The report begins: “It is staggering that the government has given over £40 million ($60.89 million) to Kids Company over the past 13 years and still has no idea what it was getting for taxpayers’ money”.
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The founder of collapsed charity Kids Company Camila Batmanghelidjh and the charity’s chairman of trustees, Alan Yentob, give evidence to the House Commons Public Administration Committee at Portcullis House, London.
It doesn’t hold back, concluding: “This situation must never occur again”.
The PAC blames the government for not treating the charity with the appropriate level of scrutiny, resulting in missed opportunities to help other children.
In a shocking portrait of the failed charity, they also claimed that Kids Company spent £200 on a pair of trainers for a 12 year old, and paid for youngsters to go on holidays, including to America, Ibiza and to a luxury spa weekend in Britain.
In 2015, despite warnings from the cabinet office that further funding of the charity would not provide value for money, ministers still paid £3m to support the restructuring of Kids Company and secure its long-term sustainability.
Although MPs said the remit of the inquiry was not to assess the outcomes of Kids Company’s work, they were “very sceptical on the charity’s inflated claims about what it achieved”.
The report stated: “In funding Kids Company for so long they have not served taxpayers across the country well”.
It is particularly alarming that the Department carried on handing over money for years despite there never being a model that could be replicated across the country.
The government failed to learn lessons from Kids Company until the end.
PAC chair Meg Hillier said the Kids Company case would anger many people.
‘The lack of scrutiny over its funding was staggering. “Fairness and value for money – fundamental values when considering public spending – appear to have been forgotten in repeated and ultimately doomed attempts to keep Kids Company afloat”, she added.
“Even after civil servants finally refused to agree additional funding, ministers “took a punt”.
In a damning report published on Friday, the cross-party committee said money was ploughed into Kids Company to the detriment of “other, deserving” charities. Payments during the charity’s final months alone totalled more than £7m.
“The faith that things would improve when they didn’t was naïve”.
The committee has called for a “fundamental review” of the way grants are given to charities, in order to make sure they are spread “fairly” and “equitably”.
Karl Wilding, director of public policy at the National Council for Voluntary Organisations, said: “This report will make extremely frustrating reading for thousands of charities who have to submit detailed plans to have a hope of funding”.
“We were concerned that Kids Company did not develop techniques that could be picked up by other organisations, when replication of its services was a condition of its funding”, the report added.
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The report said government ministers relied on the charity’s own performance assessments and didn’t seek independent evidence of its performance.
