The Peter McVerry Trust wants the State to fully fund its services for homeless people despite a €15 million Government bailout intended to stabilise the crisis-struck charity, a report for the public spending watchdog has found.
The report by the Comptroller & Auditor General also shows how an interim chief of the charity was paid at a rate of €1,000 per day from the budget of the Department of Housing before a new permanent chief executive was appointed last April.
Although the trust’s funding model prior to this year was based on 70 per cent State income and 30 per cent from fundraising, the C&AG said the charity’s current budget request was “based on 100 per cent cost recovery from the State”.
The trust is still in talks with State funders in relation to its 2024 budget.
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Between 2019 and 2022 the housing body received a little more than €140 million from State sources but ran into serious financial trouble last year. While the department approved a €2 million advance from the trust’s 2024 funding last November, the C&AG said the sum of money provided by the Dublin Region Homeless Executive “exceeded the amount approved by the department by over €3 million”.
Serious governance failings in the charity established by Jesuit priest Fr Peter McVerry remain under separate investigation by the Charities Regulator and the Approved Housing Bodies Regulatory Authority.
When the department raised questions last June, the trust was “unable to provide all the information requested” in relation to staff changes and numbers, cost-saving measures, and up-to-date figures for cash-flow, budget and data on its fixed asset register. Further information was provided in July and the trust committed to continue work on “outstanding items”.
The trust’s overview in February of its own rationalisation plan led the department to note a “number of significant liabilities” that were not addressed. These were a Revenue debt, loan agreements, contingent liabilities and creditor debt to suppliers.
In a critical assessment of the Government bailout last November that highlights further large liabilities arising from the turmoil in the trust, the C&AG said the department had already incurred €1.56 million in costs on “professional fees” on top of the original €15 million rescue package.
These additional costs include €1.42 million for accountants PwC, who received €878,000 to carry out an independent review of the Peter McVerry Trust, and €541,000 to provide support services to it. Also included was €128,000 to fund the work of an interim chief executive and management consultancy services within the trust.
When the previous chief executive left the charity last October after less than five months in the post, the department suggested a former county council chief executive as a potential candidate to provide short-term assistance as a temporary chief.
“The trust engaged the recommended candidate commencing October 16th, 2023, at a daily rate of €1,000 and recouped the cost of this from [Dublin City Council] who in turn recouped it from the department.”
The report said PwC’s preliminary review of the trust noted “a cash depletion of €4 million” in the eight months to September 2023.
“At that time, PwC was unable to obtain sufficient assurance as to whether the causes of the cash depletion had been rectified,” said the State spending watchdog.
Although the department attached 32 conditions to the bailout, the comptroller found 19 of them did not specify “well-defined criteria, capable of verification” and said that made it a challenge whether the trust was compliant”.
“Termination costs related to the halting of trust projects that were in the initial stages of development are estimated by the department to be in the region of €1 million.”
But the comptroller noted that the trust’s current estimate for such costs is €1.5 million, down from an initial €2 million estimate based on 100 per cent recoupment of costs.
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