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| Kids Company: MPs say 'catalogue of failures' led to collapse | Kids Company: MPs say 'catalogue of failures' led to collapse |
| (35 minutes later) | |
| The collapse of the Kids Company charity was a result of an "extraordinary catalogue of failures", a committee of MPs has said. | |
| The Commons Public Administration and Constitutional Affairs Committee (PACAC) also criticised the charity's trustees and the Charity Commission. | The Commons Public Administration and Constitutional Affairs Committee (PACAC) also criticised the charity's trustees and the Charity Commission. |
| Kids Company closed in August after questions over management and finances. | Kids Company closed in August after questions over management and finances. |
| Camila Batmanghelidjh, who founded the charity in 1996, said the report "is a product of bias and rumour". | Camila Batmanghelidjh, who founded the charity in 1996, said the report "is a product of bias and rumour". |
| She added: "The only place we got a rigorous fact-based investigation was with the police." | She added: "The only place we got a rigorous fact-based investigation was with the police." |
| Conservative MP Bernard Jenkin, who chairs the committee, said its inquiry had heard "an extraordinary catalogue of failures of governance and control at every level - trustees, auditors, inspectors, regulators and government". | Conservative MP Bernard Jenkin, who chairs the committee, said its inquiry had heard "an extraordinary catalogue of failures of governance and control at every level - trustees, auditors, inspectors, regulators and government". |
| 'Tragic failure' | |
| He did say that the committee had heard positive accounts of valuable work by Kids Company, and of "inspired and motivated employees", which made the trustee board's failure to ensure the charity's sustainability "all the more tragic". | He did say that the committee had heard positive accounts of valuable work by Kids Company, and of "inspired and motivated employees", which made the trustee board's failure to ensure the charity's sustainability "all the more tragic". |
| He added: "There has been a litany of allegations of inappropriate 'therapies', lavish spending and abuse of power within the organisation, and we hope that this episode highlights to all trustees that protecting the reputation of an organisation is a core element of good governance." | He added: "There has been a litany of allegations of inappropriate 'therapies', lavish spending and abuse of power within the organisation, and we hope that this episode highlights to all trustees that protecting the reputation of an organisation is a core element of good governance." |
| The charity supported deprived and vulnerable inner-city children and young people in London, Liverpool and Bristol. | The charity supported deprived and vulnerable inner-city children and young people in London, Liverpool and Bristol. |
| Analysis | Analysis |
| By Lucy Manning, BBC News special correspondent | By Lucy Manning, BBC News special correspondent |
| The report spares no one: Camila Batmanghelidjh, the trustees, government ministers, the auditors and regulators are all criticised. | The report spares no one: Camila Batmanghelidjh, the trustees, government ministers, the auditors and regulators are all criticised. |
| The heaviest criticism is for the trustees led by the BBC's Alan Yentob. | The heaviest criticism is for the trustees led by the BBC's Alan Yentob. |
| He's described as someone who condoned excessive spending and lacked proper attention to his duties. The BBC is also accused of poor leadership for failing to take action against him when he tried to make suggestions about the BBC's reporting of Kids Company. | He's described as someone who condoned excessive spending and lacked proper attention to his duties. The BBC is also accused of poor leadership for failing to take action against him when he tried to make suggestions about the BBC's reporting of Kids Company. |
| The report also makes clear that even without the police investigation that triggered the charity's collapse, it would have been unlikely to survive due to the trustees' financial negligence and Ms Batmanghelidjh's reluctance to restructure the organisation she founded. | The report also makes clear that even without the police investigation that triggered the charity's collapse, it would have been unlikely to survive due to the trustees' financial negligence and Ms Batmanghelidjh's reluctance to restructure the organisation she founded. |
| Overall it makes for very sorry reading about a charity doing some good work let down by those who ran it, those who were supposed to oversee it and those who kept funding it without making proper checks. | Overall it makes for very sorry reading about a charity doing some good work let down by those who ran it, those who were supposed to oversee it and those who kept funding it without making proper checks. |
| Mr Yentob and Ms Batmanghelidjh kept insisting there had been no financial mismanagement. This report makes clear there certainly was. | Mr Yentob and Ms Batmanghelidjh kept insisting there had been no financial mismanagement. This report makes clear there certainly was. |
| While the committee's report said ultimate responsibility for the charity's closure was on its "negligent" trustees, including the BBC's former creative director Alan Yentob who was chairman of Kids Company's trustees, the government and regulators must also learn lessons from its failure. | |
| The PACAC report criticises the government, saying it is unacceptable that successive ministers appear to have released funds to the charity "on the basis of little more than their relationship with a charismatic leader, small-scale studies and anecdotes, and no more than two visits made by [Oliver] Letwin more than 10 years previously". | The PACAC report criticises the government, saying it is unacceptable that successive ministers appear to have released funds to the charity "on the basis of little more than their relationship with a charismatic leader, small-scale studies and anecdotes, and no more than two visits made by [Oliver] Letwin more than 10 years previously". |
| 'Force of personality' | |
| The committee says such an approach was an unjustifiable way to conduct government business and to handle public money. | The committee says such an approach was an unjustifiable way to conduct government business and to handle public money. |
| Ms Batmanghelidjh and Kids Company "appeared to captivate some of the most senior political figures in the land, by the force of the chief executive's personality as much as by the spin and profile she generated for the charity", the report added. | Ms Batmanghelidjh and Kids Company "appeared to captivate some of the most senior political figures in the land, by the force of the chief executive's personality as much as by the spin and profile she generated for the charity", the report added. |
| The committee also highlights "extraordinary accounts of luxury items and holidays or spa days being lavished on 'Camila's kids', a favoured group of clients". | The committee also highlights "extraordinary accounts of luxury items and holidays or spa days being lavished on 'Camila's kids', a favoured group of clients". |
| Conservative minister Oliver Letwin over-ruled civil service objections to pay a £3m grant to Kids Company just days before it collapsed. | Conservative minister Oliver Letwin over-ruled civil service objections to pay a £3m grant to Kids Company just days before it collapsed. |
| He appeared before the PACAC committee in November to discuss the charity's closure. | He appeared before the PACAC committee in November to discuss the charity's closure. |
| Speaking after the committee's report was complied, he said: "As I said to the committee I believed it was the right thing to do to give this charity one last chance to restructure. | Speaking after the committee's report was complied, he said: "As I said to the committee I believed it was the right thing to do to give this charity one last chance to restructure. |
| Grants review | |
| "We will of course pay careful attention to this report and in light of what we now know about Kids Company we will be reviewing our grant-giving process. | "We will of course pay careful attention to this report and in light of what we now know about Kids Company we will be reviewing our grant-giving process. |
| "Charities across the country do important work transforming people's lives and strengthening communities, and they are well placed to deliver publicly funded services. | "Charities across the country do important work transforming people's lives and strengthening communities, and they are well placed to deliver publicly funded services. |
| "By updating the process by which grants are awarded we will make sure the most stable, most effective charities receive taxpayer funds." | "By updating the process by which grants are awarded we will make sure the most stable, most effective charities receive taxpayer funds." |
| Kids Company timeline of events | Kids Company timeline of events |
| June 2015: Concerns raised by the Cabinet Office about Kids Company's request for a £3m government grant, but ministers approve the funding | June 2015: Concerns raised by the Cabinet Office about Kids Company's request for a £3m government grant, but ministers approve the funding |
| July 2015: Ms Batmanghelidjh steps down, denying the charity has been mismanaged. The Met Police launches an investigation into allegations of failings and abuse linked to the charity. | July 2015: Ms Batmanghelidjh steps down, denying the charity has been mismanaged. The Met Police launches an investigation into allegations of failings and abuse linked to the charity. |
| August 2015: Ministers say they want to recover the government grant. The charity closes. Ms Batmanghelidjh tells the BBC that Kids Company was subjected to a "trial by media" | August 2015: Ministers say they want to recover the government grant. The charity closes. Ms Batmanghelidjh tells the BBC that Kids Company was subjected to a "trial by media" |
| October 2015: Ms Batmanghelidjh and Kids Company chairman Alan Yentob (at the time also a BBC executive) appear before the Commons Public Administration Committee and again deny the charity was badly run. The National Audit Office says the charity received at least £46m of public money despite repeated concerns over its management | October 2015: Ms Batmanghelidjh and Kids Company chairman Alan Yentob (at the time also a BBC executive) appear before the Commons Public Administration Committee and again deny the charity was badly run. The National Audit Office says the charity received at least £46m of public money despite repeated concerns over its management |
| January 2016: The Met Police says it has concluded its investigation into allegations against the charity, and concluded there is no evidence of criminality | January 2016: The Met Police says it has concluded its investigation into allegations against the charity, and concluded there is no evidence of criminality |
| What went wrong? | What went wrong? |
| The report also said the charity's board of trustees had failed to protect the long-term needs of beneficiaries of the charity, which had centres in London, Liverpool and Bristol. | The report also said the charity's board of trustees had failed to protect the long-term needs of beneficiaries of the charity, which had centres in London, Liverpool and Bristol. |
| It said: "Throughout Kids Company's 19-year existence, the board ignored repeated warnings about the charity's financial health, failed to provide robust evidence of the charity's outcomes, and did not adequately address increasing concerns about the suitability of its programmes and behaviours of its staff. | It said: "Throughout Kids Company's 19-year existence, the board ignored repeated warnings about the charity's financial health, failed to provide robust evidence of the charity's outcomes, and did not adequately address increasing concerns about the suitability of its programmes and behaviours of its staff. |
| "The trustees' negligent financial management rendered the charity unable to survive the predicted reduction in donations following the emergence of allegations of sexual abuse. Its closure left many vulnerable beneficiaries without an important source of support." | "The trustees' negligent financial management rendered the charity unable to survive the predicted reduction in donations following the emergence of allegations of sexual abuse. Its closure left many vulnerable beneficiaries without an important source of support." |
| 'Profile too limited' | |
| The Metropolitan Police last week announced it had found no evidence of criminality after investigating allegations of physical and sexual abuse at the charity. Kids Company had always denied the claims. | The Metropolitan Police last week announced it had found no evidence of criminality after investigating allegations of physical and sexual abuse at the charity. Kids Company had always denied the claims. |
| And the PACAC also called on the Charity Commission to raise its profile so as to provide a more visible outlet for people to raise concerns with. | And the PACAC also called on the Charity Commission to raise its profile so as to provide a more visible outlet for people to raise concerns with. |
| "A number of witnesses who had grave concerns about the charity did not alert the Charity Commission: the commission projects too limited a public profile to provide much reassurance about charities and their regulation, and to attract complaints," the report said. | "A number of witnesses who had grave concerns about the charity did not alert the Charity Commission: the commission projects too limited a public profile to provide much reassurance about charities and their regulation, and to attract complaints," the report said. |
| Camilla's Kids Company: The Inside Story will be broadcast on BBC One at 21:00 GMT on Wednesday 3 February, and on BBC Two in Wales. | Camilla's Kids Company: The Inside Story will be broadcast on BBC One at 21:00 GMT on Wednesday 3 February, and on BBC Two in Wales. |