A European Commission funded study claims that the Irish Government’s approach to exposing corruption in our banks and government is deeply flawed.
The report published today by anti-corruption group Transparency International Ireland (TI Ireland) finds that there are so many loopholes in Irish law that most people in business or the public service are effectively stopped from reporting wrongdoing or raising concerns in the public interest.
“We know what we know about corruption in our banking system and regulatory failure because of whistleblowers. Yet those who would report wrongdoing in our banks and public service still have little or no legal protection or guidance. The situation doesn’t just leave thousands of people exposed to disciplinary or legal action - it leaves the country exposed to another financial crisis”. claimed TI Ireland’s Chief Executive, John Devitt.
TI Ireland are now calling on all political parties to back a single law that would protect citizens and employees and allow for fair and transparent follow up of reports. “Northern Irish whistleblowers are covered by a single clear law that protects them against retaliation when they speak out against wrongdoing – even to the press. There is no good reason why such protection can’t be introduced south of the border”, added Mr Devitt.
The Government scrapped a comprehensive whistleblower bill in 2006 and has said that it will introduce protections in individual pieces of legislation. In 2007 a government sponsored body, The Company Law Review Group, rejected the Director of Corporate Enforcement’s call to offer whistleblower protection under Company Law because “Ireland’s reputation as a lightly regulated economy could suffer”.
TI Ireland has also criticised the Government’s “extremely complex” attempt to protect nurses and other healthcare workers who blow the whistle as “difficult to decipher”. The Health Act’s lengthy whistleblower provision is described as providing “little comfort to the prospective whistleblower”.
The study includes interviews with three prominent whistleblowers including Eugene McErlean, the former head of group audit with Allied Irish Banks. Mr McErlean reported overcharging and other wrongdoing at the bank, which he claims was then ignored by the Financial Regulator.
According to Mr McErlean whistleblower legislation could have saved the taxpayer billions. “If there had been legislation in relation to whistleblowers in the financial services introduced earlier, all the information about the banks would have come out before. We’re now paying the price for silencing people who could have told us what was going on.”
The Governor of the Central Bank, Patrick Honohan has also recently spoken out in support of TI’s call for whistleblower protection, telling an Oireachtas Committee in December that the Central Bank “are seeking the introduction of a statutory regime to encourage whistleblowers and to provide a specific process for them”.
While six out of ten of Ireland’s leading companies were found to have whistleblower policies, one company spokesperson revealed that their whistleblower ‘hotline’ was used “very rarely if at all”. The study also quotes a Dublin Chamber of Commerce finding that only 36 per cent of Irish companies encourage whistleblowing in the workplace compared to 89 per cent of their counterparts in the United Kingdom.
“An Alternative to Silence - Whistleblower Protection in Ireland” was co-funded by the European Commission and accompanies the TI report, “Alternative to silence: Whistleblower protection in 10 European countries”.
Notes for editors
The key recommendations from the report:
1. Ireland should adopt a generic whistleblower protection law covering whistleblowers in the public, private and non-profit sectors. The success of the generic UK Public Interest Disclosure Act runs to a mere nine pages and applies to the entire private and public sectors in the United Kingdom. It is an example of a simple and very effective law adopted by the jurisdiction most resembling Ireland’s. It makes little sense to continue with a “sectoral” approach that covers a limited number of professions and sectors.
2. In the absence of the early adoption of a generic provision, whistleblower protection provisions should be extended, as an intermediate measure, to company law and financial services as a matter of urgency.
3. Amendments should also be made to Health Act whistleblower provisions that remove the “ought to know” clause. This clause means that a healthcare worker may be sentenced to three years imprisonment for innocently making a false claim.
4. Whether a generic or sectoral whistleblower approach is adopted, the level of awards to whistleblowers that have been subject to reprisal should be of an amount that is “just and equitable in the circumstances”. This is the case under the Safety, Health and Welfare at Work Act 2005 and Employment Permits Act 2006.