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It’s hard to see through the fog surrounding the future of the National Lottery

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One of the most vexing issues on the voluntary sector landscape right now is the future of the National Lottery.

The government wants to reduce the amount of good causes money awarded by the Big Lottery Fund from 50 per cent to 40 per cent.

Considering that the BLF has given £3.6bn to mainly charitable projects since 2004, you might have expected this to be greeted with howls of protest.

But the sector’s response so far has been fairly muted because nobody knows quite what the impact will be.

Ministers claim charities will actually benefit. While the BLF’s slice of the cake will diminish, they say, the overall size of the cake will increase when Olympics-diverted funds return after 2012.

They are also proposing that all BLF funding goes to not-for-profit organisations. Currently, a minimum of 80 per cent must go to voluntary groups although the BLF says the actual figure is 92 per cent. The remainder goes to statutory projects, which under the last government led to allegations of ministers using the lottery to fund pet projects.

Ministers also point out that, although the proportion of lottery money going to the BLF will decrease, the proportion going to arts, heritage and sports distributors will increase and a good deal of this will go to charities.

It’s a persuasive argument, yet a sense of uneasiness remains. Last week Navca and the Directory of Social Change called on the overall amount of money going to local voluntary and community groups to be preserved.

When Nick Hurd, Minister for Civil Society, was in opposition he was fond of using the phrase ‘smoke and mirrors’ to describe Labour’s policies and statements.

It’s hard to see through the fog of this one.

Charities should make it clearer that chuggers are getting paid

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The Newsnight programme about chugging last week found nothing whatsoever to surprise anyone in the charity sector.

All of it was pretty common knowledge, easy to turn up, much as we might expect. But it did raise a valid point: the general public don’t like chuggers much.

Mick Aldridge, chief executive of the Public Fundraising Regulatory Association, told the programme it was “extraordinary” that some donors didn’t realise some of their money was being spent paying face-to-face fundraisers.

To check how aware donors are, I carried out a totally unscientific survey of my friends and family – all regular donors, all well-educated professionals. None of them realised they’d been signed up by agency staff; none had guessed their signature might be worth more than £100 to these staff.

Most did understand that charities needed to spend money on fundraising staff, and thought 25p or 30p of each pound was a pretty reasonable ratio. But they also said that, for reasons that go beyond the cost, they deeply disliked chuggers.

One described them as “intrusive and annoying”, another as “unpleasant and aggressive”. A third said that Moorgate in London was so full of chuggers that being there was like running a gauntlet of gladiators.

For a long time now, charities have looked on as fundraising agencies engaged with the public on their behalf. But the sector is storing up trouble for tomorrow.

It’s undeniable that chuggers, in the medium-term, raise cash. But in the process they risk playing fast and loose not just with the reputation of the charities they represent but also with that of the whole sector. Getting chugged can be a deeply unpleasant experience and each time it happens it lowers the public’s liking for the whole sector a little.

In my view, it’s time to recognise that in some places, fundraising tactics have gone too far. They need to be reined in a little.
 

The government talks local but acts national. How do charities make sense of this?

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Two stories I have worked on this year have generated considerable feeling.
 
One is the merger of Age Concern and Help the Aged into Age UK and its subsequent attempts to persuade local Age Concerns to become ‘brand partners’.
 
The other is the decision by the Alzheimer’s Society to merge local branches into a new regional structure.
 
In both cases the changes have been perceived by opponents as attempts by big, bureaucratic London-based charities to impose their will on local charities.
 
Whether or not this is true, certainly there has been increasing pressure on large charities to bend to the government’s way of working if they want to retain their influence and funding. For many, this has meant becoming more business-like and centralising their structures.
 
But now the coalition government is talking about a smaller state and a big society.
 
Small community groups may have displaced large, heavily state-funded charities in ministers’ affections but the large scale radical reforms the government is introducing, such as the Work Programme, are only fuelling the pressure on charities to get bigger and more professional.

What the government wants and what it needs seem to be two different things. It’s difficult for charities to know how to respond to this.
 

Was the Charity Commission right not to publicise the findings of its investigation into the Tony Blair Africa Governance Initiative?

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The long-awaited verdicts from the Charity Commission on the last two of the charities it investigated over political activity during the pre-election period are out.
 
Both the employment charity Tomorrow’s People, which was probed over the appearance of its chief executive in the Conservative Party’s election manifesto, and the Tony Blair Africa Governance Initiative, which was investigated over claims it emailed supporters asking them to vote for the Labour Party, received “advice and guidance” from the commission about political campaigning, but neither received any further sanctions.
 
On the face of it, the cases seem quite similar. So why did the commission write a full report and press release on the Tomorrow’s People case, but nothing about the Tony Blair one?
 
We would never have known about the latter had the complainant, Conservative MP Greg Hands, not leaked the commission’s letter about the case to the Sunday Times.
 
The commission says it chose to publicise the Tomorrow’s People case because many other charities might find themselves in a similar position and it would be useful for them to understand the rules.
 
The Tony Blair case, it claims, is so unlikely to be replicated elsewhere that it was not worth publicising.
 
Granted, very few charities have been set up by former Prime Ministers. But the Blair case was, at its heart, about the sharing of data between affiliated organisations: something that seems likely to affect far more charities than requests to appear in political party election manifestos.
 
It would be interesting to hear charities’ views on which of the cases they found more relevant.

We need to clearly define the meaning of social enterprise

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On Friday, I read a short piece by Laurence Demarco, founder of Senscot, the network for social entrepreneurs in Scotland. Demarco – a popular figure in Scottish social enterprise who should probably be better known south of the border – is worried that the government seems determined to widen the definition of social enterprise to include anything it wants.

He is also concerned that a lot of profit-making businesses want to call themselves social enterprises because it sounds good and it helps them win business from local authorities. In the most worrying recent example, Andrew Lansley, the health secretary, decided to invent his own definition of social enterprise that includes government-owned organisations such as NHS foundation trusts.

Demarco’s problem with this is that this leaves the social enterprise sector open to public corporations, private enterprise, Uncle Tom Cobbleigh and all. Already, lots of people are calling themselves social enterprises even though they aren’t. Others are dithering about whether they are social enterprises or not.

As support grows for social enterprises, it becomes more and more useful to become one. And it becomes more important that the term is more clearly defined. Fortunately, there is already a reasonably clear definition of what social enterprise is: you can’t distribute the majority of your profit, and you must do something socially beneficial.

Any business that doesn’t meet that definition shouldn’t call itself a social enterprise.

Not that it’s a bad thing to distribute your profit. There are plenty of socially-focused businesses out there that do, and in many cases, this is a more sensible model. It’s one which can attract growth capital more easily – and obviously a bigger business can do more good. Also, if an entrepreneur has to risk his own capital to get a business up and running, he should be entitled to a reward when it works.

But they aren’t social enterprises. They should just be called something else. “Social business” is the term Demarco favours, and one already in use. Let’s use it.

The clothes collection scammers have a new tactic

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They have strange, fragmented names, such as Hope For Ever or Light And Love. They often claim to be raising cash for orphans in Eastern Europe. The bags and leaflets have weird fluorescent lettering and cheap print that rubs off on your fingers. And there’s always a charity number that can be duly checked and usually found to be fake.

Clothes collection scams are usually so obvious they are laughable.

Which is why a new batch of leaflets falling through letterboxes across the country from a company called Clothman Ltd are cause for concern. No evasive language here: the company brazenly claims to be collecting on behalf of Breakthrough Breastcancer.

A copy dropped through my letterbox the other day. The print quality was so tacky it was obviously fake, and I was about to bin it. Then I saw the Breakthrough name and pink ribbon logo.

A little Googling soon revealed Clothman Ltd to be a scam emerging this year, with leaflets falsely claiming to be collecting for the much-trusted Breakthrough and Northamptonshire Air Ambulance charities appearing in Essex, Manchester and parts of London.

I contacted Breakthrough, where a member of the supporter relations team confirmed the charity has no relationship with the company, and that the charity is considering legal action.

Could Clothman Ltd’s leaflets mark a new tactic by clothes scammers?

This carrot and stick approach to jobseeker volunteering is confusing for everyone

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One of the more surprising details to emerge from the story by Third Sector  about Calder UK, the firm that has agreed to pay volunteer centres for using their services as part of its welfare-to-work programme, was its method of finding volunteer placements for jobseekers.

The Department for Work and Pensions had made it compulsory for jobseekers taking part in the programme to carry out four weeks of unpaid ‘voluntary’ work, which could be at a business or a charity. 

In order to set up the voluntary work, staff at Calder UK had given jobseekers the address of the nearest volunteer centre, without first checking with the centres that they would be able to find placements for them and without agreeing to pay them for doing so. The staff had then told the jobseekers to go to the centre and find themselves a placement.

According to some volunteer centre staff, Calder UK staff had told the would-be volunteers that the firm would “stick them in a charity shop” for four weeks if they failed to find a placement.

If I were unemployed, I would be very confused about volunteering. First there’s the carrot: once people have been unemployed for six months, they are given the chance to improve their skills by doing a spot of volunteering. As far as I’m aware, there’s no coercion involved.

But then there’s the stick: once they’ve been unemployed for 18 months, many are placed on intensive welfare-to-work schemes under the Flexible New Deal. On these, voluntary work is compulsory and some have been told they will lose their entitlement to Jobseeker’s Allowance if they refuse to take part.

The coalition government’s Work Programme may replace both of these Labour schemes. With a bit of luck, any new system will encourage those out of work to volunteer, but will stress that, by its nature, the work is voluntary.  

Not so looney: Lambeth Council’s bid to become a co-operative could be taken up elsewhere

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Last night I went to Lambeth town hall in London for the first of a series of public meetings by the council to discuss its plans to become a co-operative.

In practice, the plan means the council will launch a series of pilot projects in which local residents run public services, and will look favourably on other local voluntary and community groups that identify services they think they can run better than the council.
 
The 70 or so local residents that gathered in the crowded room to discuss the idea seemed keen. But more than one of them said the plan sounded very close to the government’s big society agenda – considered surprising since Lambeth council is Labour-controlled.
 
Council leader Steve Reed did his best to put some clear blue water between the council and the government. “Big society is about rolling back the state, whereas this is about changing the role of the state,” he said.
 
He was backed by fellow councillor Paul McGlone, who said: “Big society is people doing something for nothing, and we don’t believe in that.”
 
Both were keen to say that, despite the recent announcement that Lambeth would cut its voluntary sector funding for young people’s services by up to 35 per cent from January, the co-operative plan was not just about saving money. It was a better, and more cost-effective, way of providing services, they insisted.
 
Lambeth is a good place to pioneer the co-operative council model: there is already a strong voluntary sector locally, and a tradition of community activism.
 
But if the plan proves successful, might the coalition government look beyond party politics and encourage other local authorities to do the same? 

Should think tanks be charities at all?

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There are some senior figures in the Conservative Party who are not very keen on campaigning charities. Oliver Letwin, now Minister of State at the Cabinet Office with the role of providing policy advice to the Prime Minister, was more vocal than most about this before the election.

There is a certain irony, then, surrounding the case of Atlantic Bridge, an educational charity which was set up by Liam Fox, the Secretary of State for Defence, and has had Conservative luminaries including the Foreign Secretary, William Hague, on its advisory board.

The irony comes because this week’s regulatory report by the Charity Commission on Atlantic Bridge leaves the indelible impression that this is a campaigning organisation. It devotes itself to advancing a version of the ‘special relationship’ between the UK and US that was in the ascendant in the Thatcher-Reagan years.

But the commission’s rap over the knuckles for Atlantic Bridge comes not because it  has campaigned – campaigning is permissible for charities if it is pursuit of their charitable objects. The censure comes because it promoted a view of transatlantic relations that was closely aligned with the Conservative Party.

The commission has told Atlantic Bridge that if it wants to conform to its educational charitable purpose it should approach its subject matter in a manner that is less party political, and that to demonstrate its public benefit it should provide more information about its activities.

This time it’s the Tories. But the mind drifts back to the case of the Smith Institute, which was similarly criticised by the commission two years ago for not keeping sufficient distance from the policies of the Labour Party. Some politicians and policy wonks, it seems, just can’t resist trying to use charities for political purposes.

The commission said in 2008 that it was going to produce additional guidance about how how think tanks can conform with the requirement for educational charities to provide public benefit, but this has not yet materialised.

In the meantime some commentators have suggested that the regime for think tanks should be more relaxed than for other charities because their reason for being, and the benefits they bring, are essentially political  – and often specifically party political.

This is arguably true. But perhaps the best way of squaring the circle is to veer the other way and be much more careful about granting charitable status to think tanks. Indeed, when you look at the particular focus of Atlantic Bridge and the people involved in it, you have to wonder how it ever got charitable status in the first place.

  

Hands up if you understand Gift Aid… most charity employees don’t

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One of the main reasons that the voluntary sector only claims a third of the Gift Aid available is because few people understand it well enough.

This is not widely discussed, but in my experience it is true. When it comes to how tax relief actually works, the charity sector is an ocean of uncertainty, dotted with islands of knowledge in specialist agencies, umbrella bodies and accounting departments.

Many trustees don’t understand it, some chief executives don’t understand it and, most worryingly, a lot of fundraisers – the people who are usually responsible for collecting Gift Aid declarations – certainly don’t understand it and aren’t incentivised to ask people for it. Possibly rightly, too, because when they do ask, it often puts donors off.

A lot of donors certainly don’t understand a word of it. Some of them tick the Gift Aid box; some of them don’t. Most of them then forget every word about it. For them, charity tax relief is a deep darkness.

The sector can improve the situation with better communication tactics.

Lindsay Boswell, chief executive of the Institute of Fundraising, has given one example. He says charities are more effective at collecting Gift Aid if they cut it out of their initial ask altogether, and leave it to a follow-up call when it can be explained properly to donors.

Another tactic, suggested by Theresa Lloyd, a fundraising consultant, is to write to all higher rate donors who are able to reclaim tax relief for themselves, explaining how to go about it. Hopefully, by doing them a favour, this will prompt them to give more in the future and make them more conscious of tax relief.

Another suggestion she makes is to run an information campaign for donors and charity workers alike.

Charities are entitled to point out the benefit of tax relief to themselves and launching a national campaign, funded by third sector organisations, might help explain how the system works.

It is hard to believe that with the best part of £2bn going begging last year, spending a few million on a campaign to improve take up is a losing bet.