The Telegraph has published a critical front page article attacking large charities for not spending enough on frontline services, but the report it is based on has been described as “flawed” by the Charity Commission and NCVO.
A Hornet’s Nest, published on Saturday by the True and Fair Foundation, formerly Miller Philanthropy, criticised 17 of the UK’s largest charities for spending less than 65p in every pound on charitable activity.
It was given “exclusively” to the Telegraph, which carried a story on its front page with the headline ‘One in five of Britain’s biggest charities spend less than 50 per cent on good works, new report claims’.
Gina Miller, the philanthropist behind the True and Fair Foundation, argued that charities should be forced to spend at least 65 per cent of their income on charitable expenditure.
She said: “‘It is an utter disgrace that so much of the money people generously give is going to feed large charity machines, which are often charcterised by obscene overheads and salaries, aggressive fundraising, and bloated marketing and publicity departments; resulting in questionable levels of charitable spending.”
The report singles out Cancer Research UK, the British Heart Foundation, Sue Ryder and Which? for criticism.
Most of charities that were singled out by the newspaper issued statements disputing the figures and the Charity Commission described the analysis as “flawed”.
Martin Miles, chief financial officer at the British Heart Foundation, said: “This report gives a distorted view of the proportion of our income that we spend on charitable activities, as it doesn’t allow for the very different financial profile of running the UK’s largest network of charity shops.
"Of the £147.3m raised by the British Heart Foundation in 2014/15, around 78 per cent (£114.6m) was available to fund lifesaving research and to improve the lives of heart patients. This was entirely due to the efforts of our supporters, as we receive no government funding for our research."
A Charity Commission spokesman said: “Donors need to see how charities spend their money. That’s why charity accounts are public documents.
"This report has not, however, considered basic information in the charities’ accounts, which has led to this flawed analysis.
"The Commission has looked at the accounts of the charities named and we would recommend anyone interested in charity finances does the same.”
Karl Wilding, director of public policy at NCVO, wrote a blog on the umbrella body’s website, calling the report “deliberately misleading”.
“We’re all for transparency at NCVO," he wrote. "We do a lot to make charity finances accessible, through our UK Civil Society Almanac programme, for example, and have consistently campaigned for greater transparency in various areas.
“There are interesting debates to be had about the detail of charity reporting requirements and how they can help readers to understand how charities work. This ‘report’ contributes nothing to those debates.”
Acevo also condemned the report. Sir Stephen Bubb, chief executive, said: "This is a flawed and simplistic analysis which arbitrarily defines ‘charitable activity’ to exclude campaigning."