Grave funding problems well flagged within Saint John of God service

Serious funding problems facing Saint John of God (SJOG) Community Services, a charity providing healthcare services to 8,000 children and adults, were apparent from its first board meeting of 2019.

The charity had run a financial deficit of €5.5 million in 2018, and at the end of that year had asked the Health Service Executive (HSE) for a cash advance of €11 million, and received €6 million.

In January 2019, SJOG requested a further €3 million advance from the HSE, and would require several funding advances over the course of the year to ensure it could pay staff and creditors, board meeting minutes show.

Paul Robinson, a board member and former health board chief executive, said it was "worrying" that a funding advance was "required so early in 2019," and the situation "will remain very serious" unless a plan was agreed with the HSE, he told the January board meeting.

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Funding issues

Clare Dempsey, charity chief executive, told the board it was "difficult" to draw up a strategic plan for the next three to five years given the funding issues.

The charity is one arm of the wider SJOG Hospitaller Group, and runs intellectual disability services and mental health services for both children and adults, employing 2,500 staff.

Minutes of its board meetings last year were released to The Irish Times under the Freedom of Information Act.

By March 2019, the charity was “unable to pay salaries at the end of April” unless a cash advance of €5 million from the HSE was approved, minutes from one meeting show.

During the meeting, the board heard it was “virtually impossible” to approve a budget for the year due to the “inadequate funding” from the State. However, a budget was signed off “with reservations expressed” and on the basis it would be reviewed at the end of June.

As early as April the board of the religious order’s wider group, “did not see any alternative option” to having the HSE take over the running of its intellectual disability services, in the absence of a substantial funding increase.

The financial situation continued to deteriorate and in April the directors “noted with concern” an €800,000 overrun from the previous month.

Brother Donatus Forkan, the provincial of the SJOG religious order and chairman of the charity, read a reflection titled Embers after the Ashes at the start of the June board meeting, which later heard the 2019 deficit had reached €9.4 million.

There was concern expressed during a July meeting over “the lack of back-up in key areas” due to a “significant number of vacant posts,” which the charity could not afford to fill, minutes show.

Legal issues

In October, the board held two “extraordinary” meetings to discuss legal issues around the HSE taking over the services.

One heard that SJOG would continue to run its hospital based in Stillorgan, south Dublin, and several schools for children with intellectual disabilities, which operate under separate companies.

The HSE calculated the funding shortfall facing the community services at €11.9 million, which the board described as “insufficient for the provision of sustainable services,” at a meeting last November.

SJOG put the funding hole to be filled at over twice that at €27 million, a spokesman for the charity said.

The charity had also run up an accumulated deficit from previous years of €33.4 million at the end of 2019, in part due to rising care costs.

The financial crisis has come to a head this week, with Ms Dempsey writing to the HSE to advise if the significant funding shortfall and deficit are not resolved, the charity may have to terminate its service agreement with the HSE and have the State take over responsibility for its community services.