growth.

The origin of the slush fund

The “Skills Programme” was operated and funded by the Office of Management in the Department of Health since 2000 and subsequently by the HSE, after its establishment in 2004. Different sums came to the SIPTU fund until 2004, when it was regularised at €250,000 per year from the HSE. Between 2001 and 2009 sums totalling €4.493 million were paid into a SIPTU-named account. SIPTU head office denied that the funds were paid into any official account controlled by the union. The account was not authorised at any level by SIPTU.
     It transpired that the account into which the money was paid was called “SIPTU National Health and Local Authority Levy Fund,” with two signatories: Matt Merrigan (Junior), full-time head of the Health Division, and Jack Kelly, an employee of St James’s Hospital, Dublin, president of the Health Services Branch and formerly a member of the National Executive Council for almost thirty years.

What was the “Skills Programme”?

The description of the scheme states: “The deepening of workplace partnership in order to enhance the quality and delivery of health service users and to improve the working arrangements for health service staff is considered to be a necessary requirement for ongoing development of the health service,” and that its aim was “to up-skill managers, employee and union representatives in people management skills, including the skills of working together effectively and of handling changes and conflicts in a constructive manner.”
     The scheme was set up to deal with the training needs of non-medical health workers, such as health-care assistants, home-help workers, porters, and catering workers.
     The scheme is continuing and is necessary, the Public Accounts Committee was told. There was no mention of anyone in these categories being brought on foreign trips.

What did it deliver?

From the evidence publicly available, this is hard to quantify. Matt Merrigan, in his submission to the investigation by the union’s trustees, claimed that five thousand employees were trained. It seems that be no evaluation or accreditation results were produced that justified the scheme’s objectives. But as the scandal broke, the amount of money spent on foreign trips, expenses and gifts quite rightly attracted headlines.
     The fund authorised by the two signatories paid for a total of thirty-one foreign visits over a period of seven years, 2002–09. These included trips to Australia, Hongkong, a variety of destinations in Britain, and to various places in the United States, some around St Patrick’s Day. They included three sixteen-day junkets to Australia that coincided with Irish teams taking part in major sports events. Senior management personnel from the HSE, the Department of Health and the Department of Finance went on these trips, while the union stated that, apart from Kelly and Merrigan, only two other serving union officials went on one trip. People from the same state agencies went on multiple trips, as did Merrigan and Kelly.
     Peter McLoone and Kevin Callinan of Impact were involved in “social partnership study trips” to the United States, though it is not clear whether this was with the Merrigan-Kelly fund or some other. The union “believes that this travel was relevant to the activities intended by the partnership programmes,” but it repaid €112,791 “because of concerns [that] there had been intermingling of monies from different funding streams.”
     Former officials of the state agencies continued to receive money from the Levy Fund for “consultancy” work, in spite of breaches of tendering rules.
     Billy Attley, former general secretary of SIPTU, after his retirement chaired meetings for a fee of €1,000 per day—though he told a newspaper that he claimed only half that for half-day meetings! An audit report showed that he had been paid €26,750 up to the end of 2009. He rejected claims that the steering group was at fault for not monitoring the fund, saying that its brief was to approve training programmes. “We had no control over finance. We had no role in that area: that was the responsibility of the HSE.”
     The Comptroller and Auditor-General revealed how some money was spent: €73,000 was spent on degree courses, €30,000 on laptop computers for SIPTU members, a fee of €10,000 to one union academic, €18,500 for a promotional video. €10,000 for PR material, and various amounts on entertainment for delegations, including meals in Dublin pubs and restaurants. €1,586 was spent on one retirement party.
     More than €12,500 was spent on taxis. One journey involved a taxi from Dublin to Kilkenny, a wait there, and a return to Dublin, at a cost of €432. Another involved a journey from St James’s Hospital to Tullamore, returning via Co. Louth and Dublin Airport, at a cost of €544.
     The Skills Programme office clocked up costs for services of €526,444, none of which were tendered for.

How it happened

There was “a complete failure by [the] HSE and other State bodies” to implement and adhere to to the most basic standards of governance, transparency and accountability in relation to the disbursement of public money,” according to the SIPTU report.
     “What emerged, relating to breaches of controls, lavish expenditure on taxies and foreign travel, breaches of public procurement rules and breaches of civil service employment law are truly shocking and those responsible for this will have to be held to account.”
     Many of the state agency people on the scheme’s steering committee were old hands at industrial relations, whose paths had crossed those of the union officials during numerous talks. There seems little doubt that the deal was born out of complex negotiations in the health service. Such issues as upgrading the skills of low-paid workers were often a part of settlements in lieu of monetary awards in the early days of the “Celtic Tiger.”

Why it happened

“Social partnership” was adopted by leading elements within the labour movement who had already decided that the class conflicts in society could be modified, or even avoided. They felt that this could be achieved by negotiating immediate workers’ gains nationally with the Government and employers. They would rationalise this by the assertion that the ruling political elite governs with the apparent consent of the governed and that the labour movement should not be outside this consensus.      These people confused power relationships with mere participation. But it gave the union hierarchy the “profile” of being power-brokers, sitting at the decision-making table.
This month the CPI will be publishing a comprehensive pamphlet on the future of the trade union movement, and so we do not include here a more detailed analysis of the social, economic and cultural damage to workers and their families brought about in the guise of “social harmony.”
     The SIPTU scandal is an example of how “social partnership” operated at the local industrial level and distorted the traditional operations and standards that were taught as basic on shop stewards’ courses. It not alone corrupted the philosophy of what unions were for but compromised some of those involved. For some individuals it was a corrosive break with the motivation, the honesty and the dignity of those who created, shaped and steered the trade union movement.
     Billy Attley and Jack Kelly can be seen in this light as considering themselves as being owed and entitled to perks and privileges from taxpayers’ money. Attley’s €1,000 for chairing a day’s meeting, and Kelly’s “expenses,” are inexplicable. Their names are now associated with the likes of those named in the FÁS scandals from the trade unions, ministerial, state and employers’ sides.
     Matt Merrigan’s behaviour, while indefensible, demonstrates in an exaggerated form the cosy relations that “social partnership” encouraged. He had the means and the power to offer managers and those on the other side of the negotiating table “free” trips to exotic places. For some perhaps this would be called oiling the wheels of industrial negotiations; but it certainly undermines the collective sense of workers’ representation.
     The unaccountable participation of high-ranking trade union officials on state boards and such “partnership” committees, combined with situations where they end up travelling the world with employer and Government representatives, is where the policy of “social partnership” has led us to.
     SIPTU’s report on the scandal is critical of itself and of the state agencies responsible, and suggests procedures and standards for avoiding any recurrence.
     Instead of using the union’s procedure, the National Executive Council is “to appoint a Senior Counsel to investigate the issue and make such recommendations as they consider appropriate regarding the implications for Matt Merrigan’s contractual relationship with the Union. The Senior Counsel concerned will also investigate the implications regarding Jack Kelly, who is not an employee of the Union. These investigations are to be completed as expeditiously as possible with due regard to the principles of natural justice.”

■ Most of the relevant information is available from the account of the hearings of the Oireachtas Public Accounts Committee and the SIPTU Trustee and Executive reports, Liberty, March 2011.

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