Cost audit of disability groups

THE GOVERNMENT is to review wages and costs in hundreds of non-government agencies and organisations that receive State funds to help people with disabilities and mental health problems.

The new review, which will be announced in early February, will look at the scope for greater rationalisation and improved efficiency within the disability services sector.

The Minister of State with responsibility for Disability and Mental Health, John Moloney, said yesterday said the new efficiency review would form part of an overall plan for the sector which he would announce in a few weeks' time.

The Department of Health has told the HSE that the review group would look at measures such as "amalgamations, greater use of shared services, improved administrative efficiency and shared professional/clinical staffing structures, having particular regard to the need to maintain and improve the standard of frontline services delivered to clients".

Mr Moloney said yesterday that there were about 600 non-statutory groups working in the sector.

He told The Irish Timesthat among the issues the review team would examine would be whether groups could use the same facilities, accommodation, front-of-house staff or back-up operations. The review group would also look at wages and overheads.

He also suggested that the use of public relations companies by disability groups should be examined. The Minister said that the department paid out about €1 billion in support for people with disabilities. Mr Moloney said that he had great respect for the groups concerned and that he did not want to engage in a "turf war".

However, he said that apart from a €20 million investment in therapy services, he had no new money available for this year unless it was generated through efficiencies. He said that any money saved would remain within the disability sector.

Mr Moloney said that he would shortly be announcing the person who would chair the review.

He said that the chair of the review would be non-political and have a direct involvement in the disability area.

The Minister said that he wanted the new review group to report back to him by June.

Two years ago a report by the State's spending watchdog highlighted the need for greater transparency and accountability among voluntary groups providing services for the disabled.

The report by the Comptroller Auditor General (CAG) found a widespread failure among voluntary bodies to provide audited financial statements or disclose levels of executive pay. About 90 per cent of all intellectual disability services and 60 per cent of physical and sensory disability services are provided by the voluntary - or non-profit - sector.

An audit of 42 non-profit organisations between November 2004 and January 2005 found that 12 groups did not file accounts for 2003.

These groups received approximately €100 million during the same year.

It also noted several cases where financial statements carried qualified audit opinions due to uncertainty over issues such as the verification of fundraising amounts.

In the case of "one significant non-profit organisation", it found that no financial statements had been received between 2000 and 2004. During this time the organisation continued to receive funding worth a total of €288 million.

It found that expenditure on headquarters costs, overheads and executive pay was not generally reported in a transparent manner, which made it difficult to assess whether costs were being absorbed by administrative costs rather than front-line services.