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Why charity is a waste of money


Why charity is a waste of money

Malcolm Clark

Published 13 March 2000

An appeal is launched - for Mozambique or Romanian orphans - and cash pours in. Malcolm Clark thinks we should take more care over its destination

There was a time when the only hint of scandal about Blue Peter was the penchant, on the part of the team's Labrador, for crotch-sniffing. Now, after the problems about presenters spending too long in the loo (from sniffing to snorting, in one fell swoop), the programme's most venerable institution is suddenly in disgrace. No, not the sainted John Noakes, but the annual fundraiser. I can't wait to see how they explain this one to the kids.

This event is the daddy of all TV charity events. The revelation that its most successful appeal wasted millions on non-existent orphanages is not only a coming of age for children's TV, but a sign of the times in a country that appears to be in thrall to charity.

If you don't know already, it all started with a heart-breaking report, which explained how tens of thousands of Romanian children, abandoned by families who cannot feed them, had been dumped in little more than filthy holding pens. Blue Peter set a target of £600,000 to build bright new orphanages; £6.5 million was sent in.

Then it all went wrong. The charity to which this enormous sum of money was sent, the British-based Romanian Orphanage Trust (yes, I know, the acronym is ROT) disbursed the money to a local Romanian charity, Pentru Copii Nostri. Newsnight's Sue Lloyd-Roberts discovered only 12 substandard houses had ever been built and that hundreds of thousands of pounds had gone AWOL. What made it all the more embarrassing for Blue Peter is that the programme sent out a team to report on progress. They came. They enthused. They were conned.

As one TV charity appeal departs, in humiliation, another one arises to take its place. The floods of Mozambique, the intrepid journalists of ITN tell us, require us to throw millions of pounds in a roughly southward direction. The credit-card hotlines are already buzzing and a charity infrastructure is being constructed almost as quickly as the waters of the Limpopo are receding.

Perhaps three years ago Clare Short, a bold new overseas development minister, would have given this panic short shrift. She would have explained that the best way to use the limited resources available to her department was not in a mad scramble. She might have argued that news-fuelled hysteria tends to achieve very little, that it pours the wrong resources into tiny markets and often totally destroys them, doing more long-term damage to communities than even flood and famine. Now, I suppose, she realises that in moments of crisis, TV and charities conspire to mislead the public into believing that they really do live in a global village. So we come to expect that millions in aid will whizz through cyberspace much as it does in the financial markets.

Before I go any further, I had better explain that I too am a giver. I give left, right and centre. My money is busy building things all over the developing world, and saving lives, limbs and conquering diseases I have barely heard of and cannot begin to spell. But I can't tell you exactly how my money is being used, or even where.

I blame the BBC, which has been trying to convince us of the virtues of "charidee" for decades. It has inflicted on us that unpleasant orgy of self-congratulation called Children in Need, where extremely rich people give up some pin-money to encourage the poor to give money to the even poorer. But among the multiplying horrors of television afflicted with a conscience, Blue Peter has always been the charity showcase.

Even as an eight year old, I knew I was being brainwashed. Just as the Blue Peter formula of pets, plants, and making toys out of recycled household waste produced a nation that is obsessed with animals, gardening and DIY, so its heart-warming appeals for money, or used postage stamps, gave us the idea that charity is an unqualified good thing. There are, at the last count, more than 187,000 different charities in this country, with a combined turnover of more than £16 billion, and assets of more than £35 billion. This is almost an entire shadow economy. Yet, in our encounters with this vast sector, we take our cue from the people who taught us in the first place - we smile inanely like dumb Blue Peter presenters and thank them for being so kind as to take our money.

For one thing, we assume that someone is in charge, that, for example, there is someone making sure that charities do not uselessly duplicate their activities. As if. I first became critical of charities when I researched a programme about Aids charities in the early 1990s. It turned out there were almost as many registered charities devoted to Aids in Britain as there were people with Aids. One person's concerted effort is another's job-creation scheme.

Then we assume that the people who run charities will actually respect our hard-earned cash. Now, have I missed something? It has become a fundamental rule of economics, we are constantly being told, that if you get something for nothing you won't respect it. So how is it these charity administrators somehow manage to avoid being spoilt by our largesse? All they have to do is show us a few pictures of poor people and we send them millions through the post.

So, though we give our money in the vain hope that it will get to Africa, millions somehow get waylaid in Soho. It's not just the administrators, the managers and the lobbyists. There are the appeals letters, and the cinema adverts, and the carefully reconsidered rebrandings.

I hate to pick on the Aids sector again, but the leading HIV/Aids charity, the Terence Higgins Trust, can hardly be stuck for cash. It recently decided to spend hundreds of thousands on a campaign to combat homophobia. Posters in the London Underground announced: "It's homophobia that's queer!" How many people who gave the charity their legacies ten years ago, thinking it would go towards care, and counselling of people who were genuinely ill, ever thought that their money would be used to help balance the books of the Tube?

But at least the trust is what we would all think of as a real charity. I defy you to work out why we are all subsidising Eton or the colleges of Oxford or Cambridge. The latest wheeze is for yuppie sports facilities like Jubilee Hall in Covent Garden to claim that they, too, are charities. They promote fitness, you see. Lift those cheques. I mean cheeks. What do you mean you don't give them money? We gave £2 billion in tax subsidies to charities last year.

Now all this would be fine. We could put up with the excesses, the breaches of faith, and the high admin costs if we could be sure that most of our money eventually got to the people we wanted to help.

And you will be sure of that - if you think the Charity Commission, which is supposed to oversee the work of charities, is up to the job. But, I suspect, its mere existence fosters the illusion that the sector is properly regulated. It was alerted to the Blue Peter scandal over a year ago and decided to take no action. And when the Public Accounts Committee most recently looked at its work, it lambasted it. It turns out that a third of all charities provide no audited annual accounts. A quarter provide no returns at all.

So what's the common factor in a slew of recent news stories, from the trustees of the Princess Diana Fund spending £6,000 on a private jet to take them to the Isle of Man, or a local hospital charity that bought the trustees' wives new Golfs, or even the bizarre case of the innocuously named Trust of St Michael the Archangel, which claimed to be linked to the Catholic Church, but was really a fascist front organisation? They were not exposed by official regulators, but by journos looking for a scoop.

Now since there aren't legions of Sue Lloyd-Robertses flying around, canoeing up rivers and persevering with difficult questions, we are left with no choice but to take the charities on trust. And that's my problem.

Charities handle the most corrosive commodity we know - cash - and yet have the loosest regulation and a deeply secretive culture. The people who are most likely to witness mistakes, and abuses, are those whom we wanted to help in the first place and who therefore are in no position to answer back. Should we really trust people who are attracted to a business like this?

I keep wondering: how did we all get so rich that we could afford to give money to charity anyway? Was it the saintly voluntary organisations that swept through slums freeing our grandparents from bondage while holding a hankie to their noses? Er . . . nope. It was big nasty things like economic growth, transfers of wealth, and real jobs that put money in our parents' pockets. When a charity says it's going to help provide those kinds of things, it is welcome to send me a begging letter.

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2000 Mar 13