One in five of the UK's biggest charities are 'spending less than half of public donations on good causes' (and some spend as little as ONE PER CENT on charitable work)
- UK's biggest charities 'are spending less than half of cash on good work'
- Nearly 300 allegedly spent just 10% on charitable activities in three years
- And Lloyd's Register Foundation used only 1% of money on such causes
- Other accused charities include the British Heart Foundation and Age UK
- They have been branded 'utter disgrace' following release of new report
- Many of the organisations have disputed the 'totally misleading' figures
Some of the country's biggest charities have been branded an 'utter disgrace' after a new report claimed one in five of them is spending less than half of its public donations on good causes.
The report, released today by the True and Fair Foundation, alleges a fifth of Britain's best-known charities are putting less than 50 per cent of the funds raised for them toward 'charitable activities'.
A whopping 1,020 voluntary organisations - with a combined annual income of £6billion - reportedly spend half or less of their cash on good work, including the British Heart Foundation and Age UK.
Nearly 300 spend just 10 per cent - and The Lloyd's Register Foundation uses only one per cent of the money raised by the public on charitable causes, according to the explosive document.
Shocking: This graph, created by the True and Fair Foundation 'based on data from the Charity Commission and Companies House', shows charities' average spending on charitable activities over the last three years
Many charities disputed the figures in the report, deeming them 'totally misleading'.
But Gina Miller, founder of the True and Fair Foundation said in a statement: 'It is an utter disgrace that so much of the money people generously give is going to feed large charity machines, which are often characterised by obscene overheads and salaries, aggressive fundraising, and bloated marketing and publicity departments; resulting in questionable levels of charitable spending.'
The report claims that Cancer Research UK and The Guide Dogs For The Blind Association - two of the UK's biggest charities - spend 64 per cent of their respective incomes on charitable activities.
Meanwhile, Marie Carie was found to give just one per cent more of its donations - at 65 per cent.
Below the 50 per cent mark, the British Heart Foundation was said to spend an average of just 46 per cent of its cash on good work - while Age UK apparently gives a slightly higher 48 per cent.
Under fire: The report alleges a fifth of Britain's best-known charities - including the British Heart Foundation (file picture) are putting less than 50 per cent of the funds raised for them toward 'charitable activities'
Analysis: Another graph by the True and Fair Foundation, apparently based on Charity Commission figures
And the LRF, The Racing Foundation and The Motability Tenth Anniversary Trust seemingly spent just £20million between them on charitable work over the past three years, the report shows.
Many of these charities are given large sums of public money annually, as well as donations.
The True and Fair Foundation analysed data on 5,543 charities - with a combined annual income of £40.7billion - to discover 'how much of their income was spent on the end charitable activities'.
It looked at figures from the Charity Commission's websites in relation to each organisation.
Its 'A Hornets' Nest' report, first seen by The Telegraph, claims that 17 'large charities' with a £50million or higher annual income spend an average of just 43 per cent on good work.
Charities' minister: Rob Wilson said last night that voluntary organisations need to 'reassure people and make very clear that the money donated to them will be spent on frontline charitable activities'
Ms Miller said: 'The army of extraordinary small and medium size charities who form the backbone of our communities are being drowned out by some of these extravagant and grossly inefficient big brand charities.
'It is time a light was shone on the sector so people can see just how their hard earned money is really being spent by all charities. There are too many examples of charities of all sizes failing to remember that they exist for the sake of their beneficiaries, not the staff.'
Charities' minister Rob Wilson said last night that voluntary organisations need to 'reassure people and make very clear that the money donated to them will be spent on frontline charitable activities'.
He told The Telegraph: 'It's important for charities to be as transparent and accountable as possible - so people can make an informed decision about where their money goes.'
When approached by the newspaper, a Lloyd's spokesman said the LRF is not a publicly funded charity, but is instead, funded 'by the profits from its trading entity, Lloyd’s Register Group Ltd.'
'The confusion comes from accounting requirements which require us to list the total turnover of the trading group (Lloyd’s Register Group Ltd) as ‘income’ – whereas in reality the Foundation’s income comes from the trading group gift-aiding a proportion of its profits and from investments,' he said.
Martin Miles, chief financial officer at the British Heart Foundation, said nearly 80 per cent of the charity's income was spent on life-saving research and benefiting the lives of heart patients.
In a statement to MailOnline, he said: 'This report gives a distorted view of the proportion of our income that we spend on charitable activities, as it doesn’t allow for the very different financial profile of running the UK’s largest network of charity shops.
'Of the £147.3 million raised by the British Heart Foundation in 2014/15, around 78 per cent (£114.6 million) was available to fund life saving research and to improve the lives of heart patients. This was entirely due to the efforts of our supporters, as we receive no government funding for our research.'
Major charity: The report claims that Cancer Research UK (file picture) and The Guide Dogs For The Blind Association - two of the UK's biggest charities - spend 64 per cent of their incomes on good causes
A British Heart Foundation spokesman added: 'We would strongly dispute that this report is evidence of financial inefficiencies or poor governance within charities.
'It doesn’t take in to account the variety of ways in which charities are structured which inevitably affects how much they need to spend to generate their income.
'For the BHF (and some of the other charity retailers the report includes) it doesn’t account for the fact that we run the largest and most profitable network of charity shops in the UK.'
Cancer Research also said it had spent 80 per cent of its income on good work (excluding the cost of running its shops).
A spokeswoman referred MailOnline to a blog on its website, where it says 'for every £1 donated... 80p is used to beat cancer.'
Meanwhile, Age UK said it had used nearly 95 per cent of its cash on such causes.
A spokesman said: 'The report is incorrect in how it is presenting Age UK accounts. During 2014/15, Age UK raised income of £90.1million (fundraising income, charity income and commercial profits) from which we spent £84million on charitable activity.'
And a spokeswoman for Guide Dogs told MailOnline: 'We believe that the figures in the True and Fair Foundation’s report are inaccurate and misleading. What the report has deemed as non-charitable expenditure can be linked to trading, fundraising, sales of assets or building reserves, which generate additional income and help donations to go further.
'As the guide dog service does not receive any government funding, we rely on donations from individuals to continue to fund our life-changing work.
'We will continue to carefully monitor our financial position.'
The Association of Chief Executives of Voluntary Organisations also criticised the True and Fair Foundation's report, accusing it of excluding campaigning in its description of 'charitable activity'.
The Charity Commission agreed that the analysis was 'flawed'.
It added that the report had not 'considered basic information in the charities’ accounts'.
In a blog, the National Council for Voluntary Organisations referred to the report as 'neither true nor fair', explaining how charities add public donations to their trading to boost the amount of money they have to spend on good causes. It described the study as 'misleading in its analysis'.
The True and Fair Foundation concludes its 'A Hornets' Nest' report by declaring that trust in the charity sector 'is being eroded as light is shone on negative practices', and that charities have to ' evolve and be transparent so donors can be confident that they have a right to be supported'.
MailOnline has attempted to contact the LRF, The Racing Foundation and The Motability Tenth Anniversary Trust and Marie Curie for comment.
Read more: http://www.dailymail.co.uk/news/article-3357458/One-five-UK-s-biggest-charities-spending-half-public-donations-good-causes-spend-little-ONE-CENT-charitable-work.html#ixzz3uClNDGPD
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