The House Magazine: Charities Bill

Written by Annette Brooke and published in The House Magazine on Sat 1st May 2004

ANNETTE BROOKE MP EXAMINES HOW THE CHARITIES BILL WILL HELP CHARITABLE AND VOLUNTARY ORGANISATIONS

The announcement in last year's Queen's Speech of a draft Charities Bill was a very long awaited boost to the charitable sector. Much of the credit for the draft Charities Bill finally appearing in the Queen's speech must be attributed to the many charities that campaigned long and hard so that the issue was not allowed to drop off the political agenda. Since the current law is based on the preamble to an Act that is over 400 years old, nobody could deny that reform is long overdue.

I am pleased that the draft Bill will be subject to pre-legislative scrutiny by a joint committee of both Houses, this should certainly help produce good legislation. However, its report back is likely to be two years after the Government's Strategy Unit published the "Public Action, Public Benefit" report in September 2002.

All of the major political parties agree that the voluntary sector already plays an important role in the provision of a wide range of vital public services An updated legal and regulatory framework will be essential to ensure that the whole sector is equipped to take forward new roles and responsibilities, which accurately reflects the reality of what it does and how it does it. It will also need a strong independent regulator with a clearly focused role.

The general public supports the charitable sector to an enormous degree, both by providing generous funding through donations and by offering time as volunteers to organisations. However, research suggests that there is a growing dissonance between what is charitable and what many people believe to be charitable. Some recent high profile stories in the media about national lottery grants have highlighted this. A new and updated Charities Bill will enable the active citizens and volunteers of the future to have both a clear understanding of what a charity is, but also confidence in the systems governing charities to ensure that donations and resources are managed responsibly and effectively. In this way, the reforms will help to strengthen the credibility of, and support for, charity.

The government's response to the Strategy Unit report proposed the introduction of new definitions of 'public benefit' increasing from four to twelve the definitions of charitable purpose. The recommendations included the introduction of categories such as 'the advancement of science, culture, arts and heritage'; 'the promotion of animal welfare' and 'the promotion of human rights, conflict resolution and reconciliation', to name but a few. Amnesty International UK, for example, hopes that this latter category will ensure that the promotion of human rights anywhere in the world will be considered a charitable purpose. It remains to be seen whether the Joint Committee will conclude that all the work of Amnesty International is 'charitable' as opposed to 'political', but the introduction of the draft Bill does at least allow open debate on this matter, and a considered assessment of the proposals.

It is likely that the draft Bill will include proposals to reform the Charity Commission, ensuring that it focuses more clearly on its role as a regulator.

Currently, the Charity Commission is responsible for determining public benefit, for registering charities and for regulating the sector as well as acting as an advisor to charities in how they carry out their role and functions within the sector. Concerns have been expressed that this dual function can cause confusion and in some cases, a conflict of interest.

An independent appeals mechanism is a basic principle of most regulatory bodies, and is also one of the proposed reforms under the regulatory framework. Currently, cases challenging decisions by the Charity Commission on an organisation's charitable status must be taken to the High Court which is both a lengthy and expensive process which few organisations are able to pursue.

The Charities Act Coalition, established to ensure that the Bill progresses and receives Royal Assent before the next Parliament, believes that an independent tribunal should hear appeals against decisions of the Charity Commission, and continues to lobby for a 'suiter's fund', funded by the Government, to enable important cases to be taken to the High Court.

In short, the Charities Bill Coalition (now Charities Act Coalition) has succeeded in achieving its long term campaign to get the Bill on the political agenda, and to keep it there, particularly with the Joint Committee established. We must ensure that this important opportunity is not lost and that there is true 'public benefit' from all the proposals and that the new Act will make Charity Law fit for the 21st Century.