€1.6m charity donations drop shows transparency need - McGrath

An interim chief executive for the new Charities Regulatory Authority will be in place by the end of this month, but the Minister for Justice has been warned against appointing someone “subservient to him” when the office is fully functional.

Fianna Fáil public expenditure and reform spokesman Seán Fleming said it was good the Minister was starting to establish the office but “bad that it’s taken so long”.

The warning came as figures from the Department of Finance showed a €1.6 million drop in the income tax relief the exchequer gave on PAYE donations to charity.

Figures from Minister for Finance Michael Noonan released to Fianna Fáil finance spokesman Michael McGrath showed the exchequer gave tax relief in 2012 of €25.1 million to charities for PAYE donations, but following a fall in donations the relief dropped to €23.5 million last year.

Mr McGrath said the tax relief system as a vital source of income for charities. But the drop in donations “even before the controversy about charity funding emerged”, showed the need for charities to “step up to the mark” in funding and business activity transparency.

Mr Fleming called for “full transparency” in the appointments process for the new regulatory authority. He said it looked like the Minister would appoint his own departmental staff to the interim regulator office because there was insufficient time before the deadline, for the recruitment process to be completed.

Mr Shatter had told Mr Fleming arrangements were being made to appoint an interim chief executive officer to the new authority and a number of other administrative staff from within existing resources.

“I intend to have these staff in place by the end of February to enable the authority to carry out the necessary preparatory work before coming formally into operation later this year,”the Minister said this week in reply to a written parliamentary question.

Mr Fleming called for transparency in appointments when the charities authority was fully functioning later this year and said “I would warn against the Minister trying to put someone subservient to him into this role. We have seen only this week that seems to have a problem with independent regulators and the Garda Síochána Ombudsman Commission.”

He said it would be a “wrong step” not to put in someone independent into the position, when the authority was fully up and running.

Mr Fleming said the only reason the Minister was setting up the regulator was because he was forced into doing so by the Public Accounts Committee, which had the Central Remedial Committee (CRC) and similar types of organisations attend before it. The committee brought into "sharp focus" the problems in the charities sector and the Minister "is only responding to the political imperative".

In wake of the charities controversy Mr Shatter had last month issued a call for expressions of interest from suitably qualified individuals to sit on the board of the new regulator and he hoped to make those appointments by Easter.

The preparation and publication of a statutory register of charities will be an early priority for the new authority, the Minister has said. All charities will have to provide an annual report of their activities and these reports will be publicly available.

“This will provide a much needed increase in transparency and accountability in the charitable sector and will support good practice in charity governance.”