Rapid expansion of Peter McVerry Trust was 'reckless', chairman tells Oireachtas committee

It was also confirmed at the committee that there were three creditors seeking payment from the Peter McVerry Trust who had not yet been paid.

There was a degree of “recklessness” about the rapid expansion of the Peter McVerry Trust, the organisation’s chair has said.

Chairman of the board of directors Tony O’Brien has acknowledged and apologised for the “serious financial and governance issues” within the Peter McVerry Trust in recent years.

The homelessness charity has faced scrutiny in recent years after financial difficulties emerged at the trust, with an investigation by the Charities Regulator finding there were “inappropriate transfers” of funds and failures in oversight by its board.

The investigation also found there was a failure to adhere to “donor intention” in how restricted funds were used.

Speaking at the Oireachtas Housing Committee, Mr O’Brien was questioned by Sinn Féin’s Eoin Ó Broin about the organisation having underbid for tenders and subsequently unable to deliver on projects.

Mr O’Brien said it was fair to describe the process as underbidding.

It’s my opinion, and I stress my opinion, that there was a degree of non-strategic recklessness, if I can put it that way, about the rapid expansion of the organisation in terms of new projects and geographical reach.

Mr O’Brien added there were “insufficient controls” provided to the former board to understand how the organisation was underbidding for projects.

He also told the committee the trust was often dealing with a small number of developers on their housing projects, telling Fianna Fáil senator Joe Flaherty it was between five and six.

Meanwhile, Mr O’Brien confirmed there were three creditors seeking payment from the Peter McVerry Trust who had not been paid.

He said this was the case as the trust “is not satisfied about the documentation supporting the invoice and other arrangements”.

Pressed by Mr Ó Broin, the Peter McVerry Trust’s chief executive Niall Mulligan said it was between €2m and €2.5m.

Fianna Fáil’s Paul McAuliffe questioned Mr O’Brien about part of the Charities Regulator investigation, which found the charity had used €1m in restricted funding it received from a religious order to pay its creditors.

In response, Mr O’Brien said his understanding of the issue was that the trust had been facing cash flow pressures, which they had expected would be resolved.

It was a borrowing from Peter to pay Paul type of effort, but of course, that all came to a halt when the music stopped. Therefore, it wasn’t possible to replenish the restricted funds.

Mr O’Brien was formally appointed as the chairman of the Peter McVerry Trust last April, having previously served as the director general of the HSE between 2013 and 2018.

At the same committee, chief executive of the Approved Housing Bodies Regulatory Authority Ferghal O’Leary said the issues at the trust were “far more serious than we’ve seen anywhere else”.