6th July, 2015

Kids Company and the case for an evaluation

I have a picture of Camila Batmanghelidjh on my office wall.  One day I hope to be as charismatic and authentic as the founder of Kids Company.  There is no doubting that Camila is a formidable character, highly adept at garnering support for the cause.  Kids Company have developed a model of support that enables them to engage the most disengaged and deprived children and young people in London, Liverpool and Bristol.  Their ability to engage young people describe by some as “hard to reach” would make many front-line organisations weep.

Camila is to stand down as Chief Executive, citing politicians’ “ugly games”.  It is reported that a row with the Department for Education ensued about how the charity intended to spend its next £4.25m grant.  Certainly, when spending such vast sums of the tax payers money, a very clear plan needs to be presented on how funding will be spent – the numbers of young people supported and the expected outcomes this will achieve.

The row was resolved, according to the Guardian, when Camila lobbied the prime minister’s officials and the money was immediately approved.  Now, Kids Company is reportedly in negotiations with the Cabinet Office over a one-off grant of £3M to restructure in the face of fluctuating income, in order to avoid receivership.

As a former CEO, I have huge sympathy for Kids Company and their struggles.  Albeit on a much smaller scale, I was at the helm of a small local charity supporting vulnerable young people in West London, when it became apparent that our model of care was no longer sustainable and we faced a cash flow crisis.  We were fortunate to receive a one-off donation from our corporate supporter, but it was made clear that this was part of an exit package; the charity had become ‘toxic’, it was in trouble and needed to change.  I therefore met with the Director of Social Services and our Grants Officer (for it was back in those days!) and together with the board we carved out a way that we could continue to support the children referred to us in a more sustainable way, topped up by our own fundraising.

And herein lies the challenge, when working directly with vulnerable beneficiaries – seeing the hardship up close and knowing that your work changes lives – there is a temptation to always do more.  However, it is the board’s responsibility to plan activities and control organisational expenditure in line with resources.  A charity cannot plan its activities based on the hope of high risk and fluctuating income, not without significant reserves to draw on if income dips below expected levels.

It’s easy to ‘bash a charity’ these days – all you need are a few questions and a couple of disgruntled employees and the Newsnight report almost writes itself.  However, there are clearly concerns by those who have given scrutiny to the charity about some of its operating policies as well as its reporting mechanisms.  Kids Company should answer them.

In a statement on its website last week the Kids Company board of trustees said: “In partnership with a group of philanthropists, the charity is being supported by the new government to create a more sustainable organisation and funding structure that will be better able to tolerate unpredictable income streams in the future.”

It is encouraging that the charity is now working with others to build a sustainable organisation and funding structure.  An independent and externally published evaluation of services is also highly recommended, to provide a clear and transparent account for funding received, outputs delivered and outcomes achieved.  This is good practice for any charity (not just one in crisis) that wants to be accountable to its funders, and also learn from the process in order to foster an environment of self-improvement.  It is the least that beneficiaries deserve.


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