NCVO's David Kane has urged the public to "be careful" when looking at raw data of charity registrations, in response to stories by the Daily Mail and the Mirror that last week blamed a Big Society failure for the closure of almost 7,400 charities.
Kane, a research officer at the umbrella body and co-author of the UK Civil Society Almanac, said that analysis of the Charity Commission register is not sophisticated enough and that in a wider context "we lack the tools and data to fully understand what is happening to the voluntary sector in this difficult period".
The Daily Mail and Mirror both ran stories on Friday claiming that the government's Big Society agenda is undermined by the fact that 7,349 charities were wound up in 2011. Gareth Thomas, the shadow minister for civil society, too launched an attack on the number of charities closed in 2011/12, advising that it was 1,000 more than the previous year.
But in a blog entitled "Behind the headline: why '7,000 charities close' doesn't tell the full story" on Friday, Kane said the figures are more likely to be a reflection of administrative action, and gave words of caution against fingering blame.
The figures quoted include subsidiary charities, he said, which are usually excluded from analysis of the register. And the newspapers also failed to offer a breakdown of why the charities were removed from the register, which can currently be divided into those which ceased to exist, do not operate, have transferred to another charity, are a voluntary removal, or 'other'.
"Unfortunately these reasons don't give a lot of information on why charities close, but they do back up the idea that administrative changes are driving much of the change," said Kane.
He explained that charities do not close the way that businesses do, "instead they just gradually fade away, doing less and less activity". But while the Charity Commission is making moves to distinguish which of these charities are still operating and which have ceased to exist and should therefore be removed, it depends on the Commission's resources available to do so, which directly effects the register, he said.
Further he advised that re-registration, which is common for administrative reasons is not tracked by the Charity Commission.
People are forced to look elsewhere for data, he said, pointing to examples of data provision such as the voluntary sector cuts site, the charity forecast survey or government data on spending.
Due to the lack of strong data, he says, "I'd caution against using raw administrative figures to draw conclusions about the health or otherwise of the voluntary sector.
"More sophisticated analysis might shed more light on what is happening though."
The NCVO and others are trying to address the lack of tools and data, he said, advising the NCVO highlighted a number of measures in its response to the Charity Commission information strategy review.
Responding directly to the newspaper articles and Gareth Thomas's comments on the removal of charities, the Charity Commission told civilsociety.co.uk: "There is some fluctuation in the number of charities removed, but this is fairly evenly matched by the number of new charities that are registered.
"There was one quite large peak of removals in 2009, however, this can be attributed to an administrative project by the Charity Commission to clear up the register of charities that had been dormant for some time."
