Kids Company – the third sector and austerity

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Camila Batmanghelidjh founded Kids Company in Camberwell in 1996

Less than a week after receiving a government grant of £3 million in July, Kids Company closed down on 5 August 2015. Its charismatic leader, Camila Batmanghelidjh, had worked in social care since 1991 when she established Place2Be, a charity for troubled children in primary schools. Place2Be now reaches 80,000 children and works in 235 schools across the UK. In 1996 she founded Kids Company, a charity for children suffering from poverty, abuse and trauma. Batmanghelidjh came across ‘hard to reach’ children in Camberwell in south London, living in conditions of severe neglect and domestic chaos. She saw that the response to early life deprivation is hostility to authority, lack of hope, and a frozen emotional state like a protective shell against further damage. She believes that damaged children can learn to trust adults only through patient interaction and therapeutic activity. Material aid such as food and shelter should be on offer at all times with an ‘open door’, street-level approach.

Kids Company grew to offer services for some 36,000 children, young people and families, many of whom were otherwise unsupported asylum seekers. Volunteers and paid staff ran alternative education centres and therapy houses, and worked with over 40 schools in London and Bristol and a performing arts programme in Liverpool. One-to- one mentoring was at the heart of the project.

Batmanghelidjh has won recognition, awards and honours for her work. In 2006 she received Ernst and Young’s Social Entrepreneur of the Year Award, followed by The Third Sector magazine’s Most Admired Chief Executive in 2007. In 2009 she was named Businesswoman of the Year, and won the Centre for Social Justice’s lifetime achievement award and the Scottish Widows Women in Public Life award. In 2013 she was named one of the most powerful women in Britain by the BBC’s Woman’s Hour and appointed an Honorary Commander of the Order of the British Empire (CBE) for services to children and young people. Batmangheidjh has received honorary degrees and doctorates from many universities including the Open University and was made Honorary Fellow of University College London in 2014. Celebrity supporters of Kids Company include pop group Coldplay, Prince Charles, Gwyneth Paltrow, Stephen Fry and Richard Branson. Alan Yentob, the BBC’s creative director, was Chair of the Trustees.

So what brought this prestigious and successful organisation to an end so rapidly? Here was a charity that perfectly matched the profile of public/private partnership so central to the politics of Blair’s Labour government and all subsequent administrations. It was supported by the great and the good, and headed by an enterprising individual setting out on a mission and generating finances from a variety of sources for nearly 20 years. Until very recently, Kids Company was a working example in the ideological war to win support for outsourcing and enterprise. Its model of stand-alone autonomous organisation was at the heart of David Cameron’s recent announcement that all schools in the country will be taken away from local authority control and turned into ‘academies’ with private, corporate, or religious sponsors.

The platform of the present government is to ‘shrink the state’, which Labour has failed to oppose, abstaining in the vote on the draconian welfare reform bill. Both major parliamentary parties claim that the public supports austerity and cuts. This populist attack on the unemployed and poor and disabled people as benefit ‘scroungers and cheats’ is now being extended to charities, the voluntary sector and Non-Governmental Organisations (NGOs).

Kids Company operates in what is called the third – or voluntary – sector. This sector has been increasingly drawn into the statutory responsibilities of the state sector. Charities are routinely contracted to provide services on behalf of local authorities and many now receive the largest part of their funding directly from central government. All 164,603 registered charities in the UK are regulated by the Charity Commission which is itself funded by the state. Under the previous Coalition government its £31 million annual budget was cut by nearly a third, ‘leading to a focus on monitoring and investigations, such as [into] the use of charitable funds to finance terrorism, rather than one-to-one advice.’ (Financial Times 22 August 2015)

The Charity Commission presents its role as central to the exercise of democracy. While charities must not be politically aligned, the Commission claims to exert political influence. It says: ‘It is increasingly the case that politicians pick up on public issues long identified by charities and endorse their campaigning work. So now more than ever the opportunity for charities to engage in public debate sits at the very heart of our democracy’.

The limitations of this romanticised liberal role for the third sector become obvious under conditions of enforced austerity. Public funding is cut off and projects are abruptly closed down. Charities are increasingly urgent about soliciting donations because many sustain massive institutions headed by senior executives on large salaries, with 32 earning more than £200,000 a year (The Telegraph, 26 February 2015). In May, the highest paid executive of the Church Commissioners for England, Tim Joy, saw his pay packet rise to £409,000 a year; David Mobbs, group chief executive of the Nuffield Health Foundation, receives £640,000 a year.

Far from influencing policy decisions, the third sector is influenced by government policy. Government attacks on statutory rights to health, education and housing are directed against the work of charities also. Austerity and cuts set a new low standard of services and the state intends to spend as little as it can get away with on the needs of the people. Indeed, charities, with their endless representations on behalf of good causes, are suddenly the signifiers of social neglect on a massive scale and become the enemies of the austerity agenda.

The Trussell Trust is the best example of this. The chain of food banks it has established with voluntary support provided more than a million people - including 400,000 children - with three days’ of emergency food provisions last year. This charity, which describes itself as ‘based on Christian principles but non-judgmental and inclusive’, receives no government funding at all. Instead, the importance of its work is questioned or ridiculed by government ministers. The Conservative Minister for Welfare Reform, Lord Freud, intimated last year that those queuing for the meagre rations were motivated by greed rather than poverty and hunger caused by his government’s cuts. There is, he said, ‘an almost infinite demand for a free good.’

Kids Company was similarly seen as an indicator of official neglect. Batmanghelidjh has said that desperate need is growing faster than the supply of political will to provide for those needs. The demand for the services provided by Kids Company is escalating way beyond the original notion of helping those who fell through the net of caring, schooling and parenting. Today, with one third of children living in poverty, there is a systemic crisis of conditions of life for a large section of the working class and it has been deliberately designed to happen this way. Homelessness, hunger and poor wages are built into the cuts in state expenditure. Children in need are not the casualties of society or the result of dysfunctional families. They are produced by the state itself. It is in these circumstances that Kids Company fell out of fashion.

Susan Davidson