The Central Remedial Clinic has said that the Friends and Supporters of the CRC has agreed to write off a loan of €3m it advanced three years ago.
In a statement to RTÉ News, it said that the current directors of the CRC have resolved that public and private funds will only be spent in relation to furthering the well-being and health of people with disabilities.
The CRC said that as a charity, it does not have the means to repay the loan to the Friends and Supporters Ltd and cannot undo the actions of previous years, leaving no alternative but to have asked for the write-off.
The clinic also said that the transfer of assets from the charity wing has been agreed and will happen in the coming months. Those assets amount to over €13m.
All funds received since September 2014 have gone directly to the CRC, to support the delivery of services.
The statement added that the directors of the CRC, newly appointed in early 2014, intend that no funds under their control will be spent in relation to pension liabilities.
The interest-free, long-term loan was provided to help the clinic fund its pension liabilities, under its defined benefit scheme.
The latest audited accounts for the CRC for 2014 show that the "directors remain of the view that the company is not in a position to repay this loan and as a result made a formal request to F&S that this loan would be regarded by F&S as unrecoverable".
The CRC's latest accounts also show a long-term pension liability at the Clinic of €9.2m.
Top-ups controversy
The CRC was embroiled in controversy in 2013 when it emerged that certain pension top-ups were paid using donations given to the charity wing.
An interim administrator was appointed to the CRC by the Heath Service Executive and his report in May 2014 referenced the existence of the interest-free loan of €3m.
A new board of directors at the CRC was also appointed as a result of the controversy.
The accounts show that the CRC made a surplus of €140,752 last year, compared with a deficit of €721,845 the previous year.
The main source of the funds provided by the Friends and Supporters last year came from its share of the proceeds of the lottery, operated by The Care Trust Limited.
Under changes put in place after the controversy, since September 2014, the proceeds attributable to the CRC have been paid directly to it by The Care Trust Limited.
This amounted to €441,219 last year. Other monies raised by the F&S of €27,223 last year in donations and fundraising were also paid to the CRC. It compares with €700,000 the previous year.
Paul Kiely retired as chief executive of the CRC in 2013 and the latest report references his €741,025 pension and loss of office payment.
The scale of his pension package was the source of major controversy at a series of Public Accounts Committee hearings when it emerged that much of his package was funded by the charity wing.
He was replaced by Brian Conlon, who retired in December 2013 and whose gross pay was €47,263.
The CRC received over €16m in State funding last year, with most of this coming from the HSE.
The Interim Administrator's report into the CRC recommended that the F&S be wound up as soon as possible.
It concluded that the only rationale for the setting up of the charity wing was to maximise funding from the HSE.
The report found that had the HSE had been aware of the level of funds available to the CRC from F&S, it may have reduced its annual allocation to it.
