Charity boss salary row rocks sector

An argument over wages is threatening to tip the charities sector 'into disrepute', says one boss.

by Abi Rimmer
Last Updated: 26 Feb 2015
Sir Stephen Bubb, chief executive of Acevo, has accused the chair of the Charity Commission of creating a ‘disgraceful distraction’ after he criticised the salary levels of some charity senior executives.

William Shawcross, chair of the commission, told The Daily Telegraph that high salaries risked bringing charities into disrepute after an investigation by the newspaper into 14 leading foreign aid charities found 11 of them paid their executives more than the Prime Minister’s £142,500 a year.

Shawcross said: ‘It is not for the commission to tell charities how much they should pay their executives. That is a matter for their trustees. However in these difficult times, when many charities are experiencing shortfalls, trustees should consider whether very high salaries are really appropriate, and fair to both the donors and the taxpayers who fund charities. Disproportionate salaries risk bringing organisations and the wider charitable world into disrepute.’

However, Bubb hit back at Shawcross’s comments, arguing that charity chief executives on average earn £58,000 a year, which is only slightly more than the £50,000 a year Shawcross is paid for his two day a week role at the commission.

Bubb said: ‘This is a disgraceful distraction by Shawcross. Of all the issues facing charities why does he pick on something that is simply not a problem.’

Bubb said it was essential for the sector to attract skilled and experienced professionals, and not keen amateurs. He added that charity chief executives earn far less than their counterparts in the private and public sectors.

‘Shawcross should be defending the sector not undermining it. What donors and what beneficiaries want is high-quality services from efficient and effective charities,’ said Bubb.

‘A strong sector needs strong leaders. We must pay to get them. Not excessive salaries, but professional ones. I suggest Shawcross gets to grip with the inefficiencies of his commission before criticising good charity leaders,’ he added.

The Telegraph’s investigation focused on charities that are members of the Disasters Emergency Committee http://www.dec.org.uk/. It found that the number of executives of 14 foreign aid charities receiving six-figure salaries had risen by nearly 60 per cent, from 19 to 30, over the past three years.

The study that Sir Nick Young, chief executive of the British Red Cross, had seen his salary increase by 12 per cent between 2010 and 2012, from £164,000 to £184,000.

A spokeswoman for the charity said the figure ‘reflects the enormous responsibility the position carries. ’

According to the figures gathered by the newspaper, the salary of the director of Christian Aid rose by 14 per cent between the financial years 2009/10 and 20011/12. The Telegraph said that former director Daleep Mukarji earned £107,867 in 2009/19 while current chief executive Loretta Minghella received a salary of £123,729 in 2001/12. In a statement published online, Christian Aid said Minghella brought substantial experience and skills to Christian Aid strengths ‘which are reflected in her salary that is on a level comparable with that of others of like position in the sector.’

The DEC said in statement: ‘The DEC plays no part is setting executive salaries at our member agencies but we believe these salaries are broadly in line with pay at other charities of comparable size.’

- This article originally appeared in Third Sector magazine

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