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Social justice charity Extern has to pay back £600,000 wrongly claimed from Stormont

A recent audit of Extern’s accounts revealed £601,879.40 of funding claimed by the charity was “ineligible” – and the money has had to be paid back


Ciaran O'NeillSunday World

One of Northern Ireland’s best-known charities has to pay back £600,000 it wrongly claimed from a Stormont department for its work with prisoners and ex-prisoners.

From 2015 to 2021, Extern received £8.5 million from the European Social Fund (ESF) for a skills development programme.

The allocation of ESF funding in Northern Ireland was managed by the Department for Economy (DfE) at Stormont on behalf of the European Union.

However, the Sunday World has learned a recent audit of Extern’s accounts revealed £601,879.40 of the ESF funding claimed by the charity was “ineligible” – and the money has had to be paid back.

When contacted by the Sunday World, Extern said it had commissioned an “independent, forensic audit” to find out what went wrong.

The charity, which operates both north and south of the border, describes itself as the “leading social justice charity across the island of Ireland”.

Set up in 1978, Extern says its programmes support more than 25,000 children, young people, individuals and families.

These include help for people suffering from drug or alcohol addiction.

Among the groups targeted by Extern through its work are the homeless, refugees, minority communities, and current and former prisoners.

The ESF programme was created to support projects which could help people get into education, training or work.

The £8.5 million funding secured from the ESF programme by Extern was used for the Extern Works project which was aimed at prisoners and ex-prisoners.

The project, which was set up in 1984 but came to an end last year, helped participants to learn life skills, social skills and vocational training which would help them secure “clear pathways to employment and learning”.

However, details of the funding mix-up with the Extern Works project emerged after the Sunday World examined Extern’s accounts for the 2021/22 financial year.

In the accounts report, the matter is described as an “exceptional item”.

The report said Extern Northern Ireland and DfE reached an “understanding” in June 2022 on “ineligible historical costs associated with one project under this funding”.

“The settlement of £601,879.40 relates to the funding over six years 2015-2021 and was agreed to be remitted to DfE over one year,” the report states.

“The total funding of this project over the six years was £8.5 million. During all years, all costs were expanded in the delivery of services.

“Annual auditing by DfE was part of the terms of funding and Extern facilitated auditing each year which verified the work, eligibility of expenditure and adequate trails.

“It was during the annual auditing in 2021 that some specific historical claims were identified as ineligible.

“Extern co-operated fully with DfE in an open and transparent manner to bring about an agreeable solution.

“Extern continues to receive funding from the funder to deliver essential services to support the most vulnerable in our society.”

In a statement to the Sunday World on Friday, a spokesperson for Extern said the Extern Works project was one of 66 run by the northern branch of the charity.

In relation to the money wrongly claimed for the project, the spokesperson said: “Once Extern became aware of the DfE’s raising concern on one of its projects, the Board of Trustees immediately commissioned an independent, forensic audit alongside the DfE investigation.

“The independent findings were acknowledged and shared with DfE, and an agreement reached on the disallowed expenditure between 2015 and 2021.

“The total funding of this project over the six years was £8.5 million and it supported over 2,000 adult long-term unemployed and economically inactive in our society.

“The agreed settlement of £601,879.40 of subsequently disallowed expenditure is to be remitted in instalments to the DfE over the year to 31 March 2023.”

A DfE spokesperson confirmed to the Sunday World that the final repayment of the money was due soon.

“All payments have been received from Extern NI in line with the agreed repayment plan, with final payment due on 31 March, 2023.”

When asked if any other action had been taken against Extern, the DfE spokesperson said: “A number of recommendations were made by the department to Extern NI to enhance their overall governance frameworks.”

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