Martin Kenny (Sligo-Leitrim, Sinn Fein)
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584. To ask the Minister for Employment Affairs and Social Protection the percentage of community services programmes generating traded income of 30% or more; and if she will make a statement on the matter. [49184/17]

Martin Kenny (Sligo-Leitrim, Sinn Fein)
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585. To ask the Minister for Employment Affairs and Social Protection if it is policy to remove services and support from community services programmes which are unable to generate traded income of 30%; and if she will make a statement on the matter. [49185/17]

Martin Kenny (Sligo-Leitrim, Sinn Fein)
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586. To ask the Minister for Employment Affairs and Social Protection the socio-economic factors taken into consideration when granting or removing service and support for community services programmes; and if she will make a statement on the matter. [49186/17]

Regina Doherty (Meath East, Fine Gael)
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I propose to take Questions Nos. 584 to 586, inclusive, together.

The Community Services Programme (CSP) provides financial support to community companies that provide revenue generating services of a socially inclusive nature. The CSP works on a social-enterprise model. This means that it does not fully fund contract holders but requires that they generate revenue by charging fees or raising funds. All CSP recipients are obliged to meet these criteria. These social enterprises also remain responsible for their own budgets and financial liabilities.

It is not policy to remove services and support from community services programmes that are unable to generate traded income of 30% of overall annual turnover. Approximately 57% of all CSP supported enterprises meet the 30% guidance figure which, it should be noted, excludes fund-raising and donations.

CSP service providers are community businesses that operate using a social enterprise model of delivery, which means they are trying to become less dependent on state support. The defining characteristic of CSP services is that they are set up to provide social and economic value and are managed as going concerns with business and revenue targets set within a business plan. CSP investment is allocated through a co-funding approach, with a salary contribution provided towards the costs of employing a manager and/or a specified number of full time equivalent positions (FTEs) to community businesses that deliver services to, and create employment for, people from disadvantaged groups. Service providers are able to operate by generating sufficient traded income to cover their company and service operating costs (e.g. premises rent, vehicle costs, utilities, materials, etc.) as CSP support provides partial grant support towards the cost of each staffing position and does not cover operating costs.

Services must generate sufficient traded income to be viable and sustainable entities. Services that do not generate sufficient traded income are unlikely to be effective and risk the closure and loss of service to their local area. To identify and support organisations that are in difficulty, a review of each service provider’s annual financial statements is undertaken by Pobal, who operate the programme on behalf of my Department. Any positive or negative trends in financial performance are noted. The figure of 30% of turnover for traded income provides an early indicator of possible financial issues. It is also part of a ‘rule of thumb’ that includes CSP funding not being more than 50% of annual turnover. This acts as a guideline for organisations. Any decision to reduce or remove grant support is taken after a broader assessment of the contract holder in areas such as service performance, the need for each staff position and financial data. To this end, Pobal and my Department look at the contract holder’s track record and performance. This includes an assessment of the capacity of work scheduled against the level of CSP allocation (including any spare capacity or under-utilisation in relation to the CSP funded positions in terms of the level of income generation) and whether it could be done under a relevant activation programme which, in some cases, can be much more effective and less of a cost to the organisation.

All CSP contract holders must periodically submit a business plan to Pobal for assessment. Pobal will then provide a recommendation to my Department for a decision on the issue of a future CSP contract. This business plan provides prospective new entrants and existing contract holders the opportunity to highlight relevant socio-economic information pertaining to their service and geographical area.

The purpose of the business plan is to encourage organisations to undertake a strategic review of their operations to ensure the services they provide match the continuing needs of the local population or sector of society being served. Secondly, as CSP support is sourced from public funds, a value for money determination is made. The information provided in the business plan is also necessary to demonstrate that CSP investment is meeting an evidenced need in a particular community. It is important for service providers to use available statistics such as the Pobal HP deprivation index in their business plan, supported by local research, to verify the need for the service and demonstrate that they meet the criteria of the programme. In summary, any decision to grant or remove CSP support does takes available socio-economic information into account.

I hope this clarifies the matters for the Deputy.