The Oxfam scandal sheds much-needed light on the murky charity sector

James Price
Source: Getty

Oxfam is facing necessary scrutiny after appalling allegations have emerged in recent days, but until now, large charities have been let off too lightly.

One can only imagine the scale of the furore had a for-profit organisation been embroiled in this scandal.

Look back to the Kids Company debacle to see what happens to charities when they get too comfortable relying on so much taxpayers’ money – they take their eye off the need to deliver results in order to justify donations.

Read more: In light of the Haiti scandal, should Oxfam lose UK government funding?

The result is that those in need don’t get help, and ultimately people suffer.

Oxfam employees have likely broken the law, and unless there is a fundamental reform, it’s clear that the charity should no longer be receiving as much taxpayers’ money.

This should not be the kind of piecemeal tinkering we see all too often – what kind of message would that send to other charities if they see a steady stream of state funding despite a string of dubious actions?

It would be wrong to pull the plug on projects in the field, but there is plenty of fat to be trimmed in the Oxfam budget.

The fact that this was a disaster relief project, and not a development, shows that even the most essential services are not receiving enough scrutiny and transparency.

Beyond that though, there remains the iniquity of why we have no say in where so much of our money goes.

If I walk down the high street, I can choose which charities’ shops to go in and which direct debits to set up, but I have no power which groups my taxes support.

Because of this, state spending to charities has increased more than five times faster than private donations, with people feeling their high taxes absolve them of the need to donate more.

Oxfam is guilty of PR overextension and accused of covering up crimes of its employees at home and abroad. Cutting taxpayer funding will force the charity and the wider sector to have a long, hard look at how they operate.

Hopefully, charities will be forced to strip some of their excessive lobbying activities and focus on getting value for money in order to win back the trust of the public.

Some much needed sunlight has been shed on the sector, and this is often the best disinfectant.

The corporate governance standards are clearly inadequate for a body receiving so much of our money.

If the government is unsatisfied with the way charities are addressing these issues, they shouldn't be given as much money in the future.

There are around 25,000 charities that rely on the government for more than 75 per cent of their funding. This makes them more like Quangos, breaking the accountability link between donors and charities.

Read more: Government reviews relationship with Oxfam after Haiti prostitution claims

In time, the Department for International Trade should step in, and trade should replace aid as the best means of helping the world’s poorest out of poverty – as markets and enterprise have done consistently in the developing world over the years.

This will also mean that more resources can be spent on disaster relief and better scrutiny to ensure these bodies are not doing more harm than good.

Charities are rightly praised for their ability to act more efficiently and effectively than state actors, but when they become as large as Oxfam, transparency and scrutiny suffer.

For the sake of many around the world, they need to be held to a higher standard, and should not receive taxpayers’ money from the government until they have got their houses in order.

City A.M.'s opinion pages are a place for thought-provoking views and debate. These views are not necessarily shared by City A.M.

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