Financial records show institutions just broke even

Magdalene laundries operated on a break-even basis despite a common perception that they were highly profitable, according to a review of available financial records.

The interdepartmental committee states that the institutions would have found it difficult to survive financially without other sources of income such as donations, bequests and State funding.

The report referred to an RTÉ Prime Time programme broadcast last September, which stated that a Magdalene laundry in Galway had made a profit of £56,000 in 1968.

“This is incorrect,” the report states. “The financial accounts for that year demonstrate that the figure broadcast was the approximate value of the laundry receipts without any deduction of operating costs and expenses.”

When these expenses were taken into account, the facility made a net loss in that year, according to the report.

Overall, financial records were available for five of the 10 Magdalene laundries.

In the case of a laundry at Seán MacDermott Street in Dublin, run by the Sisters of Our Lady of Charity, accountants commissioned by the committee found it had a net surplus of just over €12,000 per year on average in today’s terms between 1922 and 1973.

Robert J Kidney and Co found average receipts were not substantial and indicated the laundry “did not generate sufficient income to cover the running costs of the facility”.

No financial benefit

It said income from laundry sales was applied to the maintenance of residents and religious. There was no evidence they had a financial benefit to the order. If other sources of income – bequests and donations – were omitted, the laundry would have recorded an annual deficit of about €210,000 in today’s terms.

It was a similar story for other laundries. The Sisters of Good Shepherd, for example, ran a laundry in Limerick until 1975. Accountants Noel Delahunty and Co examined the records and found it “did not generate large sums of money for the congregation”.

The average annual surplus until 1975 – an average of just over €13,000 in today’s money – was used to support and maintain the women.

Private operation

It was then taken over by a lay entrepreneur, John Kenn-edy, who introduced outsiders to the workforce and ran the facility as a commercial enterprise until 1982, when he bought the laundry as a going concern.

Records indicate that between 1976 and 1982 it made an average annual surplus of about £25,000, or €100,000 in today’s money. Mr Kennedy has been quoted previously as saying he made a profit of £100,000 in his first year of trading. He clarified these comments to the committee.

“The figure is misleading as it is gross profit and secondly I worked tooth and nail to increase turnover in that year and repay my borrowings,” he is quoted as saying.

At a laundry run by the Religious Sisters of Charity in Cork, accountants found it made small surpluses or deficits most years. “The figures appear to support the contention by the sisters that the purpose of the laundry was to provide the residents with an activity and to produce funds to support them, and that it was never run on a commercial basis,” accountants Nolan and Associates said.