REPORT for the EXECUTIVE COMMITTEE of ASLEF by Matthias Kelly QC

Report of Matthias Kelly Q.C. REPORT FOR THE EXECUTIVE COMMITTEE OF ASLEF By Matthias Kelly QC ASLEF Report 29th June 2004 1 Report of Matthias Kelly Q.C. INDEX Executive summary, page 4. 1. The issues, page 9. 2. Introduction, background, methodology and co-operation, page 10. 3. Finance, page 22. 4. Trustees, page 49. 5. Severance Payments, page 80. 6. The Flat of the Former General Secretary and the Accommodation of the Incoming General Secretary, page 88. 7. Information Technology Concerns and the Issue of Paralogic, page 95. 8. The deletion of files, page 113. 9. The existence of a Password Recovery Programme on the server and “the “Trojan” bug, page 124. 10. The General Secretary, the Executive Committee and relations with staff, page 128. 11. The Handover from Mick Rix to Shaun Brady and Delay in Taking Office, page 137. 12. Governance, page 141. 13. The Blagbrough report, page 149. 14. Miscellaneous issues, page 173. 15. Recommendations, page 181. Appendices: 1. Resolution 319/424 of 26th March 2004, Terms of Reference. 2. Terms of reference of Paul Blagbrough. 3. List of people interviewed. 4. Interim IT report. ASLEF Report 29th June 2004 2 Report of Matthias Kelly Q.C. 5. Accountant’s report. 6. Letter of 23rd October 2002 Paralogic. 7. Paralogic’s terms and conditions. 8. APRP Job sheet and instructions. 9. Report of Mr. Peter Sommer, 21st June 2004. 10. Report of MD5, 23rd June 2004. 11. Document from General Secretary’s office. 12. Letter to staff of 29th December 2003. 13. Instruction to proceed. ASLEF Report 29th June 2004 3 Report of Matthias Kelly Q.C. Executive Summary I recognise that the union belongs to the members and not to any officer or body. Officers are in post to serve the membership. I recommend steps be taken to increase transparency, democracy and accountability in the union and the interaction of its officials with the membership. Finances 1. The finances of the union are sound.. The Union’s total funds have steadily increased from £4,417,719 at the end of 1994 to £5,390,347 at the end of 2003. An increase of £927,628. The Union’s General Funds have also increased from £4,278,106 at the end of 1994 to £4,449,018. An increase of £170,912. 2. If costs are apportioned to the year they were incurred and the effect of inter- fund transfers eradicated the draft result for 2003 is a deficit of £129,298 and not £900,000 as has been reported in the press. From 1997 to 2002 there is a deficit for two out of the six years. Overall there is a surplus of £969,246. 3. No one has provided us with any substantive or credible evidence of fraud. The present and long established system of claming expenses is unsatisfactory. It does not require expense claims to be supplemented by appropriate receipts or other documentary proof. This systemic failure leads to expense claims by members and officers some of which, on their face, are questionable. I do not mean to imply that all, or indeed most, claims are questionable. However, some are. Accordingly the adoption of a system, which requires such evidence, is needed urgently to address this systemic failure. However, I have at no time received any substantial or credible evidence of fraud on the part of any member or officer. ASLEF Report 29th June 2004 4 Report of Matthias Kelly Q.C. 4. There was disorganisation in the Finance Department of ASLEF in 2003. However, the effect of that in the long term is nil. The Finance Department has been inadequately staffed and inadequately managed. Steps need to be taken to see that an appropriately qualified or experienced Finance Manager is installed. Trustees 5. The role of Trustees within the Union was considerably enhanced from 1998 onwards. However, although there were beneficial changes to the 2002 Rule Book the rules relating to Trustees are in further need of clarification. 6. From October 2003 until the end of April 2004 the Trustees have all but been excluded from the financial affairs of the union. Severance Payments 7. The severance payments to Mick Rix and Debbie Dwight were authorised, legal and justified. They were not, as has been alleged, a misuse of the union’s assets. Allegations of theft 8. Mick Rix did not remove any furniture, which did not belong to him. Allegations of a “Scorched earth policy” 9. The lease granted to the caretaker was not a life long lease. It was a service tenancy, which was capable of termination. 10. There was no “scorched earth” policy in the period prior to Shaun Brady taking office ASLEF Report 29th June 2004 5 Report of Matthias Kelly Q.C. 11. The General Secretary, Mr. Brady, did not intend, when he took office, to move into Mick Rix’s former flat. 12. Paranoia gripped the union, particularly on IT issues, when Shaun Brady took office. 13. There was an Advanced Password Recovery programme installed on the union’ IT server to “crack” password protected files, but it was not installed in Mick Rix’s time. It was installed after Shaun Brady took office and at the request of his assistant office manager. 14. The union’s former IT service provider, Paralogic Networks Ltd, were treated unfairly and their contract broken when Mr. Brady summarily dismissed them. They should receive an apology. Deletion of Files 15. Files were deleted from the IT system. 64,334 files and folders were deleted from the hard drive of Debbie Dwight’s PC from 23 July 2003 onwards. Of those 64,334, some 43,827 files and folders were deleted on 12 November 2003. This was after Debbie Dwight had left the employment of ASLEF. It was also after Paralogic had confirmed that directories were missing on 10 November 2003. 16. Over two thirds of the files or folders which were found to have been deleted on Debbie Dwight’s PC could not have been deleted by her. They were deleted by someone else, most probably in the knowledge that allegations had already been made about deletions by Debbie Dwight. The identity of that person and the purpose behind the deletions on 12 November 2003 are unknown. It is neither proportionate nor productive to spend more time and money inquiring further into this matter. Suffice to say that the deletions by ASLEF Report 29th June 2004 6 Report of Matthias Kelly Q.C. Debbie Dwight, although unwise, were not harmful to the operation of the Union. In any event, the deletions which were discovered by The CAS Network on 3 December 2003, commissioned by Mr Blagbrough and Mr. Brady, included some 43,827 files or folders out of a total number of deletions of 64,334 which could not have been deleted by Debbie Dwight as she was not working at ASLEF at that time, had not been doing so for over two months and had no access to the PC involved. 17. I find as a fact that the vast majority of the file deletions uncovered by CAS, and confirmed by MD5, were not carried out by Debbie Dwight. They were of little consequence and hard copies existed. The operation of the union was not, in any event, impeded. There was no malicious intent. The Blagbrough Report 18. The Blagbrough report was a confidential draft report and was not intended for publication. A disaffected union member took it without consent from the union’s office. The unauthorised and premature publication of the Blagbrough report was damaging to the union and its membership 19. A major failing in the Blagbrough report was its failure to seek explanations from those accused in it. However, it was not written for publication. It was marked “Confidential Draft”. 20. In its draft form it relies upon opinion rather than hard evidence, and creates a very misleading impression. However, it must be remembered that it was a draft and not intended for publication. The Management of Head Office 21. Shaun Brady handled the union’s staff aggressively and insensitively. ASLEF Report 29th June 2004 7 Report of Matthias Kelly Q.C. 22. The level of tension within the union has resulted in staff illness. The Governance of the Union 23. There needs to be a protocol governing the hand-over from one General Secretary to another. 24. The EC are the governing body, not the General Secretary 25. There should be a special AAD to consider this report and the future course of the union 26. Shaun Brady has deliberately engaged in a power struggle to the detriment of the union 27. There has been an attempt to “smear” Mick Rix. 28. Improvements can be made to the way the union conducts its affairs. 29. There needs to be a period of stability and reconciliation within the union. ASLEF Report 29th June 2004 8 Report of Matthias Kelly Q.C. Section 1 The Issues I have identified the following issues as being of importance in this review: 1. Financial Management. 2. Trustees. 3. Severance Payments to the Former GS and Former Office Manager. 4. The Flat of Former GS and the accommodation of the New GS. 5. Information Technology and Paralogic. 6. The deletion of files. 7. Management of Head Office (Recruitment) / Relations with Staff. 8. The Hand-Over Process. 9. Governance. 10. The Structure of the Union (relationship between GS and EC). 11. The Blagbrough Report. ASLEF Report 29th June 2004 9 Report of Matthias Kelly Q.C. Section 2 Introduction and background. Introduction: 1.

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