DCH 281 Bonds submission
Submission to the Joint Committee on the
draft Charities Bill
July 2004
About BOND
BOND (British Overseas NGOs for Development) is the
United Kingdom's broadest network of non-governmental organisations
(NGOs) working in international development and development education.
BOND was founded in June 1993, on the initiative of 61 NGOs, and
now has over 280 members. It is officially recognised by the Department
for International Development (DFID).
Introduction
BOND is a member of the Coalition for
a Charities Act headed by NCVO and supports the objectives of
this coalition. We want to see a universal public benefit test,
a clearer role for the Charity Commission that stresses its regulatory
functions and limits its advisory role, and an independent appeals
tribunal for contested Charity Commission decisions.
We welcome the publication of the draft Bill. The
need to create a modern regulatory framework that will enhance
public understanding of, and confidence in, charitable organisations
has never been greater. For many NGOs, as unusual and diverse
members of the UK voluntary sector, the Bill is an opportunity
to broaden and strengthen definitions of what constitutes 'charitable
activity'.
BOND would like to ensure that the draft Bill does
not expand the regulatory burden on charities, with all charities
subject to reporting and accounting requirements that are proportionate
to their size.
The meaning of 'charity' and 'charitable purpose'
BOND supports a definition of charitable purposes
that reflects changing public perceptions of charity and provides
scope for the possibility of new charitable purposes to be recognised
in the future. The draft Bill largely meets this aim, but it
is important that the courts are given the power to grant charitable
status to organisations that may not be able to draw an analogy
with existing charitable purposes but that nevertheless provide
a clear public benefit.
Definition of public benefit
BOND welcomes the removal of the presumption of public
benefit. We believe that all charities must demonstrate that
their purposes are for the public benefit on an ongoing basis,
not just at registration.
We welcome the resolve to determine public benefit
by reference to common law. This will ensure that it can accommodate
both the present and future diversity of the voluntary sector
and remain free from political interference.
However, we share NCVO's reservations about attempts
elsewhere in the draft Bill to provide an alternative definition
of public benefit. The third regulatory objective for the Charity
Commission - "to enable and encourage charities to maximise
their social and economic impact" - currently goes beyond
any legal requirement placed on charities and distracts from their
primary purpose, which should be to maximise public benefit.
An organisation able to maximise its social and economic impact
might not necessarily be able to demonstrate public benefit and
vice versa. For many organisations, any economic impact is likely
to be incidental to their work. This objective could come to
be used in time as a definition of public benefit. The Commission's
existing objective of "promoting the effective use of charitable
resources" is much more appropriate.
BOND member organisations strive to adhere to a common
Statement of Principles that includes establishing equality of
opportunity in policy and practice. BOND would support a clause
in the draft Bill ensuring that non-discrimination is a precondition
of charitable status by making equal opportunities in charities'
employment and service provision policies mandatory.
The Charity Commission
BOND is concerned that the Bill provides no statutory
distinction between the Commission's various functions as registrar,
regulator, adviser and supporter of charities. This is relevant
given the Strategy Unit's original recommendation that the role
of the regulator be more clearly defined, with a stronger focus
on its regulatory function. The draft Bill actually expands the
Commission's advisory role, extending its power to give advice
and guidance in chapter 5, clause 20, and giving it the general
function of "facilitating the better administration of charities"
in chapter 1, clause 5.
It would be better if the general advisory and support
functions were independent of the Charity Commission and carried
out by sector umbrella and resource bodies, leaving the Commission
free to concentrate on its 'watchdog' objectives and regulatory
advice.
There is no statement in this part of the Bill explicitly
requiring the Commission to act with proper principles of substantive
and procedural fairness, in accordance with the Human Rights Act
and the rules of natural justice.
BOND welcomes the creation of a Charity Appeal Tribunal
as a meaningful and affordable means of independently scrutinising
Commission decisions. However, there is no provision, as suggested
by the Strategy Unit Report, to ensure the Commission has a clear
and streamlined internal appeal procedure as well.
Other clauses
BOND welcomes the clauses on the registration of
charities, on charitable incorporated organisations, on the remuneration
and liability of trustees, on charitable collections and on mergers.
Proposals for the regulation of fundraising describe reserve
powers for the Secretary of State - we would welcome more clarity
on the criteria on which the decision to invoke reserve powers
would be based.
BOND
July 2004
| 
