Putting faith in hope and charity

The State funds many of the charities and nonprofit bodies that help vulnerable people. So what happens to the organisations – and their clients – when the State is broke?

It employs more than 100,000 people in almost 12,000 organisations managing a collective income of almost €6 billion a year. It delivers vital public services as diverse as cancer care, housing, youth guidance and suicide prevention, meeting the standards of both the public and private sectors – and, arguably, it does it more flexibly and more cheaply.

But over the past four years most of the Republic’s voluntary and other nonprofit organisations, of which 8,000 are registered charities, have seen significant falls in their income and increased demand for their services. Many have been forced to close; others have survived by innovating, cutting costs and even expanding their services.

The voluntary and nonprofit sector is often dismissed as the Cinderella of the public services, yet it fulfils a crucial role. Although more State funding would be welcome, economically battered Ireland must explore structural and strategic solutions to the crisis in the sector. It needs a plan, but there’s more than one view about what that plan should be.

“I would say there is a lack of respect and value for the sector,” says Joyce Loughnan, the chief executive of the homelessness charity Focus Ireland. John Dunne, the head of the Carers Association, says the sector does the same on-the-ground work as the public sector, in a “lean and hungry way as opposed to being plump and sated”.

They argue that the nonprofit sector has unique benefits, that the people involved think differently, putting the people who use their services at the centre of what they do and having a positive social impact beyond what they do.

The sector should be pulled closer to the heart of everything the public sector is about, says Deirdre Garvey, the chief executive of the Wheel, an umbrella organisation for about 900 charities. Instead, says Garvey, the sector is being undermined by cuts “because other places are no-go: income taxes, Croke Park, corporation tax and social-welfare rates”.

Others argue that nonprofit groups have more value outside the system, where they are freer to criticise Government policy and to play a social-activism role. But some of the organisations that depend largely on Government funding also fear being silenced if they argue too forcefully.

Loughnan regards the terminology that surrounds nonprofits as damaging. “People say the sector is ‘ad hoc’, mainly ‘voluntary’ and reliant on ‘goodwill’. It implies inconsistency and unreliability, when the vast majority of people with us are professional, fully qualified and paid. We provide essential services. The terminology allows the State to fund a lot of what we do in an ad-hoc, unreliable way when I would argue services like finding accommodation and feeding people should be 100 per cent funded by the State. These are essential services. ”

Funding cut

As well as offering an outreach service to people sleeping rough, Focus Ireland offers advice to people who are at risk of homelessness and who need to find short- and medium-term housing. It also offers research and advocacy in six counties. To run it costs €18 million a year, of which 60 per cent is provided by the State, 30 per cent is donated and 10 per cent comes from clients through rent and paying for food. Its State funding has been cut by 25 per cent over the past four years.

Since Pieta House was established by Joan Freeman, a psychologist, in 2006, it has helped more than 4,000 people at risk of suicide or self-harm. “Of course we are a charity, but we are a very professional organisation. We should be viewed as a public service.” It costs €2.5 million a year to run, of which €150,000 comes from the HSE. “The rest of it is miraculous,” says Freeman. “Almost all is donated, particularly [by those] who have lost people to suicide.”

The Carers Association, which provides home care, respite services, training, advice and advocacy to family carers, costs €5.3 million to run, of which it receives €3.3 million in State funding.

Speedpak, a social enterprise that offers employment and training to people distanced from the workforce, has a turnover of €1 million, of which 60 per cent is statutory employment-scheme funding.

A community-development project in the disadvantaged area of Kilbarrack, in north Dublin, which provides an after-school club, a creche, community arts, a women’s health project and over-60s clubs, costs €190,000 a year to run, of which €144,000 comes from subventions for the after-school club and the creche.

“These are absolutely vital public services,” says Garvey. She says there is a dearth of detailed information about what they all do and how they see their role, and this makes it very difficult to devise policy to support the sector.

“There are no adequate definitions for the different types of nonprofit organisations. The legal term ‘charity’ goes back to 1604. As long as you are established to serve education, poverty relief [or] religious purposes, and you exist for public benefit, you can set up as a charity, with charitable status from Revenue.”

The Charities Act 2009, which was to regulate and define nonprofit organisations and establish a Charities Regulation Authority, has been all but shelved until resources allow its full commencement.

The Wheel says that 67 per cent of nonprofit organisations have existed for less than 25 years, and 24 per cent for less than 10 years. Garvey says the increase in the number of organisations began when the Catholic Church began to reduce its provision of public services. “The State has accepted them as the providers, in contrast to the situation in, say, the UK, where there is a functioning welfare system. The State here funds nonprofit organisations to about 60-75 per cent.” This, she says, implies their acceptance as a key part of the welfare system.

The fact that their main donor, the State, is bankrupt, has been very difficult, she says, but she believes those surviving are “making the most of a good crisis” in a way the State is not. Although most have cut wage and supply costs and have become more savvy in their fundraising, there have also been innovative moves to merge charities, such as one impending between the Carers Association and Caring for Carers, and collaborations to eliminate duplication, such as that between Focus Ireland and Dublin Simon, which now organise the capital’s nightly soup run together.