Arguments loom over fundraising regulation

The project is forging ahead, says Stephen Cook, but the proposed Fundraising Preference Service raises many contentious issues

Stephen Cook
Stephen Cook

The project to set up the new Fundraising Regulator is making progress, but is also – perhaps inevitably - getting more complicated; and it is significant in that context that the six-month timescale initially proposed by Sir Stuart Etherington has in recent weeks quietly morphed into a year.

The biggest step forward came when the interim chair, Lord Grade, introduced himself to the sector at the fundraising summit last week, said he hoped to get a chief executive in place by Christmas, and brought on George Kidd to lead the working party on the planned Fundraising Preference Service.

Grade has the reputation of being a no-nonsense operator, and producing Kidd at such short notice, as it were out of a hat, is evidence that he has a good network of contacts and knows when to delegate. Kidd is a direct marketing expert and looks like a good choice for the job.

But no-one should underestimate the concern and resistance building up among fundraisers about the FPS, which was always the most contentious part of Etherington’s recommendations. Neither he nor Rob Wilson, the charities minister, has wavered in their insistence that the FPS must include a "re-set button" that will allow people to halt fundraising approaches from all charities. But both are now also saying that they would have no objection to a system that also allowed people to be more selective, cutting off some charities but not others. At the same time, there are doubts about how practical and cost-effective that more selective system would be.

Etherington has also accepted that the dialogue about the rules on data use between fundraisers and the Information Commissioner’s Office have not in the past been clear enough, which is why a second working group involving the ICO is being set up in parallel with the one led by Kidd.

Between them the two groups are expected come up with a recommendation about the interaction between the permission-to-contact that a donor might give to a charity on the one hand, and the FPS on the other. If a charity can clearly demonstrate that a donor has signed up to be contacted, and that donor then uses the "re-set button" of the FPS, is the charity justified in continuing to approach that donor?

This is to some extent a replay of the issue that charities came up against in the past in relation to the Telephone Preference Service. If they had a provable relationship with a donor who then signed up to the TPS, some charities continued to contact those donors – and this was done not recklessly, but in the belief that the ICO had sanctioned it.

In its latest manifestation, this question will focus more on the nature and quality of the permission a donor gives to a charity and the clarity of the rules the ICO will be able to communicate. In the past, as Etherington suggests, everything may have been a bit too vague, and this year’s developments mean that is no longer good enough.

A related question is whether charities should in future use an opt-in or an opt-out system for acquiring permission from donors to contact them. Etherington’s report said it should be an opt-in system. Kidd said when he introduced himself that he was instinctively an "opt-out man". Meanwhile it remains possible that EU reforms in the pipeline might soon require opt-in to be the norm. It's a bit bewildering.

In that context, it emerged this week that Save the Children considers it is making a success of a revised, more prominent system of opt-ins and opt-outs for donors that it introduced in the summer. The charity declines to discuss it in detail, but in written evidence to the Select Committee on Public Administration and Constitutional Affairs, its chair, Sir Alan Parker, says the opt-out rate at the point when donors sign up has risen from less than 5% to 60%. "This proves that the reforms can and do work," he writes. There is a certain irony in a charity describing a reduced proportion of contact permissions as a success, but that is a sign of the times.

Meanwhile, sceptical voices are being raised. Sir Stephen Bubb, head of the chief executives body Acevo, who has been relatively quiet on the subject so far, this week said there had been enough doom and gloom and fundraisers should not meekly accept restrictions that stop them raising money. He calls on Wilson and William Shawcross, chair of the Charity Commission, to do more to champion the sector and fundraising - which might be a little optimistic just now.

In the coming weeks, Acevo is among bodies holding meetings about the new regulatory proposals, followed by the Institute of Fundraising and the think-tank Rogare with NfpSynergy. The recent summit was firmly told by Grade, however, that the proposals are going ahead whether fundraisers like it or not. That doesn't necessarily mean that some of the details are not up for grabs. Expect plenty of argument.




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