# 162 I'm Glad Kids Company Has Closed, by Paul Blanchard

I hope all those who sponsor kids at the Cambodian Children’s Fund, all those donors who believe what Scott Neeson proclaims on CCF’s Facebook page and in his self-aggrandizing publicity releases, read this article and ask some questions:

I'm Glad Kids Company Has Closed

To say Kids Company and Ms Batmanghelidjh have a high profile is doing them a big disservice. In the charity world, especially in London, they're absolutely massive - and much of that is down to Ms Batmanghelidjh's understandably tireless pursuit of media coverage. That's why when the wheels came off a couple of weeks ago there was almost universal shock. But what really happened here? And why is it such a shock?

There's no such thing as a free lunch

First, let's take a good hard look at free lunches. At Kids Company you could get a free lunch. And quite rightly so. If your parents/parent or carer doesn't give a damn enough to feed you; they're suffering from substance misuse issues and/or they've got no money to buy food - then it's quite right that a charity should be able to step in. But if you offer a free lunch to absolutely everyone that knocks on your door then your free lunch money isn't going to last very long.

Simplistically put, this is what happened to Kids Company. Children and young people came to Kids Company centres seven days a week, 365 days a year. They 'self-referred' - that means they alone decided to walk in through the door - they were not sent by, say, social services or local GPs. At Kids Company they got free breakfasts, lunches and dinners. And free medical and dental care, free psychiatric care, free activities, free sports, and it now appears, free cash handouts too. No one ever assessed whether these young people actually needed a free lunch or a free manicure lesson. They just assumed that because the young person was there, that they needed help.

There's no such thing as free lunch money

So, you've got a massive amount of free lunches being eaten every day by random young people who just turn up when they want to. You've got to pay for these lunches. So you need donations - the bigger the better. And that's where it all gets a bit weird.

I've read 20 or 30 articles stretching back to 2004 and there's one thing that comes across loud and clear: Ms Batmanghelidjh believes that individual donors, governments and companies should instantly hand over large sums of cash, no questions asked, and then politely disappear until the next time they're asked for money. It comes as a bitter disappointment to her that these donors might actually want to be reassured that their money was not going to be misused, or that they might want to see some measurable outcomes. In a recent article on the Civil Society website Ms Batmanghelidjh said: "People have given us money and wanted something for it. We've never had free money." Now there's a surprise.

In fact, in an article in the Charity Times in 2007, Ms Batmanghelidjh was obviously horrified that companies might want to be involved after the donation, or even undertake due diligence. The article says: "In the past former (corporate) partners have actually conducted wholesale economic evaluation of the charity without telling the board or management team what they were doing, and moreover without understanding exactly how the charity works." If someone is thinking of giving you £1million - or even £3million! - they're likely to want to know something about you, or have a quid pro quo, before they write the cheque. That's called 'the real world'.

There's no such thing as free love

Now let's look at motivations. Kids Company was founded, and operated around, Ms Batmanghelidjh's personal philosophy of 're-parenting' - that means the kids were 'adopted' by staff and the employees were encouraged to act like parents. Call me cynical but this does seem a tad strange, and potentially very dangerous. In my research I formed an opinion on where this attitude came from, and it is only an opinion. In my view, Ms Batmanghelidjh must surround herself with people who need her - the needier the better. She gets a kick out of being needed. She would dispute this, of course. And in 2007, a journalist did ask her this and she said: "They are not my children. I love them profoundly. I cry with them and I want the best for them, but they owe me nothing." But this answer unsettles me even more.

Now this need-the-needy psychology is probably not that unusual in someone who wants to work in the charity sector - and I'm pretty sure many charities send new entrants on training courses to learn how to avoid just this issue. But what is unusual in this case is that it's on such a personal and individual level. This is not a good way to run a charity. Or a good reason to set one up in the first place. I imagine a bit more objectivity is called for when it comes to running a financially sustainable charity. But it's not financially sustainable, is it?

There's no such thing as a freedom from accountability

Camila comes from an incredibly privileged and fantastically wealthy family. This is not someone who experienced any deprivation as a child. In her own words in 2009:"I came from an incredibly wealthy background." This wealth means she grew up with no fear of powerful people because her family was one of them. This self-confidence makes Camila believe that she is an outstanding businesswoman. But it seems she is not a person that easily learns from others, especially business people. I imagine if you're not with her, you are against her.

And there's the rub; the key to the whole débâcle. I'm not an expert on running a charity. But I am a businessperson and an entrepreneur. Every day I learn new things from other businesspeople - and I go out looking for new stuff to learn about running a successful business. I absolutely know there are millions of things I still don't even know that I don't know.

But what I do know is that if you look at Kids Company from a business point of view, it makes absolutely no sense whatsoever. If I'd wanted to help children as much as Ms Batmanghelidjh clearly does, then my first priority would not have been to indulge my own need for the needy. My sole focus would have been the money and, more importantly, its management. Without the money, you can't help anyone at all; without managing the money you can't hope to sustain the support long term. As the head of a charity, you are responsible for what happens to the money. You, and only you. Not being good with finances is not a valid excuse.

And that's the real tragedy here. Because one naïve person built a wall around herself, believed her own publicity, let the media convince her she was infallible, and never asked for help when it came to managing the money, there are genuinely needy kids who now have no Kids Company to turn to. But overall I'm glad Kids Company has closed because something tells me there might just be a much, much bigger story waiting in the wings...

And here is part of the bigger story:

Kids Company: Ministers Knew Of Charity's 'Gobsmacking' Spending Before Awarding £3 Million Grant

by Kathryn Snowdon, Huffington Post

Ministers were aware of a report detailing huge payments given to clients and relatives of staff at Kids Company just three days before the Government handed over £3 million, according to a report.

The charity spent more than £50,000 on a PhD for the relative of an Iranian diplomat while two children of staff members were given more than £130,000 in client payments, a leaked report drawn up by auditors at PricewaterhouseCoopers(PwC) found.

Anther huge expense was on a £305 pair of designer shoes. A client was also given £47,069 in tax-free support in 2014, according to the BBC Newsnight and BuzzFeed News investigation.

Camila Batmanghelidjh

The 13-page report was written by PwC at Kids Company's request after former employees approached the Charity Commission with 10 allegations about Kids Company earlier this year.

The report revealed "fairly gobsmacking" details, according to a senior figure in the Cabinet Office quoted by the BBC.

The PwC report was sent to the Cabinet Office on July 27 - three days before a £3 million grant was handed over to the charity, according to the BBC. It was signed off by ministers Matthew Hancock and Oliver Letwin.

Despite the "transformative" one-off payment to the charity's treasurers in July, just days later its founder, Camila Batmanghelidjh, told staff the organisation would be closing.

The fact that ministers were aware of the report will raise even more questions about why the charity was awarded more money from the Government.

John Podmore, a trustee of the Pilgrim Trust, which pulled its funding from the charity in 2003 and raised concerns with the Charity Commission, told BuzzFeed he was "incandescent".

"The car crash just became a motorway pile-up," he said.

"The report makes it quite clear – and underlines why at the Pilgrim Trust we withdrew an initial grant and refused a later application – that [Kids Company’s] financial practices were highly dubious and its work with children totally opaque.

"In the light of this report no one in their right mind would sanction further funding, rather, they would call a complete halt and demand answers as to where the previous funding went and on what basis.”

Kids Company received at least £46 million of public funding - £42 million of which came from central government grants.