Cost of charity street collecting

Face-to-face fundraising is big business in the UK

In some cases less than 10% of money collected by high street charity agents initially benefits the cause involved, Money Box has discovered.

Most of the UK's leading charities use this face-to-face fundraising method, which is worth almost a quarter of a billion pounds a year.

Collectors approach people in the street and ask them to set up a standing order for a regular donation.

But the charity watchdog for England and Wales, the Charity Commission, has received a number of complaints from the public about the tactics being used.

They must tell you they are paid and they must tell you they do not work directly for the charity Anthony Robbins, Charity Commission

Earlier this year it issued a warning to its members to carefully monitor any agency it employs, after one company in Brighton was found to be breaking the law.

Anthony Robbins, head of communications at the Charity Commission explained:

"The face-to-face fundraisers must tell you they are paid, and they must tell you they do not work directly for the charity.

"That is a legal obligation under the 1992 Charities Act. Failure to make that declaration is actually a criminal offence."

But crucially the street agents do not have to tell you how much of what you give goes to the agency that employs them.

'Valuable' method

Money Box has learned that in many cases very little of the money donated in the first year benefits the actual cause.

Scope, and the mental health charity Rethink, admitted it can be as little as 10%.

Most charities refused to talk to Money Box about the issue, but Shelter Fundraising Director Alan Gosschalk told the programme he knows face-to-face fundraising can be unpopular, but says it is a valuable way of getting support:

Charities are having to compete to get their name known and street fundraising, is a great way for them to do so Peter Gilheaney, Giving Campaign

"On average people that support us with a direct debit would do so for five years or more.

"That helps us to plan ahead and gives us stability in our income."

And he continued: "If we were for example to recruit 10 new supporters today, we may be paying an agency something like £500 in costs.

"What we know is, on average, over the lifetime of their support, these people would be worth over £2,500. So we are making £5 for every £1 that we spend."

And despite the high costs, Shelter and other charities say it can work out cheaper than many other methods of fundraising. And it is not just about saving money.

Quality donors

Peter Gilheaney from the Giving Campaign - the organisation that promotes charitable giving - told the programme it is the kind of people street collection attracts that is also valuable:

"They bring in 16-35 year-olds who are really like gold-dust for charities because they will give over a longer lifetime.

"Charities are having to compete to get their name known, and street fundraising - the chance to actually talk to somebody one-to-one - is a great way for them to do so."

Money Box asked to speak to the five biggest commercial fundraising companies in Britain. But the only one that agreed was Push in London's Shoreditch.

Its clients include the NSPCC and the Terence Higgins Trust.

It charges a flat hourly fee for sending a team of agents onto the street, but Chief Executive Simon Rydings, would not say what that was.

"It would be impossible... to say exactly what proportion of the costs go into recruiting someone. That would require an on-site mathematician."

But he agreed that it can cost up to 90% of the first year takings.

However, town centre managers have told Money Box that street collecting has become the biggest cause of complaints from the public and are lobbying for extra powers on the issue.

One charity - Médecins Sans Frontières - told the programme it is pulling out of street collecting because it has not proved effective, and it thinks there are now too many charities raising money this way.

BBC Radio 4's Money Box was broadcast on Saturday, 18 October, 2003 at 1204 BST.