Examination of Witnesses (Questions 807
- 819)
WEDNESDAY 14 JULY 2004
MR KEVIN
CURLEY, MR
JONATHAN MOORE,
MR MARK
LATTIMER, MS
ILA CHANDAVARKAR
AND MR
PETER FINNEY
Q807 Chairman: Good morning and thank
you for attending. Would you mind just briefly introducing yourselves,
saying who you are and which organisation you represent.
Ms Chandavarkar: I am Ila Chandavarkar
and I am the co-ordinator for MENTER, which is the Black Minority
Ethnic Network in the east of England.
Mr Moore: I am Jonathan Moore
and I am the Chief Executive of the Suffolk Association of Voluntary
Organisations.
Mr Lattimer: Mark Lattimer, Director
of Minority Rights Group International.
Mr Curley: I am Kevin Curley,
the Chief Executive of the National Association of Councils for
Voluntary Service.
Mr Finney: I am Peter Finney,
the Chairman of the Myasthenia Gravis Association.
Q808 Chairman: Welcome, and I think
what you will have to say to us will be particularly helpful because
the Committee from the outset in our examination of the draft
Bill have been concerned about the potential impact of the legislation,
particularly on the smaller organisations within the charitable
sector, so really this is an opportunity for you, as much as anything
else, to tell us how you feel about it and whether you think the
Bill could be improved in any way. Perhaps I could start by asking
a very straightforward question of each of you, which is if each
of you could just tell the Committee what difference you think
this Bill will make to your work either as an umbrella organisation
or to the work of smaller charities in general.
Mr Lattimer: I actually think
that this Bill will make relatively little difference to the work
of my organisation. I do an enormous amount of work also with
other charities, particularly small charities, who are engaged
in campaigning activities and also in working for human rights,
and despite the fact that there is the advancement of human rights
as a new charitable purpose on the face of the Bill, I think that
the Bill will probably make very little difference for reasons
which, with your agreement, I will elaborate later.
Mr Curley: I think that it is
very welcome for a number of reasons and there are six of those
reasons which I will explain very briefly. The first reason is
that it confirms the advice and guidance role of the Charity Commission
which has been much debated nationally and is very popular amongst
local groups, in our view. Secondly, it has a very light touch
in relation to local, short-term collections and that is welcome.
Thirdly, it proposes the CIO as a new form of charity which will
help small charities which are growing and wanting to incorporate.
Fourthly, it clearly relieves the liability of trustees who act
reasonably, and that is one of many barriers to people becoming
trustees of charities and it is good that one of them has been
removed. Fifthly, it is good that charities with an income below
£5,000 will not need to register, but equally it is good
that they will be allowed to do so because opinion is very split
amongst small, local charities. Sixthly and finally, the need
for no full audit if your gross income is below £500,000
is very welcome. It is a small amount of regulation removed.
Q809 Chairman: So overall your view
is that it will be helpful?
Mr Curley: Overall, yes. You did
not ask what we saw as the negative features.
Q810 Chairman: You will have plenty
of opportunity, do not worry about that.
Ms Chandavarkar: I echo what Kevin
has said about it being helpful. I would add the extension of
the list of charitable purposes, but I would also echo what Mark
said because most of the groups which we represent are very tiny
and below £5,000, so it is not going to make that much of
a difference to those who are still struggling for their survival.
Mr Moore: I certainly think that
those who actually take an interest in this welcome this. They
welcome the clarity which it will bring and, if fully implemented,
the effect which one predicts that it will have on the Charity
Commission. For our workers and our umbrella group in terms of
supporting infrastructure groups, I think again it gives a lot
greater clarity because I think it is sometimes confusing what
sort of advice one can give groups. I think that in terms of actually
the small groups themselves, and it depends on how you define
the small groups, but 50% of groups in Suffolk, if you like, work
from the kitchen table, it will really fly over their heads just
as the previous law was totally irrelevant to them.
Q811 Chairman: It is good to know,
as the place which makes the law!
Mr Finney: I would just like to
state that if you define a small charity as something which works
on the kitchen table, we would not fall into that category, so
we are certainly not going to be allowed to deregister or anything
like that because of our size, but there are certain aspects of
the Bill which we welcome. We welcome the Bill in general, but
there are things which are potentially beneficial to us. Certainly
the licensing of collection provisions are very welcome to us
because we operate in a very large number of small branches around
the country and it would greatly simplify our operation if we
could have certificates of fitness on a national basis. Potentially
we have an interest in the merger provisions for charities because
we became incorporated about seven years ago and we have had to
keep alive a small rump of an old charity which we will be allowed
to merge with our own charity under the new regulations, so I
think that is a good step for us. The CIO, in principle, we are
interested in, but we are unlikely to rush into that because we
are incorporated already as a company limited by guarantee and
I think we would be very cautious about seeing how the new CIO
operates before we leap into that one. Also the provisions on
trading potentially could be of interest to us, the relaxation
on the requirements to set up a trading company to be able to
do it. We actually had to make a decision a few years ago whether
we should expand our trading activities or curtail them and we
actually curtailed them because of the need to set up a trading
company, so I think that flexibility will be very welcome to us,
but we are interested to make sure that the trustees have the
discretion themselves to decide whether it is good practice to
do it or not.
Q812 Chairman: So you would like
to see that flexibility in trading power?
Mr Finney: I would, yes.
Q813 Chairman: Is that everybody
else's view on trading?
Ms Chandavarkar: Yes.
Mr Moore: On trading, I think
the ability to trade within thresholds would be a very useful
addition to the Bill, and relaxing trading regulations, that would
certainly be helpful.
Mr Lattimer: For small charities,
yes.
Mr Curley: Generally, no. Charities
which trade below £50,000 do not need to register a company
anyway; they can do it. Most local charities do not want to trade
above that level and if they do, they want to protect the charity
by creating a separate structure so that if it goes down, it does
not bring the charity down with it.
Q814 Chairman: That is four to one.
Can I ask now about the burden of regulation really which I think
is something we are concerned about, although it is very important
clearly that the charitable sector enjoys public confidence not
least because it raises rather a lot of its money directly from
the public, and you have all touched on the issue of collections
and so on. How concerned are you, first of all, about the smaller
organisations, or, as umbrella bodies representing smaller organisations,
how concerned are you about the current burden of regulation?
Also could just one or two of you tell me to what extent the so-called
"regulatory burden" is less a problem of charity law
and more a problem of general regulatory requirements in regard
to health and safety, et cetera, et cetera?
Mr Curley: Well, wearing a different
hat, I chair a family charity which provides free holidays for
disadvantaged families mostly in Yorkshire in close association
with Headway, and I have to say that I am surprised by the kind
of debate which has gone on around this because we think that
the Charity Commission's regulatory impact on what we do is very,
very light touch at the moment. We are a charity which turns over
less than £10,000 in most years. We provide free holidays
for about 200 people a year, so a small charity, which does not
employ any staff other than a part-time cleaner, so we are one
of many, many thousands. We are in the majority of charities which
are registered with the Commission. Our sole dealing with the
Commission is one exchange of correspondence once a year when
we make a return and a return these days is largely printed for
us when it arrives and all we have to do is delete if a trustee
has changed, which is very rare, and we are not obliged, for under
£10,000, to get the accounts audited, so we see it as very
light touch at the moment and we would certainly want to test
the Bill to see whether it remains light because if it is heavier
touch, that would be a disincentive for me trying to persuade
people to get involved as trustees or volunteers.
Q815 Chairman: And what is your view
about that? Do you think that the Bill will impose further requirements
or not?
Mr Curley: I think, on the whole,
that the things I have listed make life easier for a small charity
and, with reference to your other question, the problems that
tax us, the barriers that get in the way of us doing a simple
task effectively with minimum input of labour are not to do with
charity regulation, but to do with health and safety, food hygiene,
the Criminal Records Bureau, the demands of local authorities
who give you £2,000 a year and want £2,000 of reporting
on it and so on, so it is that kind of problem, not to do with
the Charity Commission.
Q816 Baroness McIntosh of Hudnall: May
I just ask for clarification, Mr Curley, whether your charity
is exclusively grant-giving, ie, in the sense that it provides
something at no cost to the people who benefit from it, or do
you have to fund-raise in order to provide that?
Mr Curley: No, it is exclusively
grant-receiving and donation-receiving and service-providing.
Q817 Baroness McIntosh of Hudnall: So
you say you are also engaged in fund-raising then?
Mr Curley: All the time, yes.
Q818 Baroness McIntosh of Hudnall: So
you would still say that the regulatory touch on your activity
is appropriately light?
Mr Curley: Very light. We do not
do, for example, street fund-raising of any kind, but we do grant-seeking
and donation-seeking from trusts and companies, local government
and so on. The burden comes from the reporting requirements of
those donors; it does not come from charity law.
Q819 Baroness McIntosh of Hudnall: Yes,
but do you see any difference between grant-giving or charities
which do not fund-raise, but do provide a service and charities,
like your own, which provide a service, but have to fund-raise
in order to do so in terms of how those charities should be regulated?
Do you see any distinction?
Mr Curley: Yes, I think that if
charities are fund-raising directly from the public, then they
should be subject to much more scrutiny and regulation than those
which are not, personally.
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