Wednesday 26 March 2014

Community Silver Trust: Charities get help from govt fund to cover operating costs

VWOs can get up to $5 million a year each for expenses like rent and salaries
By Janice Tai, The Straits Times, 25 Mar 2014

CASH-STRAPPED help groups have been given a much needed boost after the Health Ministry broadened the use of a $1 billion trust fund last July.

Since last year, charities have been able to get up to $5 million a year each for recurrent operating expenses such as rent or salaries from the Community Silver Trust.

This is on top of a maximum of $5 million a year that each of them has been able to claim from the trust to run new programmes since 2011.

The trust matches, dollar for dollar, donations raised by eligible voluntary welfare organisations (VWOs) which provide immediate and long-term care. These organisations run community hospitals and nursing homes or provide services such as rehabilitation or home care.

So far, 34 VWOs have applied for $17.5 million to defray the recurrent costs. A total of $88 million has been disbursed since the fund was introduced in 2011.

Charities say the increased government funding lets them direct more of the donations they collect to pay for patients' needs instead of daily operations, which usually eat up a large chunk of donations.

For instance, in 2002, there was public outrage when it was revealed in court that only as little as four cents of every dollar donated to the National Kidney Foundation (NKF) went to its patients.

Today, the full dollar goes directly to its beneficiaries, said an NKF spokesman.

Its administrative cost of $9 million a year is covered by government grants, including that from the trust, and recurring income, he said.

It pulls in about $24 million in donations a year but requires some $70 million to support its 3,400 patients.

Thye Hua Kwan Moral Charities divisional director Joseph Cheong said operational costs are a big worry for charities because much of government funding is for specific programmes.

"But the programmes can't run in silos and there needs to be a proper support structure where there is staff to oversee human resources, finance and volunteer management to coordinate the programmes," he said.

Being able to tell people that their donations would go directly to the needy would encourage more to give, he added.

"People are more receptive to donating to outings, furniture or food for the needy because they can see it affecting lives," he said.

The trust was introduced to "hopefully spur a much higher level of private funding over the next 10 years", said Finance Minister Tharman Shanmugaratnam in his Budget speech in 2011.

Thye Hua Kwan Moral Charities has applied for a grant from the trust to defray staff costs.

It will use the savings to introduce new programmes and subsidise clients who cannot afford its services but do not qualify for government subsidies. For example, it intends to roll out more dance therapy classes for the elderly at its senior activity centres.

Dover Park Hospice uses about a third of donated funds on its annual operating cost of $11 million.

Its spokesman said: "The operating cost has been increasing over the years as a result of our expansion of palliative care to cater to an increasingly ageing population."

The savings from the increased funding will allow the hospice to roll out new programmes and build new facilities, he added.

Madam Daisy Tay, 88, who participates in dance therapy classes at Thye Hua Kwan Moral Charities' senior activity centre in Bedok, said: "We are lucky to have such extra programmes because they are more interesting than regular exercises and keep me from feeling tired."

NCSS helps welfare groups save a bundle
VWOs save nearly $500,000 by using discounted or free services
By Priscilla Goy, The Straits Times, 28 Mar 2014

GETTING common services such as cleaning at discounted rates or for free through the National Council of Social Service (NCSS), saved welfare groups nearly half a million dollars over six months last year.

They cut $487,000 in costs from April to September last year (first half of FY2013) by using the NCSS Common Services.

At this rate, the amount saved for the last financial year ending 2013 is likely to surpass the record $815,000 saved the year before.

The services, in areas such as printing and provisions, are offered to help the 400-plus voluntary welfare organisations (VWOs) under NCSS achieve better efficiency and savings.

Currently, 25 service providers offer discounts and free help to these voluntary groups.

The top three services with the highest cost savings in the first half of the last financial year are financial audit services ($169,000), information technology hardware purchases ($113,000), and governance consultancy services ($84,000).

The top two services used by VWOs are insurance and audit services.

Lions Befrienders Service Association, which runs a befriending scheme for the elderly and senior activity centres, used audit, insurance and human resource services from participating vendors.

"We not only benefited from their professional service but also managed to save money as their audit fees were more affordable than those of our previous auditor," executive director Goh Boo Han said of the audit firm it engaged.

It is also easier to procure services through NCSS as VWOs need only look through a list of vendors who had agreed to offer their services pro bono or at cheaper rates, said a spokesman for the association.

One of the participating vendors is audit firm Fiducia, which serves about 50 organisations under NCSS and offers them discounts of 15 per cent to 25 per cent.

Managing partner Wayne Soo said: "Helping the social services sector is in line with our firm's values. This also helps to improve VWOs' quality of governance and lead to more donations."

With a growing demand from VWOs, more vendors and services are needed. Ms Quek Boon Kien, NCSS director of fund allocation and VWO benefits, said the council is getting feedback on offering other services which will cater to the needs of welfare groups.

By offering greater cost savings to VWOs through the Common Services, NCSS helps them channel their savings to serve their clients better, she added.

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