Leading charities 'failed to spot public concern over fund-raising'

Leaders of some of Britain's biggest charities have admitted to MPs they failed to spot growing public concern about fund-raising activities carried out on their behalf by agencies.

The charities were summoned to Parliament by the House of Commons Public Administration Committee following a spate of scandals over donors receiving floods of letters and phone calls demanding money, as well as data from people who have given to charity being passed on to other organisations.

Committee chairman Bernard Jenkin told the charity chiefs it appeared that "the temptation to raise money made you slipshod in your governance procedures or wilfully blind to what was going on".

Mr Jenkin paid tribute to the Daily Mail for exposing "what amounts to a scandal in the way that charities have been raising money from members of the public, using commercial companies whose activities have been so shaming that charities have immediately suspended operations and severed contracts and ended relationships".

Reports of agencies' aggressive tactics in calls to potential donors sounded "more like a boilerhouse operation than something that reflects the values of the charities that you serve", he said.

He quoted one call centre worker who said he was threatened with the sack for declining to ask for money from a woman who said she could not talk because her husband had just died.

NSPCC chief executive Peter Wanless accepted there had been "gross excesses" and told MPs on the committee: "I think that there has been an imbalance between the desire to raise money and the importance of valuing the relationship with donors, whether potential or actual."

Oxfam's chief executive Mark Goldring said: "I think we got into this situation by placing too much reliance on agencies with too little supervision." He said Oxfam had stopped buying and selling lists of potential donors "many years ago" and in July stopped contacting people identified as willing to accept calls because they had failed to mark a generic tick-box to opt out.

Save the Children's Justin Forsyth said the charity had suspended all activities with telemarketing companies, admitting: "The standards we had may have been strong but they weren't enforced in practice. We were looking, but not hard enough."

He said it was "much more costly" to carry out fund-raising activities in-house, and many smaller charities may not be able to afford it.

RSPCA vice-chairman David Canavan told the committee that only one fund-raising call in 1,000 and one mailshot in 100,000 resulted in a complaint. He said trustees had "a duty to use the RSPCA's money in the most effective manner" and found that the use of fund-raising agencies offered value for money, raising £3 for every £1 spent.

Mr Wanless said the NSPCC spent about £1.2 million on telemarketing last year and expected to raise up to 3.2 times that sum as a result, though he said telephone calls were already "in decline" as a method of raising funds and spreading awareness.

Mr Forsyth said Save the Children spent £1.8 million on telemarketing only to supporters and did not cold-call members of the public. He told the committee: "This has been a wake-up call for us as CEOs. There is a problem and we didn't know it was happening and now we have to fix it.

"It is not just wrong, what happened, but it is also counter-productive. If we treat our supporters and the public like that, they will lose confidence in us. We have got to learn lessons and we are trying to learn those lessons."

The incoming chair of the Fundraising Standards Board, Andrew Hind, told MPs that the sector needed an independent fund-raising standards committee with a majority of lay members to oversee a code of practice which would be mandatory for all charities over a certain size.

"Self-regulation isn't working and it is not going to be able to worth without some fundamental changes," Prof Hind told the committee.

He added: "I don't think we can continue with a situation where the rules for fund-raising are set only by fund-raisers, because that has led to a code of practice which is for too weak and has failed to outlaw practices which the public have quite clearly said are unacceptable. There are too many vested interests involved in drawing up the rules."

But Peter Lewis, of the Institute of Fundraising, insisted the code had been strengthened in response to public concern over issues like doorstep fundraising.

He told the committee: "In setting the code, we have to be very careful in balancing the need of charities to raise money with the needs of the public."