Pricey celebrities and prizes swelled the cost of an annual Christmas fundraiser to a third of a million pounds, a construction industry charity has said.
Lighthouse Club CEO, Bill Hill, said “significant inflationary price increases” for special guests and expensive auction prizes had contributed to a £334,123 bill for a Christmas Lunch event appearing in the charity’s FY2022 accounts.
It was also revealed the industry charity had recorded a £217,197 loss following a £1 million cash investment in the stock market.
£1.75 million in total had been invested with investment firm Brewin Dolphin as of the report’s publication, as it is permitted to do.
The Lighthouse Club said this was “within market norms” and that there had been a “significant recovery” since then.
One industry rival, however, posted on social media the Lighthouse charity had been “gambling” with donations to support construction workers and their families and that it “doesn’t sit right”.
“This was a write down of 12.4% on the £1.75m investment with Brewin Dolphin due to stock market fluctuations,” Mr Hill said of the stock market loss.
“The Charity Audit and Governance committee considered this to be within market norms considering the prevailing market conditions.
“The charity is monitoring this closely on an ongoing basis and there has been a significant recovery since 31st December 2022. The loss now stands at 2.5 %.”
The trading update also showed £334,123 went towards a Christmas Lunch event, from which the net income was £129,139. This cost was a nearly £112,000 increase on the previous year.
Mr Hill said this was due to the “significant” cost of celebrities and prizes for the event, brought about by inflation.
“Due to market economics, we kept the price of tables static in 2022 and absorbed the significant inflationary price increases in event costs and celebrities,” he said.
Adding: “There was also significant cost in supply of auction prizes for the event that generated lower margins than expected.”
The accounts also showed staff and office costs rose to £1.95 million, an 84% increase on FY2021 (£1.06 million).
£754,635 went on staff wages and salaries (FY2021: £473,925).
According to the report, it appears this was in part due to a decision to use in-house staff to man its helpline as opposed to a third party, and in response to a “dramatic increase” in calls due to macroeconomic factors.
Call volumes were 23% higher (3,421) in 2022 (FY2021: 2,788).
The charity said it employs 31 staff, the majority of which work in service delivery.
Lighthouse added it had “invested heavily in regional charity development resources” in 2022 to accelerate its Company Supporter initiative, but if “direct event costs” are removed from the calculation, staff and office costs actually rose by 59%.
Mr Hill said: “Since Covid struck we have been transitioning from a charity that relied heavily (over 80%) on event income to fund our charitable services to a charity delivering services that deliver a portfolio of welfare and wellbeing services that provides a safety net to all construction workers and their families in the UK and Ireland that are struggling. This is now funded by growing community of companies and individuals donating an annual pledge.”
Lighthouse has five main income sources – events; membership subscriptions; corporate engagement; trusts, foundations and legacies; and donated goods and services.
More than 3,000 individuals donate an annual subscription. And, at 31 December 2022, 510 companies had pledged £807,000 in annual donations.
The charity in Ipswich does not receive public sector funding.
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