Cancer hospital chiefs got charity top-ups
Chief Executives of St Luke's cancer hospital in Dublin received unauthorised 'top-up' payments of up to €25,000 per annum on their salaries between 2003 and 2010 from a charitable research institute linked to the hospital, it has emerged.
Salary top-ups for the hospital CEO of €10,400 per annum from 2003 to 2006 and €25,000 per annum from 2007 to 2010 were provided by the St Luke's Institute for Cancer Research, the charity has confirmed to irishhealth.com. It said the payment related to research and board work.
The Chief Executives during this period were Lorcan Birthistle from 2003 to 2007, and Ann Broekhoven from 2008 to 2010.
Mr Birthistle was last November at the centre of a controversy over a salary top-up from private sources in relation to his current post as CEO of Our Lady's Children's Hospital in Crumlin.
Documentation provided recently to the Dail Public Accounts Committee (PAC) shows that the St Luke's CEO allowance had been sanctioned without the knowledge of the Department of Health. The Department, which had a direct role in running the hospital until 2010, refused to approve the top-up when it was informed of its existence.
The St Luke's Institute for Cancer Research has confirmed to irishhealth.com that in 2003 it was agreed to pay a yearly allowance to the CEO of the hospital from its funds in return for services rendered to the Institute, and these payments continued until 2010, when they were discontinued after management of St Luke's, which was previously a voluntary agency, passed over to the HSE.
Recent documentation provided to the Dail Public Accounts Committee (PAC) shows that the Department of Finance in late 2010, on foot of correspondence with the Comptroller and Auditor General, raised with the Department of Health the fact that an additional allowance was being paid to the then CEO of St Luke's by a related entity, the St Luke's Institute for Cancer Research, of which she was also CEO.
A letter to the PAC from the Department of Public Expenditure and Reform states that this allowance, paid from non-Exchequer resources, had previously been sanctioned by the board of St Luke's without the knowledge of the Department of Health, who in subsequent correspondence with the St Luke's board, refused to sanction its pensionability.
The Comptroller and Auditor General's office has indicated that when the hospital sought sanction for the allowance already in place, the Department of Health refused to sanction it.
The letter to the PAC says the Department of Public Expenditure subsequently brought to the attention of the Department of Health in August 2011 the provision prohibiting additional remuneration for CEOs in the non-commercial semi-state sector without Ministerial sanction. The letter says the Health Department was asked to arrange that a similar provision be included in relevant employment contracts in the health sector.
The issue of top-up payments being made to St Luke's Hospital CEOs was also raised by the Comptroller and Auditor General back in 2007. The St Luke's CEO at that time, Lorcan Birthistle, was also serving as CEO of the research institute following a decision in 2006, three years after the top-up payments began, that the hospital CEO should be formally given this dual role.
A PAC hearing last month was informed that the Comptroller's office wrote to St Luke's management in 2007 when it emerged that an additional payment was being made to the St Luke's CEO without the Minister for Health's sanction.
The C&AG told the hospital at the time it should seek the sanction of the health minister for the payment being made.
C&AG Seamus McCarthy told the PAC last month that it was subsequently indicated in 2009 that ministerial sanction would not be forthcoming for the extra payment. The Comptroller then raised this issue with the Department of Finance, Mr McCarthy said.
"There was a concern that somebody had full-time employment but there was either a secondary appointment or they were essentially being paid a top-up", he told the PAC.
Accounts for St Luke's Hospital for 2009, the last year it provided accounts to the Department of Health, state that as approved by the Board of St Luke's, the Chief Executive of the hospital also acted as CEO of the St Luke's Institute for Cancer Research. Non-pensionable remuneration of €25,000 in respect of these duties was recovered from the Institute that year.
The accounts from 2009 show that at the time, the basic salary of the St Luke's CEO was €114,111 plus an allowance for travel expenses totalling €4,303, in addition to the €25,000 top-up.
St Luke's Hospital is now part of the St Luke's Radiation Oncology Network along with radiation oncology centres at Beaumont and St James's Hospitals.
According to the research institute, it has had no CEO since the HSE took over the running of St Luke's in mid-2010 and the top-up payment from the Institute ceased after 2010.
Company accounts describe the research institute as being wholly funded by charitable funds. Its work includes promoting radiation therapy-based and allied research and assisting the training of young cancer researchers.
According to its company accounts, the St Luke's Institute's income is derived from St Luke's Cancer Research Fund, the Friends of St Luke's organisation and other donations.
Asked if those involved in fundraising for St Luke's were aware of the top-ups, the Institute said there has always been clear and open dialogue between the hospital, the Friends of St Luke's, the St Luke's Cancer Research Fund and the Institute 'on an ongoing business basis' and a detailed annual report from the Institute was provided to the Friends and the Research Fund.
The HSE says senior staff at the St Luke's currently do not receive any additional payments from non-Exchequer sources on top of their designated salaries. Ms Broekhoven left St Luke's at the end of 2010 and subsequently took up a healthcare post in the UK.
The Friends of St Luke's, which is a well-known medical charity that raises money for equipment at the St Luke's Radiation Oncology Network and for research, currently stresses on its website that none of its funds are used to top up executive salaries.
Queries from irishhealth.com to the Department of Health about the top-ups paid to St Luke's CEOs up to 2010 have to date elicited no response.
The HSE says the top-up pay issue predated its taking over the running of St Luke's.
Public Accounts Committee member Deputy Sean Fleming noted that St Luke's was not included in the HSE's recent list of voluntary health agencies who provided unauthorised allowances from non-exchequer sources to senior staff.
However, he told irishhealth.com that the scope of the investigation may need to be extended, and it was likely that issues such as St Luke's would need to be looked at.
[Posted: Thu 09/01/2014]