Chuggers: Nearing the end of the road?

Opinions on street fundraising vary dramatically. For a section of the public and critics who coined the term ‘chugging’ (a contraction of ‘charity’ and ‘mugging’), it is a form of harassment that bullies or shames, and sometimes even physically intimidates, people into giving.

A poll conducted by Leap Anywhere in 2009 found that close to two-thirds of Britons would cross the road to avoid being approached by a street fundraiser and that more than a quarter had lied to collectors, saying they had already made a donation.

Major impact

But a portion of the professional charity fundraising sector paints a different picture. The Public Fundraising Regulatory Association (PFRA) estimates that face-to-face fundraising generates around £130m each year, helping to recruit millions of long-term supporters who donate large sums over their lifetime. It remains the most cost-effective means of raising funds for charity and, according to the PRFA, the professional fundraisers it regulates score highly on a wide range of indicators.

Proponents remind us that no television, newspaper, or billboard appeal can have the same impact as engaging with an actual person. It is, says former PFRA head of communications Ian MacQuillin, ‘a brilliant innovation and the pure essence of fundraising – trying to persuade some (sic) to support your charity in a two-minute one-to-one engagement’.

So, what, exactly, are the rules of this engagement?

Trustees of charities that conduct face-to-face fundraising must comply with applicable law and regulation – the Charities Acts, of course, but also other legislation such as the House to House Collections Act 1939 and the Police, Factories, etc. (Miscellaneous Provisions) Act 1916, which establishes the right of authorities to regulate public charitable collections. Trustees must then also comply with their governing document (does the charity have the power to conduct fundraising?) and with their duties to act with integrity and in the best interests of the charity.

Within that framework, though, charity fundraising is essentially self-regulated. The Institute of Fundraising’s code of fundraising practice defines best practice standards for fundraising in the UK. Among other provisions, it requires fundraisers not to importune any person and to avoid causing a nuisance or pressurising people into making a donation.

It also requires fundraisers to make certain statements about the charity they are raising funds for (for example, if its income exceeds £10m, that it is registered), and about whether they are being remunerated, and recommends that fundraisers give details of the complaints procedure upon request.

Charities can sign up to the Fundraising Standards Board (FRSB) to demonstrate that they follow good practice. The FRSB enforces compliance with the code and has the power to force member charities or fundraisers to apologise to complainants for their conduct, to modify or improve their training practices, to cease a particular method of fundraising, and to withdraw or reprint any non-compliant fundraising materials.

In the most serious cases, or for repeated breaches of the code, the FRSB may impose a fine or expel organisations from the scheme.

Virtually powerless

In June 2014, membership of the FRSB reached 1,617, which, according to its 2014 annual report, represents over 50 per cent of all voluntary giving in the UK (based on an estimate of £10bn annually).

The FRSB is virtually powerless to prevent non-members from breaching the code, but it does write to non-members to notify them of complaints against them and this has resulted in apologies and changes in practice. The FRSB also works to reduce the number of non-member charities, by lobbying grant-making organisations to make FRSB membership a condition of grant awards and by encouraging charities to request that their suppliers sign up to the self-regulation scheme. 

Direct debit collections are not regulated by the FRSB but by the PFRA, which, as an ultimate sanction, can withdraw a charity’s access to fundraising sites.

The administrative, organisational, and financial burden of compliance is one of the reasons why the majority of charities no longer employ staff to conduct face-to-face fundraising. Professional fundraising agencies now provide charities with trained collectors to solicit donations on their behalf.

The code requires charities that work with professional fundraisers to have a written contract in place, and professional fundraisers to disclose that they are being paid. Sector professionals argue that this is by far the most cost-effective approach of any form of fundraising, but some of the criticism levelled at the agencies, and the charities that hire them, relates to their fee structures.

Some charities pay professional fundraisers
in excess of £100 for each new donor signed
up, which means that for a monthly donation
of £10 it can take up to a year for the charity to recover its cost. Factor in the percentage of donors who cancel their direct debit agreements in the first twelve months (55 per cent according to a 2009 PFRA study) and the cost to the charity is higher still.

Public confidence

Despite regulation and the involvement of professional firms, a section of the public would probably disagree with former PFRA head of communications MacQuillin that chugging is ‘a brilliant innovation’.

In a 2013 report, the House of Commons public administration select committee (PASC) warned: ‘It is clear that self-regulation has failed so far to generate the level of public confidence which is essential to the success of the system and the reputation of the charitable sector.’

High-profile press coverage of charity scammers and bogus appeals has damaged public confidence. Businesses on streets regularly patrolled by fundraisers are reported to have complained of the nuisance caused to shoppers and the negative impact on their business.

In an attempt to control face-to-face fundraising, the PFRA introduced site-management agreements with close to 100 local councils.

These agreements impose conditions on where, when, and how many collectors can solicit donations for a given charity. There has been a decrease in complaints from the public in council areas where these agreements are in place.

Charities have also recognised that there is a level of wariness of street fundraisers and a number of approaches have been tested recently that rely on new technologies. Comic Relief added an element of playfulness to its street fundraising campaign, placing statues of celebrity supporters in public areas – a contactless card reader in the statues’ pockets enabled passers-by to make a donation.

A number of transaction-based schemes provide the opportunity to donate when you make a payment (for example, the Penny for London initiative on the Transport for London and National Rail services and the Pennies digital charity box).

Cancer Research this year launched contactless donation points in their shop windows, meaning that donors can give easily and freely without feeling harassed to sign up for direct debit or provide personal details. An interactive screen shows how their donation will be used to fund cancer research, allowing donors to engage with the cause they have contributed to. The code provisions that apply to such unmanned static collection points are less demanding than those for face-to-face collections.

However, none of these approaches provides the human element that makes face-to-face fundraising such an important source of charitable funds, so it is likely that we will continue to see high-visibility-vest-wearing charity collectors at street corners for some time.

Or perhaps advances in technology will make the street collector obsolete? But, in that case, will the self-regulatory framework be sufficient to ensure public confidence in these innovative ideas, or is a move to formal regulation, which also formalises the role of the FRSB, on the cards? SJ

Darren Hooker, pictured, is a solicitor and Clive Vergnaud is a trainee solicitor in the charity and social enterprise team at Stone King