Irish civil servant who made $4.8 billion error to get plum European job

Outgoing secretary general of the Department of Finance Kevin Cardiff moves to lucrative position

By: PADDY CLANCY | Published Friday, November 11, 2011, 5:26 PM | Updated Friday, November 11, 2011, 5:26 PM

The government is heading for a massive confrontation over continuing plans to transfer a high-paid job in Europe to the senior civil servant held responsible for making Ireland’s debt €3.6 billion more than it is.

Last week the Department of Finance confirmed that Ireland owes € 3.6 billion less than authorities believed. The error was down to an accounting error which double-counted a payment between State agencies.

Now it has emerged that it happened on the watch of outgoing secretary general of the Department of Finance, Kevin Cardiff -- and the government had already nominated him for a lucrative position on the European Court of Auditors.

The appointment is subject to the approval of the European Parliament. Its budget control committee will grill Cardiff later this month.

Dr. Ingeborg Grasser, coordinator of the 11 members of the control committee, said they will listen to what he has to say on November 23. Grasser added, “But what we have heard so far about him is not really a recommendation. The Irish government wants to have a nice new job for him and this is not good enough.”

Cardiff’s nomination has prompted growing fury, not just among Irish politicians but also among European representatives.

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Even Dublin government party representatives in Europe have raised questions over the proposed appointment to a job which could be worth at least €750,000.

Labor Party MEPs (members of the European Parliament) Phil Prendergast and Nessa Childers said that Cardiff will have questions to answer when he comes in front of the committee that approves appointments to the European Court of Auditors. They said there is some unhappiness in government circles about his nomination.

Prendergast said the debt error was embarrassing and warned she would not like to be in Cardiff’s shoes when he is scrutinized for the €180,000-a-year job.

“He might be technically qualified for the job, but the issue of the €3.6 billion will have to be revisited,” he said.

Prendergast accused Cardiff of not showing any remorse during the Public Accounts Committee meeting which he addressed in Dublin last week.

“His body language didn’t seem to show any apology whatsoever for the fact he has brought a huge amount of embarrassment on Ireland. Any aspect of fiscal policy from the Department of Finance should show us in a good light and this doesn’t show us in a good light,” he said.

Fine Gael MEP Sean Kelly said circumstances had changed since Cardiff’s nomination in light of the recent accounting error involving €3.6 billion at his department.

British MEP Marta Andreasen, a former Chief Accountant of the European Commission, said Cardiff's nomination should be withdrawn.

Andreasen, when she was European Commission chief accountant, was notable for raising concerns about flaws in the accounting system which she felt left it vulnerable to potential fraud.

Andreasen said the Irish government was behaving irresponsibly by backing someone whom she believed was unfit for the European job.

The European People’s Party, the largest group of the European Parliament and to which Fine Gael is affiliated, said questions must be asked about why the government had chosen someone who “is not at all above doubt.”

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Read More:

Can Ireland get a Greek deal too?

Ireland is $5 billion richer - government finds cash after accounting error

Michael Noonan’s plan - Irish may be able to rent their repossessed houses

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Cardiff was called before the Public Accounts Committee in Dublin to explain why the national debt had been overstated by €3.6 billion.

It emerged that his department was alerted to the error on up to four occasions by the National Treasury Management Agency but failed take any action.

A Public Accounts Committee member, Sinn Fein’s Mary Lou McDonald, said, “In other jurisdictions an error of this magnitude would have consequences for the person at the top and they would be asked to consider their position on that basis.”

Despite the €3.6 billion astonishing blunder on Cardiff’s watch, Irish Cabinet ministers insist he is the right man to take up a post overseeing accounts on a Europe-wide scale.

Finance Minister Michael Noonan said there was no change in his government’s decision to select Cardiff.

Noonan added, “The government has actually done the nomination of Kevin Cardiff, so the next part of the process is the relevant committee of the European Parliament will assess that and assess his suitability.”

Cardiff was a key figure in the negotiation of the bank bailout and Ireland’s subsequent International Monetary Fund bailout.

His proposed new job will bring an annual salary of €180,00, a life pension of more than €60,000 after six years’ work, and a “transition allowance” worth up to €156,000 a year for three years after he steps down.