A domestic violence charity that received £1.4m of public money collapsed after “chaotic” management, according to a public spending watchdog. Broken Rainbow, which was the only UK-wide charity supporting lesbian, gay, bisexual and transgender domestic abuse victims, had been surviving “hand to mouth” for years, the National Audit Office said.
Auditors drew comparisons with the discredited charity Kids Company, which collapsed amid controversy over how it had been run. They found that over 15 months, a third of payments from the charity’s bank account went to its chief executive, Jo Harvey Barringer, including money for her wife, who also worked at the organisation.
The Home Office, which provided much of the charity’s public money, did not meet its own requirements in monitoring the grant, the report concluded.
Broken Rainbow, based in Manchester, closed in June, 11 years after its founding. Among other services, the charity provided a national helpline and an online chat service.
The NAO said it had been “unable to establish a complete picture” of the company’s finances over the final year, as records were deleted remotely shortly after the liquidators seized its computers. “There is disagreement between the trustees and former CEO about who was responsible for this,” the NAO report said.
Broken Rainbow had been “spending much more than its income” for some time, with increasing amounts of money going on consultancy, research, campaigns and staff costs. Its emergency reserves shrank by 97% in just two years, from £80,083 in 2012 to £2,307 in 2014, despite its income rising by 52%.
In its final year, it had less than £500 in its bank account on most days and more than half of each government grant to cover the upcoming three months was gone within 24 hours, according to the report. Most of its cash came from the Home Office, which had handed over £1.4m since the organisation was founded in 2004.
Broken Rainbow adopted a similar approach to Kids Company by lobbying for government funding in its final days, telling the press it was “broke” and on the brink of closure.
On 1 March last year, Companies House issued a public notice threatening to close Broken Rainbow within three months, but on 7 April, the Home Office gave it a quarterly payment of £30,000.
The NAO report states: “The management of Broken Rainbow was chaotic and did not comply with regulatory requirements over a number of years. Many different parts of government had some information about Broken Rainbow’s difficulties, but none had the complete picture.”
Harvey Barringer signed off payments from the charity’s accounts alone in the final months before it went into liquidation, despite two signatures usually being required.
While the CEO was a consultant managing director, she was involved in the recruitment process to find a successor. She was eventually appointed to the post at a salary 27% higher than advertised and which allowed for a further 15% bonus, according to the report.
Harvey Barringer said payments while she was CEO totalling £114,397 between April 2015 and July 2016, which amounted to 32% of payments from the charity’s bank account, covered her hourly fee in a previous role as managing director, her £57,500 salary, and other expenses, including wages for a member of staff. It also included salary payments for her wife, who worked at Broken Rainbow, which Harvey Barringer’s records showed amount to £12,000.
In May last year, Harvey Barringer was dismissed by the board of trustees for gross misconduct in relation to several allegations about her conduct while in post.
