Small Talk: Whitehall needs to put its money where its mouth ison helping small business - The Independent Small Talk: Whitehall needs to put its money where its mouth ison helping small business - The Independent

Sunday, June 17, 2012

Small Talk: Whitehall needs to put its money where its mouth ison helping small business - The Independent

Small Talk: Whitehall needs to put its money where its mouth ison helping small business - The Independent

That is what is supposed to have happened after the Government announced in November 2010 that its goal would be to award 25 per cent of all contracts to SMEs. It even announced some reforms to help it achieve that target – notably a streamlining of the pre-qualifying questionnaires that bidders for public sector work must complete before even registering an interest in a contract.

Sadly, however, the initiative isn't working. Just 7.8 per cent of government contracts went to SMEs during the third quarter of last year, with not a single government department coming anywhere near the 25 per cent target. At the Department for Business, which championed the goal, the proportion of contracts awarded to SMEs during the third quarter actually fell, to 13 per cent compared to 16.5 per cent in the previous quarter.

Moreover, the reality of the data may be much worse than the headline figures suggest. Colin Cram, a specialist in public sector procurement, has just revealed a string of embarrassing disclosures made to him by the Department of Business on its 25 per cent target. Not only does it acknowledge that the target is an aspiration rather than a hard and fast policy, the department reveals that the 25 per cent only applies to central government contracts. This work accounts for just £65bn of the entire £236bn public sector spend.

Worse of all, says Mr Cram, the figures just unveiled are not necessarily for contracts handed directly to SMEs. Departments are allowed to include contracts where SMEs feature somewhere in the supply chain. In fact, with that flexibility, it's quite an achievement to have kept the SME contract count so low.

The suspicion must be that some departments are paying only lip-service to what was never a particularly impressive commitment in the first place. Although some of the bureaucracy involved in bidding for public sector work has now been eased, there are other ways to help SMEs get more of these contracts. In Scotland, public bodies have been given guidance on how to design tender processes so as to give SMEs a better chance of winning.

At the very least, converting the 25 per cent target from aspiration into fully fledged policy would be an important signal of intent. Announcing that only direct contract awards count would be even better.

Camera experts in the picture

OMG, which specialises in mobile motion capture – recording movements digitally – has unveiled two new contracts in the past few days.

In a £2.27m deal with the Highways Agency, OMG's Yotta subsidiary will spend four years working to determine the condition of 140,000km of Britain's main roads.

That contract win followed a deal to supply The Imaginarum with 80 of its specialist cameras. It will also be working with the studio, founded by the actor Andy Serkis (Gollum in The Lord of the Rings, right), and the film producer Jonathan Cavendish (best known for the Bridget Jones films).

The deals could mark a turning point for IMG, which had a tough year in 2011, though it remained profitable. The stock now trades at 24p, a third more than a week ago, but still well off the 44p high of a year ago.

Telecoms punt for £2.5bn growth fund

Though it became fully operational last April, the Business Growth Fund has been taking its time to make investments. The fund is backed by Britain's five biggest banks but operates autonomously and has £2.5bn of capital with which to make investments of between £2m and £10m in fast-growing small and medium-sized businesses. In return, it gets a seat on the board plus an equity stake of at least 10 per cent.

Until this month, the fund had made only three investments. Now there is a fourth, with BGF announcing it is putting £10m into Lincoln-based GCI Telecom Group. Founder 12 years ago by Wayne Martin, who still runs the business, GCI's telecoms and data services are producing annual revenues of close to £70m.

BGF is taking a minority stake – the exact stake is undisclosed – and has also installed the telecom industry veteran John Cronin on the board of GCI as non-executive chairman.

Small businessman of the week: Price is now so important – which is good news for us

Matt Davies founded DirectFerries, a ticket retailer and independent travel provider

The downturn hasn't necessarily been bad news for everyone, particularly if you're a business exposed to the way in which people are now so much more determined to get the best possible price.

One thing we've found over the past two or three years is that everyone is after deals all the time – it used to be that people knew they would get cheaper tickets if they booked well in advance, but now they expect that all the time. Price is everything – if people are not getting the best price, they're not going, and they're waiting to the last minute to make that decision.

Our business has also been a beneficiary of the unpredictable weather and industrial action that has wreaked havoc on the airlines – the UK market was starting to get a little stagnant three years ago, but the ash cloud was a huge boost for us and that has kept on going.

Islamic finance: Notion of stewardship imbues business ethics - Financial Times

Since the start of the global economic crisis in 2008, financial education has been under increased scrutiny from those dissecting what went wrong. Who, after all, had trained the perpetrators of the crisis? Were the “masters of the universe” ever taught about ethics? And if not, why not?

Training in Islamic finance, which was already gaining in popularity pre-crisis, has grown from strength to strength, as it has developed a reputation as a haven of common sense and relative security in uncertain times.

At least two of the causes of the crisis – gharar (risk) and gambling – are banned by sharia (Islamic law).

“Several of the ethical lapses which occurred in the financial sector are prohibited in Islam,” says Omneya Abdelsalam, the director of the El Shaarani Research Centre for Islamic Business and Finance and the director of the MSc in Islamic Finance at Aston Business School. “[The crisis] highlighted the resilience of Islamic banks.”

She says that religious beliefs, not limited to Islam, can help leaders be more responsible in business.

“The belief in God, and that absolute ownership of everything is solely His, brings with it an acute level of responsibility and accountability based on the notion of stewardship, which is equally placed on each individual, given that all mankind is believed to be equal before God.

“Such beliefs have a direct and powerful impact on the way business is conducted.”

This “notion of stewardship” or khalifa, common to all Abrahamic faiths but particularly central to Islam, overlaps considerably with corporate social responsibility and transparency, two areas that have enjoyed a post-crisis boom.

Dr Abdelsalam says khalifa manifests itself in Islamic businesses “through fulfilling social responsibility of the business to the best of its capabilities, including fair treatment of employees, care for the environment and customers, and fulfilling the obligation towards shareholders and other stakeholders, through wise use of financial resources”.

At Aston, the Masters in Islamic finance encourages students to think about ethics in every module, be it accounting, contract law, or conventional finance modules.

Cedomir Nestorovic, a professor of Islamic business and management at the Singapore campus of Essec, a French business school, agrees that Islamic finance courses need to address these issues.

He says: “A course about Islamic finance should not be teaching financial techniques alone. There must be a part dealing with religious and ethical issues, explaining the rationale behind the industry.”

Prof Nestorovic adds that elements such as marketing and management must also become more integral parts of Islamic courses, so that they increase their breadth.

One criticism aimed at Islamic finance instruments and banks, or Islamic finance divisions within conventional banks, is they do not embrace the spirit of sharia, but try to find ways round it, in an emulation of conventional finance.

“There is a trend to consider Islamic finance as a ‘cosmetic’ industry where products and services are conventional ones with an Islamic veneer, the only purpose to obtain clearance from thesharia board,” says Prof Nestorovic.

The danger is that Islamic finance, in trying to become more popular, loses its firm roots in religion and ethics.

Some Islamic scholars, adds Prof Nestorovic, “consider that Islam finance does not exist because riba (interest, banned under sharia) is embedded in contracts, even if it is not labelled as such”.

“There is also a certain disagreement between Islamic countries about the definition of a tangible asset and some accounting principles.

“All in all, there is a gap between what is taught and realities for a certain number of observers,” says Prof Nestorovic.

Small business confidence in Wales lowest in the UK shows FSB research - WalesOnline

Confidence levels in the small business sector in Wales are the lowest of any nation or region in the UK, according to new research published today by the Federation of Small Businesses.

The FSB’s latest Voice of Small Business Index for Q2 of this year shows in Wales a net balance on business confidence of minus 12 points – representing a two point improvement on the position in Q1.

However, despite a narrowing of the gap between negative and positive outlook responses, Wales swaps places at the bottom of the leaguetable with Northern Ireland, which saw its negative balance improve markedly from minus 33 in Q1 to minus 6.

In terms of confidence the north-east of England have the most upbeat small firms, with a net positive balance of 16 having been minus nine in Q1.

In Scotland, although still in positive terrain, the positive outlook fell from plus nine to plus 4. In the south-west of England it was up 1 point to plus 10.

As well as Wales and Northern Ireland there were also negative balances in London, the Midlands and Yorkshire & Humberside, while for the north-west it was neutral.

Despite pressures, UK-wide confidence just remains in positive territory at plus 1.3, down 0.9 points on Q1.

The survey was conducted before George Osborne’s £100bn liquidity plans for the economy announced in his Mansion House address last Thursday.

The FSB wants his Funding for Lending Scheme to provide cash to those firms that need it, with a clear reporting process so that tangible evidence is given to show the money is being passed on to small firms and not just shoring up the banks.

Janet Jones, Welsh Policy Unit Chair for the Federation of Small Businesses, said: “Overall, the Small Business Index across the UK remains in positive territory, despite a slight decrease since Q1 and despite still only being mildly above zero.

“Although business confidence has not risen as sharply in Wales as in other parts of the UK – meaning we are reporting the worst business confidence – the slight increase does show signs of improvement whilst other parts of the UK have seen a marked drop.

“The index highlights serious constraints to growth, notably access to finance, with many small firms still finding it difficult to access credit which can result in them missing growth opportunities.

“Access to capital is an absolute necessity and the Welsh and UK Governments must give serious consideration to giving small businesses realistic alternatives to bank finance.

“A further issue is that with 63% of small firms saying that fuel is the main upwards driver of business costs, we urge the Chancellor to cancel the planned 3p rise in duty for August.”

The research found that than four in 10 (41%) small firms were refused finance from high street banks as confidence dipped in the second quarter.

However, despite the credit squeeze, more than 50% of respondents said they still plan to grow their businesses over the coming 12 months.

But the proportion of firms looking to grow rapidly shrank from 10.9% Q1 to 7.2 % in Q2.

With one in five firms saying access to finance is the main barrier to achieving growth aspirations, the FSB believes the credit squeeze will impair small businesses’ growth plans, reduce new job creation and further set back the UK’s struggle to emerge from recession.

Of 17 industry sectors measured, confidence fell in all but two. Confidence rose moderately in health and social work related firms, as well as vehicle sales and maintenance companies.

All other sectors reported a fall with financial and real estate services showing a dramatic decrease.

There were further sharp falls in retailing, leisure, sports and entertainment, as well as hotels and the restaurant and bar trade. A moderate decline in confidence was reported in manufacturing, IT and other business services.

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United Financial plans 286 apartments neighboring Meijer in Franklin - The Business Journal

United Financial Group Inc. changed the housing development plan for a 22.6 acre site in Franklin to accommodate the planned Meijer  store and proposes 154 senior apartments and 132 market-rate units.

The project would expand Appleton-based United Financial’s Foresthill Highlands Senior Community in Franklin. The project would be on the north side of West Puetz Road, immediately east of the proposed Meijer grocery store that would face Highway 100.

The city of Franklin had already approved construction of 344 senior housing units on the property, but United Financial revised its plan to include market-rate apartments on the land closest to the Meijer store. Construction could begin in 2013 on 30 of the market-rate apartments, according to plans submitted to the city.

“The change from elderly housing to high-end market rate units on the west side of the parcel was necessary to accommodate the rear elevation, immediately adjacent truck access and loading docks of a big-box retailer,” United Financial wrote in a letter to the city. “The existing approved development of three, three-story elderly buildings directly adjacent to and facing the proposed retail big-box is no longer feasible or economically viable.”

The new project plan includes 130 senior apartments in a two- and three-story building and four townhouses with a combined 24 senior apartments. The market-rate apartments would be in four, two-story townhouse-style buildings with a combined 42 units, and three buildings, each with 30 apartments.

Meijer moving ahead

Meanwhile, Meijer Inc. is working through the city approval process for its 191,350-square-foot Franklin store at Highway 100 and West Loomis Road.

City officials reviewed the project at the end of April and asked for changes to the building design, landscaping and locations of driveways leading onto the property. The Grand Rapids, Mich.-based retailer has made some minor changes to its building location on the property, but no exterior design changes to the front of the store, said Franklin city planning manager Joel Dietl. The retailer is providing more details on the project landscaping plan, and is tweaking the locations of the entrances to the parking lot at Loomis Road and Highway 100, he said.

Sean Ryan reports on real estate, construction and public transit in southeast Wisconsin

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Financial system: Change for the better will come – but not yet - Financial Times

June 18, 2012 12:35 am

Business groups warn Welsh government on 'living wage' - BBC News

The Welsh government is looking at how devolved public sector bodies could be encouraged to become 'living wage' employers.

Business leaders have warned the Welsh government not to push for private sector pay rises as ministers investigate public sector wage levels.

Labour has a manifesto commitment to find ways of making sure all Welsh workers are paid a "living wage".

Business groups say it may stop firms taking on staff or even mean layoffs.

The Welsh government says it is beginning to examine how devolved public sector employers can be encouraged to pay a living wage.

A policy group of interested parties is expected to meet over the summer.

Start Quote

I'm afraid it just isn't realistic in the environment we live in”

End Quote Robert Lloyd Griffiths Institute of Directors

Academics at Loughborough University have estimated a living wage is at least £7.20 an hour. The current statutory minimum wage is £6.08 an hour for workers aged 21 and over.

Welsh NHS workers and Welsh government civil servants are already paid at least the living wage.

A number of big private sector employers, including Barclays Bank and accountants KPMG, are also signed up to paying it.

But business organisations warned Welsh ministers not to try to force them to raise wages, for example by inserting living wage clauses in government contracts.

Robert Lloyd Griffiths of the Institute of Directors said he was concerned the living wage would effectively become the new minimum wage.

"Businesses would like to take on more staff and lots of companies that I talk to would love to be in a position to be able to take on more employees," he said.

'Very difficult'

"It's very difficult out there and anything that now will hinder them from doing that, which they'd like to do, is going to cause problems.

"I'm afraid it just isn't realistic in the environment we live in."

Anna Milewski, of the Federation of Small Businesses, said: "We have to look at it from the employers' perspective, we've surveyed them.

"They say that an increase can, at best, deter them from taking on staff at worst actually result in them laying off staff, which would not be a positive outcome, of course."

Start Quote

If we're the trailblazers we hope the private sector won't be so frightened of it”

End Quote Julie James Labour AM

The Welsh government said: "Unlike the minimum wage, the living wage is not statutory.

"However, any employer in the UK is free to sign up to the Living Wage Foundation's campaign. The Welsh government is starting to look at how devolved public sector organisations have been engaging with the idea and what it would take to encourage those organisations to become living wage employers.

"This is a key reason the Minister for Local Government and Communities [Carl Sargeant] has decided to set up a policy group, so that consideration of the benefits, in much the same way as they were in London, can be given collaboratively. That group has yet to be brought together, but it is anticipated that this will happen over the summer."

Labour AM Julie James said: "If we're the trailblazers we hope the private sector won't be so frightened of it and will actually see the benefit of a workforce which when they're happy and healthy work harder, stay longer, are more and actually do better work. So it's a win win, really."

Young campaigners, working with Save the Children, recently petitioned the assembly for a living wage above the minimum wage.

Iram Shahzad, a 13-year-old pupil at Fitzalan High School in Cardiff, told BBC Wales Sunday Politics that people in her community were working long hours but not earning enough money to cover their everyday essentials.

"It's not fair that they don't get to live a happy life," she said.

James Pritchard, head of Save the Children in Wales, said a living wage would be a "direct way of starting to tackle child poverty".

Sunday Politics is on BBC One Wales at 12:00 BST.

Lamenting the money chase while chasing money - Philadelphia Daily News

 President Obama's voice echoed in the majestic rotunda of the Franklin Institute as he lit into the Republicans with fierce urgency.

"We want to move forward and make sure that elections aren't just about $10 million checks being written by folks who have vested interests in maintaining the status quo," Obama said, to applause. "The other side, they don't have any new ideas. . . . What they do have is, they'll have $500 million worth of negative ads."

In a note of irony common to modern politics, Obama was in the process of raising campaign cash while decrying its corrosive effects. Three events in the Center City science museum raised nearly $2 million Tuesday night for the president's reelection effort and Democratic committees supporting it.

And that was just after three similar events in Baltimore; by Thursday, Obama was at a star-studded gathering of donors in actress Sarah Jessica Parker's Manhattan home. The insurgent candidate of 2008 who promised to change our politics is now outpacing his modern predecessors in the amount of time raising money.

The people standing in front of the president beneath a marble statue of Benjamin Franklin had paid $250 to $2,500 to hear a fired-up stump speech. Meanwhile, in the Fels Planetarium, some 90 people waited for Obama to address them at a $10,000-a-ticket dinner. And earlier, about 15 people who had each pledged to raise or donate $40,000 got to sit at a table and talk privately with the president for 45 minutes.

"I was pleasantly surprised by the level of enthusiasm and the seriousness with which our donor base took this," said lawyer Kenneth M. Jarin, a cochairman of Obama's 2012 finance committee in Pennsylvania, who helped sell tickets. "They know what's at stake. People understand how much money is being spent by the other side, and that our side has to step up."

But all the hard work of Obama supporters in the months leading up to the Philadelphia events, overseen by Comcast executive vice president David L. Cohen, seemed puny the next day - when casino billionaire Sheldon Adelson gave $10 million to Restore Our Future, a "super PAC" helping Republican Mitt Romney.

Court and regulatory decisions in the last few years have led to unprecedented levels of money as corporations and wealthy individuals pledge to spend hundreds of millions, mostly in support of Republican candidates.

The amount of time presidents spend asking for cash has risen sharply in recent decades, according to Brendan Doherty, a political scientist at the Naval Academy and author of The Rise of the President's Permanent Campaign, to be published in July.

Obama has attended more fund-raising events in the second half of his first term than any of the last six presidents - 166 such events through Friday. In two years before Ronald Reagan's 1984 reelection, Reagan attended just three fund-raisers for the Republican National Committee, zero for his own campaign. Bill Clinton, once lionized and derided for his fund-raising prowess, attended 70 campaign-finance events in 1995 and 1996, when he was reelected.

Now, in the wake of the Supreme Court's 2010 Citizens United ruling, the sums flying around are enormous. Adelson and his wife have given $35 million this year, mostly to a super PAC that backed former House Speaker Newt Gingrich's presidential run.

"It's the Wild West, an entirely different dimension," said Larry Makinson, former head of the Center for Responsive Politics, a nonpartisan watchdog group. "The bottom line is, it magnifies the power of the 1 percent who've got all the money."

In a sense, Obama kicked off the latest installment of the political arms race in 2008 when he chose to spurn public financing for his campaign, Makinson said. Obama raised about $750 million and swamped the GOP.

This time, Obama got ahead of Romney, out-raising him $197 million to $87 million by March 31. But Romney's donations have outpaced the Democrats since he sewed up the GOP nomination. And that doesn't count super PACs' funds, where Republicans dominate.  

People raising cash for Obama here say it is a little harder than four years ago, when the campaign to elect the first black president felt like a movement; one dinner at Cohen's home that year, for instance, raised $6 million. The weak economy has also hurt.

Still, enough donors are eager and able to write big checks. Among those at the $40,000 event, according to several attendees: Jarin; former State Sen. Connie Williams of Montgomery County; Cohen and his wife, lawyer Rhonda Cohen; developer Ron Rubin; Mark Alderman, a lawyer and cochair of Obama's state fund-raising committee; Joseph and Marie Field, who founded the radio broadcasting giant Entercom; and Richard Horowitz, president of RAF Industries, a Jenkintown private-equity firm.

Businesswoman Marsha Perelman attended the $10,000 dinner. She thinks Obama's approach to government, promising investment in education and other public goods, will be better "in the long run" for business than Romney's promises to slash regulations, government, and taxes.

As is customary, a few reporters were ushered in to record Obama's opening remarks. Then the press was shooed away as the president said he'd take questions.

Perelman, who chairs the Franklin Institute board, said Obama didn't drop any bombshells in the planetarium dinner, but it was still revealing.

"One of the questions asked referred to how difficult it is to get the president's message across," Perelman said. "He made a terrific reference to how hard it is to cut through a news cycle that is a nanosecond long: During the Bay of Pigs, President Kennedy did not announce the invasion until 13 days later. He had time to figure out what happened, and 70 percent of the nation tuned in when he went on television.

"President Obama said that if that happened today, within two minutes somebody would have tweeted about it. And the highest audience he ever gets for a speech, the State of the Union, is 10 percent of the population."


Contact Thomas Fitzgerald

at 215-854-2718, or @tomfitzgerald on Twitter. Read his blog, "The Big Tent," at


Newark needs more money to meet Facebook founder Mark Zuckerberg's $100 million challenge -

NEWARK — With big money came big ideas — and that’s when it got complicated.

Nearly two years after Facebook founder Mark Zuckerberg donated $100 million to fix public education in Newark, the city is having trouble meeting the billionaire’s challenge to generate another $100 million in matching donations.

Zuckerberg’s gift energized parents and city leaders in the months after it was announced but success securing grants from like-minded donors has slowed significantly in recent months. The city is $50 million short of the goal and has secured only $2 million in gifts in the past nine months, according to the Foundation for Newark’s Future.

Greg Taylor, the nonprofit group’s CEO, said he isn’t worried.

"We’ve raised $50 million, and I couldn’t be more proud of that," he said. "We have spent the last year nurturing the momentum in Newark and trying to convince donors to invest in this moment, this time of tremendous change."

New money may be on the way.

Newark Mayor Cory Booker said he and the foundation expect to announce some sizable donations by the end of the summer that together, could "wrap up" the foundation’s campaign to match Zuckerberg’s gift.

But interviews with foundation officials, donors and grant recipients show the group is having some organizational growing pains. Part of the problem is a lack of faith in the school district, which was beset by financial scandals and plummeting academic performance for three decades.

Some donors were reluctant to invest in the Newark foundation because they had insufficient information and feared the money might be misspent.

"It’s not surprising that donors with big opinions and big wallets don’t trust anyone," said an official representing one of the grant recipients. The official was not authorized to speak publicly about the foundation’s struggles.

"Some folks want to fund something that’s proven to have worked, and some see investing in the district as throwing good money after bad," the official said.

Taylor said the foundation addressed this concern by outlining six grant-making priorities over the past year — early childhood education, high-school dropouts, community engagement, teacher and principal quality, curriculum enhancement and high-quality schools.

Others have chosen to direct their money to specific schools or programs, namely high-performing charter schools with success in working with poor students. To accommodate them, the foundation crafted a donation structure that allows gifts to be targeted rather than just submitted to the general fund.

In recent months, the foundation secured two $1 million gifts that are both dedicated to specific recipients. One will help finance an extended school day for traditional Newark public schools and the other was given to TEAM Academy, a Newark charter school with a track record of boosting achievement among poor students.

Taylor said he prefers the money go to the general fund but won’t turn down gifts that align with the group's mission.

"What the foundation is trying to do is get as much money to fund our comprehensive strategy as we can because the interplay of all those strategies will get the most for our kids," he said. "But some investors have specific priorities."

Of the $50 million donated so far to match Zuckerberg’s gift to the Newark schools, $16 million has been donated to two of the city’s high performing charter schools. The remaining $34 million will be available for district schools

This does not please some community advocates.

Clement Price, a long-standing city leader and Rutgers University historian, said it was "disappointing" to learn that donations could be offered to match Zuckerberg’s gift dedicated to a specific purpose.

"There was such a public interest in this when it first got off the ground," Price said. "I thought the Foundation for Newark’s Future would be a little more imaginative and inventive and take daring steps to create change in this city."

No money has been raised since last fall that supports the foundation’s mission generally, Taylor confirmed. But financial gifts with specified recipients are better than no donations at all because both types help unlock chunks of the Facebook money, which was not given in full, but is dispersed as needed.

Nonprofits often find their fundraising efforts stymied by philanthropic groups who prefer dedicated donations, said Andrea McManus, chairwoman of the Association of Fundraising Professionals.

It is a charitable foundation’s responsibility to make clear which types of gifts it will accept, she said, adding that public ambiguity about which types of donations the Foundation for Newark’s Future sought is not common.

"What you never want to do is accept a gift you don’t need or that will take you off in a different direction just because you have to raise the money," McManus said.

The $16 million for charter schools came from venture capitalist John Doerr, wealth management executives Elizabeth and Ravenel Curry and a third anonymous donor. They earmarked their gifts to expand TEAM Academy and North Star Academy, two high-performing Newark charter schools, Taylor said.

TEAM will use its dedicated funds to expand its student body from 1,500 students to a target of nearly 5,000 students, said Ryan Hill, the school’s executive director. As more new seats are created, more money comes in, he said — about $2,500 per student.

David Sciarra, executive director of the Education Law Center, a Newark-based group that advocates for poor students, said the foundation has strayed from an original commitment made by city leaders that donations would go the general fund.

"This is not what was promised to the public," Sciarra said. "Where is the transparency?"

The Newark Public Schools has also received some donations directly from donors that are allocated for specific priorities, Taylor said, but these gifts amount to one quarter of the funds given directly to charter schools. The Bill and Melinda Gates Foundation gave the district $3 million for professional development; the Ford Foundation gave $1 million to help extend the school day.

Only two matching donations given so far generally support the Foundation for Newark’s Future, including a $25 million gift from the Pershing Square Foundation and a $5 million gift from Goldman Sachs Gives. Together, these gifts comprise the majority of the funds raised.

Decisions about how to allocate that money will be made by the foundation’s governing board *mdash; nearly $16 million in grants have been committed so far. A grant for $100,000 will help establish a 15-member community group to advise the foundation and a $4 million grant will support Newark Superintendent Cami Anderson’s effort to reconfigure resources as the city closes some schools and opens others.

Because the foundation has five years to allocate all of the money it collects *mdash; and its needs will likely evolve — donating funds than can be used with flexibility is essential, said Paul Bernstein, CEO of the Pershing Square Foundation.

"There are some times and causes for which it is most valuable to give general funds, and this is one of them," Bernstein said. "We support the foundation’s mission, what this is all about — making sure all children in Newark get a great education."

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