January 30, 2020 / 2:22 PM / 25 days ago

Irish government backs rescue package for governing body

DUBLIN (Reuters) - Ireland’s government agreed on Thursday to provide an extra 20 million euros of funding to the Football Association of Ireland as part of a financial rescue package it said would ensure Irish soccer has a secure future.

The FAI’s auditors said last month it could not guarantee the body could continue as a going concern after an ordered restatement of the scandal-hit association’s accounts increased its overall liability to 55 million euros ($61 million).

State funding, suspended last April amid a series of corporate governance probes, will be restored and doubled to 5.8 million euros a year until 2023. The government will also provide an interest free loan of 2.55 million euros each year until 2022.

The government said the intervention was part of a plan that involved a significant contribution of additional funding from the sport’s European governing body, UEFA, and favourable terms of business offered by Bank of Ireland, the FAI’s lender, which in tandem announced a new sponsorship deal with the association.

FAI interim chief executive Gary Owens said all sides took a hit in supporting the package for the association which he said had not been in a position to pay its creditors.

“It was very bad, for the last 10 months we’ve had loads of businesses all around the country who we haven’t paid. We’ve had staff uncertain about their jobs,” Owens, a former chief executive of Irish financial services company IFG, told national broadcaster RTE.

The FAI has been beset with problems since it acknowledged last year that it had broken state funding rules by failing to tell authorities about a 100,000 euro short-term loan made to it by former chief executive John Delaney to deal with cash flow issues in 2017.

Ireland’s state corporate watchdog began legal proceedings against the FAI in May and its auditors, Deloitte, said the 98-year-old association’s accounts were not being properly kept, contravening two sections of Irish company law.

A separate state-commissioned independent audit of the association was also referred to police in November.

Delaney has since left the association and his role on the executive committee of UEFA in a clearout of the FAI’s board.

It has appointed independent directors for the first time and also named former Ireland striker Niall Quinn as interim deputy chief executive last week.

The state assistance is conditional on the implementation of a long list of reforms.

“We can now look forward to a rigorous rebuilding of the FAI from a toxic, autocratic, unfit-for-purpose organisation to a fresh, cleansed association that can honourably represent and support Irish football, at home and also on the world stage,” Irish Sport Minister Shane Ross said in a statement.

Reporting by Padraic Halpin; Editing by Toby Davis and Christian Radnedge

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