COUNTY VIEW: When charity begins at home

The recent travails of the Peter McVerry Trust have cast a timely light on the activities of the charities sector, a stratum of society that has morphed from initial altruism into what is now big, big business indeed.

We will return to Peter McVerry Trust in a moment, but first, an overview. There are now 12,000 registered charities in Ireland, or one for every 425 people. There are nearly 380,000 people employed in the charities sector, which makes charity a major industry in its own right. And looked at in the round, it is hard to see how there cannot be considerable duplication and overlap between so many charities competing with one another for what is a finite market of needs.

The journalist Conor Skehan, himself closely allied to homeless charities, recently bemoaned the fact that there are 23 homeless charities in Dublin, employing 900 people, with all purporting to reach out to the same cohort of people with the same array of services, but with no cohesion between them as to which entity is responsible for what.

The McVerry debacle is a salutary lesson in how a well-meaning, down-to-earth initiative aimed at alleviating an acute social problem can turn into a runaway horse that has long since broken its reins and is running wild. And most distressing of all is that the name of Fr Peter McVerry, such a revered and saintly man, should be sullied by the actions – or, in this case, the inactions – of those entrusted to oversee his good works.

The McVerry Trust is the largest non-government provider of emergency accommodation in the State, employing 530 staff and with €177 million in fixed assets. Its income is of the order of €62 million, but when it was on the brink of collapse last year it needed a €15 million bailout from the Government in order to remain afloat. This in turn prompted an investigation and report from the Charities Regulator which uncovered a shambles of poor oversight, lack of financial control, and inadequate governance.

The catalogue of mismanagement was breathtaking, but led back to the same conclusion – that altruistic bodies operate to a different moral standard than their commercial brethren. The public perception is that, simply because of their nature, such bodies are immune to financial irregularities on the part of those who run their affairs.

The report instanced one particular transaction that, in any other organisation, would be dismissed as far fetched. In 2016, the Peter McVerry Trust asked its external auditor to buy a house in Celbridge and then sell it on immediately to the Trust, so that the purchase ‘would not be publicly known’. The house was then rented under a 25-year lease to a friend of the then CEO, even though the friend did not qualify for a housing allocation under Trust rules. The friend was then given a transport contract worth €200,000 a year by the Trust, and was later employed by that body, so that he was simultaneously a Trust tenant, contractor and employee.

The Board of the Trust only found out about the arrangement seven years later, when the CEO retired. Indeed, the Board appeared to have a singularly detached involvement in the Trust affairs – the members actually signed off on a set of accounts showing €19 million owing to creditors, but later pleaded the board was ‘unaware’ of the situation.

Whether the McVerry situation reflects what is happening in the broader charity sector, it has certainly set alarm bells ringing at official level. At a time when compliance, regulation and governance have taken on a new importance in the commercial sector, only one in five charities employ a designated compliance officer.

Clearly, if charity begins at home, those in the front line could start by putting their houses in order.