(Unedited version of article which appeared in the Daily Express last week.)
Just when you think that the world is getting into a worse and worse state, something happens to revive your faith. Yesterday it was revealed that a ‘hedge fund’ – an exclusive kind of investment fund – might be the biggest charitable donor in Britain. Last year it gave £50 million to a foundation which helps impoverished and orphaned children in Africa and another £33 million to a charity based in America.
These were not one-off donations either. The Children’s Investment Fund donates half a per cent of its assets to charity every year and another half per cent if it does particularly well. It was set up by Chris Hohn, 39, a graduate of Southampton University, and has become one of the most successful hedge funds in Europe.
These gifts – from the heart of high-finance – come on top of the news earlier this week that Warren Buffett, the second richest man in the world, is giving US$37 billion to a charitable foundation. It happens to be one set up by the richest man of all, Bill Gates.
Suddenly there seems to be a deluge of charitable giving by the super-rich. It is wonderful and encouraging. But the most significant thing about it is that it is also realistic.
There has been a growing realisation – both here and in America – that governments are not going to put right all the wrongs in our own countries, let alone all the problems of the world. We need to take action ourselves – either by creating charities of our own or by funding those people willing to do the work.
We have seen how a significant minority of government schools have become academies of crime. We have seen, only this week, how one NHS hospital is in such a bad way that the dead have been left in wards overnight. Yesterday also brought news of a giant £215 million stock of unused mobile homes ordered by the US government for distribution to the victims of Hurrican Katrina. They were never put into place.
There is a growing understanding that government-controlled operations have a tendency to develop top-heavy bureaucracies, to waste money and cause downright undesirable outcomes. Charities, it must be admitted, are not perfect either. But they have their advantages. They tend to be quicker to react. They are often operated by highly-motivated, philanthropic individuals who work for less than they could get in commerce – or government.
Some people may think that a revival of charities is a throwback to the days of Charles Dickens. They are right. But that is no cause for shame. On the contrary, it should be a source of confidence in the potential power of charity.
Where did all the great teaching hospitals of London like St Bart’s and St Mary’s come from?
Charitable donations. Where did most schools come from before the state took over? Charitable funds and endowments, largely given by the members of the various faiths including the Methodists, Catholics and Jews.
There were far more hospitals in Britain before the National Health Service took over in 1948 than there are now. Many of them were were charitable ones, including the Great Ormonde Street Hospital and Moorfields, the eye hospital. Moorfields, incidentally, was set up in response to an eye disease brought back by soldiers from Egypt during the Napoleonic wars. It was an example of how charities can be set up very quickly in response to need.
The development of the greatest medical breakthrough of the 20th century – penicillin – was financed almost entirely by charity. The crucial stage took place in Oxford University with finance provided by the Rockefeller Foundation.
Charity today also has tremendous potential. The Bill Gates foundation already spends more fighting AIDS and TB than the World Health Organisation.
But charitable activity also often takes place on a small scale where it is barely noticed and rarely measured. A niece of mine has been working for a charity called L’Arche which cares for people with mental difficulties. The work is done without fuss on a small scale in ordinary homes around the country. It is a terrific service and my dear, heroic niece has done her work for a pittance. A rapid growth is taking place in the number of new faith schools. This is mostly a response to the failure of certain state schools. I myself have met a young man who frankly admits that if he had stayed at the comprehensive he was attending, he would now be in jail. Instead, he went to a charitably-supported independent school and has become a model citizen instead.
One of the good aspects of the new charities is that they passionately want results. The ‘hedge fund’ charity is said to be businesslike in wanting to establish whether or not the money it gives makes a difference. Similarly the Robin Hood Foundation in New York wants to know how much benefit comes from funding, among many other things, “charter schools” – schools that are somewhat independent of government – in the Bronx and Brooklyn.
In previous centuries when charity was so important, the superstars of the day got publicly involved. The great artist Hogarth painted a wall for St Bart’s Hospital. Frederick Handel, organised a performance of the Messiah to help finance the Foundling Hospital.
The same kind of thing can happen now and has already to some extent. It is not widely recognised that David Beckham has done a great deal to help many charities and has set up his own foundation. The Prince of Wales’s efforts are, of course, well known. But this could go a great deal further.
If, as I hope, charity revives in a big way, then there is one cautionary note to be struck. Like the Victorians – the greatest charity givers – before us, we must become intelligent and discriminating in our giving. There is little point giving money to a government institution which will use the money no more effectively than taxpayers’ money. Money will go further if donated to independent charities such as Marie Curie Cancer Care and the many hospices around the country.
The welfare state made people think, for several generations, that charity was not really necessary. But now we are learning that the welfare state has not got all the answers and in many instances has made things worse. Charity has been a part of civilisation since ancient Greece. It is a good thing that saves individuals and can help restore our society. Its revival should be supported with enthusiasm.