Like rich tourists in some third world bazaar, we are surrounded by begging bowls and outstretched hands. The tin-rattlers in the street, the raffle-ticket sellers in the office, the begging letter in the mail-we cannot escape.
The clamour is getting louder. There are more charities than ever before; 178,609 were registered at the end of 1994. But voluntary donations are not rising. In fact they slipped by ?339m in 1993. The national lottery will make matters worse, although no one yet knows by how much.
Charity is in competition with charity, pushing and shoving to get our money. So how do we, the donors, respond to the pleas? We act irrationally, dropping our small change into any tin that is rattled under our nose. We are intensely cautious when we spend money, but don’t seem to care a fig when we give it away.
Why? Those of us giving to assuage a conscience would probably rather just assume that the full value of our gift has been credited to a worthy cause-investigation could only devalue its moral worth if it showed the charity to be inefficient. Alternatively, we may just feel it would be unseemly to challenge charities as though they were commercial companies.
Even if donors got over these hang ups and wanted to act more like discerning consumers, they would find it difficult to get the information they need. In particular, there is no easy way of telling which charities provide the best “value for money.” While many are highly effective in advertising the neediness of their cause, few can claim much transparency in reporting on their own activities-how efficiently and effectively they spend their income.
As a reporter on the BBC’s current affairs programme Here and Now, I have spent the last few weeks challenging dozens of charities. The question was, I thought, a simple one. How much of last year’s spending went on “the cause” and how much went on “overheads”? The reply from most was quite shocking. It wasn’t that the proportion they spent on overheads was high. It was that they had never worked it out.
Most charities appear more interested in their income than in how much of it reaches the cause. The charity bible, The Henderson Top 2,000 Charities, publishes a financial breakdown for each of its entries but draws no distinction between charitable expenditure and other operating costs.…