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PASC to examine charity chief executive pay

Priti Patel MP
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PASC to examine charity chief executive pay 5

Governance | Vibeka Mair | 30 Oct 2013

The issue of charity chief executive pay is to be examined by a committee of influential MPs, which includes two politicians who have already been publicly critical of charity executive pay.

The Public Administration Select Committee is inviting written evidence on the issue of salaries for chief executives in the charity sector, ahead of an oral session on the topic, currently scheduled for 17 December.

A PASC spokesman said the evidence session forms part of its ongoing work considering the regulation of charities.

However, two MPs who are members of the PASC, have already publicly been very critical of the levels of charity chief executive pay.

Conservative MP for Witham Priti Patel was integral to the start of a recent public debate on charity chief executive pay, sparked by a Telegraph story criticising executives at international development charities who earned over £100,000.

Patel helped the Telegraph journalist who wrote the story, Christopher Hope, compile the figures. And the Telegraph describes her as a “campaigner against boardroom pay excess among charities”.

Sir Stephen Bubb, chief executive of Acevo, has suggested that there are political motives behind Patel’s comments on charity chief executive pay in the press, suggesting that she is one of many MPs “on the right” who hate effective charities who campaign. “They particularly dislike international charities who have been so effective in raising the concerns of the world’s poor.”

But Patel has hit back, arguing: “The concerns which have been raised have nothing to do with 'MPs on the right'.”

“There are some superb charities in my constituency and throughout the country that do outstanding work, often on a shoestring….The essence of the matter is that the public deserve to know that money given to charities in donations and by the taxpayer is spent in the most effective way possible, with charity bosses being held to account in an open and transparent way.”

PASC member, Charlie Elphicke, Conservative MP for Dover and Deal, has also been publicly critical of charity salaries this year.

In August, he wrote a provocative analysis for the Telegraph, saying: “Think charity and you think of the volunteer rattling a tin, frontline work relieving poverty and vocation lined with compassion.

"You don’t think of mega salaries, inflation-busting pay rises and bank-style bonuses. Yet in too many cases, this has become the culture of the charitable sector.”

Elphicke has long been vocal on high wages in the charity sector. In 2011, at a PASC hearing, he moved Sir Stuart Etherington, chief executive of NCVO, to justify paying staff members salaries of over £80,000 while expecting to make 30 people redundant at the time, in a criticism of what he labelled “charity fat cats”.

Elphicke has also recently welcomed an upcoming BBC Panorama investigation on charity chief executive pay revealed by civilsociety.co.uk this month. The BBC is still deciding whether the programme will air.

Charlie Elphicke

NCVO is currently leading an inquiry into charity chief executive pay, but it is not yet known whether a representative will give oral evidence to the PASC. A spokesman said the witnesses are still to be decided. Bubb has confirmed that he will give evidence.

Elsewhere, the issue of charity salaries has hit Ireland, with its national newspaper, the Independent, analysing charity chief executives who earn over 100,000 EUROS; a similar analysis took place in the USA this month too.

Gordon Hunter
Director
Lincolnshire Community Foundation
1 Nov 2013

STOP PRESS
Charity Commission recruits working group to examine MPs' pay, expenses, office costs, perks and directorships.
Popular opinion supports the view (expressed by Colonel Charles de Laet Waldo Sibthorp, former MP for Lincoln) that elected members should be philanthropically motivated and receive no or low pay.

Patrick Taylor
31 Oct 2013

Following Muriel Simmons remark I wondered what the pay was like at Allergy UK and note form the March 2012 accounts that no one fell into the disclosable £60,000+ bracket. I am glad as I am in the process of sending £100 and would have been miffed if it had been outrageous.

Looking at the 2013 survey by IFPS it appears most of the public are happy with 60k and less are happy at 100K salaries in charities. Funnily enough they are not at all keen on London offices. Possibly they work out that staff and premises are more expensive there.

Just to give a sighter as to pay in the commercial world I can quote a close friend who earned £70K and had around 1500 staff spread around the UK. A transfer to London lead to a doubling of salary in roughly 3 years and she was using her same brain . The hours went up fron 60 a week to 70-60 average and she was on her own signature able to commit the organisation to £10M per item.

So when I read about charity CEO's at over £100k I begin to wonder what is going on. I assume charities do not drive their staff into the ground like commercial organisations and allow adequate staff for deputising and holidays ......

I think the real answer is that, and you can check this, charities recruit from each other and not from the greater pool of the British managers. For very small charities they may be looking for a different people but the major charities poach from each other in a wage spiral.

It is not acceptable. Salary size does not improve someones abilities to perform so lets not pretend that it does. I note today from some charity accounts that a performance bonus scheme has been implemented over the last year. Do you know I always have worked on the basis that enthused staff try to do their best at all times. Introducing a bonus is therefore exceeding strange. Am I alone in fnding it reprehensible?

Muriel Simmons
Chairman
Allergy UK
31 Oct 2013

Charities need to pay a salary to their CEOs in line with their experience and the scale of the job. Unlike MPs, CEOs of charities are unable to take on directorships to supplement their incomes as they are too busy carrying out their demanding roles.

Adrian Beney
Partner
More Partnership
30 Oct 2013

Well, do we want well run charities led by people who are paid a market rate for doing a really decent job? Or do we want MPs - not notoriously frugal as a group themselves - whipping up hysteria about "fat cat" charity CEOs?

Of course I want the CEOs of charities I support to do the very best job they can and I want "value" from them. But I also want to know that the money I give is going to be used thoughtfully, effectively and efficiently. High pay does not guarantee this, but low pay guarantees that the pool of candidates for CEO posts will be artificially smaller than it needs to be and that can not be good for the leadership of those charities.

Lorraine Walker
CEO
Bliss Mediation Services
30 Oct 2013

Salary per annum is £33,315 this has not increased since 2005 not even a cost of living rise, this was agreed by myself and the directors. This is not a extra large salary and many more CEO are on this amount or near too. Also if we were employed in the private sector our salaries would be far greater.

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