Friday, January 13, 2017

Explained: Everything you need to know about the Goal crisis

Irish aid charity Goal is 40 years old and is facing a tumultuous year ahead. 

The organisation is facing a cut in funding, job losses and a new chief by the end of 2017.

What happened? We have the Goal crisis explained here. 

What was Goal like in the beginning? 

The organisation was founded by journalist John O’Shea using a IR£10,000 donation in 1977. The charity began by funding a feeding project in Calcutta, India. 

In 1979, Goal hit global headlines as it became one of the first charities to enter Cambodia after the genocide and it also began famine-relief in Uganda. 

How fast did it grow? 

The charity spent more than €1.3million on humanitarian projects worldwide in 1986, including famine-relief in Ethiopia. Journalist O’Shea left his job to concentrate on the charity in 1992. 

In 1996, Goal began operating as a company. In 1997, accounts showed a total income of €3.8m. In 2000, accounts showed a total income of €22m, more than five times the income recorded three years previous. 

Side note: The Department of Foreign Affairs made the decision to suspend funding to the charity in 1997 after an investigation by the EU fraud unit showed possible irregularities in the charity’s funding. The Department of Foreign Affairs resumed funding in 1998. 
What has spending been like in recent years? 

In 2014, the organisation spent €106m on aid programmes in sub-Saharan Africa, the Middle East, Central America and India. 

The organisation’s total income was €126.9m this year and Syria became the largest operation. 

The charity had an income of €210m in 2015, making it easily the biggest Irish aid agency. 

The spending mushroomed to €198m in 2015. Much of this increase was due to the crisis in Syria and the Ebola outbreak in Sierra Leone.

So, what happened in April 2016? 

US Office of the Inspector General launched an investigation into the alleged rigging of bids by suppliers to Goal and 15 other aid organisations operating in Turkey and Syria.

In Goal's case, the probe focused on a $175,000 (€164,500) contract for the supply of flour. 

Distributing bread is a key part of Goal's US-funded operation in Syria. It distributes millions of bags of bread to around 600,000 people each month.

But the US body believes there was collusion between suppliers to inflate the value of the contract. 

Two Goal staff on the ground were sacked after the probe was launched, while a consultant also left the organisation.

The probe is focused on the activities of individuals on the ground and there is no suggestion of any involvement by senior management.

What happened next? 

Irish Aid suspended around €7m in funding in the wake of the controversy, but the suspension has since been lifted. 

CEO Barry Andrews, who first took the post in November 2012, stepped down in the aftermath of the controversy on October 13, 2016. 

In his resignation statement, he said he believed Goal required a fresh start in terms of leadership.

Do we know anything about the charity’s salaries?

Accounts reveal the former head of Goal USA, Mark Bartolini, earned between €220,000 and €229,999 in 2015.

In comparison, Mr Andrews had an annual salary of €95,000 with a €20,000 pension contribution, while Ms Fitzgerald's package is worth €100,000.

Mr Bartolini resigned last October and the US office was shut as part of the downsizing of the organisation.

What significance does this all have? 

The alleged fraud in Syria may be relatively small in the grander scheme of things, but it has done considerable damage to Goal's reputation. 

International donors have not deserted it, but for the coming year the sums they are willing to pledge will be substantially less than before. 

Confidence will have to be rebuilt to secure its future. 

Goal general manager Celine Fitzgerald, a former telecoms executive who took over leadership of the charity following the resignation of Mr Andrews, said an action plan is "70pc to 80pc complete" and key appointments are being made, including hiring a former Criminal Assets Bureau officer as head of investigations.

Has anything happened in 2017 yet? 

Ms Fitzgerald spoke to the Irish Independent in early January and said the feeling within the organisation is that it grew too big, too quickly. 

In particular, it’s felt that their anti-fraud and investigative functions are not strong enough to cope with the expansion.

On January 12, auditors called into question the future of Goal. 

In a report, Deloitte said there was "material uncertainty" over its future due to a dependence on donors for funds.

So what’s expected now? 

The charity's funding for 2017 is expected to be just over half of the €210m it received from donors in 2015. 

The cut in funding will lead to the closure of programmes in India, Nepal, Yemen and Ukraine during 2017.

Earlier this month, the charity announced it will be shedding 25 jobs, one-fifth of its office operations in Dublin and London. 

It received most of its funding from the aid arms of the US, Irish and British governments. 

It is understood that most of the organisation’s donors will continue to fund the charity, but with much-lower donations. 

Later this year, a new chief executive is to be installed.

No comments: