Transparency for charities
The representative body for Irish charities, ICTR, set down”guiding principles” for its members last year. They included a commitment to full transparency and accountability; a ban on misleading or ambiguous information and an open and honest approach to all fundraising activities. These are important undertakings and Rehab, as a prominent ICTR member, should immediately address public concerns that have arisen in relation to its governance and fundraising activities.
Disclosure that profit levels on Rehab gross lottery sales amounted to only 8 per cent in 2010 was disturbing, though government restrictions on lotteries may be a factor in this. Even more alarming was the suggestion by Minister for Justice Alan Shatter that ticket sales had been maximised, with no regard to operating costs, to leverage compensatory funding from the National Lottery. Of the 19 charities that qualified for compensation, Rehab received two-thirds of available funding on a euro-for-euro basis.
Rehab has, in turn, accused the Minister of providing misleading information, of abusing his position and of undermining the judicial process in relation to a High Court action it has taken against the State. In that case, Rehab sought damages of €1.5 billion arising from Mr Shatter’s decision to phase out the lottery compensation scheme and to end it by 2016.
Rehab styles itself as “an international group of charities and commercial companies” engaged in training, employment, health and social care. This hybrid structure, involving both public and private approaches to governance is part of the problem. It has allowed Rehab to present itself as a publicly-funded body in wage negotiations, while refusing to disclose executive pay levels on grounds that it is a private, commercial organisation. As recipient of public and voluntary funding, it is an untenable position. Rather than continue with this approach, it should implement the “guiding principles” it endorsed last year and publish a breakdown of its financial affairs and salary levels.
Taoiseach Enda Kenny has spoken of “cleaning up” the charities sector and of having found “maggots under carpets” that were lifted by Government. That kind of language will make fundraising by deserving charities including Rehab more difficult. But it is clear that, in the absence of oversight, the sector is in need of a fundamental overhaul.
More than 300 organisations claim tax-free charitable status. Their operations are frequently conducted in secrecy and salaries are not divulged. As with voluntary/charitable organisations in the health sector, full transparency and accountability concerning the allocation of money and remuneration levels is now expected. Problems may also arise unless a clear distinction is made between their public service obligations and commercial activities.