The Kids Company affair could harm charities generally

The unfortunate downfall of Kids Company and Camila Batmanghelidjh has been exhaustively chronicled in the national media. Rarely has a charity been the subject of such detailed attention. Most of those involved have now defended or explained their role to some extent – Batmanghelidjh, the chair of the trustees, Alan Yentob, the Charity Commission. One key player we haven’t heard very much from, however, is the government.

This is an unfortunate because ministers in successive administrations have played a pivotal role in the affair through their support for Batmanghelidjh. The Prime Minister is reported to have been "mesmerised" by her. It is easy to see why. Here was someone who seemed to offer a way of dealing with deprived youth and gang culture: how very big society – the voluntary sector stepping in to tackle an intractable problem seemingly beyond the means and scope of a shrinking state.

The political backing for Kids Company no doubt helped it secure the support it also had from celebrities and philanthropists. But the effect of all this was that the charity and its colourful founder were able to play outside the rules that should apply to a well-run charity. As Craig Dearden-Phillips wrote on yesterday, this was a case of founder’s syndrome, where governance was weak and management insufficiently developed. Experience suggests that if personal fiefdoms of this kind are not democratised and professionalised, they tend to get into trouble sooner or later. Another recent example was Beatbullying under the leadership of Emma-Jane Cross; not much seems to have been learned from that precedent.

Those who emerge with the most credit from this affair are the former staff who decided to go the media to reveal what was really going at the charity, and the civil servants who spotted the accumulating problems and advised ministers not to give Kids Company any more money. But the civil servants were overruled by Matthew Hancock and Oliver Letwin, both ministers in the Cabinet Office, and the payment went ahead. This was apparently used to pay the 600-plus staff, rather than for the restructuring for which it was intended: it appears – astonishingly – that the charity was operating without reserves, relying presumably on the belief that Batmanghelidjh could always whistle up the necessary funds. But all we have heard from ministers is a short BBC interview from David Cameron asserting that it was right to give Kids Company one last chance of restructuring.

The final nail in the coffin was, or course, the news of a police investigation into allegations of sexual abuse at Kids Company. Who was going to donate to the charity again, even if the allegations were to prove unfounded? The danger now is that the collapse of Kids Company will harm the image and reputation of charities more generally at a time when they are already under a cloud because of recent concerns about fundraising methods. People will inevitably wonder if the deficiencies at Kids Company are typical.

The most helpful thing from the point of view of the sector generally would be for the trustees of Kids Company, perhaps in conjunction with the Charity Commission, to set up a thorough, independent review of what went wrong that would be published so that others could learn from it. This didn’t happen with Beatbullying, although it should have done. Let’s hope it does happen this time.

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