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5.45 pm

Edward Miliband: It has been an interesting debate with contributions from distinguished Members of the
25 Oct 2006 : Column 1608
House, including the right hon. Member for Maidstone and The Weald (Miss Widdecombe), my right hon. Friends the Members for Darlington (Mr. Milburn) and for Cardiff, South and Penarth (Alun Michael), and other hon. Members. In the time that I have available, I want to deal with both amendments.

First, I want to bring together the questions of religion and of education, and the central burden of the remarks made by the right hon. Member for Maidstone and The Weald. She asked, “Why?” Why should we have the principle that all charities must pass the test of public benefit, without a presumption in favour of a few? My answer to her is: fairness. Whether we are talking about the National Society for the Prevention of Cruelty to Children, Eton college or a religious charity, all should have to pass the public benefit test. That seems a pretty basic principle.

The right hon. Lady might say, “I agree with your principle, but I think that the practice is going to overwhelm the principle. I am really worried about what this will mean for religious charities.” That was the second part of her remarks. I hope that I can reassure her on those points. First, I want to reassure her that removing the presumption that the advancement of religion provides public benefit is not intended to lead to a narrowing down of the range of religious activities that are considered charitable. Nor is the process intended to be onerous for individual religious institutions.

The right hon. Lady talked about social mores. The hon. Member for Cheltenham (Martin Horwood), not for the first time in my experience, made an excellent speech on that point. Case law is the foundation of what we are debating in the Charities Bill and of the legislation on which we are moving forward. We have not put it all on the record in the Bill because that is simply not possible—that is the complexity of charity law. Yes, modern social mores play a role—the courts have determined that—but the foundation is case law.

Miss Widdecombe: I appreciate that it will not be a formal Pepper v. Hart statement, but will the Minister say briefly whether it is his understanding that the fact that a particular religion teaches a traditional and certainly non-modern sexual morality could never be held by the Charity Commission to disqualify that religion from charitable status? It is as simple as that.

Edward Miliband: I can certainly give the right hon. Lady that assurance. Of course, the Charity Commission has to make a case-by-case judgment on those points. She is raising a hypothetical example, but of course it is the case. I thought that her description of what modern social mores meant suggested a grand conspiracy between ourselves, the Charity Commission and the whole of the charities world.

Miss Widdecombe: Answer.

Edward Miliband: I am answering. I do not think that the commission will be able simply to say that, on the basis of the change in modern social mores, somehow a religious charity is ruled out. I hope that that gives the right hon. Lady the reassurance that she wants.

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Andrew Selous (South-West Bedfordshire) (Con) rose—

Edward Miliband: I am afraid that I have to make progress. I need to give the hon. Member for Isle of Wight (Mr. Turner) some time to reply and I do not have much time left.

I want to reassure the right hon. Member for Maidstone and The Weald on the point of principle. I also want to reassure her that the burdens will not be onerous for religious charities. As with all charities, public benefit has two dimensions. First, there must be an identifiable benefit. Secondly, it must be accessible not only to the adherents of a particular religion, but to the wider community. However, the Government, the courts and the Charity Commission have recognised that religious activities bring benefits not only to those who take part in them, but to the whole of society. Religion has an important role to play in society through faith and worship, motivating charitable giving and contributing in other ways to stronger communities. Both those dimensions will thus usually be apparent from the doctrines, beliefs and practices of a religion. The Charity Commission is clear that most established religions should not have any difficulty in demonstrating their value to society from their beliefs.

Andrew Selous rose—

Edward Miliband: I apologise for not giving way to the hon. Gentleman, but I need to make progress.

The commission has already begun discussions with the major religions of our country precisely to give them reassurance. I hope that the right hon. Member for Maidstone and The Weald will accept my reassurance, too.

I am pleased that my hon. Friend the Member for Selby (Mr. Grogan) has tabled amendment No. 1 because it gives us the chance to talk about another aspect of public benefit. On Second Reading, I set out several principles of the Government’s approach to the charitable status of fee-charging institutions, including private schools, and I want to reiterate them today. I say in passing to the right hon. Member for Maidstone and The Weald that while I think that the bar will be raised, especially for fee-charging institutions that were not subject to the scrutiny of the Charity Commission because of the presumption, I do not believe that I said the words that she attributed to me. However, perhaps we can take that up on another occasion.

Our first principle is that all charities must pass the public benefit test and be continually tested on that by the Charity Commission. The removal of the presumption will lead to that big change. The presumption meant not that there was no public benefit test in all circumstances, but that existing charities were not scrutinised by the commission. The measure is designed to bring about consistency, as the commission has confirmed. The history of this is that when the register of charities was established in 1960, private schools were automatically put on it if they had previously been granted charitable tax relief by the Inland Revenue.

Our second principle is that indirect benefit—the claim that private schools save money for the taxpayer by educating pupils, for example—should not be
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enough to justify charitable status. That is right, and the view is shared by not only Labour and Liberal Democrat Members, but the Independent Schools Council, which says that indirect benefit savings to the taxpayer should not be enough, given that private schools enjoy the benefits that come with charitable status.

Some hon. Members asked what private schools will have to provide; my hon. Friend the Member for Selby asked whether token benefits would be enough. The Charity Commission will have to make a case-by-case examination, but reassurance is available on the point of principle. The commission said in its briefing earlier this week:

The schools must thus normally provide direct benefits. However, can those benefits be simply for wealthy people who can afford the fees? Again, the commission’s briefing helpfully indicates the way in which it wants to move forward. It says:

Even at this late stage, I hope that when the hon. Member for Isle of Wight winds up the debate, he will announce the Conservative party’s conversion to such a basic principle of fairness.

The benefits will need to be extended beyond the narrow class of people who are able to afford fees, and it is unlikely that a token provision will be sufficient. To answer a question asked by my right hon. Friend the Member for Darlington, the Government believe that the benefits should be direct and meaningful. Generally, we believe that a school that does a range of things to widen access through partnerships with state schools and educational initiatives in the local community—I pay tribute to the many private schools that do this—will find it easier to demonstrate a public benefit.

Our third principle is that the Bill will raise the bar for private schools. I tell the right hon. Member for Maidstone and The Weald that the key point is that this is about fee-charging institutions that previously benefited from the presumption that charitable status was automatically conferred on them. That is why I do not believe—if I said this, I misspoke—that the bar will be raised for religious charities or charities dealing with poverty. This raising of the bar relies on a Charity Commission with a robust plan to implement it, as the Charity Commission has shown. It is embarking on a worthwhile process, involving the development of principles around the implementation of public benefit. It has promised to look specifically at the fee-charging sector, and it will consult the public about their attitudes. In the case of fee-charging charities, there has not been a directly relevant case for almost 40 years, as we heard, so the commission is right to develop its approach by consulting the public, taking account of the passage of time since in re Resch. The Bill seeks to establish confidence in the charity brand.

The fourth principle of the Government’s approach—again, this is important—is that it is for the Charity Commission to take individual decisions about particular institutions. This is necessary because a rural private school miles from a neighbouring state school
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has a different ability to co-operate with the state sector than an urban private school, for example. Similarly, the private school for disabled children or those with learning difficulties, which my right hon. Friend the Member for Darlington mentioned, may face different pressures, compared with other types of private school.

All those differences need to be taken into account by the commission. That has made framing a specific amendment to the Bill hard, as has been found by many hon. Members who have tried to do so. The dilemma is between an amendment so wide as to add little to existing law or so precise as to have unintended effects. Over the summer we considered the matter and we were not able to find an amendment that satisfied all the demands.

The amendment tabled by my hon. Friend the Member for Selby, if I may say so, falls into the first category. It does not add to the existing law. His amendment states that in determining whether a body provides public benefit, regard must be had to

The nature of the public benefit test, though, is that charitable status is not established if relief is accorded to a selected few out of a larger number equally willing and able to take advantage of it—in other words, if there is undue restriction on those able to obtain that benefit.

My hon. Friend said in a recent letter explaining his amendment that the Charity Commission should have to weigh public benefit provided by the school against the restricted access to those benefits. I agree with that, as I have said. From our point of view, the amendment is unnecessary, but we want to see proper implementation of the principles. That is why we will review the effect of the public benefit provisions not five years, but three years after implementation, and if they are not having the intended effect and are failing to raise the bar, we will consider all necessary options. My hon. Friend is concerned to ensure that regard must be had to any undue restriction on benefits. As I have made clear, this is part of the public benefit test. It will be part of the review to determine whether our intentions have been met.

This is a good Bill and we should resist the two amendments.

Mr. Andrew Turner: The Minister has eaten into my time a little, but we have eaten into his quite a lot today.

The first point is about religion. Most religions contain beliefs and values that positively affect the relations of believers to their society and to their fellow man. The tangible results of that are much more difficult to prove than results such as poverty reduction or the advancement of education. For that reason, I was happy to move amendment No. 126 and will press it to a Division.

To answer the right hon. Member for Darlington (Mr. Milburn) and the hon. Member for Rhondda (Chris Bryant), who is not in his place, in Committee we pressed for the retention of the public benefit presumption in a number of other areas—not because we believe that people are entitled to money for nothing, but because we believe in less bureaucracy, rather than more, and we know that the Charity Commission is well placed to challenge charities that
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are not delivering the public benefit that they should be delivering. The right hon. Gentleman says that the commission is not so well placed.

I am unhappy with the words that emanate from the Charity Commission and from Dame Suzi Leather, whom the hon. Member for Selby (Mr. Grogan) quoted, that she will interpret the provision in the light of current mores. That is very frightening to many religious organisations. It is the Government’s ambivalence between proposing change and saying that there will be no change that worries people.

Question put, That the amendment be made:—

The House divided: Ayes 163, Noes 341.
Division No. 327]
[5.59 pm


Afriyie, Adam
Amess, Mr. David
Arbuthnot, rh Mr. James
Bacon, Mr. Richard
Baldry, Tony
Baron, Mr. John
Beith, rh Mr. Alan
Benyon, Mr. Richard
Bercow, John
Beresford, Sir Paul
Binley, Mr. Brian
Bone, Mr. Peter
Boswell, Mr. Tim
Brady, Mr. Graham
Brazier, Mr. Julian
Brokenshire, James
Browning, Angela
Burns, Mr. Simon
Butterfill, Sir John
Campbell, Mr. Gregory
Carswell, Mr. Douglas
Chope, Mr. Christopher
Clappison, Mr. James
Clark, Greg
Clifton-Brown, Mr. Geoffrey
Conway, Derek
Cormack, Sir Patrick
Crabb, Mr. Stephen
Curry, rh Mr. David
Davies, David T.C. (Monmouth)
Davies, Philip
Davies, Mr. Quentin
Davis, rh David (Haltemprice and Howden)
Djanogly, Mr. Jonathan
Dodds, Mr. Nigel
Donaldson, Mr. Jeffrey M.
Dorrell, rh Mr. Stephen
Dorries, Mrs. Nadine
Duddridge, James
Duncan Smith, rh Mr. Iain
Dunne, Mr. Philip
Evans, Mr. Nigel
Evennett, Mr. David
Fallon, Mr. Michael
Field, Mr. Mark
Francois, Mr. Mark
Fraser, Mr. Christopher
Garnier, Mr. Edward
Gauke, Mr. David
Gibb, Mr. Nick
Goodman, Mr. Paul
Goodwill, Mr. Robert
Gray, Mr. James
Grayling, Chris
Green, Damian
Greening, Justine
Greenway, Mr. John
Grieve, Mr. Dominic
Gummer, rh Mr. John
Hague, rh Mr. William
Hammond, Mr. Philip
Hammond, Stephen
Harper, Mr. Mark
Hayes, Mr. John
Heathcoat-Amory, rh Mr. David
Hendry, Charles
Herbert, Nick
Hoban, Mr. Mark
Hogg, rh Mr. Douglas
Hollobone, Mr. Philip
Holloway, Mr. Adam
Horam, Mr. John
Howard, rh Mr. Michael
Howarth, Mr. Gerald
Hunt, Mr. Jeremy
Hurd, Mr. Nick
Jack, rh Mr. Michael
Jackson, Mr. Stewart
Jenkin, Mr. Bernard
Johnson, Mr. Boris
Jones, Mr. David
Key, Robert
Knight, rh Mr. Greg
Laing, Mrs. Eleanor
Lait, Mrs. Jacqui
Lancaster, Mr. Mark
Letwin, rh Mr. Oliver
Lewis, Dr. Julian
Liddell-Grainger, Mr. Ian
Lidington, Mr. David
Loughton, Tim
Luff, Peter
Mackay, rh Mr. Andrew
Maclean, rh David
Main, Anne
Malins, Mr. Humfrey
Maples, Mr. John
Mates, rh Mr. Michael
Maude, rh Mr. Francis
May, rh Mrs. Theresa
McCrea, Dr. William
McIntosh, Miss Anne
McLoughlin, rh Mr. Patrick

Mercer, Patrick
Miller, Mrs. Maria
Mitchell, Mr. Andrew
Moss, Mr. Malcolm
Neill, Robert
Newmark, Mr. Brooks
O'Brien, Mr. Stephen
Ottaway, Richard
Pelling, Mr. Andrew
Penning, Mike
Penrose, John
Pickles, Mr. Eric
Prisk, Mr. Mark
Pritchard, Mark
Randall, Mr. John
Redwood, rh Mr. John
Robathan, Mr. Andrew
Robertson, Hugh
Robertson, Mr. Laurence
Rosindell, Andrew
Ruffley, Mr. David
Scott, Mr. Lee
Selous, Andrew
Shapps, Grant
Shepherd, Mr. Richard
Simmonds, Mark
Simpson, David
Simpson, Mr. Keith
Soames, Mr. Nicholas
Spicer, Sir Michael
Spink, Bob
Spring, Mr. Richard
Stanley, rh Sir John
Steen, Mr. Anthony
Streeter, Mr. Gary
Stuart, Mr. Graham
Swayne, Mr. Desmond
Swire, Mr. Hugo
Taylor, Mr. Ian
Tredinnick, David
Turner, Mr. Andrew
Tyrie, Mr. Andrew
Vaizey, Mr. Edward
Vara, Mr. Shailesh
Viggers, Peter
Villiers, Mrs. Theresa
Walker, Mr. Charles
Wallace, Mr. Ben
Waterson, Mr. Nigel
Watkinson, Angela
Whittingdale, Mr. John
Widdecombe, rh Miss Ann
Wiggin, Bill
Wilshire, Mr. David
Wilson, Mr. Rob
Wilson, Sammy
Winterton, Ann
Winterton, Sir Nicholas
Yeo, Mr. Tim
Young, rh Sir George
Tellers for the Ayes:

Michael Fabricant and
Mr. Henry Bellingham

Ainger, Nick
Ainsworth, rh Mr. Bob
Alexander, Danny
Alexander, rh Mr. Douglas
Allen, Mr. Graham
Anderson, Mr. David
Anderson, Janet
Armstrong, rh Hilary
Atkins, Charlotte
Austin, Mr. Ian
Austin, John
Bailey, Mr. Adrian
Baird, Vera
Balls, Ed
Banks, Gordon
Barrett, John
Barron, rh Mr. Kevin
Battle, rh John
Beckett, rh Margaret
Begg, Miss Anne
Bell, Sir Stuart
Benn, rh Hilary
Benton, Mr. Joe
Berry, Roger
Blackman, Liz
Blackman-Woods, Dr. Roberta
Blears, rh Hazel
Blizzard, Mr. Bob
Borrow, Mr. David S.
Bradshaw, Mr. Ben
Brake, Tom
Brennan, Kevin
Brooke, Annette
Brown, Lyn
Brown, rh Mr. Nicholas
Brown, Mr. Russell
Bruce, rh Malcolm
Bryant, Chris
Buck, Ms Karen
Burden, Richard
Burgon, Colin
Burnham, Andy
Burt, Lorely
Butler, Ms Dawn
Byrne, Mr. Liam
Cable, Dr. Vincent
Caborn, rh Mr. Richard
Cairns, David
Campbell, Mr. Alan
Campbell, rh Sir Menzies
Campbell, Mr. Ronnie
Carmichael, Mr. Alistair
Caton, Mr. Martin
Cawsey, Mr. Ian
Challen, Colin
Chapman, Ben
Chaytor, Mr. David
Clapham, Mr. Michael
Clark, Ms Katy
Clarke, rh Mr. Charles
Clarke, rh Mr. Tom
Clegg, Mr. Nick
Clelland, Mr. David
Clwyd, rh Ann
Coaker, Mr. Vernon
Coffey, Ann
Cohen, Harry
Connarty, Michael
Cooper, Rosie
Cooper, Yvette
Corbyn, Jeremy
Cousins, Jim
Crausby, Mr. David
Creagh, Mary

Cruddas, Jon
Cryer, Mrs. Ann
Cunningham, Mr. Jim
Curtis-Thomas, Mrs. Claire
Darling, rh Mr. Alistair
Davey, Mr. Edward
David, Mr. Wayne
Davidson, Mr. Ian
Dean, Mrs. Janet
Denham, rh Mr. John
Devine, Mr. Jim
Dhanda, Mr. Parmjit
Dismore, Mr. Andrew
Dobbin, Jim
Donohoe, Mr. Brian H.
Doran, Mr. Frank
Drew, Mr. David
Dunwoody, Mrs. Gwyneth
Eagle, Angela
Eagle, Maria
Efford, Clive
Ellman, Mrs. Louise
Engel, Natascha
Ennis, Jeff
Farrelly, Paul
Featherstone, Lynne
Field, rh Mr. Frank
Fitzpatrick, Jim
Flello, Mr. Robert
Flint, Caroline
Flynn, Paul
Follett, Barbara
Foster, Mr. Don
Foster, Mr. Michael (Worcester)
Foster, Michael Jabez (Hastings and Rye)
Francis, Dr. Hywel
Gapes, Mike
Gardiner, Barry
George, Andrew
George, rh Mr. Bruce
Gerrard, Mr. Neil
Gibson, Dr. Ian
Gidley, Sandra
Gilroy, Linda
Goldsworthy, Julia
Goodman, Helen
Griffith, Nia
Griffiths, Nigel
Grogan, Mr. John
Gwynne, Andrew
Hain, rh Mr. Peter
Hall, Mr. Mike
Hall, Patrick
Hamilton, Mr. David
Hamilton, Mr. Fabian
Hancock, Mr. Mike
Hanson, Mr. David
Harris, Dr. Evan
Harris, Mr. Tom
Harvey, Nick
Healey, John
Heath, Mr. David
Hemming, John
Henderson, Mr. Doug
Hendrick, Mr. Mark
Hepburn, Mr. Stephen
Heppell, Mr. John
Hesford, Stephen
Hewitt, rh Ms Patricia
Heyes, David
Hill, rh Keith
Hillier, Meg
Hodge, rh Margaret
Hoey, Kate
Holmes, Paul
Hoon, rh Mr. Geoffrey
Hope, Phil
Hopkins, Kelvin
Horwood, Martin
Howarth, rh Mr. George
Howells, Dr. Kim
Hoyle, Mr. Lindsay
Hughes, rh Beverley
Hughes, Simon
Huhne, Chris
Hunter, Mark
Hutton, rh Mr. John
Iddon, Dr. Brian
Illsley, Mr. Eric
Ingram, rh Mr. Adam
Jackson, Glenda
James, Mrs. Siân C.
Jenkins, Mr. Brian
Johnson, rh Alan
Johnson, Ms Diana R.
Jones, Helen
Jones, Mr. Kevan
Jones, Lynne
Jones, Mr. Martyn
Jowell, rh Tessa
Kaufman, rh Sir Gerald
Keeble, Ms Sally
Keen, Alan
Keen, Ann
Keetch, Mr. Paul
Kelly, rh Ruth
Kemp, Mr. Fraser
Kennedy, rh Jane
Khabra, Mr. Piara S.
Kidney, Mr. David
Knight, Jim
Kramer, Susan
Kumar, Dr. Ashok
Ladyman, Dr. Stephen
Lammy, Mr. David
Laxton, Mr. Bob
Lazarowicz, Mark
Leech, Mr. John
Lepper, David
Levitt, Tom
Lewis, Mr. Ivan
Linton, Martin
Lloyd, Tony
Lucas, Ian
Mackinlay, Andrew
Mactaggart, Fiona
Mahmood, Mr. Khalid
Malik, Mr. Shahid
Mann, John
Marris, Rob
Marsden, Mr. Gordon
Marshall, Mr. David
Marshall-Andrews, Mr. Robert

Martlew, Mr. Eric
McAvoy, rh Mr. Thomas
McCabe, Steve
McCafferty, Chris
McCarthy, Kerry
McCarthy-Fry, Sarah
McDonagh, Siobhain
McDonnell, John
McFadden, Mr. Pat
McGovern, Mr. Jim
McGuire, Mrs. Anne
McIsaac, Shona
McKechin, Ann
McKenna, Rosemary
McNulty, Mr. Tony
Meacher, rh Mr. Michael
Merron, Gillian
Michael, rh Alun
Milburn, rh Mr. Alan
Miliband, Edward
Miller, Andrew
Moffatt, Laura
Mole, Chris
Moon, Mrs. Madeleine
Moore, Mr. Michael
Morgan, Julie
Mountford, Kali
Mullin, Mr. Chris
Munn, Meg
Murphy, Mr. Denis
Murphy, Mr. Jim
Murphy, rh Mr. Paul
Naysmith, Dr. Doug
Norris, Dan
O'Brien, Mr. Mike
O'Hara, Mr. Edward
Olner, Mr. Bill
Öpik, Lembit
Owen, Albert
Palmer, Dr. Nick
Plaskitt, Mr. James
Pope, Mr. Greg
Prentice, Mr. Gordon
Prosser, Gwyn
Purchase, Mr. Ken
Purnell, James
Rammell, Bill
Raynsford, rh Mr. Nick
Reed, Mr. Andy
Reed, Mr. Jamie
Reid, Mr. Alan
Rennie, Willie
Riordan, Mrs. Linda
Robertson, John
Robinson, Mr. Geoffrey
Rogerson, Mr. Dan
Rooney, Mr. Terry
Rowen, Paul
Roy, Mr. Frank
Ruane, Chris
Ruddock, Joan
Russell, Bob
Russell, Christine
Ryan, Joan
Salter, Martin
Sanders, Mr. Adrian
Sarwar, Mr. Mohammad
Seabeck, Alison
Sheerman, Mr. Barry
Sheridan, Jim
Simon, Mr. Siôn
Simpson, Alan
Singh, Mr. Marsha
Skinner, Mr. Dennis
Slaughter, Mr. Andrew
Smith, rh Mr. Andrew
Smith, Ms Angela C. (Sheffield, Hillsborough)
Smith, Angela E. (Basildon)
Smith, Geraldine
Smith, rh Jacqui
Smith, John
Smith, Sir Robert
Snelgrove, Anne
Soulsby, Sir Peter
Southworth, Helen
Spellar, rh Mr. John
Starkey, Dr. Phyllis
Stewart, Ian
Stoate, Dr. Howard
Strang, rh Dr. Gavin
Straw, rh Mr. Jack
Stuart, Ms Gisela
Stunell, Andrew
Sutcliffe, Mr. Gerry
Swinson, Jo
Tami, Mark
Taylor, Ms Dari
Taylor, David
Teather, Sarah
Thomas, Mr. Gareth
Thornberry, Emily
Thurso, John
Timms, rh Mr. Stephen
Tipping, Paddy
Todd, Mr. Mark
Touhig, rh Mr. Don
Trickett, Jon
Truswell, Mr. Paul
Turner, Dr. Desmond
Turner, Mr. Neil
Vaz, rh Keith
Waltho, Lynda
Ward, Claire
Watson, Mr. Tom
Watts, Mr. Dave
Whitehead, Dr. Alan
Wicks, Malcolm
Williams, rh Mr. Alan
Williams, Mrs. Betty
Williams, Mark
Williams, Mr. Roger
Williams, Stephen
Willott, Jenny
Winnick, Mr. David
Winterton, rh Ms Rosie
Wood, Mike
Woodward, Mr. Shaun
Woolas, Mr. Phil
Wright, Mr. Anthony
Wright, David
Wright, Mr. Iain
Wright, Dr. Tony
Wyatt, Derek
Younger-Ross, Richard
Tellers for the Noes:

Huw Irranca-Davies and
Tony Cunningham
Question accordingly negatived.
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