11/08/2015 11:58 BST | Updated 10/08/2016 06:59 BST

Kids Company and G4S - What They Say About Modern Britain

It all seems so cut and dried. Hundreds of families and Kids Company staff protest outside Downing Street, blessed briefly by the presence of the charity's founder, Camila Batmanghelidjh. Charity good; government bad. Kids Company failed because the government wouldn't bail it out. Damn those heartless bastards.

The reality is so much more complicated. Clearly Kids Company turned around the lives of some of the most vulnerable, messed up young people in our country. Equally clearly, local government children's services could learn a great deal from the love, respect and care offered by Batmanghelidjh. But how did running the charity as a personal crusade, ignoring the most basic rules of administration, blaming politicians whenever anything went wrong, help those young people? We all have a lot to learn.

The government must tell us why it spent our money on an organisation whose trustees ignored dire financial warnings from its own staff and which couldn't guarantee its own existence from one year to the next. The accountability and sustainability rightly demanded of other parts of the public sector (and other charities supported by government) were dropped for Batmanghelidjh. We need to know why, when it is the same public money at stake, whether spent by a charity or a council. For Kids Company, it was the same money, just more of it - £14 million between 2011 and 2013; a 77% increase in funding in five years.

In the last few weeks, £3 million more was funnelled into the charity, at a time when cuts to public sector funding have forced less high-profile groups to retrench or die. In my own borough, we have lost short breaks and support groups for disabled children, refuges for women assaulted by their partners, homeless shelters. So much for the Big Society. Why did the government see this as necessary, while continuing to prop up Kids Company?

Local government has a lot to learn as well. Councils are responsible for supporting, safeguarding and, in the direst situations, taking into care the children who life has dealt a pretty crappy deck of cards. The best charities understand the need for the third sector and statutory agencies to work together. Batmanghelidjh too often viewed social workers as the enemy. In Waltham Forest, Ofsted has pointed out where we need to get better. We have responded by learning from others, rather than blaming them.

The charity sector has at least as much to learn. It should drop the incredibly misleading use of 'voluntary sector'. How can an organisation with a £90,000-a-year Chief Executive and 600 paid staff be voluntary? If they are voluntary, so is Tesco's. In Waltham Forest, many of our best community groups and charities have faced closure due to money drying up. The best of the best haven't taken this lying down - they have joined together and started to bid for bigger amounts of the now-limited money which is available. Why did Kids Company expect a public bail-out when their less-feted peers do not?

The Kids Company trustees have shown chutzpah when they should have shown humility. David Cameron has his own questions to answer, but it was the trustees, not Cameron, who continually failed to build up reserves. The trustees have blamed everybody except themselves. In doing that, they have unwittingly acted like the bankers in 2008. They have built an industry on screaming that government is irrelevant or incompetent, and then demanded that the state protect them from their own mistakes. When the charity failed, having argued that government always gets it wrong, it looked to central government to bail it out. Last week's Downing Street protest was a rally in favour of having cake and eating it.

Finally, Kids Company poses questions for all of us. Is there a role for the state? Or do businesses and charities always get it right more often than ministers and councils? The government's view is clear - we can hand over swathes of the public sector to the 'voluntary' and private sectors. And we can take billions out of the public sector - over 40% out of my council alone since 2010. But we can still expect the state to step in when our charitable saints and corporate whizzes mess up. When G4S can't send security guards to the Olympics, the army will do it; when Kids Company can't run itself properly, councils will support the young people. It doesn't take a genius to see the flaws in this masterplan.

This is a wake-up call. There is a role for genuinely expert and local charities in supporting the most vulnerable members of our society. But charities are a means, not an end. The government has forgotten that. Local government failures in Rotherham and elsewhere are all-too obvious - councils can clearly learn from Kids Company. But charities must pay attention. Professionalism does not come at the expense of care: the two go hand in hand. The young people outside Downing Street last week deserved both from Kids Company; now they will get neither.