Examination of Witnesses (Questions 20-39)
GREG CLARK MP, MR IAN LEGGETT AND MR BRIAN LAMB
26 MARCH 2008
Q20 Mr Prentice: But do you know if Amnesty has tried in the past to secure charitable status, and if it was knocked back why was it knocked back because monitoring allegations of torture and abuses—
Mr Lamb: Certainly they are the classic example of what partly fell foul of the dominant/ancillary ruling because the McGovern case in 1982 against Amnesty was partly based on the Bowman v Secular Society 1917 case which effectively established the whole issue of dominant and ancillary, and so in that sense it would not have been in any way in Amnesty's benefit to register as a charity in terms of being able to continue most of its work at that point. The fact that there is now a public benefit that is the promotion of human rights brings it more foursquare into those activities that are now recognised to have a public benefit, so it is a much more fine line for them now. I certainly cannot speak for them, but certainly I would imagine it is much more a fine line for them now whether they are better in or out.
Q21 Mr Prentice: Listening to you all I am just wondering how big a problem there is, how many charities have been admonished (if that is the word) by the Charity Commission, how many charities have had their knuckles rapped because they were campaigning in contravention of the charitable rules—would you know?
Mr Lamb: I cannot give you the exact answer for that, you would have to go to the Charity Commission, but certainly my understanding and discussions with them over all of this recently is that they get very few complaints at all around breaches of the charity regulations. When I wrote my book on charity campaigning in 1997 and I asked the Charity Commission at that point whether they had many complaints, I think they had dealt with seven or eight, compared to fundraising complaints which are a massive part of their work.
Q22 Mr Prentice: Do you think that is because the charities are so freaked out about stepping over the line that there is a kind of self-censorship going on? I read in some of the briefing papers about this chilling effect, that charities who would really like to be out there campaigning in furtherance of their charitable objectives just walk back because they are afraid.
Mr Lamb: I certainly think that is true broadly across the sector but it depends a lot on the size of the charity as well. The bigger you are, the larger the department you have that is dealing just with these issues, obviously that allows you a level of sophistication in being able to understand the environment, brief trustees, have a familiarity with what you are doing and the guidelines. I would say that for some of the much larger charities they are probably responsible but, if you like, less cautious in that sense of being able to understand where they can go and where they cannot. I certainly think that for a lot of medium/small-size charities it is a completely different issue and also the trustees in those charities would probably be much more hesitant about what they can do and what they cannot do and will tend to err on the side of caution.
Q23 Mr Prentice: You are nodding your head, Mr Leggett, at that; is that the way the charitable world operates?
Mr Leggett: It is and for all kinds of reasons large charities have got more resources, they have got access to professional guidance in a way that, quite frankly, lots and lots of small or medium-sized charities really do not have.
Q24 Mr Prentice: One more question before I hand it on. Greg, you were talking about charities becoming kind of Trojan horses and that because the party funding rules are so strict a party could surreptitiously use a charity to campaign on its behalf. Are there any examples that you could give us where you suspect that is happening?
Greg Clark: I would not say that it was surreptitious but what I would say is that if you have got someone who wants to donate to a campaign, and perhaps they are not registered as electors or they do not want to disclose their identity, if you have a choice between donating to a political party and donating to a charity whose dominant activity is to campaign for a particular object that it might have in common with another party—
Q25 Mr Prentice: Would that be something like Migration Watch?
Greg Clark: It could be something like Migration Watch, you could have an organisation set up to abolish independent schools, for example, you could have any number of organisations set up to campaign for a policy that was clearly associated with a particular party and would be exempt from all of the restrictions that your Committee have been debating and would get tax relief.
Q26 Mr Prentice: But you cannot give us any examples of where this is happening at the moment.
Greg Clark: Of course we cannot because the law as it has been has restricted that, and that is why I think it is important at the moment—up to now you cannot set up a charity whose dominant purpose is to campaign politically, and I do not think that should change.
Q27 Kelvin Hopkins: Like Gordon I find this area very difficult to deal with because it is fuzzy and I like clarity. The phrase comes to mind "difficult cases make bad law" and it seems to me that at the margins there are lots and lots of difficult cases so it is difficult to draw those lines. You are nodding. Would it have been sensible for the Government and everyone else to have left things alone, as they were and not intervened?
Greg Clark: Given that the law has not changed and the Charity Commission is clear that the law has not changed, then to have settled guidance that the case law is established and the interpretations are established is not a bad way to proceed. Stonewall, for example, who are not a charity which has been chilled out of campaigning have said precisely that, there is no need to change the law because actually it is pretty clear what goes on. I do not accept this idea that the word "dominant" is such a peculiar word that it defeats any attempts to understand what it means. In terms of legal concept, and this remains in the law, that is one of the more intelligible concepts, it strikes me, so having a degree of continuity in this rather than as the Commission has been hustled into doing, to change the rules three times in the last two years, this is actually creating confusion when actually a settled interpretation would have been a better way to proceed.
Mr Leggett: Could I just come in because there was an assumption behind there that somehow the Government was involved in this, and I have to say that certainly in terms of the group that got together and eventually was chaired by Helena Kennedy, the Government was not involved in that at all. This was an initiative created by the sector, driven by the sector, run by the sector and I probably had two meetings with the Office of the Third Sector to tell them what was going on, but there was absolutely no truth in the suggestion that they were in some way engineering it or trying to manipulate it in any way whatsoever. In that sense—you used the reference to the Government and I have to say the Government was not actively involved in this at all.
Mr Lamb: Just to try and give you an answer and put some of this in context, if you look at a lot of the case law that this is based on—this is the first point I would make—a lot of it stems back, at least if you look at the dominant and ancillary, to Bowman v. Secular Society which was a case in 1917. At that point women were just getting the franchise, if you did political activity at all it was likely to be through mass political parties, which is what everybody went to and our understanding of charity, charitable trusts and the way charities worked was entirely different. You were only just out of that whole historical period where the charities generally were in that sense something that literally was part of the safety net that picked up issues, whether it was hospitals or employment or other welfare issues. Basically what people have been struggling to do ever since with the growth of charitable activity, which has grown absolutely massively, charity campaigning which has grown absolutely massively, within that rather restrictive, narrow and old-fashioned framework of what charitable trusts were about is to provide an understanding and interpretation of that which keeps up with our much more modern understanding of the role of charities in the current world. Therefore, to answer your question, it has been absolutely necessary that over time as charities' role in campaigning and public policy debate has extended at precisely the point where, in a way, there has been much more of a crisis of confidence in the normal political channels of engagement—and I think this was part of what Ian was driving at—you have to see charities' roles as being really quite different, certainly in 1917 when these judgments were being made, and trying at least to have an interpretation of the case law that makes some sense of the way charities are actually operating now and what they understand. I have been involved in debates with the Charity Commission around various versions of CC9 since about 1994, and in different consultations; when I wrote my book in 1997 two-thirds of it was about trying to explain to the sector and give the sector confidence—it was actually called The Good Campaigns Guide—in how they could actually interpret the Guidance then and go about it.[10] In this sense I would argue that the new guidance has been absolutely necessary because we have never until now quite got over that legacy of how you could access, in a very clear way, what these concepts mean in a way that people will understand and be able to do something about. In that sense that is what we were trying to do through the Advisory Group report, try and have a more modern understanding of what that might look like. Accepting that the legislation has not changed, what the Charity Commission has done is probably the best stab we are ever now going to get, and I hope it will now last a long time, giving people the confidence to campaign but not go beyond what they are allowed to do by that law as it now stands.
Q28 Kelvin Hopkins: The Government has not been involved, you say, but at the same time the Government has been promoting the concept of the third sector undertaking more service provision. That is in a sense going back to the past, before charitable services became public services, publicly funded and moved into the state sector. In a sense the Government is sort of moving back in that other direction, with a lot of privatisation as well. We have had a number of people saying that the Government is trying to encourage the third sector. Is it not possible that they might start to get more interested if things do not work. Might they start legislating and begin to intervene a bit more than they are at the moment?
Greg Clark: Perhaps I could just comment on that. Specifically Ed Miliband has been involved in the debate; he might not have been part of the deliberations of the group but he has given evidence to you. He has said, for example, on one of the major points of contention that the Government can see no objections, legal or other, to a charity pursuing its purpose wholly or mainly through political activities. That is quite a striking view, although it is not my view, and indeed in the third sector review Ed said that he is working with the Charity Commission to change the guidance. I have other reservations about how appropriate it is for a minister to be working with the independent Charity Commission, especially when it is on a point of contention, to change it, it should be more robustly independent there. So there has been government participation in this, if not strictly in the deliberations of the advisory group.
Mr Lamb: If I could just comment on that, if that was all he had said we on the group would have been jumping up and down with delight, because he would have been agreeing exactly with what we had said. Unfortunately, in other bits in the same Treasury review that was quite highly qualified, in fact using the dominant/ancillary distinction, there was another point which undercut and took some of the force away from that otherwise I would agree with you that he would have been foursquare with what we were saying. In fact, if you look at that statement in the round with some of the other things he was saying in the Treasury review report it did not quite say that, otherwise we would be quoting the report as well.
Greg Clark: It is probably a matter for debate but I think he changed his mind, rightly; I think he was persuaded that actually this was quite a risky route down which to travel.
Q29 Kelvin Hopkins: Your concern clearly is that a lot of organisations which are now not charities, do not get those advantages, but are political and would fit within Ed Miliband's definition. They could claim charitable status in future and we could see all sorts of organisations, many of them of the Left but some possibly of the Right, claiming charitable status.
Greg Clark: Absolutely. There are some pressure groups on the Right who would, I am sure, dearly love to be charities. This is actually not a partisan thing, although Ed and I have debated this across the despatch box. I genuinely have a concern for the way that charities are perceived. They are a kind of repository of public trust; there has been a survey published this week that suggests that that trust is declining slightly, but nevertheless trust is the number one word that members of the public associate with charities. There has been a crisis of trust in politicians, sadly for us, so I think we need to be careful if we, even for the best of intentions, end up with a situation in which charities seem to the public to look more like politicians and political parties than they do the charities that they have always been understood to be there and doing good works and being trustworthy. The Charities Bill, when it went through both Houses, proceeded with complete unanimity and there was care taken to ensure that this was not a matter of party political dispute, that a consensus was built, and I am concerned that in this area of political campaigning, where political pressure groups can become charities, this goes to the heart of the trust and we need to proceed with particular caution on this point.
Q30 Kelvin Hopkins: Just one more question if I may and that is the elephant at the door, or in the room even, the public schools'—boarding schools—charitable status. That is something that people like myself would be concerned about, wanting the rich to pay the full price for their expensive education. Clearly that is quite different from RNID, serving a noble purpose concerned with people with disabilities and which most people accept is genuinely charitable. Is it not the case that, the more we debate these things, they are going to become a matter of more obvious contrast and indeed pose a threat to the public schools?
Greg Clark: It is all part of the political campaigning aspect and the law that defined public benefit or that changed some of the aspects of public benefit was well-debated and enjoyed the support of both sides.
Mr Lamb: Can I just come back on Greg's previous point in that it is just worth restating again that the dangers of what we are proposing—and I agree that is not where we are now—are not as great as he suggests because we never said that a charity's overall purpose should only be political, but that they should have more flexibility over the means by which they could carry it out. So anything we are suggesting would not take away the fact that charities would still have to have an overall purpose that was broader than just a political one, it would still have to fit the public benefit test, it would still have the same scrutiny by trustees over what the charities did, but they would still have to answer to the Charity Commission, so that if they had chosen to try and achieve those ends by political means they would have to have shown that that fulfilled their overall charitable purpose and achieved a public benefit, and those were all breaks if you like in criteria against which some of the things that Greg is most worried about would have been much more difficult to happen than he suggests. That is not where we are, so in a way the point is academic, it is just important for the record to get it straight that actually we did consider very seriously some of those kinds of issues but actually felt that there were enough checks and balances in the system to prevent that, or even if we did become very concerned about that there are ways we could have strengthened the public benefit test to actually cope with that. That is clearly not where we are now anyway.
Q31 David Heyes: I want to come to this from a slightly different angle and put this into the context of the moves from national and local government towards commissioning more and more services from the third sector and large charities that are in receipt of local and national government grants of one form or another. I wonder really whether what we have been talking about so far is a bit of a red herring and whether it is not likely to be the case that a more limiting and more constraining factor on campaigning and political activities is likely to come from that source. However much you may clarify the charity or however liberally it might be interpreted, there still remains that threat to funding as a constraint. I just want to test your views on that really.
Greg Clark: That is absolutely right, the two things are problems, and there certainly is the perception, as we all know, talking to charities across the country, especially those that are commissioned by local authorities, often they perceive—and I cannot believe that in every case it is a misperception—that actually if they are too critical of their funder then they might lose that funding. That is a really worrying trend and the Compact that is there to govern the relationship between the voluntary sector and the Government at different levels, which includes a commitment that there should be an independent view there, is often more in the breach than the observance; that needs to be strengthened and to have more teeth. Brian, you have some practical experience.
Mr Lamb: Indeed. Certainly for the largest charities this is less of a concern than it may be for small local ones that are more dependent on one particular source. Certainly RNID is a major service provider to a whole number of local authorities but also when working with the Government our whole project to modernise audiology services, for example, has been very well-known. When we first campaigned with the Government to get digital hearing aids introduced onto the NHS we had what even government ministers described as a fairly vociferous campaign against the Government to put more funding into this area; then because of our expertise in it we were actually asked by the Government first to run pilot projects about modernising audiology services where in effect we were an intermediary between the Government and the NHS and we were employing audiologists who were actually going around the country modernising hearing aid services, delivering the contracts that we were actually negotiating with hearing aid manufacturers about the price of hearing aids and getting those down for the NHS. We were administering NHS money without actually recycling it through the organisation and during the period we were actually doing this we were still campaigning with the Government for them to invest more money in the service, which they then eventually did. We even had government ministers come on record saying we were one of the Government's most vociferous critics yet at the same time they had worked hand in hand with us to then deliver audiology services across the country. We were able to do that because of our size and because we were so established in the area we work in that we had the authority to be able to do that and manage both sides of that equation at the same time. If you are a single organisation working essentially in one local authority area and 90% of your funding comes from one particular local authority or PCT[11] source, whatever it might be, I accept you are in a completely different position and the feedback from those organisations would be completely different.
Q32 David Heyes: Just before Ian comes in on this I just want to press you a little bit more on the RNID experience. You in essence say that you would not compromise.
Mr Lamb: No.
Q33 David Heyes: Can you really say that? Looking at it from the sidelines with many constituents who were concerned about the early lack of progress and who were very strong supporters of your then campaigning, the campaigning seemed to go very quiet from RNID at a time when my constituents were still saying this service is very patchy, the implementation is ragged and inconsistent, and at that point of implementation a lot of the earlier noise that the RNID had rightly been making seemed to me to be silenced. Is that not a fair criticism?
Mr Lamb: I would say not. I accept what you are saying in that some say two different processes happened at the same time. We were very successful initially at getting audiology services modernised and in bringing them up to a standard that was acceptable in getting the price of hearing aids down. What we were less successful initially at doing was getting the extra funding in that soaked up the long waiting times that pre-existed the whole of that modernisation programme—and of course the irony was that once people realised that there were much better quality hearing aids available on the NHS far more people started coming forward to actually take advantage of that and the waiting list actually got worse. I cannot do it now but I am very happy to send you the press releases, debates, criticisms of ministers that continued through the whole of that period, and we still have a very vociferous campaign to make the Government meet its 18-week waiting targets around audiology services. Indeed, we are waiting next month to see whether they have got it or not and I promise you if not we will still be making criticisms of the Government. It may have appeared to some people that it went quiet; I am only sorry that they were not seeing the campaigning we were doing and I am very happy to try and convince you otherwise.
Q34 David Heyes: I have pressed you far enough on that. Ian, this core issue, is the money more of a constraint than the lack of clarity about the law?
Mr Leggett: You make a good point and it is true for medium-sized charities, small charities and very local charities. There is another coalition called the National Coalition of Independent Action which tends to represent the very small local charities which has been very outspoken on the commissioning issue and how small local charities have been affected by that. It is also true that, by and large, if charities, whatever their size, are primarily dependent on public statutory funding in one form or another, they are going to be very careful about what they say because their financial survival depends on that relationship, and that is why for me, when we did our survey looking at the big obstacles to campaigning, one of the key obstacles identified across the board in the sector was funding, and that in a way led us then to look at CC9, because what I think is really important is for independent trusts and foundations, who are much more likely to be happy to support independent action, to feel confident that campaigning is not some slightly dodgy activity that they are not sure if they can support, and many trusts do feel like that, and if they can see that campaigning by charities is legitimate, valuable and effective in achieving charitable purpose, they will be more likely to fund it, and that then means that there is not the monopoly of, if you like, dependence on local authority or central Government funding, and that will lead to a more vibrant society.
Q35 David Heyes: Lastly, pressing you a little bit further on this self-policing issue, you have all talked about self-policing based on a caution concerning the application of the law. Is it not likely to be the case that that same overcautious self-policing takes place in relation to funders, and that the local authorities that you talk about are really not such fierce, draconian, vengeful organisations that withdraw funding from organisations who maybe gave them a hard time from time to time?
Mr Leggett: It is not about whether they are draconian or hostile or anything; it is the fact that for very many organisations they may well be either the sole or one of the very small number of key funders, almost like a monopoly position. One of the reasons that RNID and many of the other very big charities can be much more confident about engaging in campaigning is because they have an independent supporter base of half a million/a million or more and that gives them, if you like, the freedom to campaign as their trustees choose. Many smaller charities are simply not in that position.
Q36 Paul Flynn: You seem to draw a distinction in those answers between political activity and good works. Is not a great deal of political activity good works?
Greg Clark: I was referring to what the public view of charities is. I think there is a sense, and this is the basis of the dominant/ancillary rule, that of course, it is right for charities to campaign and it is right for them to campaign politically but it should come out of their experience. So when Brian campaigns on the point of hearing aids, quite rightly, it comes because there is a body of expertise there and that is different from a pressure group, and you can have fantastic pressure groups and appropriate pressure groups whose existence is solely to be political campaigning organisations.
Q37 Paul Flynn: The danger suggested by what you have said now and earlier is groups that are BNP groups or groups that suggest that immigration is the cause of poverty, or campaign to get rid of independent schools. Have you any reason for believing that charities would suddenly come to life and exploit a situation now?
Greg Clark: Given that there are groups of people who make these arguments I cannot see why they would not avail themselves of the tax relief that would come from it, and the status and reassurance, the imprimatur almost, that comes from being a charity, so I would be astonished if they did not avail themselves of it.
Q38 Paul Flynn: Do you not see a danger in the present set-up that charities might abuse their position and that for empire building reasons charities which were set up for certain causes that have disappeared or diminished continued using their position and politics to define what is an empire, or to define their own jobs, or do you find it a problem with charities that have been funded by a commercial organisation using their funds to advance commercial processes? Is that not a greater danger than the fear you have about ultra-right groups?
Greg Clark: If there is evidence that a charity is being used by a commercial organisation as a front to make a commercial competitive argument then I would be as concerned about that as I would be about this possibility.
Q39 Paul Flynn: Mr Lamb, what advice did you give in your book about campaigning to convince MPs of a particular cause? What did you suggest charities should do?
Mr Lamb: That is a good question!
10 Brian Lamb, The Good Campaigns Guide, (NCVO Publications, 1997) Back
11 Primary Care Trust Back
| 
