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Let’s develop a bolder and more effective Orphan Fund

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At the Chartered Institute of Journalists’ Annual Conference last year in Bournemouth, members agreed the next steps in the consolidation of three of the Institute’s charities. Should the consolidation take place, it will be but the latest in a series of charity mergers that have taken place within the Institute over the last 80 or 90 years.

Conference accepted the benefits that would come from a merger of the charities but wished there to be examination of the issues and more discussion with the existing Trustees. Council has now considered the matter in some depth following meetings with the Trustees. The great majority are in favour of the development but a number of Orphan Fund Trustees are less enthusiastic.

This writer finds this difficult to understand as in any new structure it would inevitably be the Orphan Fund in the driving seat. It is not a merger of equals but of very unequals. The Orphan Fund has investments of almost £2.5 million. That generated income last year of around £104,000 while outgoings (of generous grants and expenses) were about £60,000.  It left a surplus of around £40,000 for the year.

By contrast the Benevolent Fund has investments worth £274,000 while the Pensions Fund is somewhat less at £224,000, together only about one fifth of the size of the Orphan Fund.  Icome and expenditure is proportionate. Benevolent and Pension Funds had income totalling £20,000, of which most was disbursed in modest grants and pensions. The combined surplus was less than £2,000. In some years there have been shortfalls on these funds – something that has never happened to the Orphan Fund in living memory.

There is a worrying aspect of the Orphan Fund’s surplus. The Charity Commission takes a dim view of charities that build up large balances. By law, a charity exists to help its beneficiaries or promote the objectives for which it was founded. A charity is not there to generate large fund balances so the Commission has the power to direct a charity to run down its balances.

Charitable purposes

At present the Orphan Fund uses just 55% of its income for its charitable purposes. By contrast, the Pension and Benevolent Funds use 91% of their income for the purposes for which they were created.

If the Orphan Fund were to have access to the £498,000 of assets of the other two funds and to take on the responsibilities that go with them, the combined fund would use almost 60% of its income for the charitable purposes set out in the governing documents. That would be a far more satisfactory situation.

The Charity Commission has encouraged where possible the merging or acquisition of charities to make more viable and efficient organisations. Thus this proposal would go along with official thinking.

Trustees acting for what would, effectively, be an enlarged Orphan Fund would no longer be constrained in the way the Trustees of the two smaller charities are presently.

The Trustees would be able to review the whole range of welfare needs of members and their dependents not, as at present, looking at one kind of support then another. Investing and providing under the umbrella of a single Fund, the Institute would be in a far more logical and practical position to help its members should they get into situations where they need support.

Would the Fund need to be renamed? Possibly. Something like Orphans, Pensions and Benevolent Fund would probably get shortened over time to OPAB Fund.

Let your views be known either to Council in the coming months or at the 2017 Annual Conference on October 14.

Norman Bartlett

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