IT Costs for Arts Council's Digital System Surge, Disclosed to the Committee
The Arts Council's legal costs related to its failed IT system have escalated from €60,000 to approximately €119,000, according to recent disclosures. This increase is primarily due to the inclusion of VAT and other liabilities, nearly doubling the initial spending on legal action against contractors involved in the controversial €6.6 million project.
The prolonged and complex legal process aimed at addressing the failures and recovering funds from the four companies involved has contributed to the escalation. Officials from the Department of Culture have expressed surprise at the increase and have requested the Arts Council to correct their earlier figures. The Council has also been asked to pause further legal action until an independent review is completed, indicating ongoing legal and procedural activity may influence final costs.
In a separate development, an alleged data breach by a former employee of The Arts Council has come to light, with the department having contacted the Data Protection Commissioner regarding this matter. The Arts Council is currently implementing measures to ensure that any contract above €25,000 must go through internal management.
The Arts Council is also in the process of finding a temporary acting CEO, with a selection process underway to identify a suitable candidate. Maureen Kennelly, the former director of The Arts Council, had her term extended until the end of the year, pending the outcome of a review, but was not reappointed on a long-term basis by Minister for Culture Patrick O'Donovan.
Representatives of the Department of Culture appeared before the Oireachtas Committee on Media to discuss the matter, with Secretary General Fergal Ó'Coigligh providing the committee with documentation, including a report on the project completed in February. It was revealed that there were up to 60 pieces of correspondence between the council and the Department of Culture on the project, with nineteen of these correspondences dated after January 2024, when a decision was made by The Arts Council to "review the project" and most of the €6.675 million had been expended.
The Comptroller and Auditor General found earlier this year that The Arts Council spent €7 million on an unsuccessful IT system. Minister O'Donovan has stated that he is not going after monies from The Arts Council. The expert group's review should be concluded around the back end of the year, and the findings will inform decisions regarding The Arts Council.
Maureen Kennelly refused the contract extension offer and stepped down from her role on 13 June. The secretary general has asked The Arts Council to establish the facts surrounding the alleged data breach and report back to him. The costs for legal redress by The Arts Council in relation to its failed IT system are approximately €119,000, more than double the previously stated €60,000. Mr Ó'Coigligh confirmed that no further money has been spent on the legal cases since the department advised The Arts Council to pause all activity on redress options, pending further consultation with the Office of the Attorney General.
The escalation in legal costs for the Arts Council's IT system issue, currently approximated at €119,000, is linked to business matters such as the complexities and duration of the legal process and the inclusion of VAT and other liabilities. Furthermore, the Arts Council is strategizing to improve its finance management by ensuring that contracts above €25,000 undergo internal management, demonstrating their awareness of the need for financial prudence in business dealings.
