Some medium-sized charities are paying executive salaries as high as those at charities receiving more than 100 times the income, according to the The Times newspaper.
Its investigation into executive pay at the UK’s 1,000 highest-earning general-purpose charities found that the children's disability charity Caudwell Children paid its most senior executive more than £230,000 last year - a similar amount to the chief executive of Save the Children International, which had a 2014 income of £559m compared to £6.2m received by Caudwell.
Another relatively small charity, the Thrombosis Research Institute, paid a senior employee a salary of between £240,000 and £250,000 – more than the chief executive at Cancer Research UK. CRUK recorded an income of £665m last year, compared to TRI’s £15m.
The study found that 1,080 executives at 390 charities are paid at least £100,000 a year, with 12 of these receiving salaries in excess of £300,000. It named the medical charity St Andrew’s Healthcare as the charity paying the highest salary: its outgoing chief executive Philip Sugarman received £751,000 last year including a £389,000 payment in lieu of notice.
It noted that the average charity employee is paid about £20,000.
In an email to members about the investigation this morning, the National Council for Voluntary Organisations reiterated its recommendation that trustees should set out clearly and publicly how they decide senior salaries and how they reflect the charity’s ethos and values.
Sir Stuart Etherington, chief executive of NCVO, said such statements and details of senior staff pay should be available on charities’ websites, ideally no more than two clicks away from their homepage.
Martyn Lewis, chair of NCVO, also said in a statement that some of the organisations mentioned in The Times piece were spending "substantially more than normal" on salaries. They included Theatre Royal Bath, which paid its artistic director about £345,000 last year; the Royal Opera House, which gave its music director Sir Antonio Pappano £571,000; and the reproductive health non-profit body WomanCare Global, which paid eight of its 25 staff in six-figures.
Lewis acknowledged that some might have special circumstances, but said they needed to explain what these were. He also said that spending less than one per cent of a household-name charity's income on senior staff pay was a "sensible amount".
Karl Wilding, the NCVO’s director of public policy, also tweeted this morning that he believed The Times was asking legitimate questions. "Some of the salaries quoted are very difficult to justify," he said.
A spokesman for Caudwell Children confirmed that its chief executive, Trudi Beswick, earned the charity’s highest salary of £230,000. He said all of the charity’s management and administration costs, including salaries, were paid for by John Caudwell, the billionaire founder of the mobile phone retail empire Phones4U, and did not come out of donations from the public.
"It’s not money that would otherwise have been going to the cause, because it’s a private donation which is just for administration and management costs," he said. The spokesman said that Caudwell also funded the charity’s services, but his vision was of a charity "where everybody’s donations go straight to the cause."
He said Caudwell believed Beswick was the best charity chief executive in the UK and did not feel he would be able to retain the same quality of staff if he did not pay such sums. But he added that Beswick would be unlikely to leave her role if her pay was reduced. "Private commercial businesses have tried to lure her away for much better financial reward but she has resisted," he said.
He said that Beswick’s salary was £100,000 and that it had remained the same over several years, but her annual income included a performance-related bonus which was paid over multiple years and employee benefits such as her pension and car. He said her remuneration policy was determined by the trustees.
St Andrew’s Healthcare issued a statement that the salary of its new chief executive Gil Baldwin was £226,000. "This was independently benchmarked at the time of his appointment and is very much in line with salaries for other healthcare CEOs in the UK," it said.