Miliband’s bonanza £1m salary from charity while cutting jobs and aid projects

Published by The Mail on Sunday (4th August, 2024)

David Miliband has been handed an annual pay package of more than $1.25million (£1million) by an aid charity heavily funded by British taxpayers – although it is cutting jobs and programmes after plunging into the red.

The former Labour Foreign Secretary’s salary from the International Rescue Committee (IRC) – given at least £33million last year by the Government to alleviate poverty and assist refugees – is disclosed in data sent to US tax authorities.

It reveals that Mr Miliband – who hit out at ‘immoral’ fat-cats during his failed bid for the Labour leadership – collected $1,253,728 in 2022 as president and chief executive: almost six times more than Sir Keir Starmer is paid to run the country.

Although Mr Miliband’s mega pay package included a $150,000 bonus, he has had to warn staff about the need for ‘rigorous prioritisation of spending’ after the charity suffered a $50million deficit this year due to accounting failures and overspending.

MPs have condemned his salary, with shadow security minister Tom Tugendhat saying: ‘The IRC is meant to be there for people suffering from the impact of humanitarian crises, not enriching its boss. This is why successive UK governments have supported its work with millions from the aid budget.’

The Tory leadership contender said this ‘outrageously large wage’ was ‘shocking’, considering the IRC’s financial woes. ‘It needs to re-evaluate its choices and prioritise helping those in need rather than lining the pockets of its CEO.’

The tax data shows Mr Miliband’s pay soared $111,314 over the previous year – with a housing allowance of $50,000. He is promoted also as a ‘wonderful’ conference speaker by booking agencies with fees starting at £25,000.

The charity’s second highest paid staff member was chief operating officer Madlin Sadler, Mr Miliband’s former special adviser in government who ran his botched leadership bid in 2010. Her salary package surged by $31,105 to $528,466.

Total cash pocketed by the ten top IRC executives was $5,209,634, fuelling fears that some charity chiefs are milking aid budgets while pleading for more funds from the public purse. 

One senior IRC figure told the MoS it was ‘demoralising’ for staff to be led by someone earning ‘a millionaire’s salary’ at a time when they face humanitarian pressures around the planet.

‘This disparity is troubling as the organisation faces significant financial challenges and staff are at imminent risk of losing their jobs,’ said the source.

Documents seen by this newspaper show the IRC – which the physicist Albert Einstein helped found in 1933 to support refugees fleeing Nazi Germany – faced a $50million deficit this year due to fund-raising shortfalls and cost over-runs, despite a $16.5million bequest.

The charity’s revenue is $1.59billion although almost four-fifths is ‘restricted’ with spending set by donors. 

Savings from a hiring freeze, salary reductions and cuts in ‘field funding’ have reduced the projected deficit on ‘unrestricted’ cash to between $37million and $42million.

Senior officials say they must ‘manage the liquidity situation carefully’. One fiscal summary detailed the need for major cost reductions to balance their budget, saying: ‘We are expecting this to result in significant layoffs.’ 

An IRC insider said their legal and human resources teams were ‘figuring out all the legalities across countries’ before sending out notices to staff in forthcoming weeks.

Mr Miliband has been given bonuses worth $400,000 over three successive tax filings. His predecessor, a theologian who left in 2013, earned $380,000 a year.

Mr Miliband circulated a letter to staff last October explaining the IRC’s operating deficit, saying they were ‘balancing strategic ambition with financial prudence’ but an ‘efficiency process’ required ‘rigorous prioritisation of spending’.

In March, he warned his leadership team they had found a ‘larger deficit than anticipated’.

Three months ago, Sadler hosted a staff discussion with financial chief Martin Bratt, who confirmed they faced a $50million deficit and admitted ‘multiple things’ had gone wrong with accounting mistakes on fund-raising, double-counting of savings and higher costs.

In his March letter to senior colleagues, Mr Miliband bemoaned there had been ‘no humanitarian emergency that has significantly buoyed our unrestricted incomes since the Russian invasion of Ukraine’. 

Yet he has faced internal disquiet over the IRC’s muted stance on Gaza. Insiders claim the charity’s response has been restrained, amid rumours Mr Miliband wants Starmer to appoint him as Britain’s ambassador to Washington. 

One source said there was ‘significant anger’ in the charity, adding: ‘There is a feeling our public messaging is driven by the personal and political ambitions of our chief executive. It is not in line with the IRC’s humanitarian principles.’ 

Many felt dismayed by the charity’s hesitancy to criticise Israel’s invasion of Gaza, in contrast with its strong stand against Russia’s attack on Ukraine, and a failure to stand alongside other humanitarian groups in its response.

A petition signed by nearly 1,700 staff spoke of ‘profound concern’ over the ‘absence of prompt, resolute and non-discriminatory condemnation that we expected from our leadership’.

Passionate appeals for a stronger response have been posted on staff forums. ‘Why is IRC so silent about the horrors in Gaza?’ asked one worker last year.  ‘Why so much fear and political calculation around what we say?’ 

One senior figure from the Middle East region looked upset as she told a meeting that she could not understand the IRC’s ‘complicit stand’, saying it was ‘failing’ both itself and Palestinians under attack.

‘We are an organisation that prides itself on its intellectual rigour and we have failed to apply that to this crisis and we continue to fail the Palestinians as we manoeuvre this internally,’ she said.

An email sent to top officials and country directors by Ciaran Donnelly, an IRC senior vice president, admitted: ‘We have not gotten everything right, and for many, this has shaken your trust in the IRC.’

Three years ago, the IRC asked a law firm to review discrimination policies with claims of bullying from minority staff who accused the leadership of reinforcing a ‘white supremacy culture’.

An IRC spokesman said Mr Miliband’s salary was set by the US board of directors’ compensation committee and he, along with other senior officials, had accepted a pay cut this year due to the deficit.

‘Like every organisation in the humanitarian sector, we face rising costs, not just in our international programmes but also in the US where refugees face high and rising rents. We are determined not to compromise on the quality or scale of our programmes, and so continue to develop a deficit reduction plan that protects both.’

He added that under Mr Miliband’s leadership the charity had grown ‘from a $450million organisation to over $1.481billion, reaching more people than ever.’

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