Analysis: That Was The Year That Was

As the sector's economic pain showed signs of easing, the Charity Commission, led by William Shawcross (pictured), took the brunt of increasing political and media criticism in 2013. David Ainsworth reviews the main themes

William Shawcross
William Shawcross

THE WOES OF THE WEARY WATCHDOG

For the Charity Commission, 2013 has been an annus horribilis. Still struggling with budget cuts of 40 per cent, the regulator has been dragged through a series of controversies.

At the start of the year it was still enmeshed in a row over its refusal to register a branch of the Plymouth Brethren Christian Church as a charity, which led to accusations of bias against religion. But that soon faded into insignificance when the furore over the Cup Trust ignited.

The existence of the trust came to light in January: a £176m tax-avoidance scheme registered as a charity, which claimed £46m in tax relief but had donated only £55,000 to good causes. The commission had investigated the trust for two years, but concluded that it was legitimate. It later emerged that no Gift Aid had yet been paid out, but that seven other similar schemes existed elsewhere in the UK.

The chief executive and chair of the commission were hauled in front of the Public Accounts Committee to be savaged by its chair, Margaret Hodge, who was "pretty appalled" by the commission, warned that its system of registering charities was "hopeless" and questioned whether it was fit for purpose.

William Shawcross, chair of the commission, admitted the Cup Trust had been a "disaster" and wished things had been done differently, including earlier publication of the fact that it had investigated the trust and had not felt able to take action. Shawcross also attracted criticism from other quarters throughout the year over his remarks on chief executive pay, terrorism and public service delivery - all of which went against the conventional charity line.

But it was the core role of the commission itself that dominated the agenda later in the year, when it faced two damning reports questioning its structure and effectiveness. First came Hodge's Public Accounts Committee, saying that its objects were too vague, were not all achievable and were in some cases directly contradictory.

But that was followed by a more in-depth report commissioned by Hodge from the National Audit Office, reported on pages 4 and 5, which concluded that the regulator did not offer good value for money, that its investigations division was too passive, too slow and too trusting when faced with serious abuse and that there were failings at every level.

Hodge, an old adversary of Shawcross, said that her question of whether the commission was fit for purpose had been answered: it was not.


SURPRISES, SINISTER AGENDAS AND, ER, 'CRAP'

The big society is dead, declared Sir Stephen Bubb, head of the chief executives body Acevo, on the front page of The Times in January. But ministers pronounced it alive and well. Kevin Curley, former head of Navca, said it was still alive but would be better off dead, while Sir Stuart Etherington, chief executive of the National Council for Voluntary Organisations, said it was still twitching, but was a "toxic brand". The consensus, it appears, is that the big society is alive but both unwell and unwelcome.

As the year went on, relations with government sank to what some felt was a new low. A lobbying bill, introduced to the surprise of the sector, looked likely to restrict charity campaigning, while a Ministry of Justice consultation came out with the unequivocal statement that it wanted to limit charities' ability to challenge government decisions. The lobbying bill argument rages on, although the government has made concessions. On judicial review there is little sign of change.

Lisa Nandy Bubb said there was a "sinister agenda" in government to muzzle charities. But the charities minister, Nick Hurd, vociferously denied that such an agenda existed. "Frankly, it's crap," he said. Hurd, meanwhile, gained a new adversary in the form of replacement shadow charities minister, Lisa Nandy (right), a former policy adviser for the Children's Society, who said sector staff faced a potent cocktail of low pay, low job security and high demand. How soon, some asked, before she went back through the revolving door?


'BECAUSE YOU'RE WORTH IT ...'

Like that of the Charity Commission, the reputation of the sector generally had a bruising year. A critical fringe of the Conservative Party, in apparent alliance with right-wing newspapers, seemed to have a vendetta against the RSPCA. There was also an attack on charity chiefs for being overpaid, starting with a Daily Telegraph analysis of the pay of the leaders of aid agencies in the Disasters Emergency Committee.

Third Sector's own analysis in March had revealed that the highest-paid chief executive in the sector, David Mobbs of Nuffield Health David Mobbs of Nuffield Health (right), received £850,000 a year. He was unrepentant, declaring that his pay was lower than private sector competitors.

Elsewhere, though, few were willing to speak out in defence of the sector on pay. Instead, most charities remained silent. The one man who can always be relied upon to say something - the ubiquitous Sir Stephen Bubb, chief executive of Acevo - did speak, and immediately faced a personal attack about his organisation's contribution to a House of Lords event where he was presented with a birthday cake.

The shortage of response led some to call for a Charity Defence Council to speak out on behalf of the whole sector - although few like that choice of name. But many umbrella bodies say that there is no need for a new organisation and, despite widespread public and political misunderstanding over pay, administration costs and fundraising techniques, there is no crisis of trust in the sector.


PICTURE OF THE YEAR

This image of a Scottish lifeboat among the North Sea waves sums up the charity sector in 2013: resilient amid the battering storms and always on hand to help people in need. The picture was one of more than 400 in a book and exhibition by the RNLI lifeboat crew member Nigel Millard, from Devon - he spent more than two years visiting lifeboat stations in the UK and Ireland to take pictures for the collection, The Lifeboat: Courage On Our Coasts.


OH, ALL RIGHT THEN ...

The fundraising sector had the spectre of increased regulation looming over it, with the government announcing that charities were on notice to introduce a sufficiently good self-regulation regime within five years or they would be regulated by government. The three bodies involved - the Public Fundraising Regulatory Association, the Fundraising Standards Board and the Institute of Fundraising - have pledged to work more closely and are making progress; but was there just a touch of reluctance about it all?


QUOTE OF THE YEAR

"As a power in the land, the third sector may be finished: its leaders, its representative bodies, have simply been defeated"

David Walker, journalist and broadcaster


FINANCIAL UPLIFT?

The year brought the introduction of Charities Online, a new system for claiming Gift Aid, and growing concern over plans to reduce charitable business rate relief in Wales. There were two court cases that left charities facing big bills for abusing that relief. But the real news this year was that surveys began to indicate that finances no longer top the sector's list of worries - partly because of increased concern about the political environment, and partly because the first glimmers are showing of optimism about future funding. The sector is beginning to believe, it seems, that things might one day finally get better.


ALL CHANGE: BRANDING AND 'AMERGERMATION'

The number of mergers in the sector seemed to increase as the year went on, including the high-profile takeover of the medical aid charity Merlin by Save the Children and a large-scale transfer of services from Platform 51, the charity for girls and young women, to the Cyrenians. The most frequent mergers were among councils of voluntary service and other local infrastructure bodies, frequently driven by a drop in funding. Consolidation was frequently accompanied by a change in branding, and the sector saw some high-profile name changes over the period, not least in two of the charities mentioned above. Platform 51 (so called because 51 per cent of the population are women), which up until 2010 was known as the YWCA, is now changing its name to the Young Women's Trust. The Cyrenians, meanwhile, is changing its name to Changing Lives. Do keep up.

Increasingly, the term "merger" was itself rebranded. A takeover would often be called a merger. When an actual merger took place, it would be described as an amalgamation, a partnership or a joining. Perhaps these terms themselves should be merged: an amalgaship, maybe, or an amergermation?


 

Read our individual sector round-ups:

Fundraising

Management

Law and governance

Volunteering

Finance

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