Former taoiseach, Mr John Bruton, and Labour MEP, Mr Proinsias De Rossa, hired two consultants without official approval to help with their Convention on the Future of Europe duties, according to files just released by the Department of Finance.
Sharp exchanges took place in the months up to November between the Government and Mr Bruton and Mr De Rossa, who both complained that the consultants they had employed had not been paid.
The two are delegates to the highly influential convention, which is preparing a fundamental reform of the European Union that should lead to the adoption of a new EU treaty after 2004.
The dispute became so fraught at one stage that Mr De Rossa warned the Government that he would quit the convention because he could not do his work effectively. In August, Mr Bruton complained to the Minister for Finance, Mr McCreevy, about "the collective failure" of the departments of Finance and Foreign Affairs and the Houses of the Oireachtas to pay up.
His consultant, Ms Catherine Meehan, he said, had incurred "very large out-of-pocket expenses" since she was recruited in April "with the full agreement of the authorities of the Houses of the Oireachtas".
Later, Mr Bruton spoke with a Department of Finance assistant secretary, Mr Colm Gallagher. "He considered it a disgrace that she has been waiting for two months and these payments have not been made," Mr Gallagher told Mr McCreevy on August 27th.
"Deputy Bruton was emphatic that he had discussed the arrangement with the right people in Leinster House and that all the actions he had taken were in line with that."
Under existing rules governing State expenditure, the Houses of the Oireachtas are unable to sanction spending unless it is first cleared by the Department of Finance. In the files released under the Freedom of Information Act, Mr Gallagher insisted that the Minister had made it clear on April 16th that Mr Bruton and Mr De Rossa could not hire staff, and that Finance had made this clear to Leinster House.
Instead, the Department of the Taoiseach's secretary-general, Mr Dermot McCarthy, suggested that Foreign Affairs should provide "expert briefings" on the convention for both politicians.
The Department of Finance said it "knew nothing more about the affair" until bills were submitted from Ms Meehan - who had left a job in Bord na Móna - and Mr De Rossa's adviser, Mr Tony Browne. In a memorandum dated September 3rd, Mr Gallagher said it was clear that Mr Bruton was "oblivious" of the fact that Leinster House could not hire staff without the sanction of the Department of Finance.
"If this is the situation, Deputy Bruton may possibly have a legal case against some official body; Ms Meehan would certainly seem to have a plausible one against Deputy Bruton." In a letter on September 4th, Mr Gallagher told the clerk of the Dáil, Mr Kieran Coughlan, that Mr McCreevy acknowledged that both politicians had believed that they had clearance to hire staff.
Because of this, Mr McCreevy was prepared to cover both consultants' costs up to then: "In any case, he will not sanction expenditure consequent on these arrangements after the date of this minute," the letter said.
However, within a week, the situation had changed significantly. In a letter dated September 12th, Mr Gallagher told Mr Coughlan that he would cover the cost of the advisers until the convention's work was concluded.
On November 7th, Mr Gallagher told the Houses of the Oireachtas that Finance would cover the expenses of a European Commission official, Mr Kevin Leyden, seconded to Mr Bruton.
The Republic has two other delegates to the convention, Green Party TD, Mr John Gormley, and Fianna Fáil TD, Mr Pat Carey.
