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Dublin: 10 °C Monday 18 March, 2019
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Concern CRC pension payments creating 'costflow advantage' for Mater

Last week it was suggested the €660,000 paid by the CRC to the hospital for 180 of its staff, was going into a ‘phantom fund’.

CEO of the Mater Hospital, Mary Day, left, at the PAC meeting.
CEO of the Mater Hospital, Mary Day, left, at the PAC meeting.

OFFICIALS FROM THE Mater Hospital appearing before the Public Accounts Committee today have clarified that no fee was paid to the hospital by the Central Remedial Clinic for the operation of a staff pension fund.

However it was suggested today that the payments may have created a situation whereby public money paid to the charity arm of the CRC was helping to create a ‘costflow advantage’ for the Mater, at a cost to the taxpayer.

In a committee session last week, it was suggested the €660,000 paid by the CRC to the hospital for 180 of its staff, was going into a ‘phantom fund’. Speaking today, CEO of the Mater Hospital, Mary Day, explained the money paid by CRC is an ‘employer contribution’ to cover the liabilities of the pension taken on by the hospital in the future.

“The CRC does not have pensions liability that it has to meet,” she said. “The Mater Hospital does.”

This is in line with public sector pension policy, she said, as it is part of the Voluntary Hospital Superannuation Scheme, operated through the hospital on behalf of CRC staff.

TD Shane Ross queried the accounts at CRC, which list this money as a ‘fee’ and asked if the CRC’s auditors had gotten it wrong, to which Day replied: “Yes”.

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Sinn Féin’s Mary Lou McDonald (above) was critical of the CRC’s former CEO Paul Kiely, who told the committee last week that the CRC had effectively been paying into a fund that does not exist.

She said he had created confusion in the country and added that the 180 staff concerned “have to have been quite troubled by the public commentary on their pensions”.

Fianna Fáil’s Sean Fleming also called for Kiely to “immediately correct the record in public” and that their auditors should apologise for the error in the description of the pension payments.

‘Costflow advantage’

The €660,000 is included in the Mater’s accounts as part of its superannuation income, the committee  heard, and a total of €9.5 million has been paid by CRC since 2001. At present 18 staff are receiving pensions through the scheme and some €1.7 million has been paid out.

Fine Gael TD Kieran O’Donnell pointed out that this results in a potential financial advantage for the Mater Hospital, which will not have to pay out most of the pensions for a number of years.

Officials at the Mater confirmed that any surplus at the end of a year goes towards the funding of patient care.

O’Donnell claimed this could be creating a situation whereby the Mater could have a “serious costflow advantage at a cost to the exchequer”, as the HSE is providing funds to the CRC to meet this obligations.

The HSE’s Director of Human Resources Barry O’Brien, said he was not in a position to say whether the HSE was covering the €660,000.

“It’s unsatisfactory that you can’t give us a response to that,” O’Donnell hit back, telling HSE officials that the committee needs an explanation as it involves public funds.

The committee also heard that Brian Conlan, who resigned as CEO of the CRC after the news of top-ups to executive salaries broke, will be called to appear before them at their first meeting in the new year.

Read: Mater Hospital ‘refutes’ suggestions of operating a CRC ‘phantom fund’>

‘Absolute madness’: CRC pays Mater Hospital €660k to administer ‘phantom pension fund’ >

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