Charities on defensive after Civitas report

Finance | 1 Mar 2007

Charities have reacted angrily to a report published last month that suggested charities receiving more than 70 per cent of their funding from the state should be reclassified as statutory agencies.

Who Cares? How State Funding and Political Activism Change Charity, published by Civitas, outlined a three-tier classification system for charities based on the percentage of the income they receive from the state. Under the proposals, charities that receive less than 30 per cent of income from the state would remain independent, but those receiving between 30 and 70 per cent would be rebranded as state-funded charities.

However, some of the charities mentioned in the report have questioned the analysis and the figures used by the report's author, Nick Seddon, a research fellow at Civitas. Martin Narey, chief executive of Barnardo's, one of the charities suggested for re-classification as a statutory agency, said the analysis of his charity's finances was 'fundamentally flawed'. The report claimed Barnardo's received 78 per cent of its income from the state, but the charity insists it receives 55 per cent of its income from the state for providing services to children, with the remaining 45 per cent coming mainly from voluntary funds.

Nick Aldridge, director of strategy and communication at Acevo, said the proposals were an 'administrative nightmare' and the report was a solution in search of a problem. 'It seriously underestimates the ability of charity leaders to manage complex relationships with the government.' He added that a lot of charities had used experience of service delivery as a basis for more campaigning.

Directory: Association of Chief Executives of Voluntary Organisations (ACEVO) | Barnardo's
Who's Who: Nick Seddon | Martin Narey

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