Bogus Charity Bag Collections

Thérèse Coffey Excerpts

Wednesday 13th October 2010 Westminster Hall

[Tracey Crouch (Chatham and Aylesford) (Con)]

It is an honour and a pleasure, Mr Gray, to be speaking on this important issue under your chairmanship. This is not the first time that bogus charity collections have been raised in this Chamber. In February 2007, the hon. Member for East Dunbartonshire (Jo Swinson) held an Adjournment debate on the matter; the then Minister, charitable organisations and consumers wholeheartedly welcomed the debate, and it certainly raised awareness of a growing problem. However, despite the positive response from the then Minister, we meet three years on and the problem is more widespread, not less, and nothing much has changed. I hope that this time this Minister will be able to offer not only warm words, but real action.

House-to-house collections of donated goods are a crucial source of income for many charities—those with and without shops. For example, last year they contributed more than £22 million to the British Heart Foundation for the fight against heart disease, and 43% of sales income came from goods donated through doorstep collections. Age UK raises approximately £25 million per year from charity bags, which accounts for around 60% of the stock sold in their shops.

Even for the vast majority of charities that do not have shops, house-to-house collections form a massive part of fundraising. Legitimate private collection companies—some of which are better than others—are used to collect on behalf of many charities. Their professional fundraising ability means that companies such as Clothes Aid collect around £2 million per year on behalf of their tied charities.

Charity bag collections are a convenient way for people to recycle unwanted textiles. Our increasingly busy lifestyles mean that it is hard to find the time to drop clothes into a shop, and, given that shops themselves are often located in pedestrianised areas, it becomes incredibly difficult to make large donations following a spring clean, or a post-diet or a pre-winter wardrobe update. Like millions of people, I put my clothes in a charity bag and pop them outside my door before heading off to work. I do so in good faith, with the belief that they will be put to excellent use and raise vital funds for whichever charity is collecting. Sadly, it appears that that trust can sometimes be misplaced.

On 13 July, a flyer was posted through the door of my constituent, Mr Philip Wilson. It simply stated that clothes, shoes, blankets, towels and other such items were urgently needed by Breakthrough Breast Cancer; that Clothman Ltd, which it stated was a commercial participator that helps raise money for Breakthrough, would pick up the bags on Wednesday; and that £100 from each tonne collected would go to the charity. It carried the Breakthrough branding, had a woman pictured on the front, a registered charity company number and website details. It also had a mobile telephone number that you could call for further information.

The leaflet looked genuine and a normal charity supporter would not doubt it. However, on this occasion the leaflet went through the wrong door—or the right door, depending on how one looks at it. Mr Wilson is mid-Kent’s fundraising co-ordinator for Breakthrough Breast Cancer, and therefore knew that his charity did not do door-to-door charity collections. He contacted the local council, the trading standards office and the police, but, despite a collection van being stopped mid-act, the operator was allowed to continue for allegedly having the correct registered charity number on the flyer. Of course, the flyer was fake, but the number was legitimate. That incident illustrates the difficulties that genuine charities face.

I first became acutely aware of bogus charity collections during the summer recess, when BBC South East televised an in-depth undercover investigation, which highlighted a spate of incidents across Kent. That investigation was already under way when Mr Wilson contacted the BBC and, shortly after, he came to my surgery. It has become clear that what happened in Chatham in mid-July has happened and continues to happen daily in streets up and down the country.

There are two major problems in combating this criminal activity: one, the legislation and, two, the often relaxed attitude of the police. Taking the police response first, I understand that the theft of a single bag of clothes may not seem like a high priority, but when it is estimated that the theft of clothes is in excess of 36,000 tonnes per year, at a cost of more than £14 million to charity, it should be taken more seriously. There are some examples of a good police response. Derbyshire police have recently conducted a successful undercover operation into this specific crime, and other forces have made individual arrests, but usually the attitude of the police is that they face tight budgets and bogus collections are not a key target or high priority.

The second challenge is the reluctance and/or capability to perform cross-border policing on level 2 or 3 crime. For example, Clothes Aid recently passed over intelligence on a small gang stealing in Bedfordshire, Hertfordshire, Essex and the Met area, but each force has refused to take the lead because it is “cross-border”. That reaction ignores the fact that this is, quite simply, an organised crime, which is cross-county and growing.

If I may, I shall move on to the legislative aspects. For a charitable collection to take place, a licence must be applied for under the House to House Collections Act 1939 and the House to House Collections Regulations 1947. The Local Government Act 1972 transferred all licensing to the local authority, except in London. Larger charities can apply for a national exemption, but without a licence or an exemption doorstep collection is illegal. Although it is feared that as much as 50% of house-to-house charity collection is bogus, Charity Bags notes that only one in 10,000 illegal clothing collections in the UK is subject to enforcement action or prosecution by the local council.

In the Charities Act 2006, the previous Government introduced a new licensing and regulatory regime for house-to-house collections, but secondary legislation is required for it to be implemented. I was concerned to read that the Minister and the Charity Commission have publicly stated that they do not believe that to be a priority. Given the effect on public trust and the financial cost for charities, I respectfully disagree, and I suggest that anything that helps combat this organised criminal activity should be a priority. I urge the Minister to introduce secondary legislation at the earliest opportunity. A better licensing system is only one aspect of the changes required to combat the problem. Since most stolen clothing is exported, I would like to see more robust monitoring from border police and better international intelligence communication.

There needs to be tougher enforcement action against bogus collectors, from the van driver up to the mastermind operator organising the entire ring. The current level of deterrence is laughable, and bogus collectors continue to act with impunity. Consideration needs to be given to whether the bogus operators breach other important legislative and tax requirements, from employment duties through to tax evasion. Finally, the charity industry needs to work together to improve collection codes. I hope all relevant organisations will participate in the consultation on the new code of conduct recently published by the Institute of Fundraising.

[Dr Thérèse Coffey (Suffolk Coastal) (Con)]

First, I congratulate my hon. Friend on securing the debate, because it is important. One concern raised with me by a constituent was about the transparency of the revenue that goes to charities. I encourage my hon. Friend to include that as part of the consultation; there is a variety of information. There is also the unscrupulous practice of certain collectors picking any charity bag—not their own—and re-bagging it. I support my hon. Friend’s actions.

[Tracey Crouch]

My hon. Friend makes a good point. Furthermore, we could consider a register of reputable door-to-door collectors to provide the donor with easy access to trustworthy information. Transparency is extremely important to combating the problem, and we need to work with the charity industry and the legitimate private companies that operate under contract with those charities, to ensure that it exists.