Northwest Area Reorganisation and BRL Corporate Governance

Northwest area re-organisation

There are two Dublin City Council entities in Dublin Northwest which is the Glasnevin North/Ballygall/Finglas/Ballymun/Santry/Whitehall areas. The changes in the local election boundaries were designed to get Greens elected but the rejectorate failed to do their duty. The City Council reorganised the Area Committees last year and left the Northwest Area mainly intact, just removing the Santry Village and Whitehall Areas from its administrative areas.

Current Background

Personnel

Area Manager Michael O’Neill, who recently replaced the highly efficient Damian Drum, has been transferred to South East and replaced by Charlie Lowe on a part-time basis. Charlie has an excellent reputation. I am not writing this because of either libel laws or pseudo-niceness or arzelikans as Private Eye might put it. No, I have been reliably informed that this man is excellent. The other factor is the retirement in July 2010 of Ballymun Regeneration Ltd CEO Ciaran Murray.

Ballymun – The success and the diligence of Ciaran Murray, the staff and Board of BRL is obvious in the changes in the physical and social infrastructure of Ballymun. The two remaining big ticket physical projects are the development of the shopping centre and the construction of Metro North. As Treasury Holdings is involved in the Shopping Centre and as many of the principles are connected to REO and the Battersea Power Station project in London, a close monitoring of the business world is needed to get the best for Ballymun and protect the interests of the Dublin public.
There is also the need to liaise with government and the Railway Procurement Agency (RPA) on the details of Metro North including the effects on the regeneration. Protecting the arts in the Axis through a agreed levy in the shopping centre floor space was one of Murray’s intentions. There are also the arrangements with IKEA in relation to jobs for locals and whether these are written or virtual and verbal with all that this implies. The interrelationship with Fingal County Council in relation to Santry Woods/Northwood Area is important because there is the construction of stations at the shopping centre in Main Street and in Northwood and the need for a reconfiguration of the city boundary northwards to the M50.

Outcome so far – John Tierney, the City Manager, has told me that he has appointed Asst City Manager Philip Maguire to be CEO at BRL part time.

Finglas – The shopping centre at Poppintree Mall needs redevelopment badly and the City Council is a passive bystander in the consequences of the liquidation of Murumba as part of the fallout from the collapse of Bernard McNamara’s empire. Superquinn site has planning permission to go ahead but the market is forbidding.
The pubs are suffering as is business in general in the village.

The centre of excellence for the elderly at Mellowes Road and the neighbourhood centres at Cardiffsbridge and Barry are on hold (whatever that means).

Social problems, and cleaning remain a difficult and the budget and staff have been cut for both.

So I asked the following questions for written answer from the City Manager’s office.

Question to City Manager City Council Meeting 05/07/2010

Q95. COUNCILLOR BILL TORMEY
Northwest area reorganisation is taking place due to retirements and staff reassignments in the light of current economic conditions. What role has the Board of BRL in appointing a replacement for the retiring CEO Mr Ciaran Murray? Did the Board have the power to select their own candidate? If so was the replacement post advertised? If yes! Where? What is the duty of the Board of directors of BRL with regard to the appointment of a CEO? Is current practice in line with the best practice in corporate governance?
Why is the reputed new CEO a part time appointment? Is this appointment temporary? What is the position of the elected members with regard to senior management appointments at Dublin City Council? When have the Councillors the right to nominate a councillor to take a place on the interview committee for the appointment of senior staff?

CITY MANAGER’S REPLY:
Section 131 Local Government Act 2001 makes provision for reserved functions. Subsection 5 provides “For the purposes of this section “function” does not include a function relating to the employees of a local authority or joint body or the direction, supervision, service, remuneration or discipline of such employees or any of them, other than a function referred to in section
145(1) “.
It follows therefore that the Councillors have no role to play in the appointment of staff to the posts referred to in the above questions or indeed to any other position.
The City Manager will ensure that appointments of staff are made that meet both operational and strategic requirements of both BRL and the North West Area.

Q96. COUNCILLOR BILL TORMEY
Will the City Manager consider the compelling wisdom of appointing a new CEO to BRL at Assistant City Manager level and to extend the remit to include the senior management role for the rest of the Northwest area if he has the power to do this?

CITY MANAGER’S REPLY:
The City Manager is satisfied that the appointments of staff are being made that meet both operational and strategic requirements of both BRL and the North West Area.

Comment: These replies are functional, presumptuous and evasive. The tone is patronising and dismissive.

Analysis: The City Manager may be satisfied that the appointments meet the strategic and operational requirements of BRL and the Northwest Area but I am not so sure that this is the best way forward. Interesting, when business slows down, synergy operates and the most sensible action would be to put the two jobs together. I believe that an Asst City Manager post should be applied there to complete the regeneration project and work to deal with the Finglas problems. The elected councillors are in the same Area Committee.

Taking the non-answers to question 95 in sequence:-

What role does the Board of BRL have in appointing the CEO? Presumably full powers but how does that square with the City Manager “appointing” an Asst City Manager to the post. Mr Tierney is NOT a member of the BRL Board so therefore he appears to be acting as a shadow director. (Section 27, Companies act 1990).

Did the Board have the power to select their own candidate? We don’t know.

Was the CEO post advertised? No answer given. Maybe/maybe not!

What is the duty of the Board of BRL with regard to the appointment of a CEO? Answer Under company law, directors must act in the company’s interest.

If a company spends € millions of public money, is it not in the best interest of the company that the CEO should be full-time? Directors have a fiduciary duty to be open and transparent. Is the management of this company transparent if it appears that there may be a shadow director? No, in my view.

The evidence for the City Manager acting as a shadow director is in the statement “The City manager will ensure that appointments of staff are made that meet both operational and strategic requirements of both BRL and the North West Area”. Game Set and Match!

Is it not the duty of the Board of directors to appoint the CEO? Has any director objected to the company’s apparent acceptance of shadow director dictation?

What is the term of the new part-time CEO appointment?

With regard to the role of councillors in the appointment of senior staff at Dublin City Council or any local authority, it is clear that councillors have no role in any such appointment. However, questions as to the role of councillors in questioning procedures followed have been ignored.

Disputes on governance in companies may have to be resolved in the High Court.

(Thanks to Mr Kevin Prendergast, Corporate Compliance Manager, Office of the Director of Corporate Enforcement who gave a teaching session on company law to the Council on Monday 5th July).

Conclusions

1. Need for reassessment of the part-time appointments in the BRL/NorthWest Area 2. Corporate governance of BRL needs to be reviewed.
3. Determination of priorities for action in Finglas and Ballymun should be identified in the light of severely reduced funding by councillors in association with the management. All issues including the Parnerships, Sports, RAPID Area funding, Garda Siochana and other bodies should be included and a special effort must be made to involve the community and inform every household of outcomes.