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Charities sector in Ireland in crisis

by Frank Schnittger Thu Jul 7th, 2016 at 11:59:17 AM EST

Console scandal creates fresh difficulties for charities - Independent.ie

I am a director and honorary treasurer of a number of charities. I give of my time freely and without compensation. I am glad to do so and feel honoured to have the opportunity to be of assistance.

But I am also a hostage to fortune. I rely entirely on the salaried staff to provide me with accurate information so the board can make wise decisions.

One of the fall-outs of the scandals in the Central Rehabilitation Clinic, and now in Console, is that charitable donations have declined precipitously. Another less publicised consequence is that it is increasingly difficult to find anyone with suitable skills to volunteer to serve on the board of charities.

I have offered my resignation on several occasions because I feel it is time to give others the opportunity to serve, and yet there are never any replacements available. The responsibilities of directors are increasingly onerous under both company law and the Charities Act. Few people feel they have the time or expertise to take them on.

Others may feel discouraged by the prospect of finding themselves at the centre of a scandal should some irregularities be discovered in the running of their organisation.

Not many people have the skills of a forensic accountant to uncover those irregularities by themselves.

As a result, the voluntary and community sector in Ireland is in freefall. Those charities which have not closed have generally downsized substantially in recent years.

It would be a pity if our rich tradition of voluntary work were to die out substantially because of the scandals at a few major charities. I urge people not tar all charities with the same brush.

Frank Schnittger, Blessington, Co Wicklow


The voluntary and community sector in Ireland has been devastated by a couple of scandals at major charities where senior executives were seen to have been awarded excessive salaries or where the founder is alleged to have diverted substantial funds for his own use.  In both cases there was a substantial failure of governance by the Board, although in the latter case it seems doubtful that there was a functioning Board at all. Fraud can occur in any walk of life, but it is particularly damaging in a sector which relies on popular goodwill and a degree of altruism on all sides.

As a result, charitable donations are in free-fall, and many charities have either closed or downsized considerably as a result.  Many charities are also reliant on state funding for a significant part of their income, and this has been savagely cut back in recent years of government austerity policies. In addition, the level of state supervision of charities and the degree of information they are required to provide has increased exponentially, and most simply do not have the administrative resources required to comply.  State funding is generally only provided for the direct provision of services, and Charities have to fund their administrative overheads from other sources.

In many ways the squeeze on the voluntary and community sector has thus been both financial and administrative, with higher ranking civil servants questioning the value of services provided, or preferring that those services be taken in-house under their direct supervision. Most charities wouldn't have a problem with being made redundant in this way, but the reality is that the vast majority of services they provide simply cease when they close, because there is no governmental appetite or capability to take them on.

There are many reasons the state uses charities to provide some services.  Firstly, their arms length contractual arrangements absolve the state (and senior civil servants) of all responsibility if something goes wrong.  Secondly, those services are often provided much more cost-effectively by charities, because many of the services are provided on a voluntary basis, and even salaried staff are on lower pay (and pension) benefits than their equivalents in the state sector. Thirdly, it is much easier for the state to cut funding to a charity than it is to make permanent public service employees redundant.

But there are also many positive reasons why Charities can do a better job than their equivalents in the public sector. One of the charities I am involved with, the Clondalkin Addiction Support Programme (CASP), employs a community based and holistic approach to drug addiction treatment programmes which have been shown to be much more effective than the exclusively Medical Model used by the statutory health services. Another, Restorative Justice Services , provides a restorative justice service which successive governments have refused to provide on a statutory footing despite Official reports recommending that they do so. For a more detailed description of Restorative Justice Services available in Ireland, see my my diary here.

So the differences between the voluntary and statutory sectors are not only organisational and financial, they are ideological and political as well. In general statutory organisations are dominated by the professional interests of the medical or legal professions which place little value on the social, community, family and personal dimensions of the problems being addressed, and it can even be argued that they have a vested interest in ensuring that those dimensions are never properly addressed: Where would the legal profession be without crime?  

For all the lip service being given to "evidence based approaches" - to solving problems, the relative failure of the medical model to deal with addiction based problems, or the retributive justice systems failure to reduce victim trauma or the incidence of crime, alternative approaches are only tolerated on the margins even where they have been shown to have been far more successful in dealing with the problems they are supposed to address.

While in an ideal world there would be no need for charities, and all human needs would be met by the private or statutory sectors in each society, the reality is that we are very far from that ideal. Not only are conventional approaches to many problems prohibitively expensive, they are often not that successful in addressing them.

The voluntary and community sector in Ireland has had a key role not only in filling the gaps in services provided by the private and statutory services, but in advocating for the victims of crime, in meeting the personal, social and community needs of addicts, and in pioneering alternative approaches to resolving the problems arising.

I live in hope that restorative justice services will be mainstreamed in Ireland, and their provision placed on a statutory footing. I also hope that the widespread failures of conventional medical approaches to addiction and other health problems will be complemented in mainstream public health services by holistic methods proven to provide better results. And indeed some progress is being made. In the meantime, however, there will be a need for pioneering voluntary and community based organisations to highlight unmet needs and to address them where these are not being provided by private for profit or statutory services.

The crisis facing charities in Ireland is not only one of funding, but of a lack of understanding of what they can do better than anyone else. We risk a takeover by political and professional interests which will be very much more expensive, but often less effective as well. Rather than exploiting public outrage at a couple of scandals in major (and well funded) charities, we need to fix the problems in the effectiveness of the good charities which we still have and ensure they have the resources and the expertise to do their jobs better than ever. That doesn't just require more donations, it requires more people volunteering their expertise at every level of their organisation.

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The thought wandered through my mind that the lax regulation might be another little present from Catholic Irleland, where charities were pretty much all church run. Couldn't be hassling the bishop, after all.

Any truth to that thought?

by Colman (colman at eurotrib.com) on Sun Jul 10th, 2016 at 04:52:19 PM EST
I don't think the lax reglation was Catholic Church specific, more a recognition that many charities provided a service the state might otherwise have to provide, and so where given the benefit of the doubt on the principle of - "leave well enough alone".

In addition many smaller charties don't have the admin reources or skills to deal with a complex regulation regime and are already under pressure negotiating service level agreements with state agencies. A huge number have already closed there doors.

I noticed a distinct change of attitude amongst HSE officials at our annual service level agrement meeting last week.  Previously the attitude was: we can screw the charities to achieve our cost reduction requirements... now the realisation has hit home that they soon might not have many functioning charities left to outsource some of their workload to so they had btter be nice to us.  They were actually helpful for the first time in living memory...

Index of Frank's Diaries

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Mon Jul 11th, 2016 at 01:37:48 PM EST
[ Parent ]
I suspect that the thought of the public firestorm that might irrupt at legislation regulating the activities of The Roman Catholic Church would have been a factor in there being so little such regulation on the books. Who in either Fianna Fail or Fine Gael would have supported such legislation?

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Fri Jul 15th, 2016 at 04:20:08 PM EST
[ Parent ]
Possibly in the past, but charities have always had a separate public and legal identity to the Church that may have been involved in setting them up and running them.  As far as I know the finances of the churches themselves are still largely unregulated - I've never heard of diocesan accounts being challenged, for example - so you may very well be right at least as far as the Churches themselves and their closely associated charities are concerned.  Many charities are now in direct receipt of public funds as well as private donations, and it is this which has driven the demand for precisely defined public service level agreements, audited accounts, and public accountability for moneys spent.

Index of Frank's Diaries
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Sat Jul 16th, 2016 at 09:53:05 AM EST
[ Parent ]
has just belatedly published a much fuller version of the letter I sent in to both them and the Independent:

Volunteers and charities

Sir, - I am a director and honorary treasurer of a number of charities. I give of my time freely and without compensation for expenses of any kind. I am glad to do so and feel honoured to have the opportunity to be of assistance. But I am also a hostage to fortune. I rely entirely on the integrity of the salaried staff to provide me with accurate information so that the board can make wise and informed decisions.

One of the fallouts of recent scandals is that charitable donations have declined precipitously. However, another and less publicised consequence is that it is increasingly difficult to find anyone with suitable skills to volunteer to serve on the boards of charities in general. I have offered my resignation on several occasions because I feel it is time to give others the opportunity to serve, and yet there are never any replacements available.

The responsibilities of directors are increasingly onerous under both company law and the Charities Act, and few people feel they have the time or expertise to take them on. Others may feel discouraged by the prospect of finding themselves at the centre of a scandal should some irregularities be discovered in the running of their organisation. Irregularities for which they may be found to be legally responsible, even if they have been kept in the dark by those who have committed them. Not many people have the skills of a forensic accountant to uncover those irregularities by themselves. We rely on trust, verified by information wherever possible.

As a result, the voluntary and community sector in Ireland is in freefall. Those charities that have not closed have generally downsized substantially in recent years. The needs they served are now either unmet, or are being met at much greater cost by statutory or private for-profit enterprises. It would be a pity if our rich tradition of voluntary work were to die out because of the scandals at a few charities.

I urge people not to tar all charities with the same brush, and to treat each on their own merits. More importantly, if you do have the time, energy and expertise to serve on the boards of such charities, I urge you to volunteer to do so. It is the lack of such management expertise, as much as any reduction in donations, which is driving the decline of the sector. - Yours, etc,

FRANK SCHNITTGER,

Blessington, Co Wicklow.



Index of Frank's Diaries
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Fri Jul 15th, 2016 at 03:50:56 PM EST


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