A mental health charity that has helped thousands of people in Greenwich was at the verse of collapse after the scale of its financial problems was laid bare.

At a meeting of Greenwich Council’s adult social care scrutiny panel on November 1, a full breakdown of Greenwich Mind's finances was revealed.

From 2011 to 2017, the charity made a loss of over £100,000 for five of the six years, often having an expenditure up to 50 per cent higher than its income.

In 2015-16, Greenwich Mind’s income was £400,000 while its expenditure was £700,000.

The organisation had significant cash reserves but by August 2017, it had debts of more than £100,000.

Last week's meeting was told a full closure of the organisation could be “chaotic” and incur “a range of unforeseen costs” according to the report, as those who relied on the mental health charity could be left temporarily without help.

Greenwich Mind serves more than 3,500 people in the borough providing vital medical services for people with mental health problems, including issues like schizophrenia or bipolar disorders.

The charity was under severe financial difficulty and the scale to which it was making a loss year after year was kept a secret from Greenwich Council, who part-funded the organisation, according to the report.

The meeting revealed that people who used the organisation’s service were more aware than the council of the looming severe financial problem.

When Greenwich Council staff met with Greenwich Mind's CEO, Ross Milne, to discuss a contract extension in September 2016, no concerns were raised about the financial state of the organisation.

It wasn’t until July 2017 that Greenwich Mind called a crisis meeting where they outlined the scale of their financial difficulties and asked the council for advance payments on their contracts to prevent the organisation from collapsing.

The CEO even offered to take six months unpaid leave in March 2017 in an effort to balance the books, before he resigned in August later that year.

Dr Hannah Patrick, from the board of trustees to Greenwich Mind, said: “Cumulative operating costs of the organisation had been above funding levels for several years but because it had accumulated significant reserves, the negative cash flow was inadequately appreciated and acted upon.

“Staff wages, pensions and HMRC contributions were significantly higher than national norms for the sector.

“This would have been avoided if the trustees had been more aware of their responsibility to scrutinise the accounts and demand frequent financial updates including regular analysis of cash flow.

“This would have been particularly useful following the first concerns expressed in autumn 2016.”

To prevent the collapse of services provided by Greenwich Mind, the report said it looked like that Greenwich Mind would merge with the more financially-sound Bromley and Lewisham Mind.

A spokeswoman from Greenwich Council said: "The Royal Borough of Greenwich has provided significant on-going funding and support to Greenwich Mind for decades and we will continue to do so.

"The council has worked tirelessly in recent months alongside Mind nationally and Bromley and Lewisham Mind since Greenwich Mind's financial crisis, to ensure continuity of services and support for all users in the medium and the long-term.

"We are also repairing Mind’s headquarters - which is leased from the Council - free of charge.”

Ben Taylor, consultant CEO at Greenwich Mind and chief executive at Bromley & Lewisham Mind said: “Since the financial difficulties at Greenwich Mind came to light, a transition plan has been agreed with Greenwich Council to restructure the services and put them onto a sustainable footing.

"Implementation of this plan is well underway and we expect the transition to be complete by the end of the year.

"In the meantime the services are continuing to operate, providing valuable support to people with mental health problems in Greenwich.

"An important part of the transition plan is for Greenwich Mind to merge with a more robust organisation. Bromley & Lewisham Mind has been chosen as the preferred merger partner and all parties are working together to ensure that the merger can take place quickly.”