Analysis of data provided by the Charity Commission reveals a 35.7% increase in the number of charitable incorporations paying their employees more than £400,000 in the past 5 years, while the number of people working for charities and earning more than £400,000 has increased by 42.2%.
The number of charities paying employees over £100,000 has increased by 22% since 2019, with the number of charity employees earning over £100,000 having increased by 63%. These figures may reflect that charities spend £20 billion more on their charitable operations than they did in 2018 - an increase of 30%. In response, the Charity Commission has stated that they will 'take action' if a 'line is crossed' by charities renumerating their executives beyond a level which is considered reasonable. This is in the context of Wellcome's latest published annual accounts disclosing that its Chief Financial Officer, Nick Moakes, received a pay-package of £5 million.
David Holdsworth, Chief Executive of the Charity Commission, said:
Large and complex charities must attract talented people to run them, but the public rightly expects the demands of executive jobs in charities to be balanced with the selflessness that underpins what it means to be charitable. So do we.
He also said, 'Trustees are legally bound to make prudent decisions on all charity spending, including pay, and if this line is crossed, we will take action.'
What action might be taken by the Commission was not specified.
Holdsworth's statements have been criticised by leaders within the sector. Sarah Mason, Chief Executive of the conservation charity Morecambe Bay Partnership, responded that the statements by the Charity Commission were 'tone-deaf'. In response, a Charity Commission spokesperson reiterated the Charity Commission's position:
'Views on pay in charities vary, but we are clear that prudence, transparency and accountability in charities are non-negotiable – the law requires this of trustees, and so does the public.'
Authored in collaboration with Ethan Lees, a trainee at the time of writing.
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