What is the Citizens Advice organization for?

The Citizens Advice (CA) organization is, in many ways, a paragon of the Voluntary Sector.  In an increasingly regulated society, more people have problems coping with the benefits system, tax, energy bills, housing, debt, trading standards and employment issues amongst others. The 21,600 volunteers provide £111 million donated hours in the 316 CA (independent) charities and do a fine job of bringing together those who need help and those whose experience can provide it.  Matters requiring professional expertise are referred to accountants, lawyers etc and that line, which might seem hard to draw, appears to work well.

It is also remarkably good value for money. CA “help two in three people to resolve their problem [sic] and for every £1 spent on CA we are worth £8.74 to society, we save the taxpayer £1.51 and our clients benefit by £10.94.”

According to the CA Annual Report, their income in that year was:

CA works closely with, and is largely funded by, local government and yet only Devon shows up in their financial statements.  That is because the 316 independent charities which do all the work, and get the local funding, are not consolidated into annual report.  Imagine Tesco’s annual report failing to include any of its shops and supermarkets. 

A separate document partially consolidates the whole but it is a PR document, rather than an annual report. That said, and it may be rather unfair as it is truly impressive and the Impact Report makes heroic efforts to quantify the value of the CA organisation to the UK. There is no question that the benefits hugely outweigh the costs.  The financial costs are far easier to measure. The whole organization service received £239m in 2014/15 (p.29).

The two documents together suggest, however, that the HQ is more pre-occupied with political campaigning than with actual advice to citizens: their primary purposes are given as “campaigning on big issues, informing national policy and connecting people with society” whatever that last may mean.

They are so caught up in the fashionable issue of equality that it is the largest of the half dozen governance committees. “Equality, diversity and inclusion drive everything we do.”

The objects of CA “are to promote any charitable purpose for the advancement of education, the protection and preservation of health and the relief of poverty, sickness and distress. In carrying out its objects and in all aspects of its work, CA is committed to promoting equality and diversity, preventing prejudice and discrimination, ensuring equal access and promoting good relations between all sections of the community.”  Nothing in either “purposes” or “objects” (whatever the difference might be) about actual advice to citizens.

Of the £88M received by CA HQ, 46% was passed on to the 316 local charities, 21% was spent on IT and support to the local charities and 33% retained for national campaigning and central overhead.  Directors receive expenses but not salaries and the CEO and two other executives have six figure salaries, including the “Director of Consumer Futures” who joined when the “Consumer Futures” (previously called the National Consumer Council and including some watch committees such as for energy and postal services) quango was merged with CA in 2014.

It remains a separate unit within CA with the original role, namely to Consumer Futures’ role is to: “contribute to regulatory decision-making processes on behalf of consumers, represent consumers on advisory groups and panels, be consulted by regulators and businesses and undertake investigations”. This may have been a neat political move to get rid of a quango but do we benefit from it at all?

No rationale is given for retaining 33% of the income for the centre but the centre takes care of its own interests in priority to the needs of the local units.  It has £32M in the bank and afforded £1M for “rebranding” which amounted to removing the word “Bureaux” and the apostrophe after “Citizens”.  It can afford initiatives, e.g. promoting equality, which have little or nothing to do with advising citizens.

BIS, as the largest single funder, should refocus the organisation onto advising citizens, cutting its grant accordingly.  Furthermore there is a huge opportunity for the private sector, notably the large banks, accountants and law firms, to takeover much of the funding through sponsorship of the individual charities. 

Citizens Advice would provide valuable publicity for these big firms and it would be easy enough to maintain separate between general sponsorship and business links.  Sponsoring a horse race has no impact on your horse’s chances of winning.  But this is a great opportunity for professional firms to gain publicity in a positive, friendly and relevant way as well as relieving HM Treasury of a sizable burden.