CIH finances better than you think

Two facts in your article on the CIH's finances (6 June, page 8) need correction.

The CIH did not lose "£1.2m due to stock market falls last year". Our reported investment losses amounted to £496,000. This reflects the repositioning of CIH investments to reduce exposure to continued falls in share prices. Second, the CIH did not lose "almost £1m on its conferences and courses". Our conference and training activities contributed more than £250,000 to CIH income in 2002.

It is correct that the CIH recorded an operating deficit of £941,000 across all our activities including policy and lobbying, our presence in Scotland, Wales and Northern Ireland and all other member services.

This was higher than planned but we are on course to reduce significantly our operating deficit this year.

Overall, our strategy is still valid. From 1995 to 1999, the net value of the CIH increased from £6.34m to £11.45m. We used the increase in our investments both to expand the CIH's activities and to build up our reserves.

The fall in stock market values has meant that we have drawn from reserves to continue to fund our current operations. At the same time, continued uncertainty about future investment growth means that we have already taken steps to bring our income and expenditure closer into line.

We will continue to review our budget to ensure that our reserves remain at a level above the base line agreed by the CIH's council of 12 months'-worth of resources expended. Balancing the almost continuous demands for CIH to expand its activities within the constraints on our resources is not easy, particularly given our attempts to share best practice as widely as we can.

Subscriptions from members contribute only 20% to funding the institute's activities and our ability to continue our work on policy through our national office and branch network depends on the success of both our investments and our business activities.