News in focus: Mixed welcome for self-regulation

Is the Regulation of Fundraising Unit really 'doomed to fail'? John Plummer canvasses experts' opinions.

The voluntary sector finally revealed last week how it plans to reassure people that fundraising is a reputable, well regulated profession.

According to one leading academic, however, the plans could have the opposite effect.

Stephen Lee, director of the Centre for Voluntary Sector Management at Henley Management College, claims the proposed Regulation of Fundraising Unit will only increase public suspicions and is doomed to fail.

"It will be largely irrelevant," he says. "It will be a precursor for further regulation in three or five years time, when it fails - as it inevitably will."

Lee's views will cause concern, given the stakes. The Government has indicated that if the sector cannot regulate itself effectively, it will.

The self-regulation steering committee, which includes representatives from leading voluntary sector organisations, but no actual fundraisers, will ask charities and agencies to pay between £30 and £1,500 a year for membership of the unit. This will entitle them to use a logo showing that they conform to industry standards.

'Discrete division'

The steering committee says the unit will operate as a "discrete division" within the offices of the Institute of Fundraising. But the decision to base a supposedly independent organisation in the same building as the professional body for the very people the public will be complaining about is highly controversial.

Lindsay Boswell, chief executive at the institute, says the unit will be independent, but Lee is unconvinced. "You can dress it up as much as you want, but to the public it will look like the unit is part of the institute," he says.

Lee is equally concerned about the sharpness of the unit's teeth, given that it won't fine anyone and membership will be voluntary. The cowboys, he says, will still operate off the radar.

He also believes the £1.71m the institute has asked the Home Office to pay for the first three years of the scheme is inadequate. "How is the public going to be made aware of this organisation, which will exist on between £500,000 and £600,000 a year?" he asks. "The institute has sought to protect what it considers to be its role rather than concentrate on the strategic imperatives.

"The scheme will be significant to professionals, but will have little impact on the general public."

Steering committee member Sue Brumpton, who also chairs the Public Fundraising Regulatory Association, which monitors street fundraising, says the inclusion of members of the public on the council that oversees the unit will ensure its independence.

She adds that the voluntary nature of the scheme will not undermine its purpose. "The idea of the unit is to develop a kitemark scheme so people will be able to see that our members come up to standard," she says.

Steering committee chair Simon Hebditch, also executive director at the Charities Aid Foundation, says setting up the scheme was hard work. "There is no evidence of a huge volume of complaints against fundraisers, but people are concerned that things are run properly," he says. "When people don't have the chance to complain, they feel bad."

He admits the scheme can only work if charities and agencies see the value in joining a scheme that offers no individual return. "Self-regulation gives us the opportunity to harness the expertise of fundraisers," he says.

Whether the public regards the unit as independent will be the acid test, according to Joe Saxton, co-founder of think-tank nfpSynergy. "The landscape is littered with examples of self-regulation that have been criticised for not working," he points out.

Philip Cowen, director of Charity Check, which analyses fundraising, says the 2002 Strategy Unit report recommending self-regulation ignored evidence, including the Dundee Report in 2000, that suggested self-regulation could not work. "There has been a long history of attempts to impose it based on ill-judged assumptions - and this seems to be the latest one," he says.

Bodies seem divided. "To big charities, £1,500 is peanuts," says Stephen Pidgeon, chief executive of direct fundraising agency Target Direct.

"Those who say it's too much should improve their fundraising."

Rob Reaks, chief executive of Personal Telephone Fundraising, says that although he supports moves to increase the transparency of fundraising, he questions whether it is necessary to add to the regulatory burden.

"There is over-regulation because of the perception of negative fundraising," he says. "The £1,500 will be absorbed easily by agencies, but for charities it will be a big issue."

The months ahead will reveal not only their willingness to pay but also their faith in how well they think their money will be spent.

- See Editorial, p22.

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