The Portuguese Red Cross has been fiddling its annual accounts to hide the high level of State funding it receives, its management has not been acting in the best interests of the organisation, the vehicle fleet is unnecessarily large and it has €20 million in the bank.
The Inspectorate-General for Finance has stated what has been known at the organisation for years - financial misreporting to hide the amount of State support has become the norm.
The report into the Red Cross finances, hidden in a bottom drawer but now made public following Tuesday’s Police raids at the Inspectorate-General for Finance, the Portuguese Red Cross and the Ministry of Defence, (HERE) refers to the annual accounts for 2013, 2014 and 2015.
According to the hidden audit, the Portuguese Red Cross has been tardy in getting its annual accounts approved and even tardier in sending them off to the Council of Ministers, a violation of the rules that should mean that the institution loses its cherished ‘public utility’ status.
The 2016 audit report has only just been sent to the Court of Auditors, causing the Inspectorate-General for Finance to conclude that this is a repeated violation of the organisation’s legal duties and that its public utility status is in question.
Regarding public funding channeled to the Red Cross, the Inspectorate says that for the 2013 and 2014 accounts, "the large tranche of public money received by the institution was recorded as ‘services’ and only a small amount was recorded under, ‘subsidies or public support.’”
This was no more than, "a device to hide the true origin and nature of the income and to avoid showing that it is really the State that finances a very significant part of Portuguese Red Cross activity."
As for money in the bank, the Inspectorate states that it is clear that, "public subsidies have allowed the Portuguese Red Cross to maintain a large financial cushion of liquid reserves, one for which the best risk management measures may not have been adopted."
The amount held on deposit, while happily accepting taxpayers’ funds year-after-year, was €19.7 million in 2013 and €20.8 million in 2014 which was, "practically the amounts that received as public subsidies in those years," €19.3 million and €21.6 million, respectively.
The Inspectorate also questioned the size of the car fleet when reviewed against the mission of the institution. The Red Cross had 370 day-to-day ambulances, 143 emergency ambulances, two specially kitted out ambulances, six boats and 13 all-terrain vehicles.
Finally, the Inspectorate questions why public support is granted to the Portuguese Red Cross when it does not fulfil its legal obligations to the State.
This report had not been made available to government or to the public, until the raids yesterday when officers uncovered it.
The damning report into the Portuguese Red Cross’s financial activities now is available to the public after it was released in full on Tuesday by RTP.
