Memorandum from the Royal Television Society
("RTS") (DCH 190)
INTRODUCTION
1. The RTS (a registered Charity) is currently
reviewing with the Charity Commission the public benefit of its
educational activities. The Council of the Society hopes that
these submissions might provide some practical insight for the
Committee as to the consequences of the withdrawal of the presumption
of public benefit for educational charities (Sections 2 (1)(b)
and 3 of the Charities Bill) and the current opacity of the public
benefit test.
BACKGROUND
2.1 The RTS is established to advance public
education in "the science, practice, technology and art of
television and its allied fields and other scientific subjects."
2.2 The Society was founded 77 years ago
by John Logie Baird when the use and potentialities of television
were in the realm of the imagination. As television developed
into broadcasting with the BBC, and then into a world of increasing
channels, the range of the Society's activities expanded to meet
the changing meaning of "the practice, technology and art
of television." The Society is the leading education forum
for providing understanding of what is happening in television
and the forces shaping its future.
2.3 The Society in doing this also fulfils
another role of wider social utility. "Television is a special
medium: it interacts directly with the society we are and want
to be."[136]
To quote the Rt Hon Tessa Jowell MP, Secretary of State, Culture
Media and Sport, "Broadcasting is now far too important to
our society for decisions about its future to be left to what
could in effect be private conversations."[137]
The Royal Television Society provides open information, illumination
and debate on the factors shaping the present and future of television
and broadcasting.
2.4 The Society achieves its aims in practice
primarily through its programme of events. These events are open
to both members and the public and we run approximately 26 events
nationally over the year, with another 125 or so organised by
the 14 Nation and Region Centres. Membership is open to all. The
national activities include:
(a) Early Evening Events—seven or eight
a year where an expert panel discusses an important issue or a
leading practitioner is interviewed. To date in 2003, "Meet
Charles Allen," "What Future for TV Investigative Journalism—Post
Hutton," "Ofcom, Public Service and the Future of Television,"
and "Interactivity—Why Bother?"
(b) Distinguished Lectures—three per
year covering technology (Shoenberg), programme-making (Wheldon)
and political and strategic aspects of Television (Fleming).
(c) Dinners—seven times a year with
a high level speaker, who presents a new perspective on a significant
topic in television, followed by questions and debate. Recent
dinners have included Jane Root; Controller BBC2 "Does Life
Begin at 40? Lessons from BBC Two;" Ed Richards, Senior Partner
Strategy and Market Developments, Ofcom "The Public Service
Broadcasting Review;" Ashley Highfield Director of New Media
& Technology, BBC "TV's tipping point: why the digital
revolution is just beginning;" John Willis, Director of Factual
& Learning, BBC "Patriotic, populist and mostly pap?"
(US television).
(d) Television magazine. This is a platform
for presenting articles and views on important issues in television,
together with reports on the Society's events.
(e) The RTS Website—which provides
public access to the Television magazine archive, major speeches
and lectures, Centre activities in Nations and Regions, Awards
winners and information on the Society.
2.5 The Society's reputation as an impartial
forum has made it the forum of choice for public policy announcements
and consultations. Recent events have included the launch of BBC
Charter Review by the Secretary of State, Culture Media and Sport,
and Ofcom on the Public Service Broadcasting Review. In September
we anticipate an important contribution on policy when Lord Currie,
Chairman of Ofcom, delivers the Fleming Lecture.
CHARITY COMMISSION
REVIEW
3.1 The Society's current dialogue with
the Charity Commission arises from a random review visit undertaken
by the Commission on 17 June, preceded on 3 June by an informal
meeting, to which the Commission had agreed at our request.
3.2 At the informal meeting the Commission
indicated that at the review visit it would be focussing on the
issues of the Charity's "Activities", the extent to
which these are of "Public Benefit", the extent to which
they are "Educational". In particular, the informal
meeting brought to the fore the technical issues of:
(a) Poise—the balance between public
benefit and private benefit.
(b) Motivation—who are we seeking to
serve—are we driven by members' interests or the public
interest?
(c) Education—do our educational activities
serve a charitable purpose?
(d) Presentation—is our information
presented in a way that addresses these issues?
3.3 Our attention was drawn to the paper
RR8 "The Public Character of Charity" from which we,
mistakenly, drew some comfort. The Commission also suggested we
might consider taking legal advice. The informal meeting was very
helpful in sighting us on the key issues and enabling us to prepare
for the formal review visit and to take legal advice from specialists
in charity law.
3.4 Following the informal meeting and with
the assistance of the specialist charity lawyers engaged by us,
we made preliminary legal submissions to the Commission in the
hope of establishing common ground on the interpretation of "public
benefit" in the context of an educational charity. At the
review visit itself the Chairman, Chief Executive and others made
oral submissions explaining the activities of the charity and
their educational intent.
3.5 At the Review visit certain issues pertinent
to the public benefit became apparent:
(a) The Commission's interpretation of public
benefit differs in some respects from that of our legal advisors,
in particular on the matter of the extent to which the education
of individuals in the practice of television is charitable. We
are optimistic such differences will be resolved but it will require
a further, separate dialogue involving the Legal Division of the
Commission.
(b) Where there is agreement over the relevant
legal principles, those principles are hardly easily accessible
to the layman. Central to the Commission's review of activities
is an assessment of the Society's "poise"—that
is, the extent to which might appear to be for the benefit of
its members (notwithstanding the Society's open membership) in
contrast with it being run for the benefit of "the public".
With the best will in the world, this comes down to the subjective
assessment of attitudes and intentions which can easily differ
from person to person.
(c) Although it was agreed it would be premature
to consider this issue in the terms of "social and economic
impact", in the absence of a presumption of public benefit,
impact assessment methods will have to be developed to enable
the charity to go further in "demonstrating" the public
benefit it provides, and its "altruistic" character.
This will be far from easy if "public benefit" remains
such a difficult concept to pin down in the case of charities
such as the Society.
However, at the meeting no definitive conclusion
on any of these points was offered or reached.
OBSERVATIONS ON
IMPLICATIONS OF
THE REVIEW
VISIT
4.1 The Society is optimistic that with
the assistance of its advisors and the Commission the issues identified
above will be resolved. Our legal costs to date are in the order
of £6,000. With a fair wind we might still expect our costs
to be £15,000. In a worst case scenario where the RTS becomes
a test case appealed up to the House of Lords costs could exceed
£500,000. The Society also has the benefit of an executive
staffed by professionals.
4.2 When the Act removes the presumption
of public benefit suddenly the onus will be on all charities under
the traditional first three heads (poverty, religion, education)
to actively and regularly ask similar questions to those the Society
is asking itself at present. Our experience of this process highlights
four areas that will make this process for any charity far from
easy:
(a) The consequence of being found wanting
in the delivery of a public benefit is unclear. At the informal
meeting with the Commission it was suggested that one potential
consequence would be a loss of charitable status (ie the Society
carries on but not as a charity). Our advisors have suggested
that unless (broadly) there has been a considerable shift in social
attitudes (as was the case with gun clubs), a charity (or the
funds within it) can not just lose their charitable character.
Clear guidelines are needed on this issue, particularly because
if the former analysis is correct it introduces to status an "activities
test" that we understood the Strategy Unit Report and Government
Response to have rejected.
(b) The common law definition of public benefit
in context of education is far from certain. This is, we understand,
the consequence of the common law not being as comprehensive for
the first three heads of charity due simply to the fact that to
date the presumption of public benefit has existed. In the case
of the Society two issues—the extent to which it is legitimate
to educate individuals in matters that might be useful to their
career, and criteria that might be applied to measure the necessary
degree of altruism in a member-based charity—are not easily
pinned down. The Commission's own current formulation of the public
benefit test using phrases such as "ancillary" "incidental"
and "reasonably necessary" is of limited practical use
to the layman.
(c) It was indicated by the Commission that
these issues must be looked at "in the context" of what
the Society was doing and whom it was serving. If this is correct
it will be all the more difficult to derive general principles
from individual circumstances. To take two examples from the Society's
experience: It has been suggested to the Society that it is easier
to demonstrate "public benefit" if education is delivered
in an academic institution (eg school, university) than directly
to members of the public. There is little guidance as to what
drives this distinction. Public benefit is also more easily accepted
in the case of youth education, but less easily in the case of
adult education. This seems to have something to do with the extent
to which the education might assist a person in their career,
but some professional education is regarded as for the wider public
benefit (eg lawyers, engineers, pilots). In contrast, the suggestion
seems to be that education in television is less charitable because
television is somehow of less social utility. An analysis of the
relevant case law may in due course provide for the Society an
answer to these questions, but the Society has the resource to
pursue these enquiries. Other charities may not be so fortunate.
(d) The consequence is that less well-resourced
charities are likely to simply have to accept the Commission's
interpretation of the law (we understand that the proposal there
should be a "fighting fund" for the Appeal Tribunal
or appeal to the High Court has previously been considered and
rejected). In the absence of substantial precedent for the first
three heads of charity this opens the risk of Commission rulings
being seen as arbitrary, and the position of charities in the
first three heads being uncertain for a considerable period until
there is a sufficient body of new case law to fill the gap. If
this risk is to be averted, access to the proposed Charity Appeal
Tribunal must be swift and straightforward and its decisions widely
published.
CONCLUSION
5.1 These submissions are intended to provide
some practical insight into the consequences of the withdrawal
of the presumption of public benefit; as such the conclusion the
Society can offer are tentative. We should also emphasise that
these submissions are not intended to be critical of the Review
process being undertaken by the Commission. The fact a conclusion
on "public benefit" could not be reached at the visit
reflects prevailing uncertainties in the application of the test
itself.
5.2 This suggests to us three points of
potential relevance to the Charities Bill:
(a) Notwithstanding the uncertainties outlined
above we are not sure that a statutory definition of public benefit
would assist. Indeed, it would introduce additional uncertainty
to this issue while the mechanism for resolving such uncertainty
as exists will remain the same (ie the Commission, the Appeal
Tribunal and the Court).
(b) Paragraph 1.19 of the draft impact assessment
to the Bill states (at page 143) "a clear focus on the requirement
to deliver public benefit is essential to ensure continued confidence
in the charity brand and to maintain public support for the granting
of fiscal benefits to charities". We would endorse this statement.
However, we are also concerned the assessment does not obviously
take into account the need for immediate further guidance on the
subject of public benefit for educational charities (eg sectoral
reports) and given the need for case law to "catch up"
on the subject, the impact on the resources of individual charities
that might be called upon to revisit assumptions about the charitability
of their activities. In conjunction we would urge the Committee
to give close scrutiny to the matter of access to the Charity
Appeal Tribunal as the principal arbiter of any such disagreements,
particularly for small and less well resourced charities. A "clear
focus" on the delivery of public benefit will be lost if
uncertainties over the public benefit test persist for any significant
period of time.
(c) The Charity Commission's briefing paper
for the Joint Committee on public benefit (DCH 13) refers itself
to the need for further development of the law for the first three
heads of charity and also suggests that groups of charities and
their representative bodies develop "sector owned guidance
and best practice standards". We are not in a position to
express a view on the likelihood of this approach succeeding,
but both the Commission and practitioners seem to agree there
is going to be a need for considerable further clarification of
the public benefit test for significant groups of charities. Given
the uncertainties that are going to prevail for some time hence,
we would suggest that it might be appropriate for there to be
a moratorium on the Charity Commission taking regulatory action
against charities for the relief of poverty, the advancement of
education or the promotion of religion if such regulatory action
is a result only of the withdrawal of the presumption of public
benefit.
July 2004
136 Ofcom review of public service television broadcasting
April 2004. Back
137
Media Guardian Edinburgh Television Festival 23 August 2003 Speech
by Tessa Jowell, Secretary of State For Culture, Media and Sport. Back
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