Oireachtas committee to see Arts Council chief's emails warning about botched €6.6m IT system
The head of the Arts Council alerted department officials to concerns over a botched IT system as far back as 2021, a raft of emails show.
Almost 60 pieces of correspondence have been handed over to members of the Oireachtas arts committee which show that the outgoing director of the Arts Council Maureen Kennelly had sought "urgent" meetings with senior department officials and repeatedly raised the need for resources to address cost and time overruns.
As far back as July 2021, 'variations arising on the project' were highlighted in relation to the €6.6m system which was ultimately abandoned, one document reveals.
The committee recently heard that a senior civil servant did not act on serious concerns around the Arts Council's failed project, which Ms Kennelly described as 'very disappointing and frustrating'.
The documents, seen by the Irish Examiner, show that updates on the ICT [information and communications technology] project were provided at various meetings across 2022.
In November 2022, correspondence showed that the department was informed that the system was due to go live in late 2023, but 'there are cost overruns which are being monitored carefully'.
Ms Kennelly also stressed that recruitment of roles associated with the project were a 'critical priority' for 'the timely and cost-efficient delivery of the new system, the roles referred to above are a critical priority'.
In December 2023, Ms Kennelly sent an email 'about the Arts Council's urgent requirement to get a senior ICT resource into place'.
'As referenced at our liaison meeting on Monday last, we are at a critical junction with the business transformation project. To guarantee the delivery of current and future Arts Council strategy, a particular skillset of CIO is required,' she wrote, before expanding on the need to recruit staff 'to help us with the current challenges of the Business Transformation Programme'.
Another email sent in February 2024 requested an 'urgent meeting with the secretary general' and other senior civil servants on the project.
Issues with the abandoned IT project first came to light in February, with the plan originally expected to cost in the region of €3m for a bespoke grant application system.
However, the project ballooned in costs and eventually cost the State €6.6m before it was cancelled.
The council is still using its previous system, but has sought to purchase an off-the-shelf system, which would cost an initial €1.5m to install. There would then be an annual €241,000 subscription fee for the service. However, the Arts Council confirmed to the committee the bespoke system would cost €560,000 per year to operate.
Appearing before the committee on June 11, Ms Kennelly said it was 'very disappointing and frustrating' that correspondence, which raised concerns around the project, was not sent to more senior civil servants.
She said it seemed as if issues with the IT project were not being escalated up the chain of command and this had been a 'great surprise'.
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THE BOTCHED IT PROJECT 'None of us set out with the intention of this happening. It is deeply regrettable. There's been lots of indignation and outrage about this, but I wouldn't want that to obscure the fact that the arts sector is populated with people – and the Arts Council as well – who are highly dedicated, very responsible and committed to delivering value for money for the public.' This is the view of Maureen Kennelly , who left her role as director of the Arts Council this month, and is speaking about the organisation's disastrous IT project, which ended with a multimillion-euro write-off and no software system to show for it. The idea was to bring together five existing systems, including those dealing with grants. The original budget for the project was €2.97 million, for delivery in 2021. That rose to €6.5 million by the time the plug was pulled, in June 2024. The net loss was €5.3 million. 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'They were confident that the Niamh Brennan review' – of the council's governance and culture, which O'Donovan commissioned in February and is expected this autumn – 'would accurately describe the development of the project and my role in it, trying to rescue it. It is important for me to say that I inherited this project. The project had started well before my time, and it was conceived and initiated on a very shaky foundation. 'I led the bid to rescue it to the point where it was ultimately decided by the board, in conjunction with me, to stop the project in favour of an option which would be cheaper in the long run' – an off-the-shelf rather than custom system. 'Unfortunately, the Minister decided not to wait for the outcome of the Niamh Brennan review. He judged me before those findings are available and against the clear advice of the Arts Council board. His actions have served to discredit the Arts Council and, in particular, my reputation. It is clear to me that he saw the opportunity for a scalp and I was a very easy target.' The IT project had 'troubled origins', she says, because 'the senior expertise simply was never there to deliver it, and the oversight from the department and the OGCIO' – Office of the Government Chief Information Officer – 'was never in place'. 'This was one outlying project which failed, there's no doubt. But it absolutely should not overshadow all the work the Arts Council does. And the Arts Council is by no means alone in enduring difficulties with such a project.' Kennelly chose to remain at the organisation until the conclusion of two Oireachtas committee hearings into the debacle – 'I thought it was very important for the Arts Council to be accountable' – and left two days later, on Friday, June 13th. One of the hearings was of the joint Oireachtas Committee on Arts, Media, Communications, Culture and Sport, where the Sinn Féin TD Joanna Byrne described Kennelly as having been 'thrown under the bus by the Minister'. THE BACKGROUND In 2018-19, with the council's core computer system on its last legs, the organisation's previous director initiated a huge 'business transformation project' with the approval of the Department of Culture. The IT project was complex, seeking to merge grant-management and financial systems, among others. As Ireland's national Government agency for funding, developing and promoting the arts, it has a large brief and hundreds of clients, from big organisations to individual artists. It was clear at the committee hearings that neither the council nor the department had the senior IT wherewithal to adequately manage or assess this, and relied on external contractors and project managers, where frequent staff changes added to the problem. 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The last thing you want is to be writing off significant funds. I know from my own very deep past in the arts sector how precious those monies are.' Blinder: Maureen Kennelly with Catherine Martin in 2022, when the TD was minister for culture. Photograph: Maxwell's She was appointed at the height of the pandemic, a period when the arts sector was battling for survival. The council, which Kennelly led with its chairman, Kevin Rafter, and the department, led by Catherine Martin, as minister, and Katherine Licken, its secretary general at the time, are regarded as having played a blinder, securing extra funding to keep the arts afloat through lockdown. Last year the council's programmes, partnerships and grant aid supported 588 organisations and 2,000 individuals, 140 festivals, 318 schools and 31 local authorities. After years of underfunding, the council's annual budget increased by 75 per cent between 2020 and 2024, to €140 million, effectively holding on to Covid-response increases. Its remit expanded, grant applications rose from 3,000 to 8,666, and the council funded more individuals and organisations. All that takes more work; the department says that its approved staffing level for the council increased from 47 in 2018 to 146 in 2024. Ticking away in the background was this complex, ballooning IT project. It has all been detailed in the report of the department's internal examination , in media reports and at the Oireachtas hearings: the Public Accounts Committee on May 29th and Culture Committee on June 11th. And in parallel with Brennan's report, the department is reviewing its own governance and oversight. As the project's expected delivery approached – a year late, in September 2022 – multiple bugs were discovered. This was substandard work, Kennelly told the Public Accounts Committee. 'The really serious nature of the situation was clear to me,' she says. The council went into dispute with contractors, and Kennelly restructured the project, changing internal personnel and stopping payments to contractors. 'With hindsight, I'm not sure any other CEO would have done any differently, to be honest.' She continued to 'really earnestly' appeal for sanction for a senior IT person. THE ACCOUNTING Before the Oireachtas committees, Kennelly and Feargal Ó Coigligh , Licken's successor as secretary general, sought to be 'completely transparent in relation to our failings'. A key factor that emerged at the Culture Committee is that although the council kept the department informed, the problems that developed appear not to have been escalated within the department, up to the secretary general or the minister, until late June 2024. 'It was surprising to me that it wasn't being conveyed upwards,' Kennelly says. 'We weren't keeping a single thing hidden from the department.' Asked in committee how much correspondence she had with the department about the project, she estimated 'about 60 pieces of written communication' – a number Ó Coigligh initially questioned at the Culture Committee but then accepted. At committee, he also acknowledged departmental failure. 'We should have stepped in much earlier when it became clear this project had run into serious difficulty.' Twenty-one external expert contractors have been paid; 75 per cent of the costs relate to four companies. The council has started legal proceedings against two of them (Codec, one of the contractors involved, strongly rejects claims its work was substandard) and is in pre-action with two others. The legal action has cost €60,000 so far, but the department has now frozen spending, pending recently sought feedback from the Attorney General's office. 'I hope the Minister's decision to pause spending on it will not squander a good opportunity to recover monies on behalf of the public,' Kennelly says. 'It wasn't, 'Let's just lash loads of money at the lawyers and get this fixed.' It was being constructed extremely carefully.' 'Furious': Patrick O'Donovan and Simon Harris. Photograph: Brian Lawless/PA Wire O'Donovan was 'desperately angry' when he was told about the €5.3 million write-off, and immediately took it to the Cabinet; there was, perhaps, the slight air of a new sheriff wanting to clean up Dodge. Coming on foot of other sagas involving wasted public money, fury erupted . Minister for Public Expenditure Jack Chambers decried 'a massive waste of money'. Tánaiste Simon Harris was 'furious'. (Then, this month, O'Donovan was admonished for bringing 'substantial expenditure' issues, including the Arts Council, to Cabinet 'under the arm', without telling colleagues in advance.) When the Minister declined to renew Kennelly's contract, the council instead proposed deferring a decision until after Brennan's report. The department's only offer was a 'final contract' of up to nine months or 'until a new director is appointed, whichever is sooner'. It was 'highly conditioned', Kennelly says. 'I think any self-respecting senior executive would have thought twice about it.' She declined. 'It's just disappointing that my only encounter with the Minister was about this, and that he appears to have rushed to such hasty judgment on this outlying project when there are so many other fantastic things being delivered by the Arts Council,' Kennelly says. THE MEDIA COVERAGE The Minister told the Sunday Independent last weekend, 'I made the decision that I think is in the best interest of the Arts Council and the taxpayer.' Kennelly is 'flabbergasted by this. He made the decision against the clear advice of the Arts Council, and I would like him to explain how this decision meets the best interest of the taxpayer and the Arts Council. 'I find his statement deeply insulting and damaging to my reputation. I hope that he'll have an opportunity to explain why he made that statement at the joint Oireachtas committee' when it convenes on July 2nd. She says the council was dismayed by details in an Irish Times report in April based on information released following a Freedom of Information request. It referred to a meeting that the new Minister called with Kennelly and Maura McGrath – Rafter's successor as chair – two months earlier. O'Donovan asked if they or their predecessors had discussed the business transformation project with the previous minister or secretary general, 'to which both replied 'No'', according to minutes the department supplied. But Kennelly's own note of her full reply is, 'No, but I kept the principal officer, my designated line of contact, informed right throughout the project.' 'I was flabbergasted,' Kennelly says. 'It was an extremely selective record of the meeting. The department should never have sent minutes to The Irish Times without checking them with us first. It was an extremely unfair reflection of the whole situation.' She adds, 'It appears they may have been put out there to justify the Minister's actions.' Culture Committee: Feargal Ó Coigligh answers questions on June 11th. Photograph: Oireachtas TV Several members of the Culture Committee, including Malcolm Byrne of Fianna Fáil, repeatedly asked the secretary general whether he advised the Minister about Kennelly's contract. Ó Coigligh repeated, several times, that it was a ministerial decision, effectively refusing to answer the question. THE LESSONS 'It's a huge regret of mine' that the IT project wasn't delivered, Kennelly says, 'and that the circumstances of my contract mean I'm not there to see a new system through. I hope and I trust good decisions will be made in the future.' The lessons to be learned include ensuring appropriate internal expertise is in place, alongside departmental and OGCIO oversight. 'The Arts Council is set up to develop the arts and to support artists and organisations. It's not set up as an IT specialist ... The risks of the project weren't properly assessed from the start.' If they had been, someone would perhaps have said, 'This is a project that's doomed to fail ... You were absolutely not set up to take this on.' At the Culture Committee hearing Joanna Byrne said, 'I am of the view that there was full transparency at every stage, from 2021 right up to 2024, on the part of the Arts Council. Yet it is okay for the department to state that it failed but that nobody within it is to blame ... Thousands of artists in this country are not getting the service they desire and deserve because of the failures in the department. I do not think it cuts the mustard to state that the department failed but that nobody was held accountable.' Kennelly says now, 'It seems probable to me that someone was briefing against the Arts Council and against me, and I find that abhorrent.' Is she bitter about all that has happened? 'No. I'm disappointed. It's been a very tumultuous time. I loved the role, and have huge regard for the people in the Arts Council, and equally huge regard for people in the sector. The Arts Council's an enormously important part of Irish life. It has to be protected, and funding for the arts has to be protected. That's absolutely critical.'
