Chapter 2 — Finance

Response of the Christian Brothers

The Congregation criticised Mazars for failing to take note of the findings of the Kennedy Commission (1970), the Tuairim report (1966), and the Department of Education submission to this Committee. All submitted that the funding to Industrial Schools was inadequate. However, both of these reports were written at a time when numbers had fallen so dramatically that the system of funding, based on capitation, was under pressure. Even at this time, the payment per child was reasonable but the costs of keeping the institutions open for smaller numbers was becoming more burdensome and was taking an increasing amount out of the maintenance grant. The Department of Education acknowledged to the Committee that they had not conducted any investigation into the rates of capitation but had simply relied on the Kennedy and Tuairim reports and on the correspondence with the Resident Managers’ Association through the years.

The question Mazars was asked to investigate was whether the capitation was adequate throughout the relevant period including periods of high occupancy.

The Sisters of Mercy response

Some issues arose in relation to the Sisters of Mercy and Goldenbridge that also gave rise to questions on finance.

The Sisters of Mercy ran a lucrative bead-making industry in respect of which no accounts appeared to have survived. Inquiries by the Committee indicated that this activity brought in at least £50 per week.

In 1952, which was a time when the Resident Managers were demanding substantial increases in capitation allowances, the Sisters bought a large house in Rathdrum, County Wicklow, with this money, which they used as a summer house for the children for a couple of weeks every August. There was no record of any other Sisters of Mercy schools using Rathdrum and there is no evidence as to what it was used for during the other 11 months of the year. Such a purchase was not consistent with an institution struggling to survive. The Sisters’ response also dismissed the comparators used by Mazars on the basis that they failed to take into account the nature of the costs implicit in running an institution. It insisted that the only valid comparator was with a UK institution but, like the Christian Brothers’ submission, did not advert to the differences between the two systems.

The Rosminian response

The Rosminians also disputed the comparators used because of the inherent expenses in running an institution that were not reflected in ordinary household accounts. They stated: In any event, and critically, the schools were dealing with a situation which required remedial and restorative standards of care. This cannot be done on a tight budget, never mind a persistent deficit.

The allegations made against institutions – including Ferryhouse and Upton – were that basic care was not provided. The Commission accepts that high levels of individual care were not possible because of the lack of funds, but was concerned to establish to what extent serious neglect could be excused.

The Rosminians stated that their schools barely survived and that that would indicate either gross mismanagement by the Order, or underfunding by the State. All the evidence, they maintained pointed to the latter.

The Oblates of Mary Immaculate response

The Oblate response to the Mazars report was also defensive. The Oblates saw the Mazars’ report as an attempt to illustrate that the Order had profited from their involvement in Daingean and set about dismissing that proposition. They did not see that Mazars was engaged in a much simpler task. Their response set out the arguments for using UK schools as a benchmark for assessing the adequacy of the grant and they also engaged in a detailed exercise of looking at the costs of childcare in institutions today and adjusting these costs for inflation.

In relation to the ‘benchmarks’ used, they reiterated the point made by the other three submissions that Comparisons with the value of average family incomes, welfare benefits paid to families or family spending are unlikely to give a useful measure of the cost to the Oblates of running a residential institution.

Whilst this is true to a certain extent, the comparators used by Mazars are valid in assessing whether funding was adequate to provide basic physical care such as food, clothing and accommodation.

Conclusion

The Mazars report raises doubts about the generally accepted proposition that funding for the residential schools was so inadequate that children suffered neglect and deprivation.

There were variables that had a considerable effect on the ability of schools to provide an adequate standard of care. These include: The size of the school. Mazars calculated a break-even number in respect of the four schools. This would indicate that where numbers fell below a critical figure, which varied as between the schools, a school would have been under financial pressure. Economies of scale were a significant factor in large schools. The ‘one size fits all’ approach by the Resident Managers failed to address the genuine needs of some of the smaller institutions. The existence of a farm that could provide food and fuel to the institution. Schools with an internal national school received a national school grant in addition to the capitation grant. This grant was also based on capitation and was therefore more valuable to larger schools. Many schools used industrial training as a means of generating income and for providing the needs of the institution.

Value of work done by the Order

The purpose of the residential school system was that the State and religious Orders would act in partnership in providing care to poor and destitute children. The Religious would raise donations for the establishment and upkeep of the schools and the State would pay to maintain the children. By the time the Department of Education took over the running of these schools and by the start of the period examined by the Investigation Committee, this dual role had become blurred for a number of Congregations. Most religious Orders did not seek public subscription for the premises used as residential homes and used the capitation grant to enhance and improve them. It is difficult to establish what effect, if any, this had on the funds available for the children and it varied from school to school.

In assessing the adequacy of the capitation grant, some Congregations have taken into account the monetary value of the work done by the religious staff over the years. On a simple accounting basis such an approach may be justified, but in determining whether the institutions had enough money to provide the basic needs of the children, an analysis of what was, at the time, understood to be the charitable nature of this work is important.