Is the RTE payments scandal symptomatic of a lack of Ethics in Irish business?

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odyssey06 said:
They were guaranteed by RTE as per the contract, but it's unclear in several of the years if any extra services were provided i.e. the years where RTE guaranteed the payment as no commercial partner signed up. So I would disagree they were 'earned'.
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No contracted services were provided to the client after the first year. This was the nature of the guarantee RTE gave Tubs and/or his managing agent - he got paid by RTE in the event of the client pulling the plug. In that regard RTE acted as any guarantor to a rental or mortgage agreement would, they paid Tubs or his agent. Whether you, RTE, or anyone else regards the payments as "earned" is irrelevent; they were due and owing to Tubbsie on foot of a guarantee.

RTE were stupid and corrupt in trying to hide the payments, Tubbsie should have kept his gob shut as should his agent.
 
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JimmyB99 said:
Thedaddyman,

There's folk that were there a year or two claiming this as you know well.

When people play the social welfare system here, questions are asked. Why is it ok to play the social welfare system in another country?

I am not - as was made clear - talking about "legal entitlement". I think it's an ethical question - there's people who don't need this money who will claim it. I'm not sure it's morally right.
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I've no doubt there is but bear in mind, this isn't free. In my case it was a significant 4 figure sum I had to pay over to the British Govt in the hope that I will live long enough to be able to get it and a bit more back. Onus is on them to plan what to do with that money like any pension scheme and invest it properly. If I die before i reach pension age, or don't live long enough to enjoy the fruits of my investment, they win, not me.
 
Hi Thedaddyman,

JimmyB99 said:
One man's ethics is another man's smart play.
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It's perfectly valid for you to disagree with me. All I'm saying is that this scheme has been described as a "no-brainer". The reason being the terms are so skewed in favour of the contributor. Someone is paying for such generous terms. All I was saying is that I don't recall seeing a single post on this site wondering about the ethics of taking advantage of such terms. Can you see how it might be an ethical question for some people?
 
mathepac said:
Whether you, RTE, or anyone else regards the payments as "earned" is irrelevent; they were due and owing to Tubbsie on foot of a guarantee.
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You could say that about all RTE staff. Everybody’s earnings were properly due under the law but they were all leaned upon to give some up as a form of solidarity to protect the financial health of their employer.

That RTE had to go to such lengths to maintain the level of remuneration payable in this instance would suggest that they got some considerable pushback on the notion that a pay cut should be applied.

RTE’s mistake was in conceding to the pushback. If they applied the cut without agreement, they may have been breaking the law but would Tubs and his agent really have had the chops to sue when all around them were sucking it up?
 
I was talking with an accountant friend of mine last night and the RTE payments came up. I mentioned the ethical issue and he said the bigger issue was why did the auditors not question the "consultancy" payments and bring it to the attention of the board. He said that auditors generally investigate "consultancy" payments and look for engagement letters and copies of reports to prove that actual consultancy work was carried out.

He mentioned that the Revenue do not challenge consultancy payments. He said that if a company wanted to pay a consultant €100,000 for just one hours work they are free to do so.
 
CuriousCork said:
I was talking with an accountant friend of mine last night and the RTE payments came up. I mentioned the ethical issue and he said the bigger issue was why did the auditors not question the "consultancy" payments and bring it to the attention of the board. He said that auditors generally investigate "consultancy" payments and look for engagement letters and copies of reports to prove that actual consultancy work was carried out.

He mentioned that the Revenue do not challenge consultancy payments. He said that if a company wanted to pay a consultant €100,000 for just one hours work they are free to do so.
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I believe one of the reasons this came to light is that Deloitte flagged it for that reason, €75,000 for consultancy services.
 
Yes. Deloitte was unhappy about how the consultancy fees were described in the accounts.

It was pretty heavy at the Public Accounts Committee yesterday - many unanswered questions.

The committee asked RTÉ for numerous records, some going back 20 years.

The former RTÉ chairwoman, Moya Doherty, described the barter account as a “slush fund” and current chairwomen, Siún Ní Raghallaigh said it was designed to deceive.
 
It's odd that nobody is focusing on the use of self-employed contractual arrangements for what is to all intents and purposes a PAYE type job. Massive savings on employer PRSI which no doubt finds it way to the "talent"
 
A question was posed, I forget who by, about tax compliance. RTE replied that it would seek advice.
 
What’s really interesting is that these practices can go on for years without anyone questioning their legitimacy.

Suddenly, when it comes to light, everyone within an organisation whose fingerprints aren’t on it is outraged and shocked that any such arrangements could have occurred.

It’s a nonsense. This goes on everywhere. It’s never a problem until suddenly it becomes a problem. It’s like a game of spin the bottle as to who gets to have the spotlight shone upon them.

I’d say the current RTE controversy is making a few public sector heads a little twitchy this week. There isn’t an organisation out there that doesn’t have skeletons in the closet that might someday be discovered.
 
CuriousCork said:
My accountant friend says he is curious to hear how the VAT was treated on the invoice to the UK company and the money coming back.
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I think many tax issues will arise as the enquiry goes on.

From yesterday’s PAC meeting: -

Deputy Marc Ó Cathasaigh: “As Ms. Ní Raghallaigh said, it appears that this was an act designed to deceive or, at the very best, to conceal. It should have been presented to that committee. Regarding the payments that came through this clandestine and labyrinthine method of invoices and the divil and all, there is the issue of tax compliance. These have moved between jurisdictions and we have been told there is no VAT liability because they emanated from the UK. They are part of a payment in lieu of salary or as a top-up to salary. Are we satisfied that the tax liabilities have been covered off? In the end of year reporting in terms of tax liabilities, were the transactions undertaken by the barter account - this one is the largest and most notable - adequately captured when preparing and submitting tax returns at end of year?”

Mr. Richard Collins: “In relation to those invoices going through the barter account, we are taking advice on that on the tax liability and what tax exposure we have.”

Deputy Marc Ó Cathasaigh: “The witnesses are not currently satisfied that the tax liability is adequately provided for?”

Mr. Richard Collins: “I cannot say for 100%. We are taking advice on it.”
 
Salvadore said:
You could say that about all RTE staff. Everybody’s earnings were properly due under the law but they were all leaned upon to give some up as a form of solidarity to protect the financial health of their employer.
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They were leaned on because their employer is an shambles of as organisation with gross inefficiency baked into its siloed structures. There should have been a reorganisation and redundancies and no pay cuts.

What's happening now is what happens in dysfunctional organisations where the management isn't willing or able to do their job properly.
 
JimmyB99 said:
This is what Mr Collins said in the meeting yesterday. Is it true or not?
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It could be argued that there was no need to route the payments through the UK and that doing so had the effect of avoiding VAT that would be payable if all transactions were conducted within Ireland.
 
Salvadore said:
It could be argued that there was no need to route the payments through the UK and that doing so had the effect of avoiding VAT that would be payable if all transactions were conducted within Ireland.
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And VAT would have been less than the percentage applied by the UK company - who appear to be doing nothing except facilitating these transactions.
 
It’s interesting also that while the original outrage was in relation to the additional payments to Tubbs, it took relatively little additional digging to uncover the Fas-like accounts that allowed for tickets to rugby and champions league tickets.

It beggars belief that so many people in a publicly funded organisation could look at these activities going on in plain sight and think there was nothing suspect about them.

That said, I worked for a government department that had its management meetings in the Aviva. I questioned the free bar afterwards and was just smiled at. I’ll admit to having one drink at the state’s expense.
 
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