Charities should not provide service delivery

When the government says ‘please will you take on more service delivery’ how should charities respond? While the position of an individual charity and board of trustees will vary with circumstance, it’s worth asking a general question first: is this in our long term interests?

The first, and most important, quality charities possess is the public perception of, and involvement in, a ‘good thing’. While market research shows this is often built on little understanding, anecdotally its roots lie in the very fact that charities are not an arm of government.

This matters to a swathe of stakeholders: the beneficiary more willing to deal with a charity employee than a social worker; the corporate or trust seeking something distinctive from state provision; and the public for whom altruism is about more than seeing taxes fund a more or less effective welfare state.

Nick Seddon’s Who Cares? Civitas report, in which he suggested that some charities are de facto state bodies, generated a media storm on precisely this point because of the gap in understanding between lay perception of charities and the range of financial realities behind some of the biggest charities in the land. The suspicion lurks that the government is ripping off charities and the donating public.

Yet it’s also true that the public sees beyond this simple headline. An unemployed individual will work with a government funded charity programme to enhance return to work prospects because it’s genuinely good help. Trusts and corporates can see government funding as an amplifier of their own investment. The public is in favour of charities campaigning and wants to see innovations from charities taken up by government and used to the benefit of all in need.

Ultimately, for public, funder and beneficiary alike, the bit that sticks in the craw is the lack of transparency. The suspicion is that it hides a lack of independence. Negotiating fair terms and a track record of informing and educating a charity’s donors is vital in repudiating this.

So, when trustees next gather to consider whether or not to accept the government’s shilling, they must find out whether they are doing so transparently, on fair terms, with a communications plan that can tackle the questions such a relationship will generate. If not, walk away, not just for the benefit of your charity, but the for the benefit of those in need.

Charles Nall is the new chair designate of the Charity Finance Directors’ Group