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FAI could lose funding over John Delaney loan controversy

FAI could lose funding over John Delaney loan controversy
© Reuters
Sport Ireland could halt FAI funding over loan controversy

Sport Ireland has confirmed it could cease or suspend funding to the Football Association of Ireland amid concerns over a controversial loan.

Sport Ireland's chief executive John Treacy told an Oireachtas committee on Wednesday that his organisation had no knowledge of a "bridging loan" to the FAI by former chief executive John Delaney of 100,000 euro or that the FAI was paying Delaney's rent.

Last month Delaney, who has now officially resigned from the FAI board two weeks after quitting as chief executive, confirmed he gave the association a 100,000 euro loan to help it through a short-term cash flow problem, which has since been repaid.

Sport Ireland, which provides 2.7 million euro a year for a number of programmes within the FAI, also noted it had only received a letter from the FAI about the matter on the morning of the committee meeting. The letter said the FAI is currently conducting a review and will not be able to provide Sport Ireland with further detail on the loan until the review has been completed.

"The letter does not provide any explanation, the board of the FAI has not provided any legitimate reason why it cannot provide any explanation," Treacy said.

"We still await any explanation. We will ask for the terms of reference and ask for assurance that we will be consulted as part of that review and a full final report will be submitted."

Sport Ireland chairman Kieran Mulvey said the organisation would need to be "reassured everything is OK" before any further funding is given.

Treacy also told the committee he found it strange that the chief executive of the FAI had a larger salary than Taoiseach Leo Varadkar.

The committee heard that cash flow is an issue for FAI, a fact which would be well known within sport.

"We gave the FAI 50% of their funding for this year, and a second payment of the 25% at the end of March, so we have no idea why the loan was given or why they needed it," Treacy added.

"We know they have debts at the Aviva (Stadium) and are meeting those requirements, so we know it's not easy either."

The FAI drew down funding early every year from 2016 to 2019, the committee heard.

Fine Gael's Noel Rock noted that this would highlight cash flow issues in the organisation.

Treacy replied: "Yes, we know they're carrying large debt, but again, the sustainability of the organisation is still moving forward and debt has decreased.

"The concern is to maintain programmes the best we can, we provide funding on a staggered basis to protect the funding we give to them, there is checks and balances there."

Sport Ireland attend Sport Committee
Sport Ireland chief executive John Treacy (left) and chairman Kieran Mulvey arrive at Leinster House (Brian Lawless/PA)

Sinn Fein's Imelda Munster asked if Sport Ireland's auditing process was lacking or insufficient.

"We are satisfied in the audits we've undertaken, and satisfied that the investment by government in FAI is good value for money and gets good return," Treacy said.

"We will be auditing the FAI again in 2019."

Munster queried if this situation has arisen with the GAA or IRFU.

"They say it's a bridging loan, do you find it credible that an organisation like the FAI would be in such a dire financial situation that it would have to resort to getting (a) loan from their CEO's personal bank account?"

Treacy replied: "We find it extraordinary, to be honest. That's why we've asked the questions we've asked, we're waiting for an answer.

"Generally, if an organisation – and we've had experience of this down the years – if they're in financial trouble they come in and talk to us, and we work with organisations to oversee and make sure they meet their cash flow issue. A lot are tight on funding, that's how it goes. There's dialogue and we support the organisations.

Treacy was asked repeatedly if he had confidence in the FAI board, and dodged the question a number of times, before being told: "It's a yes or no question."

He replied: "Well, I'm not saying yes."

Former chief executive of the Football Association of Ireland John Delaney
Former chief executive of the Football Association of Ireland John Delaney (Niall Carson/PA)

The Sport Ireland representatives were asked what sanctions could be imposed on the FAI if it is found they have acted inappropriately.

"To be honest, we'd like to see what the outcome of your own hearing next Wednesday is with FAI and we'll make an assessment then on that basis," Mulvey said.

"On Tuesday, we'll take stock. We will have to be reassured everything is OK, before any further funding is given."

Senator Frank Feighan asked if the FAI is a "symptom of a 'Goodfellas club' around the world" referencing UEFA and FIFA.

"I think it would be well known that FIFA would not be leading lights in that particular area, or international boxing organisations," Treacy replied.

"There's a long way to go in international sport for some organisations.

"Corporate governance in the sports sector in Ireland is far superior than in other countries, and I mean that in all sincerity," he added.

Representatives from the FAI are due to appear before the committee on Wednesday.

Click here for more stories about John Delaney

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