Payroll giving should be replaced with direct debit solicitation, say fundraisers

Growing Philanthropy in the UK says Fundraising Standards Board should have increased powers and be funded by a proportion of Gift Aid

Report author Adrian Sargeant
Report author Adrian Sargeant

Payroll giving should be axed, the Fundraising Standards Board should have power over all charities and be funded by a proportion of Gift Aid, according to a report based on a summit of top fundraisers.

Growing Philanthropy in the UK, a joint publication between Bristol Business School and the Institute of Fundraising, was written by Adrian Sargeant, professor of non-profit marketing and fundraising at BBS, and Jen Shang, a philanthropic psychologist and assistant professor at Indiana University in the US.

It was based on the Growing Philanthropy Summit, which took place in July and was attended by fundraising academics and charities including the British Red Cross, Cancer Research UK and the RNLI. The authors said, however, that the final report did not represent the views of all participants.

"This group felt that payroll giving should be axed and replaced by the workplace solicitation of direct debits," the report says. "Payroll giving was developed in a pre-direct debit era and may no longer be fit for purpose."

It says the future of payroll giving was "one of the most contentious issues discussed at the summit", and that although some participants felt it needed additional money from the Treasury for incentives, promotion and awards, others said that participation in payroll giving was "minuscule" and that successive government schemes to boost it had "largely failed to have an impact".

The report says the FRSB should be given powers similar to the Advertising Standards Authority, which can refer companies that break its good practice rules to the Office of Fair Trading. It adds that 0.05 per cent of all Gift Aid should be diverted to fund the FRSB.

"In this way, all charities who seek to raise funds from the public would be included and additional resources would be created," the report says.

According to the report, fundraisers are poor at measuring long-term success and the sector must change its metrics.

"The continued use of performance measures, such as response rates, immediate return on investment and the total amounts raised by a given campaign, is crippling the long-term performance of the sector’s fundraising programmes," it says. "These simplistic metrics need to be replaced by measures indicative of longer-term value."

It says the sector needs to communicate better with the public, who continually overestimate the cost of fundraising. To do this, the fundraising information website Charityfacts should be merged with the Impact Coalition, and the new organisation should be better resourced, it suggests.

It also calls for the creation of a fundraising research institute and radical improvements in fundraising training, including the development of an academy for fundraisers, a degree in fundraising and a sales force made up of senior fundraisers to sell the "body of knowledge" about donor behaviour.

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