Clear sense now in political circles that Rehab is in line for a grilling

Taoiseach to the fore among those expressing surprise at revelations

 The Rehab Group campus in Sandymount, Dublin.  Photograph: Mark Stedman/Photocall Ireland

The Rehab Group campus in Sandymount, Dublin. Photograph: Mark Stedman/Photocall Ireland

Thu, Jan 23, 2014, 01:00

Rehab is struggling to contain growing political disquiet over the operation of its lotteries. In the wake of damaging disclosures to the Dáil by Minister for Justice Alan Shatter on Tuesday night, a dose of scrutiny by the Public Accounts Committee now looms.

The Minister has questioned the low yield to charity from the lotteries and suggested they could have been used to “leverage” public funding for Rehab from a scheme to compensate charitable lotteries for competition from that National Lottery. Concern about Rehab was a big factor in the Government’s decision to close that scheme after 2015.

All of this is on top of controversy over the refusal of Rehab’s chief Angela Kerins to reveal her pay. The sense must be that she will find it increasingly difficult to resist full disclosure.

Following anger and astonishment at the Central Remedial Clinic debacle, the clear sense now in political circles is that Rehab is in line for a forthright grilling when it goes before the PAC. Across the spectrum in Leinster House, on both Government and Opposition benches, the mood these days is pretty unforgiving when it comes to lapses on the part of charities which have received huge financial support from the public purse.

Line of defence
Late on Tuesday night, Rehab’s opening line of defence was to attack Shatter. It dismissed his intervention as an improper intrusion in two court actions the organisation has taken against the State. The first is a High Court objection to the closure of the compensation scheme, on which a ruling is imminent. The second is an action on competition grounds in connection with the National Lottery.

Early yesterday morning, there were whispers in the charity sector that Rehab might challenge Shatter’s Dáil remarks in the courts. However, nothing materialised.

Having said late on Tuesday that it could not deal with the substance of Shatter’s claims as the matters were before the courts, Rehab selectively issued a statement shortly after lunchtime yesterday in which it defended its claim for support under the compensation scheme.

In doing so, it failed to confront the Minister’s central contention that the lotteries are sweeping up public funding while providing an inadequate return for charitable purposes.

While the very structure of the scheme appears to provide an incentive, there was nothing in Rehab’s statement about its cost base and no explanation as to how one scratch card product could return a profit of less than €9,500 on sales approaching €4 million. Neither did it explain clearly how Shatter had “misled” the public, as Rehab claims he has.

Main argument
Rehab’s main argument is that the compensation scheme, in place since 1997, was set up to ease pressure on charities arising from the €20,000 weekly limit on the prizes they can offer, in the face of “unlimited” prizes in National Lottery games.

With Taoiseach Enda Kenny to the fore among those expressing surprise at Shatter’s revelations, Rehab insisted it was quite disingenuous for any Government figure to do so, as it is obliged to return detailed information to the Government every year.

Rehab went on to assert that a Department of Finance review 12 years ago found the scheme to be necessary and added that the department increased the total available compensation twice, most recently in 2005.

Although the High Court will soon decide on the legal merits of action against the scrapping of the compensation scheme, the court of public opinion is another matter.

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