Why the Telegraph front page was absolute rubbish, and what we need to do about it

Why the Telegraph front page was absolute rubbish, and what we need to do about it

Why the Telegraph front page was absolute rubbish, and what we need to do about it9

Governance | David Ainsworth | 14 Dec 2015

The True and Fair Foundation report on the front page of The Telegraph was superficial nonsense, says David Ainsworth, but charities are going to keep getting hammered unless they change their ways.

Charities are back in the newspapers. This time it’s in the Telegraph, one of the two newspapers which have most consistently criticised and attacked the sector.

On Saturday, the Telegraph chose to give space on its front page to The Hornet’s Nest, a report by the True and Fair Foundation, run by Gina Miller, philanthropist and ardent self-publicist, which suggests in essence that many large charities spend less than half their income “on the cause”.

The report reaches this conclusion through some fairly, well, heroic reasoning. It basically takes all the money not spent on front line services and writes it off as worthless, including money spent on running charity shops and money raised in one year which is due to be spent in another. This leads, of course, to arbitrarily low efficiency ratios for many of the country’s largest charities.

The logical conclusion, of course, is that all shops should be shut and that large one-off gifts to charity should be spent immediately.

It’s thinking which leads you to absurd places. The Daily Telegraph’s own charity of the year, for which its Christmas appeal is raising money, is Horatio’s Garden, a small charity which appears to do excellent work. For various reasons, mostly to do with the fact that you need to raise funds first before you build a garden, it raised £293,000 in 2014, but spent only £42,000 on charitable activities – a ratio of 14 per cent.

On the other hand Kids Company, according to the Telegraph and the report, was an excellent charity. Its ratio was over 90 per cent.

It’s nonsense, in short. Attractive and beguiling nonsense, unfortunately. But nonsense, nonetheless.

What’s worrying is that the authors of the report were told at length that it was flawed, before it was published, not just by NCVO but by the Cabinet Office and the Charity Commission. Yet they went ahead anyway. The Telegraph was also told, at length, by the same people, and also went ahead. Karl Wilding of NCVO has explained since, in excruciating detail, exactly why it’s rubbish.

The question then, for me, is why the Telegraph carried it. Why are such dangerous and damaging half-truths are gaining currency? Why are intelligent reporters peddling this crap? And what can the sector do about it?

Why does the media keep attacking charities?

There’s little doubt that national newspapers – particularly the right-wing press – are determined to have a go at the charity sector. Rather worryingly, this report is not even the first to draw the same conclusions this year, based on the same flawed reasoning. The Sun produced an article earlier this year saying exactly the same thing.

In all, I can count eight separate and dangerous accusations which have been levelled at the sector by the newspapers this year, some of which have more weight behind them than others:

  1. Not enough money is going to the cause
  2. Charity chief executive pay is too high
  3. Charity fundraising is too aggressive
  4. Charities spend too much campaigning and not enough helping people
  5. Big corporate charities have lost touch with the public
  6. Charities rely too much on public funds
  7. There are too many charities and they should all merge
  8. Charities are investing donors’ money in guns and tobacco

Among the country’s largest newspapers The Daily Mail, The Telegraph, The Times, The Sun, the Financial Times, the Daily Express and the Evening Standard have all given space to direct attacks on the efficiency of the charity sector.

The narrative – of wastefulness, inefficiency and a sector out of touch with its supporters – is now well-established in journalists’ heads. Having had a few conversations with national newspaper journalists about the subject, it’s clear they feel that this is a sector ripe for attack. There is already a presumption of guilt before the story is written.

It’s tempting to say this is just an agenda. They’re deliberately ignoring the facts because it makes a good front page. But it’s a bit more complicated than that.

Journalists believe, at heart, that everyone is lying to them. They like clear and simple narratives in which there is someone doing something which is obviously wrong. Some are willing to wilfully ignore the whole truth for the sake of a convenient narrative. Most are not, but they’re congenitally willing to believe the worst of people. Now, in charities, they feel they’ve found a soft underbelly. If you couple that with some simple and believable statistics, which appear at first glance to be backed up by the Charity Commission website, it’s no surprising they’re happy to run something.

Then there is the genuine belief of many on the political right – not just reporters but MPs, too – that charities are genuinely badly run. These individuals often support charities, but believe in service delivery and voluntarism, and are heavily opposed to campaigning.

The trouble is that some of the criticism is well-founded. I think almost all of us accept that many charities went too far with their fundraising. It makes the newspapers believe that there is some merit in the other accusations. Particularly the most damaging ones about pay and efficiency.

What next?

The charity sector has up until now been entirely reactive to the media. It has rebutted claims, but made little running of its own. There has been, in some cases, a positive strategy of refusing to engage, because it could give the story oxygen.

This theory doesn’t seem to have worked. The narrative that charities are poorly run is firmly established in the journalistic consciousness. It will take some serious spadework to dig it out.

Sometimes when journalists get a story like this under their skin, they’re really onto something – MPs’ expenses, for example. Other times, it’s rubbish – the link between MMR jabs and autism springs to mind. The trouble is, they want it to be true, because if your job is to produce a good story, and you think you’ve got one, it takes a lot of pushing for you to be dissuaded.

So there is a definite correlation between how much the mainstream media knows about a particular issue, and how fairly it’s reported. Most journalists don’t know anything about charities, and it shows. Nor, when it comes to that, do most of the public. Their trust in the sector has largely been based on ignorance, and on an outdated understanding of what the sector does.

One solution is education. The sector needs to publicise the work is does much better. Programmes tracking the work of charities would make good television, and would raise the sector’s positive profile. This is something to really fight for.

Another is to accept criticism and change. The sector has to admit it’s in the wrong on fundraising, and it probably has to take some criticism on its investment policies. But that’s not enough. The sector also needs to measure and monitor itself much better.

But as I’ve written before, there’s also the need for the sector to measure its own effectiveness. In a vacuum, without good metrics, we will continue to have the newspapers use crude proxies to assess charities, and find them wanting.

This was obviously an awful report, and there was a deliberate agenda to attack charities, but it was able to exist because charities have never produced metrics of their own.

The same argument applies to Kids Company. The lack of any effective, impartial measures of charity effectiveness allowed them to parrot appalling data measurement and their mandatory audit as clear evidence that they were doing brilliant work. No one questioned them for 19 years.

Kids Company showed the limitations of standard accounts and audits. These measure financial probity, but they really are not effective tools to measure whether a charity is delivering on its mission. Yet to an outsider they are the only measures that exist.

It is time for the sector to produce its own standards. Not just because of outside scrutiny, but because charities have genuinely been too slow and reluctant to measure their own effectiveness, and now others are starting to do it for them.

You can see why charities don’t want to. Charity effectiveness is difficult to measure, and any proxies are going to be questionable. It costs money to track this stuff, which could arguably be better spent. And the moment you start using analytics to track doing good, you risk creating perverse incentives. In the US, where measurement of charities is much more advanced, there are still wildly inaccurate claims. Over there, some people are trying to fight it with the idea of the “impact audit”, though I don’t know if what they’re doing is quite right.

The fact is, however, that charities must produce their own evidence if they don’t want others to do it. And not just individually, either. There must be a collective standard. Then, next time report like A Hornet’s Nest appears, we can point at our own evidence and say “No, look, we measured already. That’s rubbish.”

17 Dec 2015

What amazed me about this piece was that the Telegraph seemed to make no checks into the charity that produced this report. It is run by two people, a Mr and Mrs Miller who are the only trustees. It looks like it has a national presence but it is really a small charity and company, with no staff and a 125K annual turnover. Whilst it urges greater accountability of charity finances, it managed to submit its own accounts a whooping 107 days late in 2010. And as Karl Wilding points out, The True and Fair Foundation own 2013 ratio of charitable expenditure to total income was 47%, less than those charities it was complaining about.

15 Dec 2015

One thing the sector hasn't considered is whether the charity shop model is an acceptable level of risk in the eyes of the public.

BHF defended themselves by stating that in 2014/15 they spent £140m running their shops, and made a profit of £30m. A 21% return on their investment.

Yes they have £30m more to spend on the charitable cause, but they risked nearly 5 times that money to do it.

Is that an acceptable RoI? Is that an acceptable level of risk? The public may disagree with the sector.

Phil Wells
15 Dec 2015
Response to [Nathan]

The only sensible way to answer this is to compare different organisations running charity shops. These achieve a number of other goals so comparing roi with other fund raising will not be valid. It is also (like child sponsorship) a way to raise a £ that won't come through other means. So it may be worth it even if the roi is low - it is still positive and the opportunity cost may be negligible.

George Overton
Head of Fundraising
15 Dec 2015

For the media, especially print media, charities seem to be in the same boat now as schools and social services departments. We're a target for relentless criticism and we can't do anything right.

What do we do about it? We can appeal, in personal meaningful ways, to those of our donors and volunteers who'll listen. We can bypass the media in our relationships with those supporters, just like the big players at the weekend did in their rebuttals.

Also don't forget that charity supporters, like everybody else, don't buy newspapers as much nowadays (the Daily Mail etc are a slowly dying breed).

I'm not sure what else we can do about it, but we do need to ride it out in a dignified way.

Barney Mynott
15 Dec 2015

I would suggest that we need to consider why these types of stories get exposure and why there is public interest in them. I would suggest that the response cannot just be about rational arguments and making a better intellectual case.

I think we are losing a lot of the emotional arguments at present. Facts and figures alone won't work. We need to understand more about what people feel about charity - what they think is special and the things they don't like charities doing.

David Ainsworth
Civil Society News
15 Dec 2015
Response to [Barney Mynott]

I don't think we can separate the two. I think that what we have is a data problem driven by emotion. Essentially:

a) the public feel an instinctive inclination to give
b) they don't understand charities very well and don't really want to
c) they nonetheless have a strong desire to know their money is used well

This set of drivers means that they want simple and easy to understand metrics to understand what's happening in the sector. Charities aren't offering them, so they've focused on pay and admin costs.

Barney Mynott
15 Dec 2015
Response to [David Ainsworth]

I don't think we are disagreeing but I think that people feel that charities aren't what they were. As charities have become more professional they have become much better at making a difference but as bigger charities have become more corporate there has also been almost a loss of innocence.

If this is what people feel then facts and figures will not change their mind. Stewart Lee 9 (the comedian) does a good sketch with the line 'you can prove anything with facts' - which although a good line does raise the issue that people do not always believe facts that go against what they believe. Our first instinct when faced with unconformable facts is to challenge the legitimacy of those facts.

So the issue is, if people think charities spend too little on mission, are bloated or have lost their way - and they are not to be persuaded by facts, how do you reach them?

Michael Walker-Smith
14 Dec 2015

The suggestions put forward by David Ainsworth as repeated below are spot on. While I agree 'effectiveness' would make their benefits a lot clearer as said these are not so easily quantifiable. As a trustee of smaller charities which largely depend on grants such grant applications require some indication of the effectiveness of their work. This is usually more qualitative but where feasible backed up with statistics.

"One solution is education. The sector needs to publicise the work is does much better. Programmes tracking the work of charities would make good television, and would raise the sector’s positive profile. This is something to really fight for.

"Another is to accept criticism and change. The sector has to admit it’s in the wrong on fundraising, and it probably has to take some criticism on its investment policies. But that’s not enough. The sector also needs to measure and monitor itself much better.

"But as I’ve written before, there’s also the need for the sector to measure its own effectiveness. In a vacuum, without good metrics, we will continue to have the newspapers use crude proxies to assess charities, and find them wanting."

I just wonder why the press has this year decided to attack this sector. People read the press who help form opinions. This situation is not helped when TV programmes my extend this further. But as it is usual with news; it is nearly all bad news. Good news rarely 'sells'. How sad but real.

Patrick Taylor
14 Dec 2015

"Hornets Nest" - a very successful report in gathering attention and the top two "charities" are very interesting. However I do not see anyone rushing to explain whats good about them. In fact the Motability charity is very interesting at first glance. And the loss of money from the Lloyds Foundation in tax compared to what they do spend in charity is interesting.

I do wonder if the report had spoken simply of those two whether it would have got much press mileage - and I bet very little attention from the charity sector.

But should the sector be looking for oddities where the financial benefits appear to be designed to be curiously beneficial. If the Charity Commission is not up to the job then should charities actually work on some kitemark system, perhaps one that differentiates between types of charity.

However overall I think David Ainsworth is on the money about explaining what is going on.


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David Ainsworth

David Ainsworth is editor of Civil Society News, the Charity Shops Survey and Governance & Leadership magazine.

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