Donors need to know funds are used properly
Published 13/08/2016 | 02:30
When I was eight, I turned our garden shed into a cafe to raise money for the foreign missions. First up, I emptied the shed of spades, rakes and detritus.
Next, I begged a bottle of orange squash and a packet of biscuits from my mother, who also provided some paper plates and plastic cups. Then I negotiated an advance on my pocket money from my father and spent it all on packets of crisps, which I'd open and sell in smaller quantities to maximise profits.
Finally, I made a cardboard sign for my cafe, while my brothers were out spreading the word that I was open for business.
Earlier that week, a missionary had spoken to my class about starving children in Africa, showing us pictures of their little distended bellies, and I was gripped by an urge to do something to help. The cafe was a goldmine, because it piqued the curiosity of all the local kids and was a novelty in our small town.
Also, it would be open for one day only - my father wanted his shed back.
By mid-afternoon, I sold out, raising riches beyond my wildest dreams. About €50 in today's terms. The only blight was when one of the big boys took a pen from his pocket and wrecked my lovely sign by correcting the 'CAFEY' spelling.
Irish people have an instinct for charity - it is bred into us in homes, schools, churches and communities. Giving generously is encouraged and we also supply a steady stream of committed charity workers.
Once, the charity sector was above reproach. Now, a shadow is spreading as a spate of fiascos has damaged the public's confidence. In that context, it's particularly disturbing to hear about millions of euro in funding withheld from Goal, the international aid organisation, pending a US government inquiry into fraud allegations.
But let's remember that there are still trustworthy bodies doing important work.
In Goal's case, the issue seems to be oversight failure regarding the local supply chain, which did not spot corruption among employees in Turkey, where the charity has a humanitarian relief programme for Syrian refugees.
Two staff members in Turkey have been sacked and the US's foreign aid arm, USAid, is holding back money, as is Ireland's Department of Foreign Affairs, until USAid reports on its inquiry into alleged bribery and bid-rigging for contracts.
This is a setback for Goal but the story is not a repeat of the Console scandal and we shouldn't conflate the two.
Goal has an excellent reputation internationally as an able first-response operator in the wake of emergency. That is why it can attract so much funding - income almost doubled in 2014 to €127m.
Holding back funding until assurances are given about proper oversight is a logical and prudent step. Clearly, the people in the Turkish operation have been unable to provide answers to questions asked by USAid, which has a duty to ensure maximum efficient use of money it donates. Some holes in Goal's procurement system became apparent.
So the question is, why was there insufficient oversight of the process? It's Goal's job to manage the local staff where it does relief work. Responsibility can't be delegated without sufficient management.
Granted, the area in question - south-east Turkey bordering on Syria - is bandit territory. But that is all the more reason to have scrupulous controls. Large sums of money are at stake and in those volatile situations there are always people looking for an angle to enrich themselves.
Procurement is notoriously difficult to manage and needs people working full-time across it. It could involve medical supplies, food, sanitation - a range of needs for Syrian refugees. Tight controls are essential, with huge amounts of money at stake and reputational fallout when something goes wrong.
Goal had a duty not just to put robust structures in place, but to spot any corruption of the process as soon as it occurred and then stop it. Red flags were raised by a funder and not by Goal. While this is a setback, it is fixable. However, the situation is exacerbated by the timing, happening at a sensitive juncture for the Irish charity business.
What is under the spotlight here is the mechanics of project management and how it works in the field. Goal does have a reputation for strict cost controls, in fairness.
It was set up in 1977 by John O'Shea, who was criticised for corporate governance issues, including Goal's culture and for holding too much control. Nevertheless, he did extraordinary work in building up a highly respected organisation. He stepped down after settling out of court in 2012, and Barry Andrews - a former Fianna Fáil minister - took over as chief executive in 2013. Governance failings were addressed and the board was strengthened.
Goal may no longer have the profile it enjoyed under Mr O'Shea, but it does attract significant funding from governments and grant-awarding institutions. That's an expression of trust and is not easily given by some of these bodies.
Grant income doubled to €111m in 2014, growth resting mainly with two donors: USAid and Britain's Department for International Development.
Ireland was the third-biggest donor in 2014, contributing €17.2m through the Department of Foreign Affairs. The department has complained about a communications gap between it and the charity, but Goal says it was precluded from revealing the inquiry by US internal spending watchdog the Office of Inspector General.
Unhappy funders frequently bail out and Goal now has a trust issue on its hands. As a recipient of public money, it has an obligation to operate to the highest standards of governance. It needs to reassure funders that structures are in place to prevent procurement failures happening again.
It should explain what it is doing in Turkey, how the funds are managed in the field and from Ireland and set out the safeguards against future problems. Funders need to feel confident that money is spent responsibly.
Incidentally, I changed my cafe money into a postal order and sent it to a convent in Nigeria. A handwritten thank-you letter describing how the cash was used arrived soon after. Trust was established - at the age of eight, I was a satisfied donor.