A charitable cause
Wednesday, 23 July 2008, 8:42 am | 1,758 views
Tan Kin Lian / Senior Writer
During the past two years, several high profile charities in Singapore have come under the spotlight. They were involved in financial and administrative irregularities. These notable cases are the National Kidney Foundation, Youth Challenge and the Ren Ci Hospital.
People wonder, “What is happening here? Why are we facing these irregularities in a clean, corruption-free place like Singapore?”
Perhaps, it suggests some major weaknesses in the Singapore system.
Welfare
The problem starts with the Government’s view that welfare is bad and can be abused. The Government restricts the funds that can be used for welfare. There is a belief that the voluntary and charitable sector can take better care of the needy and poor and provide the assistance in a more efficient manner.
The actual experience has been disappointing. The facts have been glaring in our faces for so many years. Yet, Singaporeans, including our leaders, have been quite naïve.
In 2005, the National Kidney Foundation raised $98 million in funds. After deducting direct fund raising expenses of $19 million, the net proceeds were $78 million. It took care of 2,300 patients on dialysis. The funds raised works out to $33,000 per patient.
However, the patients are not given free treatment and still had to pay a fairly significant share of the cost of dialysis. The NKF had an accumulated fund of $262 million at end of 2005.
Ren Ci raised $30 million in 2007. The direct fund raising expense was $1.5 million, giving a net income of $28.5 million. It took care of 413 beneficiaries in their chronic sick wards and nursing home. This works out to $69,000 per resident.
In both cases, the amounts raised are excessive in relation to the number of beneficiaries.
Structural weaknesses
These charities have an independent board of directors, comprising of respectable members from the business community and society. The board is expected to exercise governance over the funds and management of the charities.
In practice, it is difficult for the non-executive members of the board to exercise these functions. Most board members have been approached mainly on their ability to help in the fund raising activities of the charity.
They are now required to shoulder the additional burden of providing close supervision over the investments of the surplus funds, use of the funds and the day to day operations of the management.
Some of these board members may find their job descriptions to be too onerous and the rewards too unattractive, that it is better to leave this thankless task.
A business organisation can employ highly paid accountants and senior managers to carry out the functions of internal control, checks and balances. This is not possible with the limited budget of a charity.
Community Chest
Let us look at the work of the Community Chest of Singapore, an organisation that is not tainted by these irregularities. The Community Chest raised $47 million in 2007 to take care of 350,000 beneficiaries. The average amount raised per beneficiary is $134.
It seems that the aggressive fundraising by NKF and Ren Ci might have siphoned charity dollars that could have gone to the Community Chest to take care of a larger number of beneficiaries.
Every dollar of donation raised is made available for the social service programmes run by the charities funded by the Community Chest. The fundraising costs are sponsored by the Totalisator Board and Singapore Pools.
I have always held the view that it is better for fundraising to be centralised under the Community Chest, instead of allowing individual charities to compete for the charity dollars.
This will avoid unnecessary competition and waste and reduce the fundraising cost. It will ensure that more of the money raised will be available for the social programmes, instead of being spent on marketing and administrative expenses.
However, there was a fear in the past that the Community Chest would not be able to raise sufficient funds to meet the needs of the larger charities like NKF and Ren Ci. This was the reason for their exclusion from the ambit of the Community Chest. As events turned out, the independent fundraising approach has raised other problems.
Schools to raise funds
The fundraising efforts have spilled over to the schools and their students.
Over the years, there have been many complaints from parents that their children are asked to raise funds for the schools and for charity. The students have to approach their parents and relatives for the donations.
Many schools carry out these fundraising activities throughout the year. The parents felt compelled to donate to these causes to support the requests of their children, relatives and friends.
Children from poor families are put at a disadvantage. They are unnecessarily embarrassed by their inability to meet the fundraising target.
Teachers have complained that they are required to spend time to collect and account for the donations raised, and to co-ordinate the students in this effort. It is an added burden to their heavy workload.
We should stop these wasteful activities. If funds have to be raised, let it be done in a coordinated manner once a year, where all the schools can take part together.
A New Strategy
I wish to suggest this approach towards funding charities for the future:
1. Set up an alternative centralised fund raising organisation to take care of the specific needs of the larger charities, such as NKF and Ren Ci.
2. Allow donors to make specific donations to these charities, instead of going to a common pool, which is the approach adopted by the Community Chest
3. Set a limit to the annual amount that can be raised for each charity, including the total amount that can be accumulated in their reserves.
4. The funds raised should be managed by a trustee organisation and released to the charity to fund their services, based on an approved budget.
5. The specific charity can set up a fundraising committee to work under the ambit of the centralised body.
I hope that these suggestions can help towards a charitable cause.
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“There is a belief that the voluntary and charitable sector can take better care of the needy and poor and provide the assistance in a more efficient manner.”
Assuming there is.
Believe or face reality?
I have no idea de.
I heard from CNA he shall be free soon.
For the biggest abuse of public trust he got 3 months.
Wow, quite fair judgement won’t you say?
So fair I think its hard to be fairer than that.
For abusing public trust and multiple allegations, he kenna a 3 month sentence.
Some charges the prosecutor said to have dropped.
I wonder the why oh why?
Kin Lian,
Whichever organisation is concerned, it is the people behind it that make the differences. It is clear that the so-called management committee did not do its fiduciary duty. Their concerted aim is probably more concerned with capturing a bigger slice of the donation dollars rather than how the funds are ideally used for its intended purposes. To put it bluntly, more and more of Singapore’s charities are run along the likes of a commercial enterprise.
Identifying the government as the source of the budding problem is legitimate. In NKF’s case, it is atrocious that even with regular external audit where alarms were at times sounded, no preventive actions were instigated. The public can only draw the conclusion that this was because of the prominent patron and other public figures supporting the concept and modus operandi of the charity.
We have come to a point where the Community Chest is an ideal centralised donation centre. All monies will be apportioned to all charities under its umbrella, leaving the necessary staff of the charities to strictly focus on their specific responsibilities. We can expect much higher level of transparency and accountability from the Community Chest as well.
In summary, the Community Chest (Finance Minister) will apportion funds based on the budget put up by the individual charities (all ministries), after due diligence.
Of course, there are many areas to improve on governance and management.
Laws most likely to be broken by sophisticated and educated elite tend to attract less severe penalties vis -a- vis those by the lower social strata. Following media reports of local court cases reinforce this opinion. Perhaps lawmakers in deciding on the weight of punishments to mete out took into consideration on the likelihood that they could be at the wrong end of the stick one day. 18 yrs for smelling woman’s armpits, 3 months for betraying the trust of a nation. 5 years for cheating $ I0 million. 1 year for stealing $100. I could be wrong.
I believe the 350,000 beneficiaries is misleading. That number includes public education outreach. So the actual number of people benefiting from a service is far lower.
So the solution of the article is to scale up Community Chest and let them decide where to spend one’s donations. As it is the Government makes many decisions on my behalf without my input if the solution is take away more decision making power from me I say no thank you.
I rather donate to who I want to when I want to.
If the ECB can’t keep track of their funds what makes you think Community Chest would be any different?
I hope that MediaCorp will not air charitable shows as glamourous and in such great scale in the near future. NKF is a bad publicity to our nation and abroad, and now Ren Ci. It was to me more like an entertainment shows in return for donations from the public. Of course, donars gave out of love for the beneficiaries and the needy. But, history repeats itself, as proven to fail utterly.
Just because our Government ’s perception of a welfare state in Singapore is not healthy in terms of national management is just an excuse and exit to shouldering resposibilities.
Whenever things went wrong, our Government, the hero stepped in and all things will put back into perspective, and this episode of event ends beautifully here. Let’s be happy our big brothers came in time to rip the bud of the scandal.
manbeer,
Agree with you. Personally, I had stopped donating to charities way before the NKF scandal. Instead, I believe in extending help to the needy that I know of and come across. As such, 100% of my goodwill is utilised for a cause that I intended for and not channelled for any other dubious purposes.
My take on the Community Chest is to weed out the unnecessary focus of the charities’ management on donation drives and instead, fully assume their responsibilities on proper usage of funds, including transparency, of course.
Charity, like some ministers have said about welfare, has become a dirty word too. With so many high profile big charity organisations coming out in the limelight of dishonorable or dubious conduct, and I would guess many more yet to be uncovered, it is time to stop donating anyhow.
We, as citizens should open our eyes and ears extra wide and be extra cautious in parting with our hard-earned money just because of our compassion and feeling for others. The hard facts are very hard. Therefore, our hearts cannot be too soft.
We have to face the reality of today’s highly educated and smart people in managerial or leadership positions. If these people turned fraudulent, we are not any wiser. They are in control of things, not us. Our legal system seems to be in favour of those in higher positions than the lower rungs when judgement and punishments are made and meted out. The saying goes: “Birds of the same feather flock together.” So most likely, the highly educated will lend their shoulder to those closer to their own kinds and positions, most probably because of the “Old Boy’s Net’ connections. Rich, powerful and highly educated professionals have more strings to pull than those of the commoners. That is a fact of life.
So, it is time to make our own decision instead of allowing others to rule over every aspect of our life, from cradle to grave, including who or where to donate our money to. If the government does not wish to regulate the charities, than we the donors should regulate our own money in our own pockets. The practice of direct donations, instead of through an agent or an organisation, is much to be desired (though may not be practical for some).
[...] Ren Ci Head Monk Charged - The Online Citizen: A charitable cause [...]
We need an ombudsman/speak up/whistle blowing culture ….. we are not allowed to question. Without questions, how can we get objective answers and solutions that are good for all?
Over the years we have refocus our direction. I remember very vividly that we are told of confucion values. today we replace it with monetary values. It is I and no more we. It is Rule of the jungle. Survival of the fitest.
Wherever I go, I see so many selling tissues. These people cannot be train and retrain. No amount of work or all fare can they be integrated in the economic environment. We as a nation have lost touch. As catherine said SOCIAL DIVIDE, WEALTH DIVIDE AND NOW NATION DIVIDE.
I have also refocus my contribution. I do not contribute anymore. There are too many layers . The salary, advertisement etc are unnecessary. These GST is suppose to take care of the poor. I give directly to those who sell tissues. and the handicap. Look at them ernestly and see how they can be train and retain It is impossible and yet they are no even help.we have to relookat how to help the poor needy and handicap. I have decided to help directly I leave it to you to decide for yourselves.
the gst and growth diviends first installment is Singapore Democratic Alliance worker party Chiam See Tong and Low Thia Khiang speak for our behalf our mean peoples to ask goverments to cope our the inflations without opposition party we cant survive in this world and we cant hang out to go to Clarke Quay to pub,bar and restaurants to enjoy life in singapore and other country and also to buy things and paid bills what we like we are not corrupted but we have to fight the inflation prices increase so we must show support to opposition party to have a party without gst and growth diviends first installment it is very worse luckily with gst and growth diviends first installment thank gosh our familiy can survive ,friends,brothers,sister and also our blood brothers can surive it all thank to Singapore Democratic Alliance worker party Chiam See Tong and Low Thia Khiang speak for our behalf for moneys
is it truth that womanladiesgirlsoldwoman said then how about erp cost prices, the oil prices the road taxes and tax that we have to paid and see increase in our working salary paymentsas i see someone said what to do but life must still go on in the mediacorp channelnewasia i see that mediacorp also support opposition partys will Singapore Democratic Alliance worker party Chiam See Tong and Low Thia Khiang speak for our behalf ?i think so so i confirm sure that i will vote for opposition partys on the election day
it true that the goverment and the lee kuan yew and the member of parliament concern for themself for the water they dont care about all this like the old beggers lying on the street they will said help to the beggers like you saying please help youself they can give NTUC Fairprice vouchers only to needy actually by right in the prices and oil increasing cost we have to help ourself luckily got opposition partys help us or we will all suffer but if we choose opposition partys surely we will get more moneys the pap dont care for all the peoples like u and me and your gangs members groups and your friends,family members ,blood brothers,girlfriends,relative want lah but i will still support opposition partys in slient
there already is a central body. give ncss more bite. heard that they already know but powerless as they only can bark.
“Set a limit to the annual amount that can be raised for each charity, including the total amount that can be accumulated in their reserves.”
this is downright …let me think of a polite term… questionable. put a cap to people’s generosity? if exceed limit then how? go to mcys coffers?
The writer’s recommendations bear some thought. One would like to add that schools should not be part of the fund raising process. The students are not there to hold flag days and beg for donations to meet some school target. By all means encourage volunteerism. Giving a hand in direct help of the needy is of more use than begging for a few dollars here and there to fill up the school’s donation card.
Hi Changipatriot (post 15)
The annual limit is for tax exemption. It should be set at an amount that is sufficient to meet the operating needs of the charity.
We should prevent the accumulation of excess funds, as it leads to the kind of problem that have been encountered in our charities.
Mr Tan Kin Lian,
I am dismayed that you somehow did not mention the priest Kang’s embezzlement.
Was it selectively omitted due to whatever reason?
Would you choose to clarify, please?
Regards
George Mac Master
Finland
Kin Lian,
I suspect that the reason why the govt is reluctant to have fundraising and the charity dollar managed by a centralised entity is because it sees altruism and philanthropy as being integral to social cohesiveness.
Indeed, PM Lee said as much recently.
If we have fundraising or a single entity handling the money, will that make the rest of us less charitable? After all, people may start to think that well, let the rich donate and let that single entity or organisation handle all of our charity needs.
I do agree with your point about students doing fundraising. I think it should be banned. Students are already inundated with so many things nowadays. Raising money for the schools, especially, should be banned.
After all, it is the govt which should be taking care of the schools and not kids. Also, isn’t that why we pay taxes in the first place?
Kin Lian - ” In practice, it is difficult for the non-executive members of the board to exercise these functions. Most board members have been approached mainly on their ability to help in the fund raising activities of the charity. ”
The current practice by charities to appoint their board members on the basis of their fund raising skills and/or social standing led to the problems we are now facing. These people, although with good intentions, may not have the time and energy to fully carry out their onerous tasks at the charities’ boardrooms.
If society or the state chooses to impose ever stricter liability on them for their failings, it would be even more difficult to find good and willing candidates in future.
Perhaps Board members should be pre-qualified and appointed on the same basis as company directors in listed companies and paid a reasonable annual salary. The acceptance of remuneration would impose on board members an irrefutable (and legal) obligation to spend more time on the job and carry out their duties more diligently.
Rather than “rewarding” big fund raisers by appointing them as board members, perhaps the charities could give them formal recognition by making them patrons of the particular charity.
Hi elite_ah (#18)
I am not familiar with Priest Kang’s case. The omission was not a selective action.
[...] Ren Ci Head Monk Charged - The Online Citizen: A charitable cause [...]
If the Government gives adequate funding for the old, sick and needy, there is less need to rely on charity. Charity will continue to be a challenge to manage, and to run efficiently.
I read today that the Government of Taiwan has decided on the following measures to help the people to cope with high inflation:
1. Reduce income tax
2. Give a monthly allowance of SGD 233 to 450,000 people at the low income level. This is quite generous compared to the smaller handout from the Spore Government.
Hi Andrew
Refer to your comment (#19)
If there is a centralised fund raising body for specific charities, more people are likely to donate. They help their favorite charity and know that the donations will be better used.
Community Chest had a big scandal too - Dolly Davenport. Does the name ring any bells?
Mr Tan
Sunday Times had an article on the blight of “poor” charities.
I had thought that charities like these would be part of the Community Chest.
But it seems not. If so, why not? Does CC have mininum barriers to join?
Hi Another Tan,
I believe that the Community Chest accepts the small charities. But the some charities prefer to have their own fund raising effort, as they think that they can raise more money compared to the funding by Community Chest.
I think that all charities should join the Community Chest or the second fund raising organisation. It ensures better accountability and reduce the cost of fund raising. It also reduce donor fatique.
I receive so many mailers from the non-Community Chest organisations. It is a big waste of money to send out the mailers, when the actual percentage who respond is probably less than 5%
Just read Durai of NKF fame just got out of prison.
Whatever one may think of his misdeeds, maybe rather than send him to jail, he could have been put to better use advising the Community Chest on what techniques to use to prise open the wallets and purses.
Personally I don’t trust the Community Chest! My trust leans more towards The Singapore Bhuddist Lodge (SBL) and the Red Cross (RC). There’s practically no question what donations are used for by SBL and RC, You’d have to guess what percentage of your donations goes to who and who and who from the Community Chest.
A Tan, it’s very easy to see what works to “prise open the public’s wallets and purses”. Just observe Ho Sun Yeow the rocker-cum-missionary for City Harvest Church. She once approached a friend of mine as soon as she heard he graduated and ready to be called to the bar. City Harvest Church selectively chooses the people they want to attend and support the church. They are one of the first churches here to use technology (web cams and live telecast) and music to “spread God’s love”. Donations are by monthly giro. Modern marketing!