Oireachtas Joint and Select Committees

Thursday, 27 February 2014

Public Accounts Committee

Payments to Section 39 Companies: Discussion

12:40 pm

Ms Angela Kerins:

We do not take €83 million from the State. We deliver €83 million worth of services to the State. Every penny of that money is associated with a cost in service delivery and within the organisations and the service level agreements in the organisation represented here. It is important that people do not think the State just gives us money. We sign contracts, like any other subcontractor, with the State and deliver services for that money. It is not free money rattling around; it is directly associated with the cost base for service delivery. The HSE and SOLAS have to ensure that is the case and they are validating this now. We all want to ensure they are reassured.

The Rehab Group is much broader than these two companies; there is much more going on in many countries. The remuneration of the management team is fairly and independently assessed for its size. The Rehab Group has been compared with semi-State bodies; it is not a section 39 organisation. The funding stream for National Learning Network and RehabCare is through section 39. Approximately €40 million worth of services are purchased from the private sector and I am not sure whether it comes through section 39 or another section. They are disability services. There are private for-profit companies competing with not-for-profit organisations for the contracts to deliver residential, respite and day care services. It is not the case that Rehab simply gets a pile of money from the two organisations and can do what it likes with it - it cannot. We have to meet very specific and comprehensive contracts. There are also quality measurements, as my colleagues said. We have a level 5 award from the European Foundation for Quality Management, EFQM, and there are European quality systems. We put all of these through and support them from a company and a group perspective.

It would be narrow and misleading to compare Rehab with a normal, regular charity because it is much broader than that. Neither can it be compared with the private sector because the private sector does not have a not-for-profit ethos. It cannot be compared with the State because we have to pay our own bills. If contracts are withdrawn, which sometimes happens, or we lose one, the cost base of redundancy, etc. sits with us. The Rehab Group does not enjoy the comfort of being a public sector organisation. I am not saying it is easy to be a public sector organisation, as people work very hard in the public sector and there are some very good people working in it. Most of them are superb, hard-working individuals. The matter is complicated. It is neither a private nor a public sector organisation; it is a not-for-profit organisation which combines all of these aspects.

Then there is the international side in that we also work with other governments.

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