British Heart Foundation research says as little as 5 per cent of the profits from door to door charity collections actually goes to help good causes.

The charity said millions of householders are being duped when making donations to door-to-door charity bag collectors. It said that because of the deals struck with collection agents, just 30 per cent of items donated to charity via letterbox charity bags actually stand a chance of ending up in high street charity shops.

The British Heart Foundation (BHF) claimed most of it is sold abroad for private profit.

Many charities, often those without shops, do deals with commercial firms who collect door-to-door for them, with bags emblazoned with the charity logo. But the commercial company keeps all the donated goods and then re-sells them for profit, mostly to overseas markets.

The BHF said it does not employ such agents and that all profits made from its charity bag donations stay with it. They then make a royalty payment to the charity, but as little as 5 per cent of the cash made goes back to good causes, according to the BHF.

In some cases charities are getting £50 to £100 per tonne of goods collected when, in fact, the goods can sell abroad for anything up to £1,800.

Private profits run into millions

This is now a lucrative industry, with householders inundated with charity bags as firms chase millions of pounds of profits from the trade. The BHF survey showed 70 per cent of charity bags an average householder receives are from such commercial companies, working with charities by selling the donated items overseas.

The poll also found 65 per cent of those questioned were not aware these commercial companies exist, and that people mistakenly think all of the money raised goes to good causes.

The survey said when householders are told of the arrangement, it leaves 85 per cent of them “shocked, cheated and disheartened”.

Charity loses millions in donations

The increase in charity bag collections has led to an estimated loss of £4.6m in donations direct to BHF shops in the last two years, the charity said.

Mike Lucas, retail director for the BHF, said: “It is vital commercial companies act responsibly and be transparent on their charity bags, particularly around how much profit the named charity will actually make from a collection.

“Householders have the right to know what happens to their donations and currently this information is not clear. Although this is a legal way to raise money, companies working for commercial gain are a huge problem for charities with high street shops.”