Baroness Jill Pitkeathley: 15 November 2017

Charities are the eyes, ears and conscience of society. They mobilise, they provide, they inspire, they advocate and they unite. I have worked in or with the sector for most of a long working life and so I was delighted to be appointed to chair the House of Lords Select Committee on Charities. We managed to reach agreement after much robust discussion and we came up with 100 conclusions and 42 recommendations.

The timing was significant. It was recognised that we are living in a time of profound economic, social and technological change and that the environment in which charities are working is altering dramatically. In addition some high profile failures in the charity sector had eroded trust. Kids Company closed almost immediately after receiving millions in public money and the spotlight shone on possible trustee failure and lack of due diligence on the part of funders.

At about the same time newspapers published a series of reports alleging that some of the best known charities in UK had used exploitative and unethical fundraising methods.

. So it was the right time to set up a Committee which focussed on the charitable sector.

I have been told many times that the Report ‘Stronger Charities for a Stronger Society’ is an important milestone for the sector. Over 11 months we had more than 200 submissions, saw 50+ witnesses, made visits outside London, hosted round tables, in order to consider a wide range of issues relating to the sustainability of the sector

We felt that it was most important for the Committee to increase the sector’s confidence in itself- to give acknowledgment and recognition and I am therefore very pleased that has been so well received by sector. In a pretty difficult environment for charities, the consensus achieved seems to have been particularly helpful. Several commentators have said that it is in effect a roadmap for strengthening the sector and I very much hope that is how it can continue to be used.

The normal process for such a report is for government to respond in 3 months but the General Election intervened and at the time of writing we are still waiting for the response from the government though I have met the Minister and she has assured me that it is ‘imminent’.

Some of our recommendations were definitely for the government – for example

-better consultation with the sector is vital and must be improved.

-commissioning and relationships within the contract culture must also be improved and more encouragement given to consortia in the bidding processes

– a consultation should be launched about employers giving time off for trustee duties

-impact of devolution and the impact of Brexit on the charitable sector have scarcely been considered and must be addressed.

We make comments too on the Charity Commission- itself going through major changes at present and considering whether to charge charities to part fund its services. We raise concerns about this and emphasise that if it goes ahead we need to be clear what benefits for charities would be and MUST

ensure that burden does not fall on small charities who will not be able to afford it.

These and other recommendations will be pursued by me and members of the Committee in a debate in the Lords when the government response is finally received.

BUT many of our recommendations were for the sector itself and don’t have to wait for a government response.

– These include our recommendations about governance. Good governance is essential to a strong charity sector. Charities need strong governance with robust structures, processes and good behaviours in order to deal effectively with their beneficiaries. We call for new efforts to provide training and development for trustees and recommend that charity boards should be more engaged in self-reflection, checking out how they operate, appraisals, examining their behaviours and measuring their impact. We urge infrastructure bodies to identify any shortcoming in the provision of such training and advice and do more to raise awareness of what does exist. Witnesses felt that there is plenty of material out there but it is hard to find and not co -ordinated.

We were very concerned about the lack of diversity on many trustee boards. Of course Boards should reflect their beneficiaries in terms of ethnicity, age and background but when commonest way of becoming a trustee is because someone asks you boards are almost bound to be limited to the same kinds of people.

And we know many charities are concerned about the supply of trustees- how do you get them? Where are they going to come from in the future?

We need to emphasise more that this is a 2 way street. You give something as a trustee but you get something back- something on your cv? Recovery from illness or bereavement? Leaning a new skill? These are all perfectly valid reasons for becoming a trustee but those recruiting should be open about this.

Employers have a role to play too– we recommend that the government should hold a public consultation on introducing a statutory duty to allow employees of organisations over a certain size to have time off work to perform trustee roles.

To encourage turnover on Boards we encourage trustees to consider 9 years as a maximum term. While we considered that there may be some circumstances where it was appropriate to pay trustees, we do not support payment as a general rule but encourage a more generous interpretation of expenses.

I am delighted to say that sector has taken up the challenge and is using the report to help them further the recommendations; using it as a road map in fact. NCVO/ACEVO convened a group of 15 membership organisations- and set up a series of working groups – 11 in all,to see how this joined up approach can help us make the proposals in report a reality. They Include governance, diversity, leadership, and campaigning.

There is no doubt that trust in charities was knocked; it may be getting better but can never take for granted. Levels of probity and transparency must be constantly monitored. Charities confidence in themselves is important in this regard and I do hope that what Report has done is increased the confidence of the charitable sector

Charities face greater operational and environmental pressures than ever before but their principal are enduring and they have always helped society through periods of upheaval such as the one we are facing at present. I have no doubt they will do so again.