DCH 189 Tom Levitt MP
Tom Levitt MP
Labour Member for High Peak
Rt Hon Alan Milburn MP, Chair
Joint Committee on the Draft Charities Bill
Scrutiny Unit, Room G10
7 Millbank
London
SW1P 3JA
24 June 2004
I am writing in my capacity as Chair
of the All Party Parliamentary Group on Charities and the Voluntary
Sector.
The group welcomes the publication of
the draft Charities Bill for pre-legislative scrutiny. This is
a much needed reform that will update and strengthen the legal
and regulatory framework for charities. As well as addressing
the confusion and inconsistencies that mar existing charity law,
the draft Bill also makes clear the link between charity and public
benefit. These measures will, we believe, enhance public trust
and confidence in the charitable sector.
The APPG was very pleased that three
members of the scrutiny Committee took the time to attend our
recent meeting and talk about the draft Bill and the pre-legislative
process. As you are aware, our members have significant experience
of the charitable sector as well as considerable knowledge of
issues that affect charities and charity trustees. Of particular
concern is the question of trustee liability where the individuals
concerned have acted in good faith. We believe that this is a
real disincentive for those interested in taking on the role of
trustee and unless addressed could make it more difficult for
charities to recruit in future.
We are therefore pleased that the draft
Bill does make some provision for this:
- the
creation of a new legal form, the Charitable Incorporated Organisation
(CIO) will provide limited liability in the same way that a company
limited by guarantee does; and
- the
proposal to give the Charity Commission the power to relieve from
liability for breach of trust or duty provided that he or she
has 'acted honestly and reasonably'.
Both measures will go a long way towards
addressing the concerns of trustees and will make a real and practical
difference. Members also expressed some concern that the legal
position of trustees in relation to liability insurance remains
unclear.
A further issue raised at our meeting
is the role of the Charity Commission and the need for this role
to be clarified in law. Members of the APPG cited examples of
cases where, in their experience, the Charity Commission had been
heavy handed and where the wide range of advice and information
coming from the Commission made it more, rather than less difficult
for trustees to be clear about their own role. There is a concern
that the draft Bill extends the role and powers of the Charity
Commission without placing any limits or responsibilities in terms
of how it exercises those powers.
I hope that the Joint Committee will
take on board these issues as you consider the draft Bill and
we wish you well with your work.
Yours sincerely
Tom Levitt MP
Chair
20 Hardwick Street Buxton Derbyshire
SKI 7 6DH
Tel: 01298-71111 Fax: 01298-71522
Minicom: 01298-71105
E-Mail: tomlevittmp@parliament.uk
Website: www.tomlevitt.org. uk
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