So, you can imagine the head scratching I have had with the recent news of the Hepatitis Foundation. Check out the story here, but the upshot is they have been investigated for some expenditures, hundreds of thousands of dollars of those charitable dollars on travel and entertainment.
The ex CEO of the charity has just been on the radio talking about issues with the board where he was basically told to mind his own business. He talked of salaries to the board members, international junkets and top flight board dinners. Direct quote: I think some people just had their snouts so far in the trough they couldn't see the daylight. This is a truely wonderful sentence!
There are a couple of things with this.
- A complaint was made to Charities Services by a member of the public. While I don’t know, I would suspect that that complaint may well have come from the ex CEO. This is because no-one has any incentive to look in depth at the financials of this organisation: it’s 100% funded by the taxpayer under (I assume) a Ministry of Health services agreement.
- The investigation has taken two years to complete, and then was not published at the time as the regulator believed the charity would take some action. The report has been made public thanks to an OIA, four years after the member of the public raised the complaint, and goodness knows how many taxpayer dollars spent investigating.
- There has been no change to the Board. Indeed, the same board has been in place since 2011 (as at 27 November 2019 – this could well change). I would have expected someone to take the hit acknowledge a mea culpa and stand down. Once again, my expectations are not met.
There is also another interesting snippet in the financial reports, one that has not been covered by the media yet. This is a screen shot of page 19 of the 2019 financial statement. Yes, you are reading this correctly. The charity has stated they have 2 Full Time Equivalents, paid an annual amount in 2019 of $452,537. That’s $226k per annum per FTE. I acknowledge that this is over several staff and governance: the accounts define key management personnel as Board of Trustees, the Chief Executive Officer, the Nurse Manager and the Financial Controller, however they themselves have identified the effort as 2 FTEs. It’s a bit difficult to understand what’s actually achieved by the charity as no statement of service provision is provided: whilst most do give this information these days: operations get more transparent in 2021 when all charities will need to provide this data. Often its hard to separate the good work that a charity does from the money spent doing it, which is where the service provision statement helps.
Now, I don’t know how those salaries sit with other health NGOs. I do know that a salary like this in most third sector organisations would be … unusual.
There is no acknowledgement that the taxpayer is actually a stakeholder here. The charity is 100% government funded. I know that I have been arguing for 100% government funding for more charities, but if this level of what I perceive to be largesse is a consequence, then perhaps not. After all, its taken a number of years for the Charities Services to review the organisation, and the result of that review was a report which had no real consequences for the charity.
I suspect the whistle blower on this is a bit peeved given the lack of consequence given the hit over the wrist with a limp bus ticket response from the regulator. Organisations who benefit from public monies and an accommodating legal structure to achieve their charitable purpose do have to be open and transparent. It should not take two years to look at an organisation to see if its acting in accordance with the spirit of the law.
There is also considerable onus with the organisation providing the funds: the Ministry of Health. They are about to write a letter to the charity to express their “concern and disappointment”. Four years after the complaint was made. I also hope other charities don’t shrug their shoulders and wonder what they could get away with. I also hope our donors don’t shrug their shoulders and view all charities through this lens of entitlement.
If I were in charge, I’d look to beef up the investigations of charities. We need a bigger, faster stick. We need to support members of the public who see things happening in the communities that are a bit whiffy and enable them to do something about it. We need to keep an eye on things like costs both within organsiations and across different ones: benchmarking perhaps. I’d ensure that those funding organisations under review were part of that process.
But what can WE do as citizens? I have written before about a need for vigilant eyes. And what I wrote then still stands: its good to be more curious about the organisations that serve our communities. Its good to understand how and why they operate, separate the spin from reality, and how money spent in the name of community is spent. In the meantime, our Board will continue to do the right thing, and look to make our wee piece of the world a better place, following principles and values of integrity, trust and compassion.
I write about this stuff as I believe that as need to understand where funding comes from, where it goes, and how it gets there. As a citizenry we allow both those supplying money and those asking for money to operate, and as a community we need to ensure we have oversight over the organisations they choose to fund. Love to talk with you if you think this is at all interesting, and if you want to dive into the data a bit more then happy to do so. Check out my website http://www.delfi.co.nz/
Apologies to the swine for the photo. A much maligned animal.