THE BLOG
11/02/2016 06:25 GMT | Updated 09/02/2017 05:12 GMT

A Charity Worker's Perspective on Trading Activities

As you can imagine, in my role as Charity Director at Age UK I have been following the current media debate about Age UK's trading arm's activities - and about charity trading arms more generally - very closely.

As you can imagine, in my role as Charity Director at Age UK I have been following the current media debate about Age UK's trading arm's activities - and about charity trading arms more generally - very closely.

One of the things that has emerged I think is how little most members of the public understand about how charity trading works. Maybe that's the fault of those of us who work in charities - perhaps we should have done more to try to get the facts across sooner - but in any event let me have a go at explaining it now.

The way the arrangement works at Age UK is basically that our trading company sells products and services to the public and then gifts the net profits to the charity.

People like me and my colleagues who work in the charity then use this money to help fund all the charitable services and activities we offer for the benefit of older people. As you may or may not know, these cover a huge range - from our free information and advice service, available online, by phone and face to face; to keep fit classes and lunch clubs run by our fantastic local Age UKs; joined up health and care services for older people with illnesses like diabetes and arthritis, to ground-breaking research projects into brain ageing.

So in one way Age UK's trading arm is just like any other business - it trades for profit - but in another way it is totally different - it gifts its net profits to the charity, rather than handing them over to its shareholders.

From my point of view as a charity worker this is a brilliant arrangement because it means that in the charity we have more money than we would have gained just from fundraising or grants of various kinds to invest in charitable services for the benefit of older people - and they are certainly badly needed at the moment.

It isn't only Age UK that works like this - lots of big charities do. So, for example, recently I bought a specially adapted telephone for a partially sighted friend of my Mum's, from a leading sight loss charity which offers a fantastic range of products for people in this unfortunate position. Similarly, I occasionally go online and buy a big sack of bird feed from a leading bird charity for the wildlife in my garden. In each case I was buying from charity trading arms - which then will have gifted the profits on my purchases back to their charities, just like happens at Age UK.

One of the issues that has arisen as part of this media debate concerns 'price', with some commentators suggesting that charity trading arms should always be offering the cheapest deals for their customers.

I don't believe most charity trading arms do provide the cheapest prices: although it must depend a bit on what they are actually selling and the markets they are competing in. Realistically I doubt they can usually or indeed ever sell things more cheaply than anyone else, and I don't accept the argument that they necessarily should.

Let me illustrate why by using one of my earlier examples: at my local pet shop I can buy bird feed that is slightly cheaper than those I purchase from the bird charity. I don't mind that I am paying a little more because I know I am buying a high quality product - the bird charity's nuts are definitely plumper! - and I also like the fact that the net profits from my purchase will be going to the charity to help them support our country's birdlife, rather than to a company and its shareholders. It's a great cause and one I want to help support.

But clearly, even if charity trading arms can't be the cheapest, they should certainly make sure the deals they are offering are reasonable for their customers. I am sure everyone would agree with that, it seems only right.

So in this context it is important I make clear that I know Age UK's trading arm totally rejects the accusation levelled at them recently that their energy tariff represents a poor deal for customers.

Their job is to make a reasonable profit through selling good products and services to the public, and then gift the net profits to the charity, and my job and my colleagues' who work with me is then to spend this money wisely and effectively, to the maximum benefit of older people. I hope and believe we both play our parts in this.

Age UK's trading arm's activities are not strictly my business - we are all part of Age UK but we operate alongside each other and, as I have explained, on a day to day basis we actually do very different things. The combination of our activities means however, that we are able to make a really big difference to millions of older people.

My Age UK trading arm colleagues are clear that the accusations levelled at them are unfair, misleading and just not right. I hope that over the next few days they will get a fair hearing as they work hard to get this important message across.