Kids Company: benefactor pulled £3 million donation from charity as soon as 'allegations of sexual abuse' were raised

The charity closed its doors on Wednesday

A Kids Company benefactor who had pledged a £3 million donation pulled out as soon as allegations of abuse and sexual offences related to the leading children's charity had become known, its founder has said.

Camila Batmanghelidjh, who started the charity 19 years ago, has now said a philanthropist who was going to make a huge donation pulled out after hearing of the police investigation.

Kids Company ceased to operate on Wednesday evening after running out of money.

Ms Batmanghelidjh told the BBC that within 20 minutes of a Cabinet office grant, also of £3 million, being handed to the charity last week, "the police call out of the blue to say that there's been allegations of sexual abuse related to Kids Company".

She added: "Within the hour this is all over the news that Kids Company is being investigated ... the minute the philanthropist discovers that this is on the cards - they freak and then they don't put their money in, so then the deal breaks down."

Ms Batmanghelidjh was speaking on BBC Radio 4, in an interview to be broadcast in full at 8pm.

She has blamed "rumour-mongering civil servants" and "ill-suited ministers" for the charity's demise.

After the doors closed for the last time, graffiti above the brass Kids Company sign in Bristol read "RIP" with a cross underneath and "THE BEST PLACE THERE WAS" written to one side.

She also called on David Cameron to explain what would now happen to the thousands of vulnerable children helped in 11 street centres and 40 schools; the Kids Company website states their services reach 36,000 people across London.

David Cameron with Camila Batmanghelidjh in 2010 David Cameron with Camila Batmanghelidjh in 2010
The Government has said it is working with local authorities to ensure the young people affected are looked after.

A spokeswoman said: "The Government has supported Kids Company over the last seven years to help it deliver services for vulnerable young people and so we are disappointed it has been unable to move to a sustainable financial position.

"The welfare of these young people continues to be our primary concern and we are now working closely with local authorities to make sure they have access to the services they require."

In a statement, the charity's trustees said its priority was to "secure a future" for the children it had helped after the "sad end" of Ms Batmanghelidjh's organisation, adding that its closure will leave "many thousands of vulnerable children, young people and families without hope".

In her own statement, Ms Batmanghelidjh added: "I apologise to all the courageous and dignified young people who have touched our hearts and made us brave."

Camila Batmanghelidjh claims the Government tried to silence her with a £3m grant Camila Batmanghelidjh claims the Government tried to silence her with a £3m grant
Ministers Oliver Letwin and Matthew Hancock agreed to give extra money to help restructure the charity, despite official objections from a Whitehall mandarin who warned they did not think it would offer "value for money".

Kathy Evans, chief executive of the Children England charity, told BBC Radio 4: "My understanding is local authorities in all the directly affected areas, and a range of other charities, have said they will do what they can to support children who are looking and are identified as abandoned by this process.

Ms Evans called on society in general to realise "that actually, right across the country, there is incredible pressure and many children who aren't being adequately supported. There are 60,000 children's charities."

"Last year alone, their Government income dropped by £150 million. So the circumstances of Kids Company are certainly unique, troubling, high profile and not the norm for most charities, but the norm for most charities is very serious financial pressure."

READ MORE: 7 REASONS WHY THE GOVERNMENT DON'T LIKE BATMANGHELIDJH

Kids Company received a £3 million grant from the Cabinet Office after agreeing, on the orders of the Government, to make changes in its leadership, management and governance.

But Ms Batmanghelidjh emailed staff within the charity last week to say they would be paid using some of the grant money, according to the BBC.

It has been reported that the Cabinet Office is making plans to claw back the grant because it believes conditions attached to the use of the money were not met.

Ms Batmanghelidjh has refuted this, saying they had informed the Cabinet Office that some of the money would go towards staff salaries, and had received no response to say that it should not be.

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