Ex icare head’s wife paid $800,000 under contract awarded without tender, inquiry hears

By Shannon Jenkins

Tuesday August 25, 2020

Adobe

New South Wales insurance agency icare paid the wife of former chief executive John Nagle more than $800,000 over three years, a parliamentary inquiry has heard.

The inquiry on Monday heard that Nagle’s wife had received $750 a day to train icare staff between 2016 and 2019. She was awarded the contract without a tender.

Nagle’s resignation earlier this month was announced just hours after he appeared before the inquiry on August 3.

In 2019, he had been sanctioned by the icare board and lost a short-term bonus after he failed to properly disclose the conflict of interest regarding his wife’s contract. He had threatened to resign when he lost his bonus, but board chair Michael Carapiet had convinced him to stay.

There were a number of senior executives at icare who knew Nagle’s wife had been awarded the contract but “no one thought it necessary to tell the board”, according to former board member Mark Lennon — who resigned days before Nagle. Lennon told the inquiry that despite the conflict, Nagle was not sacked because he was the best person for the job.

Retired Supreme Court Judge Robert McDougall was appointed to lead a “root and branch” review into icare shortly after Nagle and Lennon resigned.


Read more: Movers & shakers: ex judge to lead icare review


The inquiry also heard that eight icare executives had been paid $3.96 million in salaries and bonuses in the 2019 financial year.

Group executive Rob Craig pocketed $870,878, with a $175,730 bonus and a $160,000 long-term performance payment. Meanwhile, Nagle received a base salary of $700,000, and a $106,000 long-term performance payment.

icare’s people and remuneration committee chair Gavin Bell said key performance indicators for executives “take a balanced scorecard approach” and were agency-wide. The agency was losing millions of dollars while the bonuses were being handed out.

State Insurance Regulatory Authority chief executive Carmel Donnelly told the inquiry that in January 2018, 89% of the injured workers with the Nominal Insurer compensation scheme had returned to work within six months.

She said the return-to-work rate for the Nominal Insurer is currently 80%, which she argued remains at “an unacceptable level”.

McDougall’s review will look at the structure and sustainability of the Nominal Insurer scheme and the Treasury Managed Fund, as well as the relationship between icare and SIRA, and the operations, culture and governance of icare.


Read more: Former icare compliance officer harassed at work, misconduct concerns ignored


 

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