Tuesday, September 27, 2005

Charities Bill: what do NCVO want?

As the sector's leading membership organisation, it's worth relecting on the following statement by NCVO which sets out what they want from the Charities Bill -

A universal public benefit test: All organisations that are charities should be required to demonstrate public benefit, both when they register as charities and on an on-going basis. At the moment some categories of charities - those for the relief of poverty; the advancement of religion and the advancement of education - may be presumed to benefit the public, but all others must provide evidence that they provide such benefit. Removing this presumption in favour of some charities would not only create a level playing field for all, it would also make the legal position simpler and clearer and establish in the public’s mind a clear relationship between charity and public benefit.

A non-statutory definition of public benefit: The definition of public benefit should be based on case law, not defined on the face of the Bill. This will ensure that the new system is flexible enough to accommodate the diversity of the sector and robust enough to safeguard its independence. It will ensure that political interests do not influence the way public benefit is defined.

A modern, independent regulator: The role of the Charity Commission should be clarified, with a clearer distinction between its regulatory role and its wider advice-giving functions.

An independent appeals process: There should be a mechanism for keeping the Commission’s decisions under review other than through the High Court, which is expensive and time-consuming and beyond the means of most charities. It should enable organisations that are unhappy with decisions of the Charity Commission to appeal against those decisions. And there must be scope for the law to evolve through the review and development of case law, so that it continues to reflect contemporary needs and aspirations. If necessary public funding should be made available to allow this to happen in the form of a ‘suitors fund’.

Does the Bill meet these aims?

Yes, to a large extent it does:

o there is a new, updated list of charitable purposes;
o there is a clear link between charitable status and public benefit;
o there will no longer be any presumption of public benefit in favour of certain charities; and
o there will be an independent Charity Appeal Tribunal.

These are all measures that the sector has been calling for and we welcome their inclusion in the Bill. However, because existing case law on public benefit is very weak, particularly in relation to charities that charge high fees, there is still a need to strengthen the public benefit test.

Therefore we believe the Bill should be amended to enable the Charity Commission to take account of the impact of fees or charges when considering questions of public benefit.

NCVO

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