What The Charities Act & Regulator WILL NOT Do

Today Minister Shatter announced plans to establish an Independent Charities Regulator to become operational in 2014. For everyone in the charity sector the implementation of the Charities Act 2009 is very welcome, and judging by the public comments on-line it is universally welcome.

However, there is clearly a misunderstanding of what the Charities Act contains. The 3 areas that seem to be focused on by the public are not necessarily areas that will be affected by the new regulator. The Charities Act:

• Will NOT have an impact on charity CEO salaries
• Will NOT have an impact on religious organisations getting tax relief
• Will NOT get rid of street fundraisers (sometimes referred to as chuggers)

CEO Salaries
My understanding is the Charities Act has no say on what a charity CEO should be paid, although the act does touch on persons being paid reasonably and proportionately to the service they provide.

But charities will never be regulated on how they pay their staff, in the same way businesses aren't regulated on how much they pay their staff - because it wouldn't make any sense.  Trustees/Directors will continue to decide what is appropriate to pay a CEO and their obligation/desire will continue to be getting the best possible staff at the lowest possible cost, operating in the best interests of the charity.

I know you don't want to hear this but it's still going to be up to you to determine who is worthy to donate to. If you don't like what a charity pays their CEO or they refuse to tell you then you can withhold that donation. But if you like what the charity is achieving and the impact they are having then their staff are probably doing a good job.

You can read more on my own thoughts on charity salaries in these posts:

• Why Charities Are Doomed
• Imagine Two Organisations
• How Much of My Donation Is Spent On Overheads (Or Why Admin Costs Are Bull***t)
• The Magic 100,000
• The People Vs. Angela Kerins
• Frequently Asked Questions

Religious Organisations

The Charities Act specifically states that "The advancement of religion" remains a charitable purpose.

You can read more on my own thoughts on certain organisations and charitable tax relief here:

• Should Charities Receive Tax Relief?

Street Fundraisers

While the Charities Act 2009 provides for certain minor changes to the requirements of cash and non-cash collections, it still specifically allows these (extremely effective) fundraising methods to continue. Thankfully an official permit system will continue on from the self-regulation of the IFFDR, and this should weed out some cowboys, but fundraisers will continue to interact with you on the street and knock on your door.

The onus will remain on the public to check if the fundraiser talking to you is legitimate and if the charity they are representing is really the best place to donate money. The charity register will make this easier, but you'll still have to do a bit of work to see if the specific charity is actually helping anyone. 

You can read more on my own thoughts on street fundraisers here:

• Chuggers In The Media

Are Fundraising Complaints Worth It?

Someone asked me last week, "Is it OK to annoy 20 people to sign up 1 donor?"

Make no mistake about it - I don't want fundraisers to annoy people and I think better fundraisers, better regulation, better training, and better complaining can reduce annoyance.

But according to the UK's FRSB and Institute of Fundraising, their members received only 33,744 complaints while generating £4.16 billion in voluntary income. Is that OK?

True, the problem with looking at complaints is that people don't know how to complain - i.e. people are more likely to keep their complaints to themselves or complain to people who can't do anything about it (which is part of the problem). So let's take it further - rather than looking at complaints let's look at interactions.

The FRSB report showed that corporate fundraising received more complaints per interaction than street fundraising - but let's focus on street fundraising, as this is generally accepted to be the most controversial method of fundraising.

For every 1 donor signed up a street fundraiser gets in to about 10 conversations and has 'interacted' with about 100 people. So about 100 people have potentially been 'annoyed' for the sake of 1 donor (although a recent survey had it closer to 67 individuals feeling 'uncomfortable'). That's being pessimistic - I'm assuming here that everyone who doesn't sign up is annoyed, because they had to cross the road, say no, or ignore a human being - I'm disregarding the fact that a lot of people have a an enjoyable conversation before they say no and walk away.

So what's the donor worth?

Well the average donor will go on to donate €500+ by direct debit alone, plus tax relief, plus upgrades and appeals, plus all the other connections this new relationship brings. A new donor is probably worth about €1000 to the charity. But let's be really pessimistic and say this donor doesn't give as long as average, doesn't respond to further appeals and that some of the donation gets wasted in inefficiency. Let's be unrealistically pessimistic and say this donor is only worth €500.

And what does that €500 do?

Well Sightsavers say it will protect about 1,450 families from river blindness.
Concern say it'll provide 3 emergency tents, giving 3 families who have lost everything a temporary home.
UNICEF say it will provide safe drinking water to 25,000 children for a day.

So...worst case scenario...is it worth making 100 people feel uncomfortable for a couple of seconds to save thousands of people's sight, give 3 families a home or keep 25,000 kids alive for another day?

And if it were your own child you were trying to keep alive for another day how many people would you be willing to feel uncomfortable for a couple of seconds? To keep my son alive I would be willing to see about 7 billion people feel uncomfortable for a couple of seconds.

But maybe I've misunderstood the word 'uncomfortable'?

There Is Still Money Out There

I wanted to put together an ever-expanding list of ridiculous things that people are still spending money on. These are a constant reminder that people can afford to donate more to charity.

1. Wax Museums
2. Ghost Tours
3. Nespresso Stirrers (my 2  year old picked one up and said, "Broke spoon!"
4. Bottled water (maybe not so much after I watched this)
5. Spray tans, false eyelashes/nails (from Maria O'Keeffe)
6. Grated cheese (from Katia de Gregorio)
7. Pre-chopped onions, apples, etc. (from Katia de Gregorio)

Any more suggestions?

IoF National Convention 2013 Learnings

This year again I wanted to type up my key notes from the convention and put them in to one handy place - and again I decided to publish it. These aren't necessarily things speakers directly said...sometimes they plant seeds of inspiration or I drift off and think of something else.


1. Being a Donor Is Lonely
The only thing lonelier than being a fundraiser is being a donor. We need to get donors to communicate with each other and advocate for you.


2. Be Careful of Analysing How Donors Behave
It's happened a few times now at conferences: people claim donors are more likely to keep giving because of something you've done, overlooking the fact that very possibly you've been able to do that something because they're better quality donors.

For example, look at the donors who go to your events - they're undoubtedly better quality. But they're not necessarily better quality because they go to your events. More likely they go to your events because they're better quality. So have a think about it before you arrange loads more donor events.

You see it a lot from the digital guys - amounts raised on-line are increasing so there's the assumption that on-line is driving people to give. That's a dangerous assumption, and dangerously pushing smaller charities to spend money on digital before they have the basics down.

 (Word of the Day: Retrocausality)


3. Agency vs. In-House Donor Attrition
According to the DARS report there is a statistically insignificant difference in the attrition rate over 5 years between donors recruited by a charity in-house and those recruited by an agency. VERY interesting!


4. How Do You Start Fundraising If You've Never Fundraised?
You know what's missing from all these conferences? A beginner's guide to fundraising. Whenever someone shows an amazing campaign one of the first questions from the audience is always 'How much did it cost?' and the feeling that it's just too far beyond reach.

Let's run a seminar showing how to use filters and mail merge in Microsoft Office to run clever segmented mailings for free. Let's talk about who the first people on your database should be, where they come from, what you capture and what you do with them. Let's practice your first cold call, face-to-face pitch and hand-written mailing.

The reason there's so few qualified fundraisers out there is because there is no first rung on the ladder.


5. People Like Lists In Presentations
Make a numbered list in your presentation and everyone will write it down, even though they know they're going to get the slides.


6. Twitter Rocks
Twitter really cuts out a good bit of time at these things and allows you to meet up with people you know you're going to like.


7. Are We Wasting Time & Money With Research?
No, I don't think so. But we're never all going to agree on whether giving is going up or down and we're never going to find the solution to what works perfectly, because there isn't one. But we can learn from other's mistakes and data should influence our decisions.

Still though, sometimes you're just better off spending your time picking up the phone and ringing your supporters. Seriously, when was the last time you, as a fundraiser, had a conversation with someone and then asked for money? Would that be cheaper and more effective than what you're doing right now?

Why The Charity Shop Victory Is Important

Last night Dublin City Councillors voted against a ban on charity shops on Grafton Street. It's easy to dismiss this an empty victory (really, will any more charities want to open there?) and a few people asked me why I was bothering to get involved with this. But let me tell you why it's significant:

Firstly it would have continued choking philanthropy. Intentionally or not we often reward those that seek personal profit and penalise those that wish to do good. This would have done the same - like I said before, I'd be welcome to open an art gallery/tailors/barber/Brown Thomas as long as it's for personal profit, but not if it the profits go towards changing and saving lives.

Secondly, Grafton Street would have only been the start. Like all terrible people and terrible ideas they test the water, and if nobody kicks up a fuss then it keeps going and getting worse until one day our children ask how we could have let it happen. If this had of gone through then Henry Street would be next, then O'Connell Street, then one day charity shops can only exist in crappy areas and they are no longer a viable source of income.

Finally, it treats charities as second class. It's the assumption that charity shops are ugly. That only poor ugly people shop there. That charity shops couldn't run something more successfully and profitably than HMV. Rubbish.

Dublin City Council's process also highlighted that 16 councillors have a completely outdated view of charity shops and absolutely no foresight.

And the fact the council only received 3 objections from the public is unacceptable - the charity sector needs to rally around issues like this. It might not affect you today, but one day stupid decisions like this will, and I'm sure you'd like to think that the thousands of charities out there and hundreds of thousands of workers in the sector will support you.


[Finally, on a side note - I can not get over the number of people saying that charities spending rent on Grafton Street would be a waste of money. Why is it a waste for charities and not businesses? Surely everyone is on that street to make money. The difference is charities would use 'profits' to do good.]

CHY3 & CHY4 Forms - Tax Relief on Donations Revolutionised

One of my pet hates is when people say something "will revolutionise fundraising"...but this will revolutionise fundraising (in Ireland): it's the new CHY3 and CHY4 forms for tax relief on donations.

We all know and love their older brother CHY2 and the changes that came in to effect this year will mean charities should get more in the long run (although will probably see a dip in income in 2013).

The CHY3 & CHY4 forms have a similar result: you get tax relief on donations over €250 in the calendar year but there are some differences which will change everything you do:


The Forms Can Be Signed At Anytime
This is huge - you no longer need to wait until the following year to get the donor to sign the form. Instead, they can sign it at the time of donation (or in fact before their donation).

So at the point of any face-to-face recruitment you should also be attempting to get one of these forms completed, saving you trying to contact your donor months or years later. This should increase the amount of secured forms from 30-50% up to over 90%.

Similarly, any donations through DM, on-line or Telephone present an opportunity to get the form signed that week, rather than having to wait. This will impact how you construct all of your DM pieces and what you send out to any other donors.


The Forms Don't Specify Donation Amount
This is a weird one, because it means you now have the opportunity to get consent from donors who may not look like they're going to give €250, because you don't know what they're going to do in the future. If I commit to give you €100 this year are you going to ask me to sign a CHY form because I might end up giving you more? And how do you handle that conversation without seeming cheeky?


CHY3 Forms Last For 5 Years
The CHY4 lasts for a year and the CHY3 form last for 5 years - you can keep the donor's PPS number on file for this time. This is incredible because once the donor signs a CHY3 form you won't need to chase them up for 5 years (although it's important to keep their contact details up-to-date for when the form does expire).


They Can Be Renewed By Phone/Text/On-Line
But even when they expire the good news is they can be renewed by recorded phone, text or on-line if a record is kept.


Refunds Will Be Staggered
Apparently refunds will be staggered through the year - PAYE donors mostly in the first half of the year and Self-Assessed in the second half of the year.


How else is this going to affect your organisation?


I'm still pulling together information on these changes and I won't be held responsible for any mistakes in my interpretation of the changes! Special thanks to Bruce Clark of The Good Form and Richard Dixon of Concern for tweeting information on this!

One Percent Difference - National Giving or National Trusting?

Last week saw the launch of the "One Percent Difference" campaign - "An opportunity to get the ‘ask’ right, and elevate fundraising and philanthropy in Ireland to a new level." Yes, there are issues with it, but I like the website, the TV ad and the sentiment. Charities collaborating can only be a good thing and I'm grateful to the organisers.

But is it what the sector needs?

The One Percent Difference campaign quite rightly tries to highlight that, yes, of course you can afford to donate 1% of your time or money. But I would argue the barrier to giving for most people is not the money...it's a lack of belief.

The people who are responding to the 1% difference campaign so far are those that already give more than 1% of their time and money to causes that deserve it. The people who don't already give 1% are those that simply don't believe the money will be used wisely, that don't think charities are making a difference, that think you're wasting money. They get more pleasure from buying things for their kids, their friends and themselves because they see the world change around them when they do.

You know when someone asks you if you want to go out on Friday night and you can't afford it? And then someone you really like asks you if you want to go out and you find the money?

Perhaps we don't need a National Giving Campaign - "a collection bucket in another format" - yet. Perhaps we need a campaign on trust and a campaign on impact. Perhaps we need to show what your donation achieves. We need to show how and why your money is spent. We need to show that your work works. We need to show that lives are changed. We need to show that most charity staff work their asses off despite the fact they could earn 22% more in the private sector. We need to show it's almost always not a scam. We need to show impact.

And if we show that then the giving will follow.

I've compared it before to the Got Milk campaign in the U.S. - People didn't stop drinking milk in the '90s because they couldn't afford it. They moved their spending to other drinks because they believed Coke tasted so much better and they would be like Michael Jackson if they drank Pepsi. And the Got Milk campaign was dairy-police's attempt to change that.

As One Percent Difference pointed out, we're spending €6 billion a year on alcohol. People still smoke (seriously). We're queuing for the new iPhone. The existence of wax museums and ghost tours is a clear indicator that people can afford to donate more.

And charities can do more. Only 2% of charities use the telephone to fundraise. Only 50% reply to e-mails. Charities spend an unnecessary amount on bank charges and payment processing. There are donors ready to give and charities aren't allowing them to do so. Are you ready for someone to offer you their 1%?

We need to get rid of the notion of admin costs and wasted money. We need to get rid of the myth that we "don't want better regulation". We need to regain trust. There is more waste, inflated pay and mistakes in the private sector - but it's louder in the community and voluntary sector. Let's fix that.

And in the meantime let's embrace the One Percent Difference campaign, and let's improve it:

• Let's get a donation facility on the site (why add an additional step? Sponsor.ie would be happy to help like we did with Better Together).
• Let's use it to promote planned, regular giving.
• Let's work it in to our messaging and get a concrete plan about what charities should be doing with it.
• If you already give 1% then give 2%. Or 5%. Or 15%. Let's give until it stings a little.
• Let's get a call-to-action - how do you want my 1% and what's involved step-by-step?

Got opinion?