DCH 352 Home Office - Regulatory Impact
Assessment
JOINT COMMITTEE
on the draft Charities Bill
The Regulatory Impact Assessment
(RIA)
Costs to the Local Authorities
In terms of costs to the local authorities
the potential impact of the draft Charities Bill is limited to
the introduction of a new unified scheme for public collections.
A copy of the consultation on public
collections was sent to all the local authorities in England and
Wales as well as the London Boroughs. A Partial Regulatory Impact
Assessment accompanied the consultation and asked for information
in terms of costing.
Using information provided by 37 local
authorities (including the City of London) the Government was
able to provide an estimate as to the cost of administering the
current licensing regime. The RIA suggests that the average figure
should be treated with caution and goes on to explain that the
costs varied considerably from one local authority to the next.
The Government has assessed the cost
impact of the new scheme on local authorities as neutral. It
has reached that conclusion by comparing the requirements of the
current licensing regimes with the requirements of the proposed
scheme. In some respects the scope of the licensing regime has
been extended, for example, the extension of the definition of
public place and the inclusion of direct debit solicitation but
in other respects it has been reduced, for example, by the removal
of the collection of goods house to house from the scope of the
scheme and the implementation of the lead authority proposal.
The Government recognises that under
the proposals there would be particular cost implications for
the London Boroughs and has agreed that funding would be provided
for that.
The Government is confident in the
assessment of the cost impact on local authorities provided in
the RIA. It is the best estimate of costs given the information
available. Notwithstanding that, the Home Office would welcome
representations / evidence from the Local Government Associations
about costs and will continue to meet with them to discuss their
concerns.
Public Benefit Checks
The RIA does not consider the costs
to the Charity Commission of undertaking public benefit checks,
as this measure is not included in the legislation. The RIA
considers only the costs of implementing the provisions of the
draft Bill. The public benefit check would be an administrative
mechanism for the Charity Commission to check on the public character
of charities.
Given that the Charity Commission is
currently refining the nature and scope of these checks, any figures
produced at this stage would be highly speculative.
Tax reliefs for new charities
It is unlikely that the Charities Bill
would lead to any significant increase in the number of charities
entitled to tax reliefs. The proposed definition of charity,
that is the extension of the list of charitable purposes, reflects
what is currently considered to be charitable today and would
not result in automatic increase in the number of organisations
having charitable status.
Both exempt and excepted charities,
while not registered with the Charity Commission, are currently
entitled to claim tax relief from the Inland Revenue and domestic
rate relief.
Enforcement / Monitoring costs
The majority of the provisions in the
Bill are permissive rather than restrictive.
Those measures that do require enforcement,
such as ensuring the registration of exempt and excepted charities,
have been included within the RIA and are based on figures provided
by the Charity Commission.
The one area where the policy remains
within the enforcement remit of the Home Office is the possible
implementation of regulatory mechanisms should the self-regulation
of fund-raising fail. The criteria to decide whether self-regulation
is working would be applied via secondary legislation so would
not form part of the current RIA.
Monitoring and evaluating the legislation
will be the responsibility of the Home Office and Charity Commission.
Costs associated with this work would be from within existing
resources.
Confidence in the RIA
Every effort has been made to ensure
that the RIA is as accurate as possible. A reasonable degree of
variance has been built in to the costs given within the RIA and
a range of possible costs has been given on most areas. We are
confident that the figures within the RIA represent the most accurate
representation of the costs involved and remain intrinsically
sound.
Home Office
August 2004
a note on this was sought from the Home Office
following the evidence given by Fiona Mactaggart and Richard Corden
on 21 July 2004. The Committee specifically requested details
on the RIA with regards to local authorities' costs, the costs
to the Charity Commission of carrying out public benefit checks,
the costs of additional tax reliefs to new charities, and the
costs of enforcing and monitoring the Bill.
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