Regulator must understand charities’ concerns about its levy, says Acevo chief

Vicky Browning says the Fundraising Regulator must not treat all charities in the same way when it comes to persuading them to pay for its upkeep

The Fundraising Regulator must avoid treating all charities in the same way if it hopes to persuade more of them to pay its levy, according to Vicky Browning, chief executive of the charity leaders body Acevo.

In a statement made after the Fundraising Regulator published a list showing the names of the 162 charities that have not paid the levy to contribute towards its costs, Browning warned that the regulator needed to do more to tailor its arguments to different types of charities.

She said the list published by the regulator showed that certain kinds of charities were more likely than others not to pay, primarily religious or medical charities and those in the arts.

“This demonstrates a need for the Fundraising Regulator to engage with representatives from these types of charities and understand what their concerns are,” Browning said.

“The sector is not homogeneous: the same argument isn’t going to work with everyone. Charities that have concerns about paying need to see and hear that their perspective is understood and being taken into account.”

Browning said it was up to each charity to make up its mind on whether or not to pay the levy, but Acevo’s view was that it was better to have the voluntary self-regulation offered by the Fundraising Regulator than to have government legislation imposed on the sector.

The regulator’s list included 1,570 charities, the majority of which had paid the levy, but showing the names of 162 that had not. The regulator said another 95 charities not included on the list were currently negotiating with it about making the payment.

Of the 162 that have not paid, 13 have agreed to pay the levy next year, but not this year.

At least 85 of the 162 have charitable objects relating to medicine, religion or the arts, including museums.

Browning said: “Charities not paying the levy on the principle that donors’ money was not intended for the Fundraising Regulator must measure the risk against the principle and consider whether the principle should itself be subsidised by the majority of the rest of the sector that is paying the levy.”

A spokeswoman for the regulator said it engaged with all charities that got in touch to express concerns about the levy, but if charities did not reply to emails and letters it was “near impossible” to discover exactly what their concerns were.

“Where charities have refused to pay, we will continue to engage with them individually, and it is helpful that some have said they will start to pay the levy in year two,” she said.

The regulator was always happy to discuss any issues, she added.

“Many arts, faith and medical research charities have paid the levy, and we are pleased that they support independent regulation,” she said.

“We are working with the Arts Council, the Institute of Fundraising, the National Council for Voluntary Organisations and others to reach out to those organisations, and will continue to do so.

“As Acevo points out, the sector is not homogeneous, so it can be difficult to do this where charities are not part of wider networks.”

Source link

Fundraising Regulator publishes list showing levy non-payers

It includes 162 charities that have not yet paid up to £15,000 a year to cover the regulator’s costs

The Fundraising Regulator has published a list showing 162 charities that it says have not paid the fundraising levy.

Those listed as having not paid the levy include the English National Opera, the anti-poverty charity War on Want, the conservation charity Plantlife, the mental health charity YoungMinds and Devon Air Ambulance.

Others listed as having not paid the levy, which is voluntary, include BirdLife International and the think tanks Policy Exchange and the Institute of Economic Affairs.

The list includes 1,570 organisations in England and Wales that have been asked to pay up to £15,000 a year to cover the regulator’s costs, with the majority listed as having paid their share of the levy. 

But it does not include the names of 95 organisations that the regulator said it was in negotiations with over paying the levy.

Thirteen of the 162 charities that the regulator has identified as not paying the levy are marked as having agreed to pay the levy for year two but have not paid the year-one fee.

Charges levied on charities range from £150 a year for those spending between £100,000 and £149,999 per annum on fundraising to £15,000 for those that spend more than £50m a year.

Heléna Holt, chief executive of Devon Air Ambulance, said the charity did not intend to pay the levy because it did not provide the charity’s donors or beneficiaries with value for money.

She wrote a blog on the charity’s website in June in which she detailed the reasons why the charity had decided not to pay the levy and invited supporters to comment.

Holt told Third Sector that all the feedback the charity had received had been supportive of its decision to refuse to pay the levy, but this was constantly under review and the charity would pay if its supporters wanted it to.

A spokeswoman for the IEA said the charity did not intend to pay the levy. “This regulator was established after sharp and aggressive practices by some charities in fundraising,” she said. “The IEA doesn’t engage in such practices and has no intention of doing so. We have never received any complaint pertaining to fundraising that could be in any way helped or addressed by this regulator.

“If other charities have behaved so poorly they need to receive and pay for this sort of regulation, we wish them well. The IEA doesn’t fit this category, so we are not minded to pay for a service we don’t feel we need.”

A spokeswoman for the English National Opera said it intended to pay the levy and the Fundraising Regulator was aware of it. She said the charity had requested an invoice from the regulator in July.

The support charity Turn2Us is listed under its former name of Elizabeth Finn Care as having not paid year one of the levy but having agreed to pay year two.

A spokeswoman for the charity said it intended to pay the levy from year one but was in discussions with the Fundraising Regulator over what payment band it should fall into.

The children’s charity EveryChild is listed as having not paid, but Amanda Griffiths, chief executive of Family for Every Child, told Third Sector the request for payment had slipped through the gaps as a result of EveryChild becoming a dormant subsidiary of Family for Every Child last year. She said payment had now been made.

A spokeswoman for the Fundraising Regulator said: “Today, in the interests of transparency and fairness, the Fundraising Regulator has published a list that shows the charities that have paid or committed to pay and those that have not paid our year-one levy.

“The charities listed as non-payers include those that either refused to contribute to the levy or have not responded to our communications. The list will be updated to include charities with which we are still in negotiation, as and when they decide whether or not to pay. As such it is a live document. As always, we are grateful to those charities that have paid the levy and look forward to continued collaboration in the future.”

Peter Lewis, chief executive of the Institute of Fundraising, said: “While it is for the board of each charity to decide their own position, we strongly encourage every fundraising organisation to show their commitment to high standards by paying the levy.”

Sir Stuart Etherington, chief executive of the National Council for Voluntary Organisations and whose review led to the creation of the Fundraising Regulator, said charities that paid the levy were demonstrating their commitment to fundraising good practice and therefore safeguarding their integrity and reputation.

Source link

Regulator opens inquiry into charity over unexplained payments to a trustee

The Charity Commission will examine whether the funds of the Orphan Relief Fund and Charitable Trust have been used for charitable purposes

The Charity Commission has opened a statutory inquiry into a poverty relief charity over allegedly unexplained payments to a trustee and failure to provide records about its spending in Iraq.

The commission announced today that it had opened an inquiry into the Orphan Relief Fund and Charitable Trust following a compliance visit in May, which was carried out because the charity operated in high-risk countries.

The charity provides poverty relief and education for young people who have lost one or more parent, and works in Iraq, Pakistan and Somalia, as well as a number of other countries in Africa, Asia and the Middle East.

During the compliance visit, the commission found that the trustees were unable to provide records about a significant amount of its spending in Iraq between 2013 and 2017.

A number of unexplained payments had also been made to one of the charity’s trustees, the commission said.

The regulator also found that the charity had spent charitable funds on activities that fell outside the charity’s remit.

Latest headlines

According to the charity’s entry on the Charity Commission’s website, the trust had an income of £583,485 and spent £596,199 in the year to 31 July 2016.

The latest accounts were submitted 43 days late, the Charity Commission website shows.

The regulator said the inquiry, which was opened on 24 July, would examine the administration, governance and management of the charity by the trustees and their conduct.

It will also look at the financial controls and management of the charity and whether its funds have been used for charitable purposes and can be accounted for, as well as whether the trustees have complied with charity law.

The Orphan Relief Fund and Charitable Trust did not respond to a request for comment before Third Sector’s deadline.

Source link

NCVO says better communication with trustees required after regulator warns charity

The umbrella body said it was “alarming” that the chair of the charity that received the Charity Commission’s first official warning did not understand her role

The sector must get better at reaching trustees “who may not fully understand their roles” the National Council for Voluntary Organisations has said, after the Charity Commission warned a charity which paid a trustee and spent most of its income on fundraising.

The National Hereditary Breast Cancer Helpline was issued with the first official warning by the Charity Commission last month after the charity failed to address concerns about its finances.

Wendy Watson, the charity’s founder, paid herself £31,000 for running the charity while she was chair, a payment which had not been properly authorised and which she says was an error.

The charity had also been criticised for spending large amounts on staff, charity shop and sales costs, which meant that the charity was only spending a fraction of its income on running its helpline.

While the charity shops brought in 90 per cent of the charity’s income, according to its accounts for the year ending 31 March 2016 store costs and fundraising accounted for £409,227 of its total income of £924,827.

Staff costs were also £397,168 and cost of sales accounted for £123,580, the accounts show.

The charity’s 2015 accounts show that only £27,403 was spent on charitable activities, despite a total income that year of £974,555.

Speaking to Sky News yesterday, Watson said she wanted to make the charity more sustainable so she could retire and hire staff to run the helpline, which she had been running voluntarily by herself.

She said: “Mistakes were made. I’m not a businesswoman, I’m somebody passionate that wants to keep the helpline going and find a way to raise some money to do that.

“The charity needed to make the shops more profitable, which is what we’ve been doing. That will enable me to train others to work on the helpline so that I can retire.”

A report released by the Charity Commission last month says that the charity had been “exposed to undue risk through a lack of appropriate financial controls and its financial model was unsustainable”.

The report also criticises the unauthorised payments made to Watson and the charity’s receipt of interest-free loans from a trustee “for which no formal agreement or repayment schedule was in place”.

The report says: “Specifically, although the former chair had resigned as a trustee, she continued to run the charity’s operations without any formal role and continued to receive payments.

“They were continuing to allow the former chair to make key decisions about the operation of the charity, despite having resigned as a trustee.”

The charity’s failure to properly address the issues raised by the regulator led to the commission issuing an official warning under the Charities Act 2011 – the first time it has used these new powers.

The warning calls on the charity to review the loan arrangements it has in place, properly record board-level decisions and improve its financial controls.

Aidan Warner, external relations manager at NCVO, said: “It’s obvious that Mrs Watson is very well intentioned but this case is the perfect reminder that good intentions are not enough to run a successful charity.

“There’s a major question as to how the trustees ever arrived at the strategy of rapidly opening a large chain of shops in order to try and support a small, low-cost helpline.

“It’s alarming that Mrs Watson didn’t properly understand her role as a trustee, and that matters didn’t improve even after the commission’s involvement.

“We have lots of guidance available on trusteeship which is very well used. But I think all of us in the sector should think about what more we can do to reach those trustees who may not fully understand their roles.”

Source link

Fundraising Regulator appoints partner to help ‘vulnerable’ people with FPS

The Fundraising Regulator has appointed Yonder Digital Group to provide telephone support to the Fundraising Preference Service.

Yonder will offer its services to “vulnerable” people wishing to register their preferences with a live agent rather than use the online service. 

The FPS, which will enable people to block post, phone, email or text communications form named charities, was officially launched earlier this month. According to the regulator, 4,015 suppression requests were made in the first six days of launch.

The regulator said Yonder had been chosen to help provide the service because its staff had been specifically trained to work with vulnerable callers. The company will offer a supportive service to callers via a team of ‘brand ambassadors’.

Nick Allaway, head of finance at the Fundraising Regulator, said: “The FPS is a website based service which will give the public the chance to manage all direct marketing communications from a specific charity.

“However, we are fully aware that some members of the public, particularly those not familiar with using online services, will want to just pick up the phone to specify their preferences.

“Therefore, having an alternative contact method was critical. Yonder Digital Group, with its technology, expertise and highly-skilled contact centre agents was able to offer this additional support.”

Source link

Fundraising Regulator will name charities that have not paid its levy

Of the 1,768 charities that have been asked to pay the voluntary levy to fund the regulator’s costs, 200 have either refused or ignored requests for payment

The Fundraising Regulator will, at the end of August, name the charities that have so far failed to pay the fundraising levy, it announced today.  

The regulator said it would publish a list at the end of next month, the close of the first levy year, disclosing the names of the eligible charities that have and have not paid the levy. All charities that spend more than £100,000 a year on fundraising have been asked to pay the voluntary levy, which covers the regulator’s running costs.

The regulator said today that of the 1,768 charities eligible to pay, 1,344 had paid or committed to paying, 224 were in negotiation with the regulator about payment, 35 had declined to pay and 165 had not replied. 

The decision to name the organisations that have not paid comes after Sir Stuart Etherington, chief executive of the National Council for Voluntary Sector Organisations, called on the regulator to “name and shame” the non-payers. Etherington conducted a review of fundraising self-regulation in 2015, which called for the creation of a new Fundraising Regulator after the national press criticised fundraising practices.

On 10 July, the regulator published a list of all those organisations that had registered with the Fundraising Regulator, but it did not include the names of the eligible charities that had not. The existing register includes charities that have paid the levy and those which, because they spend less than £100,000 a year on fundraising, fall outside the levy but have registered their support.

The Fundraising Regulator said in statement today that its board had concluded it would be in the interests of transparency and fairness to disclose the complete list of those charities that had and had not paid.

It said that before doing so it would contact all non-respondents again and had asked the NCVO and the Institute of Fundraising to contact the small number of those that are their members to encourage them to pay the levy. The list will also be shared with the Charity Commission.

Lord Grade of Yarmouth, chair of the regulator’s board, said: “The public generously supports charities, so their commitment to good fundraising practice is of vital importance. For charities spending more than £100,000 a year on fundraising, paying the levy is a very clear sign of their commitment to ensuring the maintenance of excellent fundraising standards and professionalism.”

Etherington said that paying the levy demonstrated a commitment to good practice and showing the charities that had paid and the small proportion that had not was fair to all concerned. 

Peter Lewis, chief executive of the Institute of Fundraising, said: “Fundraisers absolutely want the Fundraising Regulator to succeed. I would encourage all fundraising charities to sign up to support the regulator and pay the levy as appropriate.”

The proposal to name and shame organisations has faced opposition within the sector.

Earlier this month, Jay Kennedy, director of policy and research at the Directory of Social Change, told Third Sector: “Naming and shaming is at best premature and at worst will just damage the sector’s reputation further with more crappy headlines. It could also damage the reputations of any charities that are unfairly castigated in print.”

Kennedy said some charities might not have paid because choosing to do so was a strategic decision for the board that they might not have been able to make yet. 

Source link

Regulator will require charities to publish details of overseas funding

The Charity Commission will expect charities to include in their annual returns information on the size and source of these funds

The Charity Commission will ask charities to detail in their annual returns any funding they have received from overseas, as part of government measures to combat Islamic extremism.

Amber Rudd, the Home Secretary, said in a statement in the House of Commons yesterday that, having finished a long-running review of the funding of extremist Islamic organisations, the commission would require charities to “declare overseas funding sources”. Rudd admitted in the statement that the majority of funding for such groups came from donors in the UK.

A spokeswoman for the Charity Commission said in a statement that the regulator would be asking charities to declare in their annual returns whether they have received income from overseas and the source and amount of those funds.

“This change is part of our wider work to align the annual return with the strategic risks facing charities and to ensure that charities are only asked to respond to question areas that are relevant to their work,” she said.

“This is information that the public would expect a modern, risk-based regulator to hold on charities, and to make available for the purposes of accountability and transparency.”

She said the plans for the new requirement, which will be introduced for the 2017 annual return, expected to be published later this summer, were already being developed before some of the issues in the extremism review came to light.

The spokeswoman said in the statement: “Since our consultation on the purpose of the annual return, we have engaged in more detailed discussions with sector organisations about the wording of proposed questions to help ensure charities understand the questions and how they will be expected to respond.”

Rudd’s statement to parliament said the commission had in recent months been discussing the introduction of a requirement on charities to declare overseas funding sources.

But Caron Bradshaw, chief executive of the Charity Finance Group, said there had been no public discussion about the change and called for a full consultation on the measure.

She said it was vital to ensure that any steps taken to combat extremism were proportionate and effective.

“We have a number of concerns about how requiring charities to declare overseas sources of funding will give useful information to the Charity Commission and help law enforcement,” she said. “It is important that the desire to do something does not lead to us wasting resources that could be better used.

“There has been no public discussion about this change, as there has been in the past with other specific measures proposed by the commission for the annual return.

“It is important that there is a full consultation before this measure is introduced so that the right decisions are made.”

Rudd told MPs that the Home Office review had found that some Islamic extremist organisations “portray themselves as charities to increase their credibility and to take advantage of Islam’s emphasis on charity”.

Some were also “purposefully vague about their activities and their charitable status”, she said.

Rudd said the government had chosen not to publish a report on the findings of the review – which was started in 2015 – because of security concerns.

Source link

Petition calls for Lord Grade to resign from Fundraising Regulator

The Change.org petition had 84 signatures this morning, including Ian MacQuillin of the Rogare think tank

An online petition calling for Lord Michael Grade to resign as chair of the Fundraising Regulator has garnered support from fundraisers after his comments in The Daily Telegraph and on BBC Radio 4 last week.

The petition, started two days ago on the petition website Change.org, had attracted 84 signatures at the time of writing and was started by a user under the name “Proud to be a Fundraiser”.

The petition comes just days after the regulator confirmed that Grade’s term as chair, which was initially an interim appointment up to January 2016, had been extended until the end of 2018.

Grade attracted criticism from sector bodies last week after saying in a national newspaper article that too many charities were “proving to be laggards” and were failing to address public concerns about fundraising.

He then appeared on Radio 4’s Today programme and gave out incorrect information about how the FPS would work, mistakenly saying it would allow people to block contact from all charities at once, rather than specific charities.

He has previously described fundraising as “the Wild West” and fundraisers as “rogues and cowboys”.

The petition calls on Stephen Dunmore, chief executive of the Fundraising Regulator, to “initiate a process to replace Lord Grade immediately and find a chairman who is willing and able to represent donors and not-for-profit organisations responsibly”.

The person who started the petition, who did not wish to be named, told Third Sector they were not expecting to attract thousands of signatures, but it was “a gesture of support” for a strong relationship between the Fundraising Regulator and the fundraising community.

“It’s not just to stir things up for the sake of it,” the person said. “Having the regulator is critically important and every fundraiser I speak to recognises that, but having that trust of the regulator, the donor and charities is the fundamental basis of moving forward.”

The person said Grade’s comments had been “disrespectful and myopic” and risked “forcing a wedge rather than forging a bond” between donors, charities and the regulator.

The text accompanying the petition describes the extension of Grade’s term as unacceptable, describing his comments as “broad sweeping statements to deliberately court controversy and fan the flames of division and discontent”.

It warns that Grade’s comments could result in charities becoming wary of engaging with the regulator, believing they would not get a fair hearing, and donors being put off making donations.

Ian MacQuillin, director of the fundraising think tank Rogare, was among the signatories.

In his comment on the Change.org website explaining why he had signed, he said: “I reluctantly made a call for Lord Grade’s resignation because I believe his public comments, which showed contempt for fundraisers and a lack of knowledge of his own organisation, mean he is bringing regulation of fundraising into disrepute at a time when we need a leader of the regulator who can build bridges and consensus, and regulate with the sector, not at it, to rebuild public trust in fundraising.”

The Fundraising Regulator declined to comment.

Source link

Lord Grade to stay on as chair of Fundraising Regulator

Appointed on an interim basis in November 2015, he will continue until the end of 2018

Lord Michael Grade will continue as chair of the Fundraising Regulator until the end of 2018, the regulator has confirmed.

Grade was initially appointed to the role in November 2015 on an interim basis, but his term was extended in January until the end of June. It has now been renewed a second time until the end of 2018, a spokesman for the regulator said.

Grade attracted criticism from sector leaders last week when he said too many charities were proving to be “laggards” in terms of improving their fundraising practices.

He then gave out incorrect information about the Fundraising Preference Service, mistakenly saying it would allow people to block contact from all charities at once, rather than specific charities.

A spokesman for the regulator said: “Initially board members were appointed for two-year terms. Their terms are now being staggered so that not all members retire at the same time.

“New board members – including, when the time comes, a new chair – will be recruited openly, as happened recently with the board member for Wales and as will be the case soon with a board member for Northern Ireland.”

Grade works as chair at least four days a month and is paid £500 for each day he works.

Stephen Dunmore, the regulator’s interim chief executive is also expected to remain in post until the end of the year, having previously agreed to stay until the end of September.

The spokesman said the appointment of a new chief executive would also be subject to open competition.

Source link