Children's hospital charity in financial crisis
Sick Kids fundraiser at centre of probe as New Pyjamas banks just £60,000
Brian Ferguson - Scotsman -3rd February 2010
The
Scottish Government has been urged to intervene in a deepening
crisis over the finances of a leading children's charity, after
£500,000 was reportedly spent on a campaign said to have generated just
£60,000.Health chiefs are being urged to carry out a full investigation into the affairs of the Sick Kids Friends Foundation and its "New Pyjamas" fundraising drive, both run in aid of Edinburgh's Royal Hospital for Sick Children.
Politicians have warned that the foundation is facing a series of unanswered questions and have threatened to call in the police after the campaign director was suspended and its chairman resigned. The Office of the Scottish Charity Regulator is now likely to be asked to investigate whether there has been any wrongdoing.
The body would not confirm if a probe was already under way last night.
NHS Lothian officials are holding crisis talks today with trustees over the future of the Sick Kids Friends Foundation (SKFF), which raises some £1.5 million a year, amid concerns that its long-term future has been thrown into doubt.
SKFF used its own reserves to fund the launch of New Pyjamas, its biggest-ever campaign. It was aimed at securing £15m worth of specialist equipment and facilities for a new children's hospital, due to open in the Little France area in 2013.
But the foundation's trustees raised concerns within the past fortnight after discovering how much had been spent promoting the campaign, and how little of the pledged support had been banked.
There are now questions over the way that the appeal has been run.
A spokeswoman for health secretary Nicola Sturgeon said last night: "The Scottish Government has asked NHS Lothian to keep us fully up to date with the situation concerning the Sick Kids Friends Foundation.
"The SKFF is an independent charity and, as such, is subject to the scrutiny of the Office of the Scottish Charity Regulator. We would be keen to be kept fully informed of any investigation that the charity regulator chooses to carry out."
The New Pyjamas appeal was led by campaign director Elaine McGonigle. She is understood to have been hired by the charity's long-time chairman, Graeme Millar. The New Pyjamas campaign is based in his office in the city.
Ms McGonigle has been suspended while Mr Millar has resigned as chair of the campaign and as a trustee of the charity. Ms McGonigle is understood to have begun her own legal proceedings.
Ten staff are understood to have been hired on two-year contracts to work on the campaign.
Ms
McGonigle announced in November that the New Pyjamas campaign –
which was backed by high-profile figures such as former first minister Jack McConnell – had
raised more than £2.5m in pledges.She hailed the public response as "overwhelming". The mystery over the charity's financial affairs deepened last night when it suggested its campaign was on target and that some £5m had been pledged to date.
A spokesman for the foundation said: "We have begun an urgent review of key aspects of the fundraising campaign for the new hospital, following concerns that current income levels do not meet agreed targets.
"The foundation is committed to taking action to deliver a successful fundraising campaign that will benefit children throughout Scotland. We are working closely with NHS Lothian in moving forward."
Lothians Nationalist MSP Shirley-Anne Somerville plans to quiz Ms Sturgeon on the issue in the Scottish Parliament next week.
She said: "We urgently need more information about how the New Pyjamas campaign got to be in this position and how the situation can be retrieved.
"I want the government to ensure we get to the bottom of what has been wrong and ensure the NHS is made to keep on top of the situation.
"A major worry is the extent to which the campaign has drained money from the foundation – £500,000 is a huge sum for an organisation that generally raises around £1.5m per year. I am also concerned about the effect this episode might have on future donations."
Lothian MSP and former GP Ian McKee said: "We need answers on this urgently, and that's why I immediately wrote to Lothian Health Board and the Sick Kids Friends Foundation asking for clarifications.
"It's staggering to see such poor financial management in what is considered one of the best children's hospitals in the world. Depending on what they come up with, there may be a case for the police to be asked to investigate."
A spokeswoman for NHS Lothian said it was not up to the health board to investigate the foundation, saying it was the job of the Office of the Scottish Charity Regulator.
A spokesman for the charity regulator said: "We would not confirm whether an individual charity is the subject of an ongoing investigation."
Controversy in the past of campaign's director
Elaine McGonigle, 44,
from Perthshire, is no stranger to controversy
after launching a high-profile unfair dismissal case against St Andrews
University.A former events manager at the university, she accused then principal Dr Brian Lang of sexual harassment and bullying in 2001.
Dr Land had warned Mrs McGonigle he intended to sue her for defamation unless she withdrew her allegations.
Papers lodged with the tribunal on her behalf alleged that Dr Lang had a "distasteful and unwelcome" habit of stroking her back and that he had made lurid suggestions about her apparent lack of underwear.
However, the case was abandoned after lawyers for both parties announced a settlement had been reached.
Ms McGonigle later publicly withdrew the allegations.
She later held a job as UK director of the Princess Royal Trust for Carers and has also acted as a consultant to charities on strategy, philosophy and fundraising.
Her profile on the New Pyjamas campaign website states: "Elaine brings with her a breadth of knowledge and experience that ensures the campaign to raise funds for the new hospital is well planned, executed and profiled."
Ms McGonigle is said to have been suspended as director of the New Pyjamas campaign after leading figures in the Sick Kids Hospital's foundation raised concerns about her stewardship of the fundraising drive.
Although she was publicly quoted in November insisting that the campaign had to date raised more than £2.5 million, insiders at the charity said it became clear shortly after the turn of the year that only a fraction of that figure had actually been brought in.
One source at the foundation said: "There are huge concerns over the levels of expenditure which have been incurred. Spending seems to have been out of control and the campaign's ambitions appear to have been far too big. The campaign has generated a lot of publicity over the last year, with seemingly next to no return."
Another said: "There are serious questions over how this campaign has been handled by Elaine McGonigle. It appears to have been allowed to drift out of control almost from the off."
Sick Kids fundraiser at centre of probe as New Pyjamas banks just £60,000
Adam Morris and Sue Gyford - Evening News - 2nd February 2010
The £15 million campaign to help give Edinburgh the world's best children's hospital was in disarray today. The Evening News can reveal that a series of serious concerns have been raised about the New Pyjamas Campaign, which has received high-profile backing across Scotland.
As of today:
• The director Elaine McGonigle has been suspended;
• The chairman of the Sick Kids Friends Foundation – which runs New Pyjamas – Graeme Millar has resigned;
• It is claimed £500,000 has been spent on the campaign but only £60,000 brought in;
• Questions have been raised by trustees over the way the appeal is being run;
• Both NHS Lothian and the SKFF have launched an urgent investigation into the matter.
Mr Millar is the chairman of recruitment firm Fletcher Jones which, it is understood, helped hire Ms McGonigle in the first place. In addition, the campaign is using Fletcher Jones offices as a headquarters base on Castle Terrace.
The Evening News also understands Ms McGonigle's son has been working at the foundation as a fundraising and events co-ordinator. Up to ten staff are thought to be employed overall by the campaign.
Ms McGonigle is said to have been suspended after trustees raised a series of issues about the way the campaign was being run. It is understood that she has in turn raised a grievance complaint against the Foundation.
A source close to the campaign said: "It looks like a complete mess and a lot of questions have not been answered."
But a source close to Ms McGonigle said it was she who raised concerns about the campaign - and that it was she and Mr Millar who chose to stand down.
Lothians MSP George Foulkes, one of the highest-profile supporters of the campaign – who has posed beside Jack McConnell in his pyjamas as appeal "ambassadors" for publicity events – said he was aware of concerns about the way the appeal has been run and had discussed it with NHS Lothian.
The Labour MSP said: "I have had a series of discussions with them and as a result I have made it clear that I think the time is right for fundraising to come under the general umbrella of the health board, as it is at Great Ormond Street and other children's hospitals.
"I am worried that this might create problems for the Sick Kids hospital and the development of plans for the future. It is very important that nothing of this is seen to be the fault of the Sick Kids or the board as they have acted as soon as it has come to their attention."
Despite spending half a million pounds, sources said just £60,000 had reached the charity's account.
Other insiders said they were dismayed at being told costs would be "covered" on other issues. Sources close to Ms McGonigle said she disputed the £500,000 figure.
Eyebrows were also raised after a lavish ball to formally launch the campaign at Dundas Castle.
Launched in 2008, the campaign's aim was to raise £15m for the new hospital at Little France, due to move ther in 2013 from its location at Sciennes.
The money raised would pay for top-class equipment and research facilities outwith standard NHS budgets.
Already the campaign – which has won widespread support from celebrities, politicians and health professionals – has announced it will be funding a new drop-in centre at the £150m hospital, and helping to provide a family hotel to allow parents to remain nearby as their child undergoes treatment.
And while the money banked remains low, the New Pyjamas Campaign did state that more than £4 million had been pledged towards the fundraising drive and only £350,000 had been spent.
One source said: "I was a bit concerned about the way money seemed to be no object in terms of expenditure."
NHS Lothian chairman Dr Charles Winstanley said: "When we were recently informed by the Sick Kids Friends Foundation about the level of funding raised by the New Pyjamas Campaign we expressed our deep concern.
"We asked them to brief us as a matter of urgency on their plans to meet their fundraising commitment to the new hospital. We had already agreed to meet them on Wednesday to discuss this.
"NHS Lothian would be concerned at any suggestion public donations made in support of our new children's hospital may have been used for another purpose."
A spokesman for the Sick Kids Friends Foundation said: "The Sick Kids Friends Foundation has begun an urgent review of key aspects of the fundraising campaign for the new hospital following concerns that current income levels do not meet agreed targets. The Foundation is committed to taking action to deliver a successful fundraising campaign that will benefit children throughout Scotland. We are working closely with NHS Lothian in moving forward."
Mr Millar today said the appointment of Ms McGonigle was done properly, and that she was "a first class fundraiser".
He said he had taken the decision to stand down after lengthy service with the charity and that it had nothing to do with these allegations.
He added: "Perhaps NHS Lothian and the trustees feel under pressure to get this £15m. I still think they will get it, but this is disappointing."
Sick Kids campaign chief was suspended for warning off wealthy donor
Adam Norris - Edinburgh Evening News - 3rd February 2010
The director of the £15 million fundraising drive for the new Sick Kids hospital was suspended after she convinced a wealthy supporter to withdraw a £100,000-plus donation.
Elaine McGonigle is understood to have warned the donor of her concerns about planned changes to the management of the charity behind the appeal, the Sick Kids Friends Foundation (SKFF).
It also emerged today that the New Pyjamas campaign paid more than £20,000 last year to the company run by its former chairman Graeme Millar, for office rent and head-hunting services.
Mr Millar, who is chairman of recruitment firm Fletcher Jones, has since resigned from his campaign post. He said his resignation had nothing to do with the allegations of mismanagement.
SKFF trustees were today due to hold crisis talks about the future of the New Pyjamas appeal with NHS Lothian bosses. The Evening News revealed yesterday that both NHS Lothian and the SKFF have launched investigations amid concerns it has spent £500,000 and raised just £60,000.
They will decide whether to appoint a troubleshooter to attempt to shore up the beleaguered campaign or hand over fundraising responsibilities to the NHS.
The SKFF, which relies on donations for all its costs, yesterday recruited PR consultants in an effort to protect its reputation.
Fundraising events planned for the coming months have been cancelled while the crisis is resolved.
Friends of Ms McGonigle today rallied to support her, praising her integrity and fundraising skills.
A friend of Ms McGonigle said the reason the fundraising director had been given for her suspension was the cancellation of the six-figure donation.
"It was not because of concerns about how the campaign was being run but because she informed a donor who was ready to give a six-figure sum of possible changes coming up to the membership of the board," the friend said. "She felt she was obliged to tell him by the laws governing the working of charities."
The friend insisted Ms McGonigle would clear her name and defended the low level of campaign donations to date.
"She is certain once everything is looked at and out in the open she will be cleared of any wrongdoing whatsoever," the friend said.
"The way the money is coming in is completely normal for fundraising on this scale.
"Getting any money in the bank in the first 18 months is a bonus, and it was always expected the money would really come in after that."
The Evening News understands, however, that there remain serious concerns among the trustees about the overall performance of the campaign.
The campaign has been renting office space from Fletcher Jones at its Castle Street base and the recruitment firm is understood to have helped hire Ms McGonigle.
The payments to the firm are declared in the SKFF accounts.
Mr Millar could not be reached for comment but has previously defended his role, saying Ms McGonigle's appointment was properly handled and that his resignation was unrelated to the current furore.
A spokesman for SKFF said: "Fletcher Jones provided recruitment services and office accommodation for the New Pyjamas campaign. This is clearly and transparently stated in the annual accounts for 2009."
Today, city bookmaker and charity fundraiser Henry Spurway said he was upset at being forced to cancel an event he was organising for the appeal, and defended Ms McGonigle.
He said: "I am 64 now and in all my years of fundraising I have never known anything like this.
"I think the way she has been treated is unacceptable, and I think if the whole truth comes out she will have nothing to worry about.
"I can only think it has been a power struggle over her head and she is the victim here. I've known her for many years and she is a woman of integrity and a talented fundraiser.
"When I found this out I was absolutely shattered. You cannot treat people like that, it is damaging for me, the people involved and, worst of all, the charity."
Relationships within the SKFF are understood to have been strained for months, with Ms McGonigle raising a formal grievance against the SKFF in November, alleging unreasonable behaviour by trustees.
The New Pyjamas campaign was launched in 2008 in the hope of raising £15m for additional equipment and research above and beyond what is provided in standard NHS budgets.
Among the facilities it had pledged to fund was a new drop-in centre at the £150m hospital planned for Little France, while it will also be involved in funding a family hotel for relatives to remain close to their children as they receive long-term treatment.
Campaign officials say they wanted to tell major donors – some of whom were promising seven-figure sums – exactly where their cash was going before their pledges were finalised.
Former GP and Lothians MSP Dr Ian McKee, a strong supporter and campaigner for the Sick Kids, said he was concerned about the recent turn of events.
He said: "I am well aware of the first class services on offer at the Sick Kids from my time as a GP, and it's staggering to see such poor financial management in what is considered one of the best children's hospitals in the world.
"If this is how the foundation plans to spend its money it could well struggle securing future donations – and that is a serious matter of concern."
Foundation trustee David Reith said he was still convinced the campaign could hit its fundraising target: "Any campaign requires refocusing and reassessment of the skills required from time to time in order to pursue its objectives. The Sick Kids charity is no different.
"We have, however, the support, the reputation, the momentum and the skills to deliver our contribution to what we are certain will be an outstanding new facility," he said.
See also:
Ministers abandoning homeless Scots in London, claims charity
National Trust for Scotland cuts fifth of its workforce
Lloyds slashes cash for Scottish charities
Work beside killers...or you're fired prison volunteers are told
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