How does CAFOD raise money and spend it to end poverty overseas?
15 December 2017
We answer your questions on where CAFOD's money comes from and how we spend it effectively.
How much of the money donated to CAFOD goes directly to the people who need it?
78p in every pound donated goes directly to support our international emergency and development work, with 12p in the pound used for education, advocacy and campaigning work, to tackle the injustice that keeps people in poverty. 10p in every pound is invested to generate future income. The amount we spend on generating funds is one of the lowest compared to other charities.
During emergency appeals, 90p in every pound is used to respond directly to the emergency – including the costs of food, water, blankets and emergency supplies – with the remaining 10p used to help the organisation scale up to respond to the emergency. This ensures that when the organisation is prioritising the emergency response, resources are not diverted away from our other essential work.
Stewardship is one of CAFOD’s key values, meaning we take great care of the valuable resources entrusted to us. We strive to spend money wisely and are always happy to receive feedback.
Where does CAFOD get its funds from?
In 2016-17, CAFOD received £50m in income, with over 60% donated from supporters in England and Wales, mainly from the Catholic community. The rest is raised from Caritas and other Catholic agencies, and other governmental and institutional donors, including £6.8m in funding from the UK government. CAFOD’s income and expenditure is publicly reported annually.
How does CAFOD make sure funds aren’t lost to corruption?
The majority of CAFOD’s charitable work is carried out by making grants to partner organisations, many of whom we have been working alongside for several years. Before individual grants are made, project proposals are subject to a formal assessment and approval, and all projects are systematically monitored for the duration of their existence. Major projects are subject to a final independent evaluation review, and financial audits are also conducted when a single partner organisation receives £50,000 or more.
Working through trusted local partners helps to safeguard our work from corruption. We operate a zero tolerance approach to corruption and fraud. Any suggestion of malpractice results in a suspension of programmes while investigations take place and local authorities are contacted.
How do you know that you’re getting value for money?
Before we fund a project, a written project proposal is subject to formal assessments and approval. By systemically monitoring each project throughout its duration and by carrying out final evaluation reviews of major projects we can, alongside our partners, evaluate the work we fund to ensure it delivers on its objectives.
As we work to long-term strategies agreed with our partners, with many grants made on a three-year basis, we are also able to track how communities can increasingly shape their own lives in the longer term.
How much does CAFOD pay its staff and Director?
CAFOD’s salary scales are benchmarked within the NGO sector and are generally around the 50th percentile. CAFOD has a defined set of country-specific salary scales, with each staff member paid according to their band/grade and the length of experience in their current job. CAFOD does not offer any performance-related or other form of bonuses.
CAFOD’s Board of Trustees is responsible for setting the remuneration levels for CAFOD senior executives. Last year, the total benefits and remuneration received by CAFOD’s highest paid member of staff (the CAFOD Director) was £93,260 salary, with £11,751 employer's national insurance and £16,320 employer’s pension contribution. This is lower than the salaries paid to comparable UK INGO Directors.
CAFOD is committed to ensuring that there is a clear relationship between the remuneration policy and practice of senior staff and that of CAFOD’s whole workforce, and aims to set a UK salary scale where the ratio between the highest and lowest salary is within 5:1; last year the ratio was 3.5:1.
Our latest remuneration report is available to read in full.
Isn’t there enough government aid money going to poor countries in need?
CAFOD’s vision is a world where everyone can flourish and fulfil their potential. We believe that saving lives through aid is a moral duty and remains a crucial part of effective development. We also believe charitable and government aid is critical if we are to fulfil our moral duty and vision inspired by the Gospel.
However, it is also crucial that funds are spent effectively. Aid money spent well not only saves lives but allows people to stand on their own two feet, through supporting services such as health and education that enable people to thrive. Crucially, it also supports governments to build the vital long-term infrastructure in areas such as finance and the law to allow, for example, better tax collection.
Aid is a crucial part of development, yet we also understand that by itself aid will not end poverty. If poor countries are to prosper we need to go beyond aid and address issues such as global businesses being more transparent about their conduct, giving small enterprises the support they need and tackling climate change, which is already having devastating effects amongst the communities we work.
Why is the government giving money to poor communities overseas when we’ve got so many people in need in the UK?
Church teaching tells us that it should never be a choice between competing ‘causes’; we should all work towards the Common Good ensuring all have access to what they need to contribute and flourish. As long as there is poverty overseas, the aid budget is the right thing to do regardless of other factors or issues at home.
Britain is a friend to the world’s poorest people – our compassion and generosity sets an example to the rest of the world and represents the best of British values.
Here in the UK we are regularly presented with suggestions that we must choose, for example, between health and social care for our families here or the aid budget that cares for those living in extreme poverty in developing countries. We are offered misleading ideas that making changes to the UK overseas aid budget could eliminate funding gaps in our services here at home. The reality is that the aid budget accounts for less than a penny of every pound spent in the UK and provides essential support for our poorest brothers and sisters living overseas.
As Pope Francis wrote in Evangelii Gaudium #54 “...the excluded are still waiting. To sustain a lifestyle which excludes others, or to sustain enthusiasm for that selfish ideal, a globalization of indifference has developed.”