Wednesday, October 31, 2012

The business of charity

A British charity which builds wells in Africa was refused overseas aid funding because its bid was not “innovative” - but the consultants who decide which charities should be helped were paid a million pounds.

 It is a small British charity with a simple goal – to supply clean water to villagers in some of Africa’s poorest countries.Just £3,000 can build a well  serving 4,000 people. A further £170 provides a latrine. Such straightforward schemes can save and transform lives. Operation WellFound has so far built more than 25 wells in four countries. WellFound has worked in Kenya, Senegal and Guinea Bissau, building sealed wells with hand pumps in areas where families previously sent their children many miles to fetch fresh water, or risked contracting dysentery, typhoid and cholera from contaminated shallow wells. WellFound requested £250,000 to build wells and latrines for 60,000 people in Burkina Faso, one of the most impoverished nations on Earth. The bid for funding was referred by the Department for International Development (DfID) to Triple Line Consulting, a London-based company which advises on overseas aid, to be examined in detail. The application was rejected. In an email sent by Triple Line to WellFound, the consultancy gave three reasons why the charity should not receive funding. The bid was considered not “sufficiently innovative”; it did not clearly explain how poverty would be alleviated; and it did not provide evidence of how the work could be replicated on a larger scale in the future.

 £29 million was paid in the past 12 months to Triple Line, whose main contract is to assess applications for grants from DfID’s Global Poverty Action Fund. The company passed on £27.1 million of the funding to aid providers it had vetted, while keeping the remaining £1.9 million as a fee for its services. Charities which are approved by Triple Line do not qualify for funding straight away. Instead, they are subjected to a second round of scrutiny by a different consultancy – this time a specialist branch of the global accounting firm KPMG. In the same 12 months, DfID paid KPMG more than £35 million. According to KPMG sources, most was passed on to aid providers and £3.5 million was kept as a fee.  

 Triple Line, based in Putney, south-west London, is owned by two directors who founded the company in 1999: Lydia Richardson, 42, a “socio-economist”, who lives with her husband in a £1 million house in Southfields, south-west London, and David Smith, 54, an economist, who lives with his family in a £750,000 house a few streets away. Triple Line – which states on its website “We operate on the principles of openness, transparency, accountability and trust” – is registered as a small company, meaning it is not required to publish its accounts. Last night its owners declined to disclose what the company’s income or profits were last year, or how much they were paid in salary or dividends.

A DfID spokesman said: “Operation WellFound was one of 238 applicants for a grant under the Global Poverty Action Fund. The top 20 will be awarded a grant. The nature of a competitive process means there will necessarily be a number of organisations that will just miss out.”

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