Today’s Times carried a front-page story with the headline “Anger at six-figure pay deals for charities”, accompanied by a leading article on page 31 entitled “Charity Bonanza”. The pieces come on the back of an investigation into executive pay at 1000 of the top-earning charities in the UK.
While all the reportage may be true, this response will address the fact that The Times’s piece does not represent the reality of the charity sector and that media coverage of charities must be more balanced to enhance public understanding of the way such organisations operate.
The story presented in The Times is not the reality for most of the charity sector.
The article by Alexi Mostrous and Billy Kenber notes that, amongst the paper’s sample group, 390 organisations pay 1,080 staff in excess of £100,000. This, includes “277 staff [who] earned more than the prime minister’s salary of £142,500 a year, and […] 12 executives [who] were paid more than £300,000”.
While this particular investigation is new, the subject matter is not novel. The Sun furiously reported that the Alzheimer’s Society has half of its income “blown” on paying staff, while last year The Daily Mail ran a story about what it saw as a lavish salary for the CEO of Save the Children. (Incidentally, all of these pieces are merely a collation of data already in the public domain.)
Nevertheless, this is quite simply not the reality for the vast majority of charities. The charities studied by the article are in the bracket which the Charity Commission considers to be “major” – i.e. having an annual income of over £5million – which makes up only around 1.2% of charities in the UK.
While this segment of the sector dominates in terms of income and spending, it does not dominate in terms of workforce, with almost half of all charity employees working for organisations with fewer than 25 staff. As The Times itself points out, the average salary for a charity employee is around £20,000 – substantially less than the national average across all sectors of £26,500. This is combined with other factors, such as the higher concentration of workers in areas with a high cost of living (33% work in London and the South East compared to 28% in the private sector) and a significantly larger proportion of graduates (45% of charity staff are university educated compared to 26% in the private sector), making charitable pay unfavourable compared to pay in the private sector.
Even at the top end of most charities, pay is not lavish. We see first-hand many cases of professionals taking significant pay cuts to move from the private sector into the third sector, while charity leaders often slash their own pay or reduce their hours in order to ensure the charity can balance the books and pay its other staff. Most charities cannot rely on huge chunks of donations from individuals and depend on grants and public sector funds, many of which put a number of demands on the ways in which the money is spent, making substantial executive pay near impossible.
Media coverage of charities must be more balanced to enhance public understanding of the way such organisations operate and the real challenges they face.
None of the above goes against what was written in The Times this morning. However, the exclusion of the other side of the story does damage to how the public views the sector as a whole. Earlier this year, research by nfpSynergy found that public trust in charities is at its lowest ebb since 2007 – and this was research conducted before the stories around Kids Company and the fundraising scandals after the death of Olive Cooke made the charity sector an easy target for press and politicians alike.
This does not seek to shift the blame – where there are problems, they need to be addressed, and ultimately the main driver in increasing trust in charities will be charities themselves. Nevertheless, one-sided reporting and sensationalism damage a cause which is ultimately motivated by making people’s lives better.
While the facts in The Times this morning will likely stand up to scrutiny, their presentation is problematic. A front-page splash declaring “anger” at executive pay is not reporting but prophecy, and may well be self-fulfilling. The glib remark in the opening paragraph of the leader about the issues in “what used to be known as the voluntary sector” merely fuels a lack of understanding in how charities are run – such as the impression that, despite over 800,000 people being employed in charities, they should be run by volunteers and any money spend on so-called administration is a waste. 57% of the public still feel that charities would be offering better value if they had no staff paid over £50,000.
Ultimately, information on how a large charity spends its money – including how much it pays its top staff – is publicly visible on its Charity Commission page. Meanwhile, websites like Charity Choice help to make this information a little more accessible for public consumption. Conscientious charity supporters will be able to decide for themselves whether they approve of how their donations would be spent. Should they disapprove, they might consider donating to smaller charities which, according to LocalGiving, get only 7% of total donations.
Journalists have a responsibility to hold organisations of all types to account and to inform the public, and there will be many who see these articles as being perfectly aligned with that. Still, at a time when public services are increasingly being pushed onto the third sector and the sophistication and effectiveness of charities is changing, it is important to present a balanced picture which celebrates the good as well as highlighting the flaws; we hope to see the stories of the health workers stretching themselves because they long to improve the wellbeing of their beneficiaries, the trustees who have successfully turned their charities into efficient machines of good, the CEOs who toil through the night to get the best deal for their staff, their donors and their beneficiaries in a tougher and tougher environment.
We all know there are challenges to be addressed in the sector, and this year in particular has seen a great deal of soul-searching. Executive pay at top charities is no exception. There is strong opinion on all sides, but the fact is that it is not an issue which directly affects the vast majority of charities. The key for a public seeking to support good causes is to be educated in how they are run and how to find out about how a charity it supports uses its funds. The press has a key role to play in this, and we hope that in future we will see more balance in order not only to hold the sector to account but also to showcase the good work it does.