• Home
  • Reports
  • Blog Directory
  • Blog
  • Media
  • Contact

Some musings on things

Where are the "Vigilant Eyes"

31/3/2017

2 Comments

 
There has been a flurry (well, two) articles in the local rag about the charitable sector.
http://www.stuff.co.nz/national/90430465/increasing-number-of-charities-creating-duplication-donor-fatigue
http://www.stuff.co.nz/the-press/opinion/90937970/editorial-ever-expanding-charity-sector-needs-a-vigilant-eye

They pose some interesting questions that I have looked at over the past few years: notably about duplication.  Nicola Woodward from Aviva I think summed this up well:

"There's also a lot of duplication and competition that isn't helpful for the people charities are here to support. The fact that we're charities doesn't make us entitled to funding – or that it should be assumed that we're doing great work."

Charities needed to be transparent and accountable and had a responsibility to work together to provide the best possible services "as effectively and efficiently as possible", Woodward said.

The editorial poses some great questions, ones I have been pondering about for a while now and boring my friends and family, but puts a lot of the onus onto DIA. 

It would be helpful if in the name of transparency, Charities Services could find a way to rate charities on what proportion of their income goes to front line services and how much to admin.

Now, this is a sterling idea – although only really shows a small piece of the puzzle.  At the moment, this material often exists (and where it doesn’t it sure should), but no one really looks at it, except those with a passion here.  Through this blog, I have looked at various charities: yep there are some great ones, but ones where the community benefit is clearly questionable.  Others look at charities via the letters to the editor channel.  However, it’s a hobby (and a fairly weird one at that).  There is no current business model to open up the sector for scrutiny, either for an individual charity’s effectiveness, nor benchmarking across sector.  There are also some big questions which remain unanswered around the role of local and central government in funding things which are more and more falling to private philanthropists or community grantmakers. 

However, I am not convinced it should be the role of the DIA to do this sort of thing given the breadth of activities they do, but rather it would be rather fabulous if DIA can help facilitate this amongst independent researchers. 

The Doing Good Better book by William MacAskill (sent to me for free thanks to the Effective Altruism people thank you very much), provides some good rating points, which he is turn has borrowed off GiveWell.  To steal theirs:
  • What does the charity do?
  • How cost effective is each programme area?
  • How robust is the evidence behind the programme?
  • How well is each programme implemented?
  • Does the charity need additional funds?
I would suggest another: How does this group compare to others doing a similar thing?

Now, I am not proposing that these measures are appropriate for our NZ charities.  Indeed, the cost of such deep dives into our 27k charities, not to mention the over 25k incorporated societies which also ask for and receive community and individual funding, would be rather over the top for the return. However, I think it’s not too hard to scratch the surface on some of these big questions.  The onus should be on the charities to show to the community that they do what they say they do, that their programmes are effective, that they are learning organisations and play nicely with others.  It will help us make sure that those who get funding actually are worthy of our money.

Us randomly scattered cynical but community minded people could work with the regulator and develop a model.  It could have the potential to put more sunlight on the NFP sectors and help us pay the rent.  I think NZ Inc would certainly be better off, grant makers would have the opportunity to reduce their costs, individuals could have more confidence in where their money goes, and we might see some positive changes within the charitable sector.

Would love to talk with you if you think this is vaguely interesting.

2 Comments
Bridget Frame
3/4/2017 10:15:23 am

I have received an email from Dr Michael Gousmett. He has written two letters to the editor about both articles: I have reproduced them below.
DUPLICATE CHARITIES

There is nothing new in the call for charities which duplicate services to amalgamate. I recall Gareth Morgan doing so some years ago, for example. Academic research has also focussed on this issue. Splinter groups are not at all uncommon. One only has to have a look at the Charities Register to see the duplication across cancer, hearing, vision, medical research, social housing, welfare, and so on. The question is not that there is duplication, but why is there duplication. One answer is that people see their particular focus as being somehow different from others, therefore of particular importance and worthy of public support. However the issue is much deeper than just savings on administration costs. Take cancer research, for example. How much cross-fertilisation of knowledge occurs between scientists, nationally and internationally, undertaking research into all the various forms of cancers that science is trying to understand? Are donors getting the best value for their discretionary dollars in funding medical research across all the dimensions that this entails? New Zealanders are incredibly generous people, but is it time to take a more introspective approach into why we have so many charities per head for a relatively small population than just focussing on superficial issues like photocopiers and staffing? After all, the taxpayer subsidies these entities through an exemption from income tax and resident withholding tax, as well as tax credits for donations at a direct cost to the government of millions of dollars a year.

Dr Michael Gousmett

Dr Michael Gousmett FCIS PhD BCom(Hons) BBS Dip CM Dip Tchg
Adjunct Fellow, School of Humanities & Creative Arts (History)
University of Canterbury
Independent Researcher and Public Historian

Reply
Bridget Frame
3/4/2017 10:17:03 am

And the next one.
CHARITY FATIGUE

Dear Ed.,

Is it purely coincidence, or did my letter to you of yesterday’s date inspire your editorial writer in today’s Press to comment on issues that I mentioned, such as the number of charities per head of population, and the number of cancer-related charities? It wouldn’t be the first time, but I’m happy to share my knowledge and over twenty-five years sector experience with you, if it helps to better inform the public as one of the few advanced level academically qualified commentators, who also has direct sector experience, in New Zealand.

Here are some more suggestions for your editorial writer/s to research:

• Since registration commenced, how many charities have been deregistered, and for what reasons?
• How many charities have contested their deregistration through court proceedings, and how many were successful in being re-registered?
• Which region has the greatest number of charities?
• As assessed by net assets, which charity is the wealthiest?
• As assessed by investments, which charity is the wealthiest?
• Which subsector of the charity sector is the wealthiest?
• How much does the tax credit for donations to donee organisations cost the government/taxpayer?
• By how much has the cost of tax credits increased since the cap on donations was lifted by Cullen and Dunne?
• Which subsector benefits the most from the tax credits concession?

I think that if you check your archives, you will find my opinion piece that you published some years ago on the need for donors to be more critical of charities.

Alternatively, you might like to check out the US organisation, Charity Navigator, and their advice, “5 steps to informed giving” at https://www.charitynavigator.org/index.cfm?bay=content.view&cpid=4756.

Regarding rating charities, have a look at the US where you will find organisations in addition to Charity Navigator that rank income tax exempt entities such as charities (the US has a different concept regarding this tax concession) and boy do charities hate them!

By the way, the comment in the editorial that annual reports provide a sense of the efficiency of a charity is incorrect. Efficiency is one thing; effectiveness is another. The question to be asking charities is, did you make a difference, and if so, how?

You might also like to ask IHC, of which Idea Services is a part, why they fail to provide the public with any detail regarding their financial activities and performance as they submit a meaningless page or two from their annual report to Charities Services and call that accountability, an issue that I will be raising with the Minister for the sector.

If you really want to stir a hornet’s nest – start having a look at the salaries being paid to charity ceo’s, and see if you can find the one that pays a quarter of a million, and the other that pays three quarters of a million!

The issue of duplication has been around for as long as there have been charities .... and that is many centuries.

Maybe it is time that the Productivity Commission took a long, hard look at the charity sector – just as Australia has done. Such a challenge to a sector that sees itself as somehow privileged would most certainly stir up the hornet’s nest. I’ve never forgotten the comment to me by a minister of a church at the time of the introduction of the Charities Bill, that the last thing he wanted was for the public to know how wealthy his church was. I didn’t understand the comment then, but I most certainly do now!

Dr Michael Gousmett

Dr Michael Gousmett FCIS PhD BCom(Hons) BBS Dip CM Dip Tchg
Adjunct Fellow, School of Humanities & Creative Arts (History)
University of Canterbury
Independent Researcher and Public Historian

Reply

Your comment will be posted after it is approved.


Leave a Reply.

    Archives

    July 2025
    March 2025
    November 2024
    October 2024
    September 2024
    August 2024
    September 2023
    August 2023
    July 2023
    March 2023
    January 2023
    September 2022
    August 2022
    July 2022
    May 2022
    April 2022
    January 2022
    February 2021
    November 2020
    August 2020
    July 2020
    June 2020
    April 2020
    March 2020
    November 2019
    October 2019
    September 2019
    August 2019
    July 2019
    May 2019
    April 2019
    March 2019
    January 2019
    November 2018
    September 2018
    July 2018
    June 2018
    April 2018
    March 2018
    January 2018
    November 2017
    September 2017
    August 2017
    July 2017
    June 2017
    May 2017
    March 2017
    February 2017
    January 2017
    December 2016
    November 2016
    October 2016
    September 2016
    August 2016
    July 2016
    June 2016
    May 2016
    April 2016
    March 2016
    November 2015
    October 2015
    September 2015

    Categories

    All

    RSS Feed

Proudly powered by Weebly