On Sunday 18 December the Mail on Sunday (and MailOnline) employed their usual jaw-dropping reductive skills to totally miss the point that should be made about International Aid Agencies.  If you didn’t see the article, the Mail reported on how charity CEOs were creaming off large salaries from the money that was being granted to them from the UK Department of International Development (DFID).  There were the usual misleading statements, falsehoods and inflammatory implications that we have come to expect from the Mail:

  • The article implied that all of the CEOs’ salaries were linked to the DFID income.  Any financial analyst will tell you that it is pointless to compare income (DFID) to expenditure (CEO salary).  It is misleading and doesn’t mean anything.  In addition, the CEO’s salary is a central or overhead cost that is split between all income streams, not just reliant on one source as the Mail implies;
  • The article said that Save the Children International received funding from DFID.  It didn’t. Save the Children UK received funding from DFID.  This might sound like semantics or a technicality, but as Save the Children UK has a different CEO to that of Save the Children International and the article is about CEO salaries, it actually becomes an important misconception.  Especially as the CEO of Save the Children International is Helle Thorning-Schmidt, the former Prime Minister of Denmark, who is married to Stephen Kinnock MP and mentioned specifically as benefitting from DFID funding through her salary at the charity;
  • A similar misconception was also given in relation to the Mail’s comments about the International Rescue Committee based in New York.  While IRC did receive some funding from DFID, it was not the amount that the Mail suggested. The IRC’s affiliate in the UK received considerably more funding percentage-wise from DFID last year, but was not mentioned in the Mail article; and
  • Three out of the eight organisations are based outside of the UK (two in the US and one in Switzerland), with different regulatory rules and requirements to that of the UK.  So the Mail’s insistence on comparing CEO salaries to that of the UK Prime Minister is spurious and pointless – why should an organisation in New York or Geneva care how their CEO’s salaries compares to some politician in another country?

Unsurprisingly I didn’t trust the Mail’s analysis abilities and did my own straightforward analysis of income, expenditure and salaries at the organisations mentioned in the article, set out in the table below.  The key two points from this analysis are:

  1. Income from DFID can range from 3% to 65% of total annual income depending on each organisation’s fundraising strategy and funding approach.  The relationship between total annual funding and funding from DFID is not explained in the Mail’s article; and
  2. For all but one organisation the reported salaries for their CEOs account for less than 1% of total annual expenditure (GAIN’s CEO salary amounts to 1.5% of total annual expenditure).  Considerably less than implied in the Mail’s article.
CEO Salary Analysis

Analysis of the Income, Expenditure and CEO Salaries at the Organisations mentioned in the Mail on Sunday Article

But the point that the Mail missed in highlighting the size and wealth of most of these organisations is whether large development agencies really are or should be charities.  Or could they possibly be better defined as social enterprises, or in some cases private companies.  I have written previously about this and it deserves to be highlighted again: large development organisations are complex operations and in most cases multi-national operations.  Are they really the same type of organisation as the small local charity that delivers a local service in a neighbourhood in the UK, France, Germany, Canada, the US?  It no longer makes sense that these businesses are classed as charities in the UK and their status as charities might actually be misleading to their own supporters (never mind tunnel-visioned outfits like the Mail).  Organisations like Save the Children, Marie Stopes, British Red Cross should consider whether they will better respond to their vision and missions as social enterprises or some other form of incorporated business, but I don’t believe that a charitable status is necessary these days for what these organisations are trying to do.

However closer consideration of the Mail’s article reveals that its real aim is to score political points against the left, liberals and internationalists and not seriously challenge what some might see as overblown and inappropriate salaries.  The Mail used an unrelated photograph of Stephen Kinnock and Helle Thorning-Schmidt when she was Prime Minister in an effort to discredit their liberal credentials and took a swipe at David Miliband without real evidence.

The real impact of the article seems to be to increase the lack of trust in charities if the reader comments are to be believed.  Not just in international development agencies, but trust in smaller UK charities not related to the article appears to have been damaged.  Something that the Mail probably didn’t intend to happen and increasing the transparency and accountability pressure on charities and NGOs, which do need to change the discourse and urgently improve how they engage with the public.

 

What do you think about the MailOnline article?  Do you think that large international development NGOs should be charities?


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