William Shawcross speech at the Centre for Social Justice Alliance conference

William Shawcross speech on charities and the EU referendum.

William  Shawcross

Good afternoon.

I am delighted to be here. First, I would like to acknowledge the work of the CSJ and the many other charities here. You ensure that government remembers to address the vital issues of poverty and social justice effectively. You shine a light on the deprivation that many experience in this country and drive this up the political agenda. The CSJ’s approach in identifying solutions to Britain’s social problems is as powerful as it is novel.

We stand here at the cusp of a historic moment for our country. The result of the EU Referendum has been described as the most dramatic event in Britain since the war. Whether that is true or not, what is clear from the result is that significant numbers of people do not feel that the current system works for them.

In an environment where manufacturing decline has been overlain with spending reductions, many of the communities that voted to leave are the same communities that feel left behind by globalisation. This is something I’m sure that many in this room would have been able to predict.

This is a great nation but, like others, we are a divided nation – divided not only by our opinion on membership of the European Union but also by inequality, within and between regions. While the economies of the South East and London have boomed, much of the rest of the country has fallen behind.

Areas such as the West Midlands have seen their prosperity fall significantly behind the rest of the UK. Regional inequality continues to grow and the UK’s current levels of regional economic disparity are in fact higher than any other EU country. This must be acknowledged. Even within the wealthy Southeast, pockets of poverty exist – in Clacton and Portsmouth, for example.

However, our nation is also marked by our commitment to voluntary action and philanthropy. Last year an estimated 32 million adults volunteered. We currently have over 165,000 registered charities. There are a million trustees in England and Wales. This is inspirational and goes to show that we are, as we always have been, a generous and charitable country. You here represent this. You support the deprived, care for the vulnerable, improve educational attainment, raise skill levels, enable individuals to exit the cycle of poverty and enhance the life chances of the most disadvantaged in the country.

As Chairman of the Charity Commission, I have seen many charities, seen the incredible work they do and I continue to be humbled by individuals’ generosity, kindness and care for others. Charities and philanthropists make the country a better place. Charities soften and humanise the state.

In this hour of division, we must work hard to re-unite our nation in a post-Brexit environment. The true spirit of charity must surely be a unifying pillar around which we can rally.

Dr Frank Prochaska, a historian of political thought and philanthropy, gave a lecture at the Charity Commission in 2014 and there he said ‘voluntary action extends well beyond what the political language can provide’. This is especially true when the state is limited by austerity and now by the short-term economic sting of Brexit. It is therefore the duty of those who can help to do so. We need to build on the legacy of the Cadburys and more recently the Sainsburys.

The word philanthropist means two things: helping those less fortunate than oneself and the love of mankind. Charities at their finest embody those values and they are best placed to face this challenge - to ensure that communities are not forgotten and the most disadvantaged are not left behind.

Now we know that for charities of all sorts to do well, public trust and confidence is vital. Indeed, enhancing public trust and confidence in charities is one of the statutory duties of the Charity Commission. Without it, charities will lose public support – both financial and emotional – and they will be unable to carry out their purposes effectively.

It is a truism to say that the last 12 months have not been good for the image of charities, many would argue the worst for some time. Poor practices, particularly amongst a few larger charities, have knocked the public’s confidence in what had been a section of society unaffected by the modern scepticism of institutions.

Last month the Charity Commission published research which showed that public trust and confidence in charities had fallen to the lowest recorded level since we started to monitor it in 2005. This is very worrying but it is perhaps not surprising after the collapse of high profile charities such as Kids Company and the series of stories we have seen highlighting fundraising malpractice.

The scandals, particularly involving fundraising, tapped into a public view that appeals for donations from some charities had become too aggressive - too invasive of our personal space.

Some might say that charities should retreat, withdraw from the public square and wait to be called upon. To sit on the naughty step, if you will.

Far from it, the response of charities across the country should be one of effort renewed.

There are nearly one million trustees in England and Wales, almost all volunteers. They preside over a combined income of £70 billion, over half the budget of the National Health Service and twice the defence budget. This represents 5% of GDP but more importantly, good causes and lives saved the nation and world over.

It is simply too important to our country for the reputation of charitable work to be permanently besmirched. But how can we restore it?

First, we must have honesty. Most charities have nothing to do with the scandals of the past year. But we must all admit that poor practice has gone on and talk about what steps are being taken in order to address it. Some have sought to ignore the practices, thinking the storm would blow over and leave them unaffected. This is folly. A scandal in a few affects the reputation of the many and twelve months on and there is no sign of media interest abating.

Without full acknowledgment of the wrongs that have occurred, charities will struggle to regain the public’s confidence and restore the bonds of faith with donors. Charities and their leaders should step forward, reject poor practice when they see it and let the public see that they are not part of the problem. I am pleased that a number of charities have taken some of these steps already.

Instead of being defensive, charities response to such revelations should always be one of public and donor empathy. Only once the public believes charities are in touch with their concerns will they start to listen more nuanced arguments. charities must first win the right to be heard.

Secondly, charities must continue their good works and encourage the public, and media to take an interest in what they are doing, in who they are helping. When people know more about a charity, their trust and confidence in charities in general increases. Charities should open their doors, not close them. By showing what they do and how they do it, as well as demonstrating the impact they make, charities can rebuild that trust.

Today sees the launch of the new fundraising regulator, which Sir Stuart has been crucial in creating, and we are beginning to implement the new Protection of Charities Act - for which I have long lobbied. This Act gives us specific new powers to deal with the minority of charities which behave badly and damage the interests of the whole world of philanthropy and the voluntary sector.

The Act will help the Commission to take robust but proportionate action where abuse occurs. We will be better able to resolve individual issues, alert charities to danger and give the public confidence. Most importantly, we will be able to better protect charities and their beneficiaries from individuals who, quite frankly, are not fit to be trustees.

The Commission is determined to always act firmly but fairly on this matter. It is important to us that a fair system is developed together with the voluntary sector. Therefore, we are seeking comments from charities as well as professional advisers, members of the public and other regulators or public bodies on the use of the Commission’s new warning powers. I would welcome all of your thoughts so please get in touch.

Your support is essential to regain public confidence - demonstrating to the world that charities and philanthropy can drive social change, tackle deprivation and re-unite Britain.

I would like to end by quoting one of my favourite authorities on the tasks in which you are all engaged. This is what William Beveridge, the creator of the welfare state, wrote in 1948 in his hugely important book Voluntary Action:

The making of a good society depends not on the State but on the citizens, acting individually or in free association with one another, acting on motives of various kinds—some selfish, others unselfish, some narrow and material, others inspired by love of man and love of God. The happiness or unhappiness of the society in which we live depends upon ourselves as citizens, not only the instruments of political power which we call the State.

Thank you for listening to me.

Published 7 July 2016