Interesting points there. I don't think, by the way, that charities and / or the Commission are automatically without fault.

In using the Commission's figures, I guess I was trying to illustrate that they have a big job to do, and that, in that context, the funding provided by the Government might be viewed as reasonable, rather than 'lavish'. I quite understand that there may be differing views on that.

Whether or not the Commission is itself effective is another debate.

I do agree that a charity's annual report, if it has any sense at all, is useful as a marketing tool. One cannot, as things stand, imagine such a document ever being an independent assessment of an organisation's effectiveness because of the inherent bias involved.

So...

1) Is it important that charity's effectiveness is monitored in some independent way? I'm not aware of any other country that has such a set-up. Should the onus on ensuring that donors are happy with the way their money is spent be on them, or should it be a statutory responsibility?  Does the fact that charities get tax breaks mean that they must carry out their public benefit work efficiently, or is is enough that they do work of benefit?

2) If it is important, who would you have do it - the Commission, or some new body?

As a postscript - why is considering media coverage such a bad thing in deciding whether to carry  out an investigation? Consider the example where the Commission receives a complaint via a newspaper that they, after due consideration, feel to be without merit. If no action is taken, the complainant might publicise the matter in such a way as to reduce public confidence in charities generally. If the Commission carry out an investigation in any case, this would surely help to fulfil the remit of maintaining public confidence in charities.

By fellow charity professionals who can't seem to face the fact that the sector has it's faults.

I was not saying that the existence of divergent opinion was the death knell of debate, rather a reluctance to entertain strong opinions of any kind (unless accompanied by long and tedious justification/explanation).....However I have broadly hinted at the reasons for my disatisfaction with the CC.

Rather than describing the impact of the Commission (a qualitative measure), you have listed a whole load of quantative measures which I imagine were lifted straight from their Annual Report- you'll have already read my views on the limitations of those particular documents. Several consultant friends of mine refer to the Annual Report and Accounts as a charity's best marketing tool and I concur with that. Don't expect a subjective summary of an organisations achievements. Let's face it any sensible charity would write the most persuasive narrative possible supported by the most favourable selected facts. I'm always suspicious when the best that they can come up with are figures, such as these, which are quite meaningless in isolation. 

To be totally frank so what if they did field 100 requests per working day? How well did they deal with those requests and how complex was the advice being asked for? As regards the Commission's regulatory function, I'm quite sure that in the public mind that's their most important job and in my opinion/ experience they make an appalling pigs ear of it. You'll find plenty of investigative reports into small non-establishment charities (easy and quick results with the minimum of public backlash), but far fewer into the bigger charities with long histories and big name Trustees and patrons. My beef is that the Commission is very pragmatic about how it executes it's regulatory function and that it should be far more objective about how it applies it's investigative criteria.

Incidentally, the Commission has issued guidance stating that one of the considerations governing whether or not they should instigate a full investigation is the possibility of negative media attention! Yes honestly, it was published in Third Sector. Surely they haven't thought this through as it encourages potential complainants to go to the papers first to force the Commission to pull their finger out (not great for the reputation of individual charities or the sector more widely). But secondly, and extremely disturbingly, it hands a tremendous amount of power to editors of newspapers who might be pursuing the most vile of political agendas.

I personally think that when you assess the value/effectiveness of the Charity Commission you have to look beyond their bland, vaguely worded regulatory remit and examine what they actually do in practice.

Don't shoot the messenger

Ginster's Dragon - when you say I disagree with your sincerely held views you are right, but surely divergent views are the starting point for debate, rather than its 'death knell'?

As it goes, I tend to find it difficult to debate where one person presents an opinion (that may or may not be based on fact) and either won't debate it or justify it, but equally will not concede any points as debate moves on. One may as well argue that chalk is cheese. You're right about newspaper opinion columns - they rarely give an opportunity to see both sides of an argument, and rarely will you see a debate in such fora. 

We are indeed fortunate to be able to see both points of view on this very discussion board, and also, I hope, to be able to interact and explain thoughts without simply making statements of divergent opinion.

Returning to the original debate, we take different points of view on the effectiveness or otherwise of the Charity Commission. Having only your original comments to go on, I infer (and may indeed be wrong) that you feel that for £30 million per annum of funding, the Charity Commission should easily be able to monitor the effectiveness of charities in addition to its current administrative, general advisory and regulatory roles.

I would point out only that in terms of operations in the public sector, this is a relatively small amount of money. The Commission has around 500 full-time equivalent staff, and, if we trust the figures on their website, provide advice to 24,000 charities and take 250,000 calls to their contact centre each year. This is almost 1,000 calls and 100 requests per advice per working day. On top of this there is the administrative requirement to maintain the register of charities, and general regulatory duties.

My point is simply that the funding and staffing levels provided at the moment don't, in this light and in my opinion, look completely unrealistic, or I might say 'lavish', in view of the responsibilities that the organisation is tasked with. To ask it to conduct detailed reviews of effectiveness of charities without providing significant additional funding would, I suspect not work.

So - what are your thoughts?  Should there be a statutory body tasked with assessing the effectiveness of charities? Should it be the Charity Commission? Should they take on the responsibility at current funding levels?

Fine Chris. I have my own sincerely held beliefs regarding the relative worth of the Charity Commission which, it would appear, are not in keeping with yours. I am able to justify them (to my own satisfaction at least)but I felt that to attempt to do that in full would lead to a very lengthy posting which would require the patience of Saint to read through and digest.

This is a comment board/ discussion forum, call it what you will, and without divergent opinion it would be an exceedingly dull medium. It isn't a dry academic forum devoid of anything other than structured analysis (thank god). I wonder, do you have the same objections about newspaper opinion columns or polemical documentaries such as Farenheit 9/11?

Don't shoot the messenger

I didn't say it was a deliberate troll - I asked whether or not it was, thus it was a question rather than an accusation :-)

My fault - I should have been clearer.

What I meant was: your use of language in your piece attacking the Charity Commission was, it appeared to me, predicated on use of emotions and bias in support of your point rather than fact or context (eg 'lavishing £30m pa'). So much so, in fact,that I was forced to wonder whether these were sincerely held views or an attempt to create / continue a debate.

It was a very relevant question Charity Chris given that it was you who levelled the accusation (as I now understand it to be) at me in this very thread!

Don't shoot the messenger

http://en.wikipedia.org/wiki/Troll_%28Internet%29

Hi Ginsters, yes I was replying to the post by Umpire which seemed to suggest charities should have a complete audit trail from when a donation is received to the point at which it is spent - which seems to me totally impractical. Hence my statement that you need to have trust in the charity to use you money in the way you expect. How you obtain that Trust is another matter entirely!

PS I think 'a deliberate troll' in this respect is a posting that you make knowing it is going to provoke a response.

Can somebody tell me what on earth a 'deliberate troll' is?! Not being a Tolkein fan I find myself at a loss.   

Don't shoot the messenger

..............I agree with you overall. My point was that the clarity of an Annual Report is no proof of an open or honest organisation. I wouldn't want to suggest that charities should be hamstrung by overly demanding compliance, merely that serious complaints backed up by evidence ought to be investigated by the Charity Commission. In my experience this doesn't happen and it impacts negatively on the charity and the charities beneficiaries. 

Don't shoot the messenger

Surely you have to place a certain amount of trust in a charity? You can't physically trace every donation you give to make sure it all goes where you expect it to can you - it's just not practical. When you give to Oxfam or Save the Children how do you know the money is going to where they say it is? If you asked either of them to prove it I don't think you'd get very far!

I don't agree with Umpire in his assertion that all charities operate in the same manner - and I do still donate to a few despite my personal experiences! That said I share his scepticism (and Martin's) about the use of Annual Reports and Accounts as proof of efficiency or honesty. These documents are a very neccessary legal minimum standard designed to root out the very worst excesses of malpractice, but that's about it I'm afraid.

Don't shoot the messenger

In support of the notion that Charities can be held unaccountable for their accounts I make the following observations and support “Ginsters” submissions that the Commission is nothing more than a government shop front.  My understanding (correct me if I am wrong), is that the commission was set up to restore public confidence in the charity sector.  However, experiences of the Commissions involvement only extends to the “is it in the Charities best interest to investigate”?  If the answer is no, that is the end of the matter.

I am sure we all attended school and most importantly, have all done math’s exams.  If your institution was like mine, you received a 0 mark if your answer did not show the workings and how you arrived at the answer.  How then is it possible for a charity to say, yes we spent the money when there is no effective audit trail.  I am sure you all recall the recent labor party donations fiasco, were those donations not audited?  What about the Shell Oil stock, wasn’t that over exaggerated?  My understanding is that they were audited as well.  Put simply, you can hide almost anything you wish the public not to know.

Transparent, I wish they were.  Would I donate to a charity, absolutely not? Why, because having worked for one, my experience has left me feeling all charities operate in the same manner.  

Yes, charities can lie in annual reports if they so wish, often without being found out.
After all, does anyone check that '240 people were helped to move on with their life'? Or even if thats just the figure who came in once, never to be seen again (so therefore could have moved on)?

It seems some charities just do the bare minimum in their annual accounts. Basic details of officers/trustees, accountant, accountant's statement about the accounts, plus a few pages of actual accounts.
Tells you very little. Could even be lying by ommission - by not saying anything about the work being done, get away with any bad news too.

Martin

Dear Charity Chris/Adam

Without going into a detailed anaylsis of the Commission's budget and a lengthy explanation of their legal remit (which is something about which there appears to be no common understanding within the commission itself), I will restrict myself to telling you where the waste is to be found..... Case Officers.

 Yes, it is in theory a great idea to have plenty of people available on the end of the phone to take down the details of serious complaints, weigh up the evidence and then decide whether to proceed to a formal investigation based on the Commission's remit and a sense of propotionality. The trouble is that this isn't what actually happens. Much like a customer sevice call centre operative the case officers job isn't to take action were appropriate. Instead their very existance is considered to be visible evidence that an important job is being done. "See, we are a regulated sector. £30m of public money says so."

 If you read Charity Commission investigation reports (and I do, just to reveal the inconsitancies in the way that they apply their 'rigorous' criteria), you'll find a surprising number are about small non-establishment charities such as muslim community groups or evangalical churches. You won't find many formal investigations into the more renowned charities with well connected Trustees -and believe me it's not because there aren't any complaints being raised against them. The touble is that the CC's guidelines on when to investigate are about as vaguely worded as the CPS guidlines for when to prosecute. Basically they both amount to "If you feel like it" and "If you think that prevailing public opinion would let you get away with it." A total farce I'm afraid.

 And as for your blind faith in so called independent regulation, does that extend to institutions such as the 'Independent' Police Complaints Commission. If so then you're in a very small club along with Ian Blair.

Oh, and Adam, charities can lie in the narrative of their Annual Reports about the number of beneficiaries being helped and the extent to which their support is making a difference. Can you explain to me how that would be picked up by an acountant during the audit process?  Also financial irregularities can be hidden. As long as the overall headline figures stack up there's little chance that an auditor would worry about the detail of individual restricted donations.  

Don't shoot the messenger

I take your point, Ginsters, that charities could just straight-out lie in their annual reports - resulting in the charity in question receiving a high Quality of Reporting score from us, while at the same time busily deceiving its donors. This is undoubtledly a weakness in our system - but I don't think it's a fatal one.

The vast majority of charities, for one thing, do not lie in their annual reports. All big-charity reports have to be audited, and auditors do raise concerns when there are problems with the accounts, or where the trustees' report isn't consistent with the figures. In addition, the Charity Commission has the power to investigate charities which report falsely - and the evidence shows that it generally does this well (on this I agree with Charity Chris).

In addition, we believe that the vast majority of charities - and charity workers - are in the business for the right reason: they want to help people. Charities may want to hide inconvenient facts or blunders from public view - something we take a dim view of - but they rarely go beyond this.

Adam, Intelligent Giving

Ginsters Dragon - I do enjoy the use of comments such as 'lavishing £30m pa on the Charity Commission'. Is it a deliberate troll?

I'm assuming it isn't, so  perhaps you would be kind enough to explain, in terms of what you would like the Charity Commission's  strategy and activities to be, and supported by a detailed budget model, why this is 'lavish', and what the figure should actually be? If you think it is too much for what the Commission currently does, I would be happy with an explanation of where exactly the Commission is wasting money.

In the meantime, I may read a few more of the Commission's investigation reports, which according to your post are not independent, of a trivial nature, and incredible.

... But I don't think that your profiles show whether charities are being 'open and honest', they merely indicate that the charity concerned has given an answer of some sort to all of the questions that you'd expect them to address. There's no objective measure of honesty in that, it's a simply a matter of blind faith. The only way to really delve into the probity of a particular charity's dealings is to independently investigate serious and credible complaints. But given that there's no organisation prepared to do that - despite the government lavishing £30m pa on the Charity Commission - it's back to meaningless box ticking for now I guess.

Don't shoot the messenger

I think there are some excellent points being made here. First, I agree with Soporo that just because measuring outcomes is difficult, that doesn't mean we should stop trying to do it. Second, I agree with LMC that one of the major problems here is with the press, and that its lack of accountability lies at the root of the whole lack-of-trust cycle. Third, I agree with Mikemuses that, if we are to insist on outcomes-measurement, then donors should realize that this takes time and resources.

So where does this leave us at Intelligent Giving? Well, I think this debate illustrates that we've got to admit our limitations. As we've always conceded, our charity profiles don't necessarily give any indication of the quality of charities' work. Conceivably, they might - if we developed a way of tracking outcomes. But we simply don't have the resources to do this.

As it stands, our profiles act as a means by which potential and actual donors can assess the quality of information provided by charities - letting donors know, in other words, whether a charity is interested in being open and honest with its supporters.

This isn't the last word in charity evaluation. But I think it's a good place to start.

Adam, Intelligent Giving

LMC do you honestly believe that people accept the word of the print and broadcast media as gospel? Really??!! How about the riduclous overeaction surrounding Gilligan, or the furore over the (fake) Daily Mirror Iraq war pics. The former was, in my opinion, a true statement of the facts and the latter could quite conceivably have been an honest mistake. And what happened? Much wailing, snarling and gnashing of teeth. Jobs were lost and reputations for ever tarnished. When charities commit far worse sins the attitude of many people seems to be that we can't 'pick on them' (hold them accountable), because for some reason it just wouldn't be fair. Most charities do a cracking job I've no doubt, but those that don't can be fairly certain that they'll never be held accountable for mismanagement or worse.

Having said all of that, too many 'transparency measures' are really nothing of the sort, but rather meaningless box ticking exercises with no independent verification. I'm all for holding charities accountable, but only if it's done in a meaningful and proportionate way.

Don't shoot the messenger

It's not just charities though is it? (rhetorical question). There is far less trust in Government and corporates as well.

Unfortunately, there is still not enough suspicion of media, which, in common with any organisation, puts its own agenda first. Shame that too many people still see "the news" as gospel truth.

Today, the C is mostly standing for Cynical ...

-----------------------------------------------

... nearly Vlad the Impaler

I agree soporo, charities can't give up because it's difficult - and let's be honest, often charities are doing their work precisely because the Govt / private sector have given up, and only charities will take it on, but people need to appreciate that it's difficult, and balance that, and the need to know where money goes, with an understanding that more time creating complex outcomes reports from a limited budget, must mean less time creating outcomes - ie helping beneficiaries.

 Please hold charities to account, but do think about the implications of doing it too much.

Sorry, also meant to say that Mikemuses does have something of a point about the difficulty of measuring outcomes, it IS very difficult and it may be that all answers will always be subjective, however, that's why I said that what need to happen is that poeple get better and cleverer about measuring outcomes, rather than giving up, which would seem a bit defeatist to me to sya the least.

Pish posh - there's at least one major charity on this site which gets a very high quality of reporting score who are not doing a good job. Showing people where the money goes does not automatically reveal if they are "transaprently rubbish" at all. In fact, quite often far from it. Equally the reverse can be true, there are many many tiny chairities out there doing a great job but who are not particulalry good at explaining their cashflow.  If it's public trust that's up for grabs you need to address both sides of the problem, not just encourage charities to makes better, glossier brochures.

I'm afraid Soporo has got hold of the wrong end of the stick in his latest post. I didn't mean to suggest that all performance-related benchmarks are a bad idea, merely that some - when badly constructed - can be.

The broader point here, however, is that performance-measurement - even when used carefully - conveys only one opinion of how well an organization is doing. New Philanthropy Capital, for example, rates charities' performance with a series out outcomes measures, but their techniques aren't to everyone's taste.

Bearing this in mind, I agree with O'Neill when she says that, to restore trust, charities (and other organizations) need to present information to potential donors in a way which enables them to make an informed decision over whether to support the charity in question. People need to make their own decisions.

This is where we come in. I agree with Mikemuses' point that it's no use regarding a high Quality of Reporting score as a good thing in itself, if the work the charity does is 'transparently rubbish.' But if a rubbish charity presents itself transparently to the world, then at least donors will be able to see that charity's incompetence for themselves. They'll be able to make an informed decision not to support them.

With our Quality of Reporting scores, then, we want to encourage charities to provide proper, digestible information to potential donors. It's by providing that information that trust, in the end, can be restored.

Adam, Intelligent Giving

But I think that givers (many, not all) ARE already becoming more demanding to see what exactly charities are doing with the money - and perhaps they should be, because people who care about what a charity does are more involved and more likely to keep giving - which is what the charity and the donor wants.  But the charity has to try to find out what the donors want to know and when.  There's no point in me sending a monthly newsletter to someone who wants an annual update at most.  So I ask my donors, I include little surveys, asking what they want to hear - if anything - and when - and I try to follow ti as well as I can (for as long as technology lets me).

 But so many people just don't tell me, so I have to guess, and this is where it breaks down, because sometimes I wonder if the same people who haven't replied to me are the same people complaining to the world that 'charities send too much mail' and so on.

It's a tricky one, but this holds for life in general - when people do what you wish they wouldn't, tell them, and if they don't change it - have little more to do with them.

Soporo touches on the other tricky thing - it's all very well us telling you exactly what we do - and being transparent, but if we're transparently rubbish, what's the point?  The difficulty is deciding how to measure it.  How do you really know if we're good average or rubbish?  Outcomes are the best way - but this is very hard to evaluate,  If I care for 25 people every day for a year is it better or worse than someone caring for 30?  Is my care better?   If I feed 100 starving people, is that better than someone else feeding only 75 - or are they doing something else special and better?

 And then you end up with people looking at what the proportion spent on admin is, and people demanding that their money only goes to 'not admin', leaving us, as rspcacambridge almost said, sacks of food, and no money to pay the petrol to transport them.

 I don't have the answers, but what I do is encourage people to find a charity doing work they like, then to go and see them, ask questions, ask why it's done one way and not the other and see just how crappy their admin offices often are - or whatever.  It's more effort than just bunging a pound coin in a bucket somewhere, but it's a lot closer to intelligent giving.

I'm interested in your apparent assertion that performance measurement always equals perverse incentives. Surely the point is WHAT you measure and HOW you do it. I do agree that it is vital for charities to be transparent about how they spend their money - and that sites like this play a role in making them do that (dare I say, incentivise them to do so??!) However, the point about waiting list targets was not that all performance meaurement distorts practice, it was just that targeting waiting lists as the sole indicator of quality of care was misjudged. The answer is not that all performance measurement therefore equals perverse incentives, just that in some cases, misapplied targets don't bring about the right results. The solution to this must surely be getting cleverer about measurement, not dismissing the whole idea as rubbish.

As I said, it is really important that charities are transparent, but surely transparency without good performance is a waste of time? So, for example there is no point in a charity being able to tell you exactly how every penny was spent, if overall it does a bad job. I'd argue that this would have a very neagtive imapct on public perception. Surely therefore there must aslo be a role for performance measurement in tandem with accountability?

We find ourselves in an interesting situation today concerning charities. It is big business.
I think the main tension we face in all this is between the need to hold charities to account and the current push to tailor giving for the giver.
I think it is very fair that givers demand openness, but I think it is very sad that there is a push towards making giving a product for the giver. I've noticed recently a trend towards charities telling givers what giving will do for them: you'll get a letter once a month, you'll know you've made a difference.
It will be a shame if openness becomes "LET ME KNOW EXACTLY WHERE MY MONEY WILL BE SPENT. IF I DON'T GET PHOTOS OF HAPPY KIDS THEN I"M PULLING OUT!"
Charities should work to win our trust, but it is sad that they feel the need to spend money making giving a better experience for the giver.
Thanks for your thoughtful post. Don't pack your bags.

I'd say one of the worst perverse incentives is the tendency for people who support the cause, but mistrust the charities, to try to force charities to spend resources on the cause by either giving donations in kind or giving money with strings. That way you can end up with utterly frustrating situations where you have sacks of food that need money spent to transport them and no money to pay the electricity bill (because that's seen as evil, wasteful "administration").