Religious orders blame property crash for redress shortfall

Religious congregations who have failed to make promised payments to cover their share of institutional redress costs have blamed the shortfall on fluctuations in the property market. The orders claim that their property assets have suffered a 30 per cent drop in value since 2009.

Correspondence between the congregations and the Department of Education, obtained by The Irish Times under the Freedom of Information Act, shows religious orders are taking a firm line against further contributions that would meet the Government's target of an equal sharing of redress costs.

The congregations have to date lodged €81.44 million in the Residential Institutions Statutory Fund through cash payments and proceeds from property sales.

A further €42 million of property has been transferred to State ownership, leaving the congregations more than €300 million short of pledged contributions.

To pay their half-share of the redress bill, as sought by the Government, the congregations will have to meet these existing commitments and come up with a further €245 million in cash or property.

The cost of the redress scheme for institutional child abuse is estimated to reach €1.45 billion.

Pledged contribution

The Daughters of Charity has in recent weeks made a further cash contribution of €1 million to the fund, but it is still €7 million short of its pledged contribution. According to the department, the order has said this would be difficult to meet “without serious damage to the future of the congregation”.

The Presentation Sisters order has paid €4 million to date.

However, plans to hand over premises in Fethard, Co Tipperary, to the Health Service Executive (HSE) have stalled, during which time its valuation has fallen from a 2009 price tag of €1 million.

In a letter to the department, the congregation said: “If the value of the property has changed since our offer was made and accepted, we cannot take responsibility for fluctuations in the property market.”

Sisters of Mercy

The Sisters of Mercy similarly pointed to falling property prices for its shortfall. In 2009, the order offered cash of €20 million and properties worth €107.5 million. While the cash payments have been made, most of the properties have either failed to achieve their valuation or have been held up by legal problems.

Of 18 properties prepared by the congregation for sale, 11 had been sold by last October. These included a convent in Cobh (valued at €1 million but sold for €246,747); Ardagh Demesne, in Co Longford (valued at €2.2 million but sold for €1.35 million); and a former convent in Dundalk (valued at €500,000 but sold for €180,714).

Overall, the Sisters of Mercy said the order had achieved only 65 per cent of the €6.7 million valuation made in 2009 for the 11 properties. The congregation also agreed to transfer 13 educational properties, valued at €19.6 million, to the department, and four health properties, valued at €61.3 million, to the HSE. These include the National Rehabilitation Hospital in Dún Laoghaire.

All of these transfers are part of a €352.6 million commitment in funding made by the congregations following the publication of the Ryan report in 2009.

An additional €128 million was pledged by the congregations under a 2002 indemnity agreement with the State. This agreement included cash contributions of €54 million, which have been met, and the transfer of 61 properties, 44 of which have been achieved.