THE head of an Irish-American body, which has secured a controversial €20m investment from the government for a scholarship fund, admitted the group spent at least €900,000 on corporate entertainment over the past five years.

Trina Vargo, head of the US-Ireland Alliance, confirmed that about $200,000 (€147,700) has been spent every year on a pre-Oscar night party in Los Angeles.

Vargo, who earns $175,000 a year, also disclosed that €180,000 had been spent on a suite at the K Club for the Ryder Cup in 2006.

The estimated cost of corporate entertainment organised by the group – which is funded by the US and Irish governments and by private donation – for those events was €942,190.

An increasing number of Irish politicians are now raising concerns about the US-Ireland Alliance and particularly the George Mitchell Scholarship Fund with which it is involved, as revealed in the Sunday Tribune a fortnight ago.

The Irish government has just agreed to invest up to €20m in a trust fund to subsidise the scholarship programme even though just 12 scholars a year will come to this country.

Socialist MEP Joe Higgins said: "There were no searching questions as to how the money would be disbursed and how 12 students a year could cost €4m.

"Against the background of major cuts in educational funding, I would suggest that this whole funding needs to be very closely scrutinised. I think funding of it should simply be ended."

Vargo said the expenditure of almost €150,000 annually for a pre-Oscar party in Los Angeles was a good investment for Ireland.

She said: "On average $200,000 is spent on this event.

"A portion of the funding comes from Culture Ireland, the Film Board and I raise additional [funding] from private sources.

"Again, compared to comparable events, this is a low price. The head of the National Endowment for the Arts told me he couldn't believe that we do it for only that cost.

"You must also recognise the value and profile it brings to people in the industry. Two Irish singers got recording contracts because of our event."

Vargo said the Oscar party had helped secure a special episode of The Simpsons for Ireland and a number of meetings with major Hollywood producers.

She said: "It's not good enough to simply say something costs x without talking about the value of the event."