Further memorandum from Age Concern (DCH
307)
INTRODUCTION
1.1 This charity ("ACE") made
an earlier submission to the Joint Committee which is attached
to the end of this second submission for convenience. We wish
to add to our earlier comments on the meaning of "charitable
purpose" in relation to "age" and make some other
points.
MEANING OF
"CHARITABLE PURPOSE"
2. We would like to suggest some alternatives
to the current wording which we have criticised in our first submission.
2.1 We are not sure why the previous suggestion
of "social and community advancement" (with a non-exclusive
specification of sub-categories) was abandoned. Possibly it was
considered too wide a category. However if the sub-categories
were expressed as exclusive but with the addition of "and
other analogous purposes" it does not seem to us any wider
than the current scope of this category of charitable purpose,
but with more positive terminology consistent with the other "advancement"
purposes.
2.2 We note that "the advancement of
citizenship or community development" already exists so we
suggest a revised sub-clause could read:
"(j) the advancement of social welfare,
comprising the care, support and protection of children and young
people, older people, and disabled people; and other analogous
purposes."
2.3 This leaves out, compared with current
sub-clause (j), the "disadvantages" of ill-health and
financial hardship. However it seems to us that these are covered
by "the prevention and relief of poverty" and "the
advancement of health".
2.4 If it is decided that the wording of
sub-clause (j) is to be reviewed but the suggestion in 2.2 is
not acceptable, we would urge the Committee to recommend that
charities with a particular interest in that wording be consulted.
TRADING AND
SPONSORSHIP
3. We have had the benefit of reading submissions
to the committee from other interested parties and note that the
question of whether charities should be able to trade without
restriction continues to be hotly debated. The nature of the trading
activities carried out by trading companies associated with ACE
are such that we consider it prudent to separate those activities
from the charity but we support suggestions that the relationship
between trading companies and their parent charities could usefully
be simplified. This would not necessarily require amendment to
the Charities Bill but would require the co-operation of the Charity
Commission, Inland Revenue and Customs and Excise and in particular
some changes to tax and VAT rules and procedures.
3.1 Some kinds of "trading" as
interpreted by those authorities with an interest in trading are
not, in our view, what the public regards as trading, and cause
considerable confusion and extra work for charities, absorbing
funds that could be spent on charitable activities. We have in
mind particularly sponsorship of charitable activities by commercial
organisations. We would like to see a relaxation of the interpretation
of trading so that sponsorship which is demonstrably for the pursuance
of charitable purposes (for example, sponsorship of a conference
about one of the policies of the charity, or sponsorship of services
which are provided to the beneficiaries of the charity) can be
regarded, if not as a donation (since it is understood that publicity
for the sponsor is a reciprocal benefit), then as a legitimate
payment to the charity as part of its administration and not a
payment that needs to be routed through a trading company.
3.2 We would like to see a general review
of what types of fundraising should be viewed as commercial trading
and what can reasonably be seen as legitimate activities for the
charity to undertake ancillary to its main activities.
CLAUSE 35—STATEMENTS
OF BENEFITS
4. We would question the usefulness of clause
35. We accept that transparency in fundraising activity should
be sought, in the sense of giving the public and other interested
persons (eg the press and regulators) as clear an explanation
as possible of how the charity benefits from particular fundraising
activities. However we echo the point made by many other submissions
that fundraising arrangements are often complex and it is often
not easy to make a simple statement. In some cases where ACE benefits,
there are joint venture companies, commission arrangements, and
usually (as required by the trading rules) payments are made to
an associated trading company, so it is not possible to make a
simple statement of how the charity benefits at the time that
the fundraising activity takes place.
4.1 We note that objection has been made
to the looseness of the phrase "in general terms" in
the existing law. We have interpreted this as permitting a statement
which is as helpful to the public as possible without creating
a risk of non-compliance. Codes such as the Advertising Standards
Authority's Charity Promotions code are stricter but are, we believe,
impossible to comply with fully in many cases.
4.2 The replacement of a statement in general
terms by an "actual amount" or an "estimated amount"
(even though this is qualified by a reasonableness requirement)
seems to us to make compliance more difficult and risk many charities
being in technical breach of the law despite being as transparent
as possible.
4.3 We agree that statements should be made
and these should comprise a general statement as to how either
professional fundraisers or commercial participators will benefit
from the arrangement and provide a contact (including a telephone
number for those without internet access) from which full details
of the arrangement can be obtained (subject to commercial confidentiality
where it is reasonable for this to apply). We think that requiring
full details on all publicity would be onerous for the charity
in terms of cost and would not benefit the public as many will
not wish to be burdened with this.
PUBLIC CHARITABLE
COLLECTIONS
5. In relation to clauses 37-43, we endorse
the submission to the Committee by the Institute of Fundraising
printed on your website as DCH 70.
July 2004
| 
