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Trade unions have said the prospect of a disorderly collapse of one of the country’s main disability and mental health service providers would be “devastating” and that the Government needs to review the entire funding model for the sector.
The Irish Times reported on Monday that St John of God Community Services had warned the Minister for Health Stephen Donnelly that it could face liquidation or having to sell assets or properties to pay off debts.
It maintained that such developments could have implications for up to 8,000 children, adolescents and adults who relied on it.
Siptu health divisional organiser Kevin Figgis said “a disorderly collapse can be, and must be, avoided at all costs through dialogue and with concentrated minds on all sides”.
“The absolute priority for the Minister for Health, the Department of Health, Health Service Executive and St John of God’s management must be the 8,000 people currently depending on these essential services and the 2,500 workers providing them.
“Pulling the plug will have a devastating impact on day and residential services. Our members will not stand for it. The children and adults who rely on these vital services deserve better. We believe the whole funding model of these services must be reviewed in its totality in order to prevent the constant threat of cuts to disability and mental health service users and to make sure the jobs of our members, many of whom are low paid workers, are secured.”
Accumulated deficit
St John of God Community Services told the Minister in a letter that without State support to deal with an accumulated legacy deficit of more than €32 million, it could face “liquidation as either a solvent entity or otherwise”.
It announced last September that it would cease running the majority of its healthcare services, due to a funding crisis. It said at the time it would transfer responsibility for the services to the HSE over a 12-month period. Over this period the HSE could either arrange to run the services itself or transfer them to another operator.
The HSE subsequently provided funding of more than €139 million this year to allow the organisation to continue to operate its current level of services until next autumn. It also received additional money to deal with the impact of the Covid-19 pandemic.
However, it has warned the Minister in a letter of the potential serious consequences of its accumulated deficit – which now stands at €32.5 million – and the implications this could have on its plans for an orderly wind-down and transition.
‘Pressing concern’
Clare Dempsey, chief executive of St John of God Community Services, told the Minister in the letter that the HSE had over recent months occasionally referenced bringing a resolution to the funding crisis at the organisation but no proposals in this regard had been put forward.
She said the issue of the outstanding deficit was “of very pressing concern”.
“If this matter is not addressed quickly, it could raise a question mark as to whether the service faces liquidation as either a solvent entity or otherwise. That, in turn, may trigger a possible sale of assets and properties in order to discharge all outstanding liabilities which would then seriously jeopardise the orderly transfer and future operation of the day and residential services which 8,000 children, adolescents and adults currently depend on.”