The homelessness charity founded by Fr Peter McVerry has been hit by a financial crisis caused by a rapid expansion of its services in response to Ireland’s homelessness crisis.
The revelation of its financial challenges has raised concerns over the solvency of one of the largest providers of homeless services in Ireland.
In July, the new chief executive of the Peter McVerry Trust wrote to the Department of Housing as well as the charities regulator and other funding regulators notifying them of a cash flow problem.
A financial and governance audit at the charity has been ordered by its main funder, the Dublin Region Homeless Executive, and this is expected to be completed over the coming weeks.
The trust has been repaying €8.3m in tax related to a Covid-19 pandemic scheme which was used to “warehouse” tax debts.
Speaking to the Irish Times, Fr Peter McVerry, who founded the homeless charity in 1983, but has not been involved in the day-to-day operations of the trust for a number of years, said the trust had “overstretched” itself as the homeless crisis escalated.
The 79-year-old Jesuit is still secretary of the board but draws no salary, expenses or allowances from it.
He said the charity was “working through the cash flow pressures” with its funders.
“Like many other firms during Covid we postponed our revenue payments, which was perfectly legitimate.” He added that the organisation was paying this tax obligation off.
A review of governance and finances is underway and emergency funding is likely to be needed to safeguard the charity’s services.
The trust provides emergency homeless accommodation to more than 2,000 people each night and employs up to 770 frontline staff and manages more than 600 properties.
Income dropped nearly €7m from €60.3m to €53.2m in 2021, while expenditure increased by €3.5m for the year, creating a deficit of nearly €11m at the start of 2022.
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