Sport Ireland suspends FAI grant funding over failing to report six-figure 'bridging loan'

Sport Ireland has taken the extraordinary step of suspending and withholding funding to the Football Association of Ireland following recent revelations over the association’s governance.

Irish sport’s statutory body have taken the decision after the association’s ‘acknowledgement … [it did not comply with Clause 4.3 of Sport Ireland’s Terms & Conditions of Grant Approval.’

The FAI’s statement confirmed that it had erred in not reporting a €100,000 ‘bridging loan’ from then-CEO John Delaney to the association in 2017.

That money was subsequently paid back, however it didn’t appear in the audited accounts and Sport Ireland was not informed, as the association is obliged to do under the terms of grant agreements.

Delaney subsequently stood down as CEO on the recommendation of Jonathan Hall Associates to take up a newly-created position as ‘executive vice-president.’

The FAI is due to appear before a Joint Oireachtas Committee on Transport, Tourism and Sport on Wednesday, where Delaney, acting CEO Rea Walshe and board members will answer questions.

Sport Ireland was expected to provide €2.7 million in grant funding to the FAI in 2019 but has suspended the second half of that payment, the first having been paid earlier this year.

“The Board of Sport Ireland at its meeting today (April 9th) has decided to suspend and withhold future funding to the Football Association of Ireland (FAI) in accordance with Clause 1.1 of Sport Ireland’s Terms and Conditions of Grant Approval,” the statement read.

“The decision was taken in light of an acknowledgement by the FAI in its written opening statement to the Joint Oireachtas Committee on Transport, Tourism and Sport tomorrow that in 2017 the FAI did not comply with Clause 4.3 of Sport Ireland’s Terms & Conditions of Grant Approval.

“Clause 4.3 specifically relates to ‘Further Reporting’:

“‘In addition each organisation undertakes to notify Sport Ireland in writing without delay in the event of any material deterioration in its financial position or of any other matter which may jeopardise the organisation’s overall financial viability and/or its ability to comply with its commitments in the Approved Submission, and thereafter to provide Sport Ireland with such information and documentation as Sport Ireland may request in connection with the relevant matter and any steps being taken to rectify it.’

“The Board of Sport Ireland will consider the reinstatement of funding once all ongoing reports commissioned by the FAI have been completed and the recommendations adopted, and the Board of Sport Ireland is satisfied that all necessary processes and controls are in place to ensure the FAI’s ongoing compliance with the Terms and Conditions of Grant Approval.”

Sport Ireland will continue to provide non-financial assistance and advice to the association in the interim.

Sport Ireland statement:

The Board of Sport Ireland at its meeting today (April 9th) has decided to suspend and withhold future funding to the Football Association of Ireland (FAI) in accordance with Clause 1.1 of Sport Ireland’s Terms and Conditions of Grant Approval.

The decision was taken in light of an acknowledgement by the FAI in its written opening statement to the Joint Oireachtas Committee on Transport, Tourism and Sport tomorrow that in 2017 the FAI did not comply with Clause 4.3 of Sport Ireland’s Terms & Conditions of Grant Approval.

Clause 4.3 specifically relates to ‘Further Reporting’:

“In addition each organisation undertakes to notify Sport Ireland in writing without delay in the event of any material deterioration in its financial position or of any other matter which may jeopardise the organisation’s overall financial viability and/or its ability to comply with its commitments in the Approved Submission, and thereafter to provide Sport Ireland with such information and documentation as Sport Ireland may request in connection with the relevant matter and any steps being taken to rectify it.”

In making the decision to suspend and withhold funding, the Board of Sport Ireland notes that the FAI has already been paid 50% of its 2019 funding to date and some positive steps taken by the FAI in recent days.

This decision will be reviewed by the Board of Sport Ireland as a standing item at each of its future meetings.

The Board of Sport Ireland will consider the reinstatement of funding once all ongoing reports commissioned by the FAI have been completed and the recommendations adopted, and the Board of Sport Ireland is satisfied that all necessary processes and controls are in place to ensure the FAI’s ongoing compliance with the Terms and Conditions of Grant Approval.

Sport Ireland will continue to provide non-financial assistance and guidance to the FAI, which may be helpful in advancing matters.