Order should give hospital to State, not help rich avoid tax

Where is the justice in a church-run private hospital allowing rich people to avoid tax, writes FINTAN O'TOOLE 

LAST WEEK, Goodbody Stockbrokers sent out a glossy prospectus to its private clients. Its aim is to arrange “a syndicate of investors to acquire a relevant interest for tax purposes in a new up to date and enlarged private hospital to be built within the grounds of Saint Vincent’s Healthcare Group (SVHG) Limited in Elm Park, Dublin 4”. The stockbrokers, for a fee of over €2 million, are looking to raise €38 million from rich investors towards the cost of building a co-located, for-profit private hospital.

SVHG, as the prospectus helpfully reminds investors, “has its origins back in 1834 when Mother Mary Aikenhead, foundress of the Religious Sisters of Charity, established St Vincent’s Hospital”. Its shareholders are the Sisters of Charity whose “values of human dignity, compassion, justice, quality and advocacy . . . guide us in our work”. The building of the new private hospital is certainly an act of charity – towards the needy rich. As the Goodbody prospectus makes clear, the primary attraction for investors is the avoidance of tax. Investors are to receive capital allowances from the Revenue of €388,267 over seven years for every €100,000 invested. Essentially, from the point of view of the investors, the new hospital is a tax shelter. It is a place where stressed-out money, that might otherwise be spent on nasty things like schools and, um, hospitals, will be afforded the tender loving care it deserves.

This tax relief is not the only aspect of State generosity evident in this project. The investors’ funds will cover just €38 million of the cost of building the super-private hospital. The rest – €154 million – is to be borrowed from Bank of Ireland.

How is this possible in the credit crunch, when many viable and productive businesses are finding it impossible to get finance from the banks?

Earlier this year the Saint Vincent’s project was foundering precisely because the banks were wary of putting up the money. What happened to change this situation? The taxpayer (via Brian Lenihan) put €3.5 billion into Bank of Ireland. Effectively, as well as subsidising the private investors, the public is lending over €150 million to a company owned by the Sisters of Charity. Apparently, the State has nothing better to do with this kind of money than to put it into the provision by a religious order of more healthcare for the wealthiest in society.

The supposed purpose of these public subventions is, of course, to free up beds in public hospitals. Interestingly, this is not quite what Goodbody is telling its prospective investors. It lists the “project rationale” as “to increase capacity to meet increased [private] demand in South County Dublin” and “to upgrade and enhance the acute care provided by SVHG”. Only as an afterthought does it add that “the greater capacity in the new private hospital . . . also offers the potential to free up resources in the public hospital”.

Note the lovely word “potential”. The money men have a nice way of cutting through the political propaganda – the point of the new, publicly subsidised hospital is to expand services for private patients.

Anything else is a possible side-effect.

What does all of this say about the role of the religious orders? Time and again, we are told that the point of their continued control of State-funded institutions is the preservation of “values”. In this case that would be all those lovely things like justice and compassion. They would also include, according to the SVHG, “a governance ethos which places a premium on medical excellence delivered in a charitable and loving environment and on an equal basis to all . . . irrespective of social standing and means”.

Where’s the justice in allowing rich people to avoid tax? In using badly needed, State-backed credit to expand services for the well-off? What sense of values allows you to claim that your special mission is to provide healthcare “irrespective of social standing and means” while you’re actively reinforcing a system of health apartheid? And if it is not to uphold justice and equality or to advocate for the poor, what is the point of church control?

The other set of questions concerns the process of reparation for the industrial school abuses. The Sisters of Charity ran five industrial schools, including St Joseph’s, Kilkenny, and also ran Madonna House. They were responsible for severe physical violence against children and for a consistent failure to protect children from sexual predators.

How should they make reparation?

Here’s an idea – if the stated objective of the co-location policy is to create more public hospital beds, why not do this in a way that is truly just and does not involve collusion with tax avoidance and health apartheid? Give the existing private hospital to the State. The great motto of Mother Mary Aikenhead, who founded the Sisters of Charity, was “give to the poor what the rich could buy with money”.

What better way to live up to this mission, and to make recompense for the wrongs done to children, than to stop taking from the poor to allow the rich to buy health with money?

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