Troubled baby bank blocked from charity bid
REGULATORS rejected a bid by the controversial Lanarkshire Baby Bank to become a charity over the planned creation of a “high salaried” post that was being lined up for its founder.
The Office of the Scottish Charity Regulator (OSCR) concluded that the proposed level of “private benefit” to employees was not necessary.
It is understood the baby bank had signalled its intention to give the general manager role to founder Bernadette Murphy, who has a chequered financial history.
Run on a voluntary basis, the baby bank gets essential items such as prams and nappies from the public and distributes them to families in need.
The organisation won a Kelly’s Hero Award – named after TV celebrity Lorraine Kelly – and recently switched premises from Coatbridge to Carluke.
However, it suffered a setback recently after the OSCR rejected its application to become a charity. The watchdog declined to elaborate on its decision at the time, but files released to this newspaper reveal why the baby bank failed to meet the strict “charity test”.
For the OSCR to approve an application, any “private benefit” provided by an organisation must be “incidental” and not “an end in itself”.
In its letter to the baby bank the watchdog stated: “In your application you told us that the organisation aimed to employ a general manager and that this was likely to be [name redacted] who would then be replaced as a charity trustee.”
The OSCR continued: “In subsequent correspondence the [baby bank] board reaffirmed its belief that the proposed salary for the general manager is reasonable but declined to provide information to support this view. The board also confirmed that it does not intend to recruit openly for the post.”
The watchdog concluded: “We accept that employing a suitably qualified and experienced member of staff may be beneficial in helping the organisation to develop further. However, taking all things into consideration, we are of the view that the proposed level of private benefit is unnecessary in order to achieve the organisation’s purposes and cannot be regarded as incidental.”
OSCR also released the baby bank application form but redacted the name of the individual that the baby bank was “likely” to employ as general manager.
The Sunday Herald understands Murphy is the person in question. A grandmother from Cleland, Murphy founded the baby bank and has been the public face of the organisation since its inception. However, she has had a troubled financial past. In 2011, an estate agency firm she co-owned was dissolved after owing money to HMRC. She was later sequestrated for a year over debts totalling nearly £500,000.
Correspondence between the OSCR and the baby bank from last year sheds further light on the questions raised by the watchdog about the application.
On November 1, the OSCR wrote: “In this case the proposed private benefit is significant. It will result in the organisation being put under serious pressure to remain financially solvent and it sets the board an ambitious fundraising target solely to sustain a high salaried post.”
In December, the baby bank stated: “The trustees are also confident in their selection of [redacted] without recourse to external open competition, not least on the demonstrable performance [redacted] has demonstrated over the first year of the LBB.”
The baby bank had 21 days to request a review of the decision, but an OSCR spokesperson said no request was received.