By Michael O’Farrell
Investigations Editor
THE CEO of State-funded charity St John of God has at least five family members employed at or providing paid services to the charity, the Irish Mail on Sunday can reveal.
The revelation is expected to heap more pressure on the charity’s boss John Pepper (pictured) – who is paid €182,000 a year, only slightly less than the Taoiseach, and who received a secret top-up payment of €600,000 in 2013.
The MOS revealed last week that Mr Pepper was among 14 St John of God executives who shared more than €1.6m in secret buyouts of pay entitlements in November 2013.
Since then parents and staff representatives facing the brunt of continuing cuts to the services provided by St John of God have demanded the money be returned.
“It is customary in a rural community that a large employer attracts numerous family members into employment” – St John of God spokesperson.
In addition the HSE has confirmed that St John of God is not in compliance with public pay policy due to the group CEO Mr Pepper’s salary, and the €125,000 salary of another St John of God executive, Clare Dempsey, who also received a secret top-up.
A Public Accounts Committee hearing this Friday, to be attended by the HSE, is to focus on St John of God. Amid continuing anger at the secret payouts, the HSE this week wrote to all Section 38 agencies – health agencies funded by the State – to ask if they too had made secret payments to executives before declaring compliance with public pay rules.
An MoS survey of a number of Section 38 agencies discovered that at least two other organisations made lump sum payments, which can be described as buyouts, in 2013 – although both Tallaght Hospital and St Vincent’s Hospital have insisted that they informed the HSE about these payments.
One of the five roles occupied by Mr Pepper’s family – a position as head of maintenance at the charity’s St Mary’s campus at Drumcar Co. Louth – was awarded to the charity chief’s younger brother Seamus Pepper in 2006. John Pepper is from Co. Louth and lives just outside Dundalk.
“Mr Pepper has at no time been directly involved in the employment or grievance process of any family member at Drumcar.” – St John of God spokesperson.
Subsequently Seamus’s son, James Pepper, became a staff member at the same facility – a residential and daycare centre for people with intellectual disabilities – as did another female relative.
The MoS has also confirmed that John Pepper’s own son – also called John – became head of Human Resources at Drumcar two years ago while his wife Catherine is paid to provide therapy services on a freelance basis at the centre.
There is no suggestion of any wrongdoing on the part of any of these family members and there is no suggestion that they are not suitably qualified for the positions they hold.
John Pepper last night rejected any suggestion that he played a role in securing jobs or payment for family members. Nevertheless, in the wake of the ongoing Console scandal which also involved family members of the CEO being employed at that charity – Public Accounts Committee chairman Seán Fleming called for the St John of God board to address the issue.
Responding to the appearance of nepotism, Mr Fleming said: ‘Reports of close family involvement in relation to the running of an organisation that’s substantially funded by the HSE and the Irish taxpayer is unacceptable.’
Seamus Pepper became head of maintenance at Drumcar after his predecessor left following an internal grievance involving Seamus Pepper. Seamus had worked at Drumcar since 2001 in a more junior role. The settlement, about which the HSE was not informed, involved the payment of €66,000 to the previous head of maintenance and came from funds provided to St John of God by the taxpayer.
As part of that settlement, the departing head of maintenance was also provided with fees to do a course aimed at setting up a contracting firm and was guaranteed that his new business would get maintenance work at St John of God facilities. The date of this settlement was May 10, 2006.
A union official who negotiated the deal – and another person who was in attendance – told the MoS last night that St John of God CEO, JohnPepper was present in meetings to agree the settlement that vacated the head of maintenance position.
But a spokesman for St John of God responded to say that Mr Pepper had at no time ‘been directly involved in the employment or grievance process of any family member at Drumcar’.
The spokesman said the grievance process had been managed by an independent consultant and ‘the outcome was signed off at local management level’.
He also said all employment of Pepper family members at Drumcar had been ‘conducted on a localised basis by managers in Drumcar’ and that it was ‘customary in a rural community that a large employer attracts numerous family members into employment’.
PAC Chairman Mr Fleming said the 2006 settlement which resulted in the maintenance position at Drumcar being vacated – to be then occupied by a brother of the CEO – was ‘shocking’.
‘I’m calling on the chairman of the board of St John of God to make a public statement on the matter,’ said Mr Fleming. ‘I’m calling on the board of directors of John of God to take immediate action on this in the interest of their own organisation because they are funded by the State.
All Section 38 groups, like the St John of God group, must follow public service appointment rules which involve the public advertisement of job vacancies and competitive recruitment procedures. The MoS asked the St John of God group to specify when and where the positions awarded to family members of Mr Pepper had been advertised.
The charity did not address this question directly other than to say that ‘recruitment in St Mary’s Drumcar, is in line with best practice and in accordance with the applicable regulations, policies and procedures at any given time’.
On Friday the matter – together with the Console scandal – will be the focus of a PAC hearing with the HSE present. Mr Fleming said: ‘We want to start with the HSE. They are the gatekeepers in all of this.’ He said it was unclear whether or not the PAC would eventually be able to hear from executives at St John of God because the committee lacked powers to compel attendance. Asked last night if its executives would attend the PAC a spokesman for St John of God said they had not yet been asked.
Other Irish Mail on Sunday articles about St John of God;
CHARITY CHIEFS JET OFF TO U.S. AS CUTS HIT HOME
Charity Chiefs Got E2m Secret Top Ups
