Third sector leaders debate whether Scottish charities are serving the public well enough

Charities fall into a “no-man’s land of accountability" and don’t have any “external scrutiny”, the chief executive a Fife charity has said.

In a letter to a mainstream newspaper, Ann Porter, chief executive of the Fife Society for the Blind, said that better external scrutiny would benefit the third sector.

“Received wisdoms about charity governance are accepted without challenge or clear-sighted examination,” Porter stated. “And for all the rhetoric about transparency in the charity sector, the reality is that charities fall into a nebulous, no-man’s land of accountability.

“The market forces, external controls and regulations that apply to the commercial and public sectors are largely absent in the third sector. There is no external scrutiny. For an industry that is considered to be worth £20 billion in Scotland, funded largely from public money, this is astonishing.”

Scotland’s third sector provides a wealth of public benefit which far exceeds its financial value - Martin Sime

Porter was responding to a series of anti-charity stories that have appeared in the mainstream press over the summer, including fears that fundraising methods contributed to the death of poppy-seller Olive Cooke and the closure of London charity Kids Company with less than a week’s worth of running costs in reserve.

Porter’s letter concludes: “Rather than repeating the old mantras about the unassailable value and virtues of the charity sector, in order to get some new thinking going, let’s start with this: the third sector is third rate. Discuss.”

Last week, TFN put out a call to the sector for ideas on how to respond to growing criticism of the third sector in the mainstream media and society.

Others are taking a much more optimistic view of the sector and argue that while mistakes will sometimes be made, overall Scottish charities do a good job.

The Scottish Council for Voluntary Organisations (SCVO) estimates Scotland’s charities to have a turnover over of £5bn a year, with 34% of this coming from the public sector.

Martin Sime, chief executive of SCVO, said: “Scotland’s third sector provides a wealth of public benefit which far exceeds its financial value. We mobilise people and communities to make a difference, often stepping in to help when nobody else will.

“Of course, the sector isn’t perfect and it’s important that we continually seek to improve how we work, so that we earn the public’s trust and confidence. We also need to make more noise about the huge difference charities and third sector organisations are making to people’s lives right across Scotland. But it’s equally important that we speak up for ourselves when the media pedals misleading and ill-informed stories about our sector. We owe it to the people we support to keep fighting for change.”

A review of fundraising regulation in Scotland is currently underway. It is examining whether to strengthen the role of existing regulators, such as the Fundraising Standards Board, the Public Fundraising Regulatory Association or the Office of the Scottish Charity Regulator (OSCR).

This week, OSCR also published new guidance on the rules that apply to charity status.

Richard Hamer, a partner at Animate Consulting, is acting as an expert advisor to the fundraising review. He said: “Charities are rightly concerned about the current wave of negativity towards them from the public, press and politicians. It seems there’s a gulf between the reality of modern charities, what the public think charities are and what politicians, particularly those in England, think charities should be doing.

“Faced with this pressure, and falling incomes and rising demand for services, it’s no wonder that some charity leaders are keeping their heads down. But now is the time to re-engage with the public, to listen to their concerns and work with them to help them understand the reality of life in today’s third sector.”

What do you think? How should the third sector respond to concern and criticism about the way it operates? Email us your views or comment below.