Future of charity service in doubt
The Daughters of Charity’s Limerick service has 250 long-term adult residents with intellectual disabilities and up to 300 adult day clients, and supports approximately 500 children. However, its management began this summer not knowing if it had enough money to stay trading through autumn.
The auditors of the Limerick service did not sign its accounts because the Daughters of Charity could not prove the €26.5m-a-year business was able to stay afloat for the next year.
In May, it directors sought legal advice on whether they could be found liable for “reckless trading” if they kept the service open.
Board records, released under the Freedom of Information Act, show management has also been warned about entering into contracts which the service may not be able to honour.
The Daughters of Charity’s Dublin service considered writing off a €1.7m loan it gave to the Limerick branch in 2010 and 2011 in order to keep it afloat.
In May this year, additional funds of €170,000, which had been earmarked to help clear its long-term deficit, had to be redirected to pay daily running costs. The service had predicted its 2013 losses will hit €900,000 by the end of December.
Talks are ongoing with the HSE to find a solution and an interim settlement has been tabled. The short-term deal with the HSE to keep the service open for the rest of the year has yet to be agreed by both sides but it is likely to be accepted. It is not designed to deal with the long-term reoccurring shortage of cash.
A special board meeting of the Daughters of Charity in July heard that arbitration had been proposed in order to reach a settlement with the HSE on the future funding needs of the service.
The HSE’s Mid-West area manager, Bernard Gloster, said: “All public funded agencies are required to continue to address their cost base and achieve efficiencies together with new ways of working.”
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