Too many doors are closing

by georgehep

An  innovative and much loved charity closes its  doors. I am not talking about Kids Company  but Them  Wifies, the Newcastle based  community  arts group. After much soul searching followed by responsible planning , Wifies bows out on 28^th August after 36 years.

The name came about when  children watching the staff unload their van on a council estate shouted “its them wifies” and it stuck.  Originally working with community groups on women’s issues, Wifies increasingly specialised in supporting  people with learning disabilities using their anatomically correct doll Josephine and running drama workshops for  young people  at risk referred by social services .

I remember the way that Wifies would network their way around a room of funders when I first came to Newcastle in the late eighties to work for the Community Foundation. They knew how to extract money and to write good funding proposals.

They had creative ideas and delivered on time. Wifies was one of a group of small North East based voluntary organisations  that included Skills for People and Lawnmowers who  gained  a national reputation through excellent work.  When their names cropped up in grant making circles in London,  you would be proud to say you knew them.

There is no disgrace in winding up a charity.  The British Association of Adoption and  Fostering  also closed last week for financial reasons. Occasionally the mission is accomplished and sometimes a charity runs out of steam.  Neither of these applies to Them Wifies. They simply ran out of people to fund them.

All the major grant making trusts including Northern Rock Foundation  have supported Them Wifies. Most recently Comic Relief awarded a three year grant. Newcastle City Council has in the past  provided solid support. But grant making trusts look for new projects and things that catch their eye. They rarely fund for more than three years and do not like to provide the core funding.

A few foundations like Lloyds Bank and Garfield Weston  are rethinking their approach as, for the first time this year, trust and foundation grants (£2.5 b ) totalled more than government and local authority grants (£2.2bn). In 2002, government provided £5bn and trusts £1.6bn.  The public are often surprised that charities receive so much public funding but many dispense public services.

Kids Company is a good example. The staff provided psychotherapy to the most disturbed and deprived children that statutory services cannot reach.  My wife, who is a psychotherapist, was so impressed that she donated a lavish gown purchased for a big birthday bash to a Kids Company auction.

Small charities like Wifies, which are the vast majority of the 160,000 registered charities, would be gobsmacked at the size of the £3m bail out  approved by government ministers against the advice of civil servants  and by the matching £3m donation from a philanthropist.

Philanthropy is thriving in the North East however from people like Tony Platten whose fund at the Community Foundation from  the sale of his business in Blyth provides £100,000 a year  to support people into employment.  The Sage Group  has just made a further donation  £1m to the 10^th birthday appeal of the eponymous music centre as well.

Don’t be kidded. Wealthy philanthropists and public spirited companies alone cannot replace the kind of money that government used to provide to the third sector. Charities are being  expected to take over the care of the most difficult children from hard pressed social services without being paid properly  to do so.

Criticisms of charities can be unduly harsh. Of course a charity the size of Kids Company should have reserves for a rainy day especially if it depends  too much on celebrity frocks.  Most charity accounts I read, as a trustee of a national grant making trust, show only a month or two’s  money in reserves.   But show me an SME with strong reserves?  Most small businesses are also stretched to the limit.

Charities are criticised for spending too much money on  running costs when the evidence shows that the high performing charities spend more on administration to provide for financial management and evaluation.   Both appeared  lacking at Kids Company.

There is a holier than thou expectation about charities. I bet there are more reported cases of fraud and financial mismanagement in the private and public sectors than in the third sector but more outrage when a charity falls short. The alleged fraud at the insurance claim handler  Quindell  has hardly figured in the papers.

In its latest survey, Newcastle Council for Voluntary Service  finds that 74% of members report increased demand for their services, 45% report reduced income and 83% predict their reserves will be exhausted over the coming year. One of the respondents said “the voluntary sector is being asked to do more and more in the community. We often get told we do a good job but this does not fund those who do the work or pay our running costs.”

Something precious  is in danger of being lost here. Others will follow Them Wifies to the door unless we take responsibility for funding  the charities that serve  those at the bottom of the pile.