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What went wrong at Kids Company? What went wrong at Kids Company?
(1 day later)
High-profile charity Kids Company had come under scrutiny in recent weeks for its performance and management. Founder Camila Batmanghelidjh agreed to step down as chief executive last month but now the charity has closed, saying it has run out of money. High-profile charity Kids Company has closed amid a row over funding and with its performance and management under close scrutiny. Its founder has said there was a "malicious discrediting campaign" against the charity, while Prime Minister David Cameron said he was "sad" it had closed.
What happened to Kids Company's funding? So what went wrong?
The charity relied heavily on public money; in its last set of published accounts, for 2013, 23% of its income came from central and local government. Whitehall provided £4m. What happened to Kids Company?
Officials and ministers at the Department for Education are said to have expressed opposition to funding the charity in the past. The charity - which relied on individual donations and government grants - said it closed due to a lack of funding.
Last month it was revealed the Cabinet Office had raised concerns about how the charity was being run and how it was spending its money. Kids Company said the funding crisis was caused the number of children "pouring through our doors" for help, and by "as yet unsubstantiated allegations" - which it said stopped donors giving money.
Government officials told Kids Company it would not receive £3m of funding unless its figurehead Camila Batmanghelidjh was replaced as chief executive and the management was restructured. Those allegations included concerns over the safeguarding of young people.
Ms Batmanghelidjh agreed to move roles and the money was paid. But the Cabinet Office then said it planned to recover the grant because it believed the conditions attached to the use of the money were not met. The charity had said it planned to restructure and had sought funds from the government and donors.
What does the charity say? But it closed on Wednesday, with ministers saying they wanted to recover a £3m grant given a week before.
Ms Batmanghelidjh said staff were "completely overwhelmed" by the number of children arriving in need of help. What was Kid Company?
She said "a lot of them" were child protection or child mental health cases. Kids Company was founded in 1996 by Camila Batmanghelidjh in south London.
"That's why I kept going back to government and saying 'you can't leave a children's charity with cases like this'," she said. It provided practical, emotional and educational support to deprived and vulnerable inner-city children and young people, in London, Liverpool and Bristol.
"I wanted government to come and take responsibility for child protection and child mental health cases that a charity like ours shouldn't be holding." Up to 36,000 vulnerable children and young people received support and Kids Company employed more than 600 people.
Ms Batmanghelidjh said some people within government wanted the charity to "disappear" and that there had been a campaign to "discredit" her. Its high-profile supporters included Prime Minister David Cameron.
Who is Camila Batmanghelidjh?
Born into a wealthy family in Iran, she arrived in England aged 12, speaking little English. She went to a private school, Sherborne Girls, in Dorset.
She gained a first-class degree from Warwick University then trained as a psychotherapist in London before founding Kids Company in 1996. She was its chief executive for 19 years.
Ms Batmanghelidjh has won an array of accolades and awards, including honorary degrees and fellowships from universities including UCL and the Open University. She was also appointed CBE.
She was listed among the UK's most powerful women by BBC Radio 4's Woman's Hour in 2013.
What is the impact of the closure?
Kids Company said 11 centres in London and Bristol and an outreach project in Liverpool had closed, and its work with more than 40 schools in London and Bristol would end.
The government held talks on Thursday to draw up emergency plans to support children affected.
It said it had met with local authorities, charities, youth clubs and other organisations to divert children to other services.
On Thursday, Bristol City Council said it had reopened drop-in services for young people in the city.
Kids Company closure timeline
Why are the police involved?Why are the police involved?
Last week the Metropolitan Police opened an investigation into claims that details of incidents involving young people who used the charity had not been passed to police. The Metropolitan Police opened an investigation into claims that details of incidents involving young people who used the charity had not been passed to police.
The investigation is believed to have been triggered by testimony from a former employee given to a BBC Newsnight and BuzzFeed News investigation.
The charity said it always met its obligations to report crimes.The charity said it always met its obligations to report crimes.
Ms Batmanghelidjh said a donor who had offered £3m pulled out when they learned of the allegations.Ms Batmanghelidjh said a donor who had offered £3m pulled out when they learned of the allegations.
What has the charity said?
Ms Batmanghelidjh rejected claims of financial mismanagement.
She said Kids Company had become "a football for the media and the civil servants".
Some people in government wanted the charity to "disappear" and there had been a "malicious discrediting campaign", she added.
She told the BBC Kids Company had been subjected to a "trial by media" based on "rumours and conjectures".
What was the reaction to its closure?
Mr Cameron said he was "sad" the charity had closed, adding: "It did good work and that's why the government supported it."
Alan Yentob, chairman of Kids Company and BBC creative director, said suggestions of financial mismanagement were "complete rubbish".
"We have had problems raising funds, and the demand has been increasing," he said.
Supporters of the charity took part in a march in London on Friday - from Camberwell in south London to Downing Street - calling for a greater awareness of vulnerable people who used the service.
Why has it become a political issue?
The charity relied heavily on public money; in its last set of published accounts, for 2013, 23% of its income came from central and local government. The government provided £4m.
Officials and ministers at the Department for Education are said to have expressed opposition to funding the charity in the past.
Last month it was revealed the that Cabinet Office had raised concerns about how the charity was being run and how it was spending its money.
Government officials told Kids Company it would not receive £3m of funding unless Ms Batmanghelidjh was replaced as chief executive and the management was restructured.
Ms Batmanghelidjh agreed to move roles and the money was paid. But the Cabinet Office then said it planned to recover the grant because it believed the conditions attached to the use of the money were not met.
What was the government's £3m grant for?What was the government's £3m grant for?
The £3m grant had been intended for a "transformation and downsizing plan" that would support the charity as it reformed itself, but the BBC understands £800,000 used to pay its monthly wage bill. The grant had been intended for a "transformation and downsizing plan" that would support the charity as it reformed itself, but the BBC understands £800,000 used to pay its monthly wage bill.
It is not clear what conditions the charity understood were attached to the grant.It is not clear what conditions the charity understood were attached to the grant.
Who decided to award the funding?
The Cabinet Office's lead official, Richard Heaton, wrote to ministers on 26 June asking for a "ministerial direction" before making the payment.The Cabinet Office's lead official, Richard Heaton, wrote to ministers on 26 June asking for a "ministerial direction" before making the payment.
He said he thought the grant would be poor value for money and sought written confirmation that they wanted him to go ahead anyway. He said he thought the grant would be poor value for money, and sought written confirmation that they wanted him to go ahead anyway.
Ministers Matthew Hancock and Oliver Letwin agreed the funding should be given after the leadership changes, and said the charity had a "realistic prospect of long-term viability". Ministers Matthew Hancock and Oliver Letwin said the funding should be given after the leadership changes, as the charity had a "realistic prospect of long-term viability".
Why has it become a political issue? What have politicians said?
Former Children's Minister Tim Loughton said he had raised "serious concerns" over whether the charity gave value for money when he was in government from 2010 to 2012.Former Children's Minister Tim Loughton said he had raised "serious concerns" over whether the charity gave value for money when he was in government from 2010 to 2012.
Now a senior figure involved in funding talks has said any concerns raised were "all overridden by Number 10", claiming the prime minister had been "mesmerised" by Ms Batmanghelidjh. A senior figure involved in funding talks has said any concerns raised were "all overridden by Number 10", claiming the prime minister had been "mesmerised" by Ms Batmanghelidjh.
David Cameron has been a prominent supporter of Ms Batmanghelidjh. Labour has called for the National Audit Office to investigate the flow of taxpayer money to Kids Company.
He referred to Kids Company as "visionary" and mentioned its work in his "hug-a-hoodie" speech in 2006 as an example of the type of public service he wanted to see. The Cabinet Office said the government supported Kids Company "to help it deliver services for vulnerable young people and so we are disappointed it has been unable to move to a sustainable financial position".
What services did Kids Company offer?
Its work included counselling, walk-in centres with hot meals and help with housing and healthcare for children and young people whose parents were often unable to care for them.
It had branches in London, Bristol and Liverpool, employed 650 people and provided "practical, emotional and educational support to some of the most deprived and vulnerable inner-city children".
Who is Camila Batmanghelidjh?
She was born into a wealthy family in Iran in the mid-1960s and arrived in England aged 12, speaking little English. She went to a private school, Sherborne Girls, in Dorset.
She gained a first-class degree from Warwick University then trained as a psychotherapist in London before founding Kids Company in 1996. She was its chief executive for 19 years.
Ms Batmanghelidjh has won an array of accolades and awards, including a series of honorary degrees and fellowships from universities including UCL and the Open University. She was also appointed CBE.
She was listed among the UK's most powerful women by BBC Radio 4's Woman's Hour in 2013.
What will be the impact of the closure of Kids Company?
Kids Company says 11 centres in London and Bristol and an outreach project in Liverpool have closed immediately, and its work with more than 40 schools in London and Bristol will end.
Councils which had contracts with the charity say measures are being put in place to protect people who used its services.
The Cabinet Office confirmed it was working with local authorities to ensure young people "have access to the services they require".