Instead of setting up new charities, funders should think about “investing” in donor-advised funds or Community Support organisations instead, said the retiring Chief Executive of the Charity Commission, Sam Younger . He advocated supporting organisations that underpin and support charities, rather than funding some of the small charities themselves. He further advised that some people should think very carefully before setting up their own charity.
This, the parting shot of the retiring chief executive last year, was to outline why he believed a 16.1 per cent increase in the registration of new charities in one year was too many.
I read this statement with great interest. At Community Impact Bucks we see and support many charities – and I think we are the type of organisation that Sam Younger was suggesting donors should support. There are 2,500 registered charities in Bucks, and more unregistered “groups” doing charity work, hundreds of Community Interest Companies – and they come in all shapes and sizes. Most have a turnover of less than £25,000 and many do similar things or support similar areas to each other. In some sectors they are falling over themselves. And the number is growing, with at least a dozen setting up in Buckinghamshire since January.
So is it a good thing to have so many charities? Should they be culled? Forced to merge to improve efficiencies? Paul Palmer (Professor Paul Palmer is the Director of the Centre for Charity Effectiveness at the Cass Business School, City University London) writing the Civil Society Blog comments on this point. He argued that each charity has its own administration, and other costs, and shouldn’t they get together and merge in order to keep administration costs down? Paul even questions trustee expenses. Fewer charities; fewer trustees!
He really does have a point, when considering the situation dispassionately… However, if the charity sector is driven by anything it is passion! Napoleon or Adam Smith (take your pick it is attributed to both!) said that we are a nation of shop keepers, and he/they may be right, but it’s not about keeping shop. We are not a nation driven by retail, that’s not why we are a nation of shop keepers …. it’s about owning our own shop, championing our own shop, innovating our own shop. We are nation of people who think we can do it for ourselves, and we think we can do it better.
When people start a charity they usually do so because they feel frustrated that something is wrong in society and they have a way of putting it right, or that they simply must do something to make a bad situation better for others. They really believe that they are the only people who can! Arrogant… Impulsive… Courageous… Yes, all these attributes are true, but are these adventurers also collaborative? Not sure. Many people who run charities put their lives into making things work for their beneficiaries – the sick, poor, children, disaffected – as well as spreading passion in sport, music and the arts. The urge that drives individuals to set up their own “shop”, or charity, is the same passion that drives them to elicit support from volunteers, to persuade business to support their cause and to stand in the rain and collect coins. Would that passion still exist if they were forced to join the more successful organisation that had similar aims? Would they be as driven if they were not the owner, if they did not feel that sense of responsibility? I think not.
Like small businesses, charities can fail, go out of business or, simply, the driving forces get tired and lose the necessary drive to keep going. But while they are operating, often on a shoe string, they are, very often, doing great work. As for value for money the measures are complex but £’s given to most charities can create £100’s of impact through volunteer time that would not otherwise exist.
In short some charities can be a bit inefficient, amateur and make mistakes – but so can business and, believe it or not, so can Government. So I would say…. yes let’s encourage mergers, increased efficiency, business and marketing expertise and help these organisations where help can be given – in training, support with managing accounts, trading and governance – let’s help (at Community Impact Bucks that is what we do!). And where efficiencies can be made with charity leaders working together to solve problems then yes, let’s help them to do so – but let’s not kill the passion that drives these courageous champions by forcing them to donate their funds and efforts to another organisation that was there first or seems to be doing things better. If there are too many charities now then, given the level of funding cuts on the horizon, people will choose to support the most efficient and the others, however well meaning, will simply run out of funds or energy and close down. But until then Vive le shop keeper! Vive le small business owner! …. and Vive le small charity leader!