In summer 2005, the chairs of Age Concern England and Help the Aged met over coffee at the King's Fund in London. Catherine McLoughlin, who had just taken the role at Age Concern, raised the idea of the two charities merging. It wasn't the first time the move had been considered: six previous attempts had failed, mainly because of Age Concern's devolved structure and complex governance arrangements.
But McLoughlin's counterpart at Help the Aged, Jo Connell, was nonetheless interested in the idea of a merger, and the pair began a process that will culminate in the demise of the two individual charities and the creation of a new charity super-brand for older people next year.
It will be the biggest merger in the voluntary sector since Cancer Research UK was formed in 2002, and it hasn't got to this point without hitting a few bumps along the way. Age Concern has had to convince Help the Aged that it's loss-making subsidiary Heyday is worth buying into, some local Age Concerns that don't want to lose their name are threatening to rebel and jobs will be lost as the two organisations combine their resources.
But the merger is going ahead. Trustees at both charities have approved it and Dianne Jeffrey has been appointed chair of the merged organisation, provisionally called New Charity. A chief executive is being recruited, but neither Gordon Lishman, director-general of Age Concern, nor Michael Lake, director-general of Help the Aged, have applied. A launch date is scheduled for April.
So why has the merger got the go-ahead at the seventh attempt? Connell says there was more willingness at board level this time and the need for a flagship charity for older people that can compete with other charity super-brands for funding had strengthened now that there are more over-65s than under-18s. "There was a much more compelling argument for merger this time," she says.
The new charity will have 15 trustees, a quarter of the number on the two existing boards. Help the Aged usually has 21 trustees, although this is down to 15 because of the impending merger, while Age Concern has 39, including 26 from its local federations. McLoughlin admits its unusually large size "isn't popular with the Charity Commission". Four of the new board will be elected from local Age Concerns in England, three will come from Scotland, Wales and Northern Ireland and the other eight, including Jeffrey, will be recruited or appointed.
The 355 local Age Concerns will be invited to become 'partners' of the new organisation, which means they will continue to exist as independent organisations within a federal structure. One of the largest - Birmingham Age Concern - wrote to McLoughlin saying it was "not inconceivable" that some would prefer to keep their names and form a new organisation. "I don't think it's going to happen," she says. "The level of commitment is high indeed." She claims 95 per cent of Age Concerns support the merger. Connell adds: "Even those who are not sure about the name change will come. I can't see why they would not. The common thing that binds us is what happens to older people."
Connell says getting everyone on board would "eliminate the confusion" about the differences between Age Concern and Help the Aged that contributed to the need for merger in the first place. The charities are the two largest in the UK for older people, and although nearly everyone has heard their names - Help the Aged even inspired a single by Pulp in 1997 - people are less familiar with what they do. Both lobby and provide services; Age Concern has a stronger regional structure and Help the Aged is more effective at fundraising. The chairs say the new organisation will continue to do all this, but will have a strong focus on campaigning and policy.
Unlike many charity mergers, such as the one involving ChildLine and the much larger NSPCC, this is almost a union of equals. Age Concern's income fell by almost 8 per cent in 2007/08 to £79.9m. Help the Aged's income is £79.5m. The former employs 1,204 staff, the latter 1,046. The chairs expect the new charity to enjoy a similar boost in income to that achieved by Cancer Research UK, but are more guarded about the impact on staff - some jobs will be lost as functions merge. "The merger isn't being done to make savings, but in the process there will be changes and some people will lose their positions," says McLoughlin. A recruitment freeze is likely.
A decision must also be taken on where staff will be based. Both charities currently lease their London head offices. The future of the charities' trading arms, Acent and Intune, as well as Age Concern's membership body Heyday, is unresolved. Heyday is a particularly thorny topic. Set up to help people prepare for retirement, it has recruited a seventh of its membership target of 300,000 and accounted for almost £19m from Age Concern.
McLoughlin, who says she was "always a great supporter of Heyday", says the new trustees will decide its fate. "It would be a great pity to lose 40,000 members across the country," she says. Connell will talk only in general terms about the reassurances Help the Aged required about Heyday before agreeing to a merger. "We asked Age Concern to reassure us, which they were able to do very easily," she says. "As part of due diligence, we asked some questions and looked at some things because there had been some stuff in the press, but we have been fully satisfied by what we have seen."
Unusually, the new charity will launch without a name. One might not even be in place until late 2010 or early 2011. "People would like it to be in place sooner, but we have to make sure it's done properly," says McLoughlin. It almost certainly won't be Age Concern or Help the Aged. Both names will exist as sub-brands beneath the new name for a while before being consigned to history.
It is a bold move, but neither chair is prepared to say how much of donors' money is being spent. "We don't have a figure we want to discuss at this time," says Connell. But she claims "it's not substantial". Connell is also unwilling to say how the success of the new charity will be measured. She says "critical success factors" are being put in place. "But don't ask me to tell you what they are - I won't tell you because that will make me a hostage to fortune."
Details are still sketchy, but the biggest charity merger for seven years is reaching its conclusion. With no other charity for older people generating income even remotely close to the two charities' combined £150m-plus total, the new organisation will immediately become the dominant player in its field. But neither McLoughlin nor Connell will be part of the future. They will step down when the merger is completed. "This is a wonderful opportunity to make something new," says Connell.
MERGERS - DOES TWO INTO ONE GO?
Formed in 2002 by the Imperial Cancer Research Fund and the Cancer Research Campaign, the merger led to 130 job losses. However, in its first year the organisation created 300 new positions and income was £32m greater than the amount generated by the two previous charities.
An immediate recruitment freeze was instigated when the NSPCC, which had 2,097 staff and an income of £112m, incorporated ChildLine, which had 280 employees and £14.6m income, in November 2005. ChildLine had been in dire straits financially and asked the NSPCC to help it survive. Carole Easton, its chief executive, was made redundant, but a year later became chief executive of the merged Clic Sargent.
Formed in 2005 when cancer charities Clic and Sargent Cancer Care for Children merged, the charities had respective incomes of £8.4m and £7.3m at the time. The combined amount grew to £17m within a year.
Christian charities John Grooms and the Shaftesbury Society united in June 2007 and adopted the name Livability in April. John Grooms' last accounts showed income of £16m and 615 staff, whereas the Shaftesbury Society's showed £27.6m and 796 staff. Livability says fewer than 10 people were made redundant. It is yet to produce its first accounts and this month admitted fundraising concerns.
Began operating as a single charity in July, but is set to launch a new brand next month. Young people's charity Rainer had 608 staff and £23m income. Crime Concern had 404 staff and an income of £18m. Clare Checksfield, former chief executive of Crime Concern, was made redundant and the merged organisation hasn't ruled out further job losses.