Where does the money go, donors ask?

The questions kept coming. And coming. For an hour, Rick Fee, director of Presbyterian World Service & Development, assured the female caller that her donation would be well spent. Her concerns are not unique. Other PWS&D staffers fielded similar calls. After giving nearly $926,000 to tsunami relief, Presbyterians want to be certain their money is well spent.

Fund-matching was one of the most pressing questions about tsunami relief. "People are mostly concerned about government matching," said Naba Gurung, a program associate with the Anglican Primate's World Relief and Development Fund. "If their funds weren't going to be matched, they would go elsewhere."

"Since people were given a choice from the beginning, they were forced to make a decision," said Fee. "People started thinking, 'How do I choose?' and then asked us, 'What are you doing? How are you doing it? How does that fit in with other agencies?'"

Unfortunately, comparing charities is a somewhat futile task. The big three — Canadian Red Cross, World Vision Canada and UNICEF Canada — have large staffs and a lot of expenses. They also raised millions of dollars for the cause. It is difficult to compare them to smaller charities such as Canadian Lutheran World Relief with a full-time staff of 11 or PWS&D with a staff of five. "There's no agreed upon way of what's included in administrative costs," said Fee. "It's like comparing apples and oranges."

The general barometer is determining the percentage of administrative expenses, which normally include staff salaries, office expenses and expenses pertaining to board and committee meetings. The differences lie in more complex areas such as coordinating overseas projects, processing donations, and paying for rent and utilities. The Mennonite Central Committee Canada, for example, counts project coordination as a project cost. Other charities consider it administration.

The MCC splits its expenses for processing donations between administration and fundraising. The Primate's Fund usually doesn't need to count this as expenditure because donations are processed at the congregational level. However, due to the government fund-matching for the tsunami appeal, receipts were processed at the head office, and have thus become an administration cost. PWS&D has hired two temporary workers to help process tsunami donations and distribute tax receipts — an expense that falls under a separate budget line for contract work. Finally, most charities pay a price for rent and utilities, while the Presbyterian Church in Canada absorbs those costs for PWS&D. "The church believes in the ministry, so every attempt is made to keep overhead as low as possible," said Fee.

The Primate's Fund puts 100 per cent of its emergency donations towards relief, as does Canadian Lutheran World Relief. The Canadian Catholic Organization for Development and Peace has an in-house rule of fixing its administrative costs for emergency projects at 8.5 per cent, down from the 10.4 per cent it normally spends. PWS&D keeps its administrative costs for emergency appeals to about 3.5 per cent, down from its regular 6.9.

The Canadian Revenue Agency requires that no more than 20 per cent be spent on administration costs and fundraising when donations are given to a specific appeal. If the charity is acting on behalf of another charity, and not doing any of the work themselves, they must put 100 per cent of givings towards a specified project.

Questioning how things work in the relief and development world can have positive implications. "If there is a positive thing to come out of the tsunami," said Ken Woodingham of the Canadian Catholic Organization for Development and Peace, "it is that the public is starting to understand the reality of international development work. There's no such thing as an emergency ending in three months — it can go on for years."