Peter McVerry CEO resigns warning of ‘imminent financial collapse’ of charity

PMVT confirmed in a statement that Francis Doherty, who took over as chief executive earlier this year, tendered his resignation to the charity’s board of directors on Wednesday morning.

“Our focus remains on the future of the organisation. We will cooperate with all stakeholders to achieve that as best as possible. Continuity of care for our participant group remains our priority,” PMVT said in a statement.

“We are disappointed with Francis’s decision but we wish him well after what has been a difficult period for him.”

The resignation follows the appointment of inspectors from the Approved Housing Bodies Regulatory Authority (AHBRA) last month over significant financial and governance issues at PMVT.

In his resignation letter, seen by the Irish Independent, Mr Doherty warns of the “imminent financial collapse” faced by PMVT.

He says that he identified “serious financial trouble, with insufficient funds to meet creditor, payroll and Revenue commitments” when he took up the role in June of this year.

He says he had begun to operationalise a financial stability plan, reducing trade creditor liabilities from €9 million to €6.9 million. He also says he concluded the sale of a property in Santry for €1 million and that further planned property sales would generate nearly €6 million in exceptional income for the charity by the end of January next year.

However, in the letter Mr Doherty claims that he has been left in an untenable position by the trustees of the organisation.

He claims to have been subjected to a “gagging order” restricted from speaking to stakeholders without prior approval from the board or the chair Deirdre-Ann Barr and quotes from a letter from Ms Barr.

Mr Doherty says the “decision to seize control of executive functions” arose from two events.

The first was his decision to seek advance payments from the Department of Housing and Dublin Region Homeless Executive in order to meet payroll and Revenue commitments. Both the Department and DRHE said that the AHBRA and the Charities Regulator would need to be notified but that in doing so the board later expressed “dissatisfaction” with the answers he and the PMVT’s finance director had provided to these two regulatory bodies.

He says the second issue was that since he took over as chief executive he had identified and disclosed a “substantial amount of concerning information and practices relating to the period prior to my appointment”.

He writes this had resulted in the board not engaging with the executive of PMVT.

He says the finalised report from PWC indicates that the financial issues at PMVT have “arisen over a number of years and this points to repeated and long-standing governance failings”.

Mr Doherty writes: “Despite my tireless efforts, and proven track record, in creating more financial stability, I have been left in an untenable position for acting in accordance with regulation and for raising issues of concern with the Board.”

The Irish Independent revealed last month that the charity’s board rejected a proposal by Mr Doherty to appoint well-known businessman David Hall and two other people to the board as part of efforts to resolve significant financial and governance issues at PMVT.

While declining to discuss any individuals who were proposed to be appointed, Fr Peter McVerry, the founder of PMVT and secretary to the board, confirmed at the time: “There was a suggestion, but the people that were recommended we didn’t feel were the right people.”

Mr Doherty copied Mr O’Brien, the Housing Minister, on correspondence to the PMVT board in which he sought the board’s approval to create three additional positions to which Mr Hall, and two other named individuals would be appointed.

PMVT has already confirmed that it warehoused three years of PAYE tax debts during Covid-19 for the years 2020, 2021, and 2022 as part of a Revenue pandemic scheme and is in a phased payment arrangement with the tax authority since September of last year.

The charity’s total tax liability is understood to have been as much €8 million – a fraction of which has so far been repaid. It warehoused as much as €5 million in PAYE debt during the pandemic.

Its cash position has also depleted by €4.15 million since January, according to a draft report from accountancy firm PWC which raises concerns about the charity’s solvency.

PMVT received more than €38m in state funding in 2021, which accounted for most of its €53m in income that year.