William makes it up


untitled (246)The news this morning of the Etherington review of charity fundraising is a disturbing reminder that the charitable sector needs to ensure it has clean hands and it can demonstrate them. This review is into the fundraising activities of around 30-50 of some of the largest charities in England & Wales is entirely unrelated to the work of the remaining 164,000 charities that have never used such methods or considered doing so. However there is a real risk that the damaging headlines will tar all charities with the same dirty brush and what is needed is for some distinction to be drawn between them. Sadly neither our ignorant media nor the Charity Commission will step in to the debate to defend these other charities, most of which do not employ anyone, let alone a fundraiser, that have never sent out a single mailshot or have a phone line to make any cold calls. This fund raising review is not the only issue impacting the charity sector at the moment, last Wednesday the Chairman of the Charity Commission addressed charities at the annual meeting of the Commission. William Shawcross is a writer, commentator and journalist yet in 2012 the coalition government appointed him to the prestigious role of Chairman of the Charity Commission which regulates all 164,000 charities in England and Wales. He initially worked for 2 days a week for £50,000 per year (a full time equivalent of £125,000) and in January this year he was reappointed and his working time extended to 3 days a week, there are no reports on his current remuneration. Despite this he has publicly criticised charity chief executives of some of the largest organisations for accepting pay of more than £100,000 for a full time role. On its website the Commission claims “William has broad charity sector experience, particularly in human rights and international aid.” Whilst he has been involved with a small number of International organisations such as DEC, the International Crisis Group and Article 19 these are certainly not typical of the broad range of charities operating in England and Wales.

On Wednesday Shawcross argued that the Commission’s £21M budget needs to come from charities not the exchequer. He cited the way in which Companies House, the business regulator is funded by Companies paying a flat annual fee. What he failed to clarify was the difference between the two regulators, in terms of their role, or the size of the sectors they regulate. If all 164,000 charities paid £13 to file their accounts as companies do, enough would be raised to operate the Commission for a mere 5 weeks. Shawcross has previously suggested that the funds only need to come from charities with an income of over £100,000. This reduces the number of charities able to contribute to around 25,000. Each of these Charities would need to pay £1,000 to fund the Commission at the level of its current operations. Organisations paying £1,000 a year from funds raised for good causes will expect a very different level of service from the one they currently receive from the Commission. Since 2010 the Charity Commission has had its income cut from nearly £30M down to the current £21M and in that time it has moved from providing support and advice to charities, to becoming more like a pure registrar, reacting to failed charities and complaints but not involving itself in the fine tuning of charities or helping to promote the values of the sector. Instead it has encouraged charities to seek help from consultants and support networks for this greater level of assistance. Those that may be expected to pay £1,000 or more to fund the Charity Commission in the future will have a view as to what they will expect to get in return for their subscription. They may even wish to question the Chairman of the Commission and challenge his remuneration, just as shareholders do their CEO and they may demand a public intervention when the media is clearly misinterpreting data. It is clear that William cannot have his cake and eat it too.

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About ianchisnall

I have a passion to see public policy made accessible everyone who want to improve the wellbeing of their communities. I am interested in issues related to crime and policing as well as in policies on health services and strategic planning.
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3 Responses to William makes it up

  1. Daniel Pritchard says:

    What a perceptive piece Ian… We, along with many other charities, seek help, advice and training from independent bodies to assist us in our work and guide us in areas of trustee responsibility, governance, finance etc. On top of which, as managers of a large facility, we also have considerable H&S responsibilities and increasing burden of ever-changing legislation to deal with. Apart from requiring things from us, the Charity Commission does very little for us; certainly nothing that would justify £1,000 per year! Our turnover would put us in Shawcross’s 25,000 – but even so, we are still a small charity with small margins and £1,000 just for the privilege of submitting our annual return is quite unreasonable.

    I am all for good charity regulation – especially as the sector is so open to confusion, error and abuse, but it is unreasonable for the cost to be met in this way. How about this for a proposal? Set a scale of fees, based on a percentage of charity turnover. This way, the very large and complex charities, would pay a reasonable proportion, as would the smaller and smallest, but all at a fair level. Can you do some calculations on that Ian? 🙂

  2. Daniel Pritchard says:

    Try 0.1% of turnover… This would mean a bill of £250 p.a. for us (approximately) and £2,500 for a charity with a 2.5 m turnover or £25,000 for one with 25 m… Perhaps the rate could get slightly lower as the size increases, but surely there is a fairer way? Even tiny charities would pay a small fee for their registration…

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