Mr.
Turner: The “wild allegations” were
supported by information from the National Council for Voluntary
Organisations and printed in its voluntary sector almanac for 2004.
That information shows that every £10,000 raised by charities
with an income of less than £100,000 costs £311 and every
£10,000 raised by charities with an income in excess of
£10 million costs £929.
1.15
pm
Martin
Horwood: That is because smaller charities often do not
employ paid staff. It is nothing to do with the efficiency of the
fundraising, but to do with the fact that larger charities tend to
employ staff and smaller ones do
not.
Mr.
Turner: I sense a vested interest, although not a current
one. I welcome the fact that charities recruit volunteers to do their
fundraising. Section
60(3)(c)(i) of the 1992 Act says that the commercial participator shall
accompany the offer for sale with a statement clearly
indicating: “what
proportion of the consideration given for goods or services sold or
supplied by him...is to be given to or applied for the benefit of
the institution or institutions
concerned”. It is
frightening to find that, however good it is generally, Tesco has not
read that bit of the law. I am sure that it would not avoid reading the
relevant bit of the food safety legislation, but perhaps I am
wrong. I accept the
Parliamentary Secretary’s acknowledgement that it is not the
Charity Commission’s responsibility to prosecute; in fact, it
should draw things to the attention of the police or trading standards.
I also welcome the suggestion that the Charity Commission must
investigate potential breaches a lot more
rigorously. The
Parliamentary Secretary did not answer well the points raised by the
AFC, but he is attempting to strengthen the law, not to introduce
unnecessary regulation, and we will have to judge it by its effect. I
beg to ask leave to withdraw the
amendment. Amendment,
by leave,
withdrawn. Clause
67 ordered to stand part of the
Bill. Clause 68
ordered to stand part of the
Bill.
Clause
69Reserve
power to control fund-raising by charitable
institutions
The
Chairman: We now come to amendmentNo. 157, with
which it will be convenient to take amendments Nos. 158, 77 and 159. I
call Mr.
Turner.
Mr.
Turner: I was concerned about whether the Secretary of
State would exercise the powers in respect of large charities. However,
we have discussed enough the expenditure of large charities and whether
further regulation is needed, so I do not propose to move the
amendment. Clause 69
ordered to stand part of the
Bill.
Clause
70Power
of Secretary of State to give financial assistance to charitable,
benevolent or philanthropic
institutions
Mr.
Turner: I beg to move amendment No. 47, in
clause 70, page 75, line 16, after
‘conditions’, insert
‘, which shall be proportionate to
the risk of loss or abuse of public money and the capacity of the
institution to comply
therewith,’.
The
Chairman: With this it will be convenient to discuss the
following amendments: No. 48, in
clause 70, page 75, line 16, at
end insert— ‘(3A) Where
financial assistance is given in return for the delivery of a service,
the Secretary of State shall ensure that a reasonable opportunity is
given to a range of institutions to offer to deliver to the
service.’. No.
49, in
clause 71, page 76, line 25, after
‘conditions’, insert
‘, which shall be proportionate to the risk
of loss or abuse of public money and the capacity of the institution to
comply
therewith,’. No.
50, in
clause 71, page 76, line 25, at
end insert— ‘(3A) Where
financial assistance is given in return for the delivery of a service,
the assembly shall ensure that a reasonable opportunity is given to a
range of institutions to offer to deliver to the
service.’.
Mr.
Turner: There are two purposes to these amendments.
Amendments Nos. 47 and 48 would require a degree of proportionality in
the Secretary of State’s activities. I am concerned about
regulation being introduced through the back door. However, it is
likely that I shall accept suitable assurances from the Parliamentary
Secretary in that
respect. Amendments
Nos. 49 and 50 deal with how Governments—not just the present
one—sometimes feel the need to set up a charitable vehicle to
undertake part of their activities even though there might already be a
suitable vehicle to undertake the work. The example I have in mind is
the Experience Corps, the purpose of which was to encourage more people
to get involved in charities, particularly people close to or beyond
retirement age. I had a conversation with the director of one
organisation who questioned whether her organisation would not have
been equally capable of doing exactly the same job, without the
establishment of an organisation that began to look like a Government
vehicle rather than a genuine charity and that cost a huge amount of
money. In a
parliamentary answer to me on 12 September 2005, the hon. Member for
Wythenshawe and Sale, East (Paul Goggins), then a Home Office Minister,
told me that the Experience
Corps “received
approximately £20 million from the Home
Office” and that
its “target was to recruit
250,000 new
volunteers”. However, as
of December 2003, it had
only “recruited over
153,000 volunteers”.—[Official Report, 12
September 2005; Vol. 436, c.
2633W.] Even my arithmetic is up
to calculating that that works out at £130,000 per volunteer.
Sometimes we ought to ask the Government whether they could not have
acted more efficiently. That is the purpose of amendments Nos. 48 and
50.
Edward
Miliband: I sympathise with the intentions behind the
amendments, but I hope that I can satisfy the hon. Gentleman that they
are unnecessary.
On amendments Nos. 47 and 49, the
compact of good practice, which was agreed between the Government and
the voluntary sector and with which the hon. Gentleman will be
familiar, is important because it covers precisely the issues that he
discussed, including proportionality in monitoring requirements. He was
right to raise the matter, because the interaction between the
Government and the voluntary sector is important and we must get our
practice right in that area. I do not think that the hon.
Gentleman’s amendments would add all that much to what already
exists, but I am sympathetic to the intentions behind
them. I shall deal
briefly with amendments Nos. 48 and 50. Again, I agree with the hon.
Gentleman’s view, but the distinction that I would draw is that
the Government are often not best placed to disburse funds. It should
not necessarily be the job of the new Office of the Third Sector to
spend lots of time filtering grant applications. For example, V, a new
charity for young people, will distribute resources on an arm’s
length and independent basis to organisations that encourage
volunteering opportunities for young people. It is better to use the
voluntary sector’s expertise to do that sort of thing than to do
it within
Government. However,
that does not detract from the hon. Gentleman’s point. When the
Government consider setting up new vehicles and institutions, we must
be careful not to duplicate existing bodies that could do the job
better. The compact is designed to cover that, too. I take his point in
both cases, but hope that on the basis of reassuring words and firm
intentions on my part, he will withdraw his
amendments. Peter
Bottomley (Worthing, West) (Con): May I ask the Minister
to help the Committee on a couple of points? Subsection (6) says that
the Secretary of State
“may make arrangements
for...assistance under subsection (1) to be
given”— that is,
financial assistance—or he may delegate the matter. Could the
hon. Gentleman give the Committee one or two illustrative examples of
hypothetical or actual cases in which the Secretary of State might want
that power? Subsection
(10)(b) mentions “an
institution (other than a charity) which is established for charitable,
benevolent or philanthropic
purposes.” I am not too
concerned about the benevolent or philanthropic purposes, but will the
Minister give an illustrative example of something that is not a
charity that is established for charitable
purposes?
The
Chairman: I call the
Minister.
Edward
Miliband: I thought you might be about to call the hon.
Member for Isle of Wight, Mr. Gale, but sadly
not.
The
Chairman: Order. The Minister is not compelled to respond,
but if I call the hon. Member for Isle of Wight, I shall wind up the
debate.
Edward
Miliband: No, I am happy to respond, Mr. Gale.
I was not seeking to question the Chair and your wisdom.
I answered the first question put
by the hon. Member for Worthing, West (Peter Bottomley) in my previous
remarks. An example such as he asks for is an institution that is set
up by the Government and disburses Government funds. Such bodies
include V, which is encouraging youth volunteering, and Future
Builders, which is providing loans and grants to institutions and
charities that want to help deliver public
services. An example of
an institution other than a charity that is established for charitable
purposes is Amnesty International, which is not a charity but does have
charitable purposes. I hope that that is helpful to him and the
Committee.
Mr.
Turner: I am grateful for the warm words of the Minister.
I am even more grateful for his firm intentions. I beg to ask leave to
withdraw the
amendment. Amendment, by
leave, withdrawn. Clause
70 ordered to stand part of the
Bill. Clause 71 ordered to
stand part of the
Bill. Clause
72Report
on operation of this
Act
Martin
Horwood: I beg to move amendment No. 156, in
clause 72, page 77, line 20, at
end insert— ‘(Z1) The
Secretary of State must, one year after the year in which this Act is
passed and each year subsequently, make a statement to the House of
Commons, which must address the following
matters— (a) the number
of registered charities in England and Wales, and an indication of
whether this number has risen or fallen since the previous
statement, (b) the number of
organisations which have failed to obtain or retain charitable status
under sections 2 or 3 of this Act in that year, and why they have
failed, (c) the total value of
Gift Aid and other special tax provisions for registered charities in
that year, (d) the total net
cost of Value Added Tax to registered charities in that year,
and (e) the number and value of
central government contracts placed with registered charities in that
year.’. The
amendment is straightforward and I hope that it will command widespread
support and sympathy in the
Committee—
Martin
Horwood: The Minister may not realise the opportunity that
he is missing with this amendment.
The clause obliges the Minister
to report on the operation of the Act not later than in five
years’ time, but some of the conditions and changes to charity
law that we have been discussing, may have immediate implications for
charities and change the way in which charity registration happens.
They might also change and even challenge the effectiveness of the
Charity Commission. It is therefore important that we have an annual
review of the sector’s
operation. The
implications for the sector are wider than simply the provisions in the
clauses that we have discussed in
this Committee. The relationship between the Government and the private
and voluntary sectors in terms of the delivery of services and public
policy objectives is a legitimate subject for regular review. Review
does take place, but on a piecemeal basis, together with occasional
debates on volunteering in Westminster Hall and ministerial speeches on
particular projects. It would therefore be valuable to have a well
rounded and concentrated report each year. The members of the Committee
are extremely well informed on the third sector, but we may be in a
minority among our colleagues in terms of a real knowledge of the way
in which the sector is operating.
As I have said in the
amendment, reviewing the changes in the number of registered
charities—whether that number is rising or falling—may
reveal trends resulting from the changes to charity registration in the
Bill. The number of organisations that have failed to attain or to
retain charitable status is clearly relevant to the changed
arrangements in relation to the new heads of charity and the public
benefit test. There are differing views on the public benefit
test—whether it represents a continuation of the status quo, as
the Government believe, or operates tighter guidance, as I would wish,
or offers a privileged position to private schools, as the hon. Member
for Isle of Wight and his colleagues would prefer. Those matters should
be discussed and any legitimate concerns about the operation of the
public benefit test could then be revealed sooner rather than
later. We could
discuss the total value of gift aid and other special tax provisions
for charities in that year. That would provide an opportunity for the
Parliamentary Secretary to parade the extraordinary generosity of
Government towards charities in the form of the various tax breaks and
concessions that it offers to them. However, in fairness, the report
should also include the total net cost of value added tax to registered
charities. The amount that it costs the many charities that are not
able to recover VAT because they do not sell anything is a matter of
concern in the sector. That is, in effect, a tax on charities, which
those of us who are sympathetic to the third sector ought to be
lobbying our respective Treasury teams to tackle through amended
policies. The review that I propose would offer an opportunity for the
issue to be discussed in Parliament in a cool-headed, rational and well
informed way. Finally,
a report on the number and value of central Government contracts placed
with registered charities in the relevant year would help to illustrate
the developing relationship between charity, the private sector and the
Government. The
amendment is balanced and reasonable, and would introduce a welcome
opportunity for Parliament to discuss the values and development of the
third sector in a well informed way.
1.30
pm
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