DCH 80 Barnados
BARNARDO'S EVIDENCE TO THE JOINT
COMMITTEE ON THE DRAFT CHARITIES BILL
1. Barnardo's
1.1 Barnardo's is the UK's leading
children's charity, working annually with almost 100,000 children,
young people and their families across the UK through over 300
services. This figure includes over 55,000 children, young people
and their families who we work directly with on an ongoing basis,
nearly 7,000 who we support through one-off sessions, and almost
35,000 others whom we assist through our work with community groups.
1.2 We work with the most vulnerable
children and young people, helping them to transform their lives
and fulfil their potential. We help young people and their families
to overcome severe disadvantage by enabling them to address problems
like abuse, homelessness and poverty, and to tackle the challenges
of disability.
1.3 Barnardo's helps children to overcome
challenging experiences in childhood. We work with them over
the long term to tackle the effects of disadvantage and to help
them develop into well-rounded adults. We call this 'Giving children
back their future'. We work hard to give every disadvantaged
young person the possibility of a different and better life ahead.
1.4 We also use our expertise and knowledge
to campaign for better care for children, and to champion the
rights of every child.
2. Flexibility and accountability
2.1 We welcome the reform to the working
practices, composition of the Charity Commission and the establishment
of an independent appeals tribunal. We are concerned, however,
that there is no statutory obligation on the Charity Commission
to act in observance of proper principles of substantive and procedural
fairness: we would urge that this matter be considered.
3. Public confidence
3.1 We welcome the clarity of definition
of charitable purpose and the rigour of regulation as a contribution
to an increased public confidence in charities. We are hopeful
that reform in respect of trustees will lead to greater and wider
participation in the running of charities. We would seek greater
encouragement to young people to participate in the work of charities.
4. Charitable purposes
4.1 We support the twelve proposed
charitable purposes. Declining to define 'public benefit' maintains
flexibility and enables an iterative process, but would engender
repeated recourse to case law. We would welcome further consideration
of whether there is, now, an opportunity to helpfully codify 'public
benefit'.
5. Delivery of public services
5.1 Much that would enable the children's
voluntary sector to further contribute to the delivery of public
services falls outwith the scope of this Bill; increased numbers
of local 'compacts', the adoption of the principle of full cost
recovery, regulation and other levers to enable strategy as well
as 'delivery led' contributions to Children's Trusts.
6. Trade
6.1 We favour but do not strongly support
the recommendation in Private Action, Public Benefit that
charities be enabled to trade as part of their normal activities
i.e. without setting up a trading company.
7. Fundraising
7.1 We welcome the introduction of
an integrated licensing system. We consider that the solution
presented within the Bill clearly addresses the core issues affecting
public fundraising, and applies a risk-focused solution. Excluding
the collection of goods and House to House collection from activities
requiring permits is welcome. It reflects the useful distinction
made in the Consultation process between those activities which
require greater regulation in order to restore and preserve public
confidence, and avoid nuisance, and those which do not.
7.2 We would like to comment specifically
on the following:
7.2.1 Integrated Licensing System
operated by 'Lead' Local Authorities
7.2.1.1 We welcome the introduction
of the five year 'fitness test' to engage in public fundraising.
We consider that Local Authorities, with clear guidance, are
well placed to issue this permit. We also welcome the recognition
that the profitability of fundraising activity is a matter for
trustees, and should not routinely be considered by licensing
authorities.
7.2.1.2 Restricting the need to apply
for permits for individual fundraising activities, to those where
public confidence and nuisance issues are most prevalent, is welcome.
This will help to alleviate administrative burdens on both charities
and Local Authorities.
7.2.1.3 We are satisfied that this
solution addresses our concerns about the removal of the National
Exemption Certificate.
7.2.2 The definition of 'public
place' in relation to 'small collections'
7.2.2.1 We seek clarification of this
definition. The Charities Bill provides that, under the new scheme,
public collections would have to be licensed if they took place
in areas where the public has unrestricted access. We are concerned
that there may be some confusion about whether 'small' collections,
such as carol singing or rag raids, taking place at railway stations
or supermarkets, may require a permit.
7.2.3 Provisions for Collection
of Goods House to House
7.2.3.1 It is appropriate that the
Collection of Goods does not fall within those activities requiring
permits. The proposed new scheme requires that notification be
given in advance of the areas in which collections will take place.
For practical reasons we recommend that this notification be
given at postcode level, not at street level.
7.2.4 'Capacity Based' System for
Granting Permits for Street Collections
7.2.4.1 The introduction of permits
for street collections is an essential step towards restoring
public confidence in this fundraising method, and overcoming negative
media coverage. We are concerned that the guidance to local authorities
will require very careful consideration, and would welcome consultation
during the development of this guidance.
7.2.4 Process for Appealing Against
Refusal of Permit for Street Collections
7.2.4.1 The introduction of a formalised
appeals structure is welcome. We recognise that, with clear guidance
given to Local Authorities, there should be little cause to appeal.
However we are concerned that in the instance of a local authority
blocking certain, or all, charities there may need to be a point
of higher authority to which the matter can be referred, in order
to avoid repeated and costly appeals to magistrates courts. We
suggest that the Home Office may be the appropriate authority.
7.2.5 Associated Costs
7.2.5.1 We consider that the new system
has been developed with sufficient priority being given to the
need to keep additional costs and administrative burden to a minimum;
for both charities and local authorities.
8. Specific proposals
8.1 We note the proposed creation of
a new legal form for charities, and that a Charitable Incorporated
Organisation (CIO) can be created as a new entity or an existing
charity can opt to be converted into such. We understand the
intended benefit as reducing the burden of registration with both
Companies House and the Charity Commission, and the attendant
double reporting requirements. We welcome this, together with
the simplified process for amalgamation of two CIOs and the transfer
of undertakings from one to another. We are concerned, however,
that:
8.1.1 Provisions relating to CIOs are
to be amplified in Regulation. Until these are available, it
is difficult to determine what genuine advantage a CIO will offer
8.1.2 It is as yet unclear how much
company law will be replicated in the Regulations e.g. as to the
maintenance of registers, registration of charges, types of resolution
required for specified matters, required filings etc. Similarly,
it is not yet known what will be on public record. Principles
of good governance would determine that there is much of value
in company law worth mirroring in the Regulations.
8.1.3 CIOs will present yet another
tier of charitable entity (for so long as there exists the option
to remain or register in one of the existing forms)
8.1.4 It is unclear what incentive
exists for existing charities to convert to this new entity, given
the administrative effort entailed and novelty of compliance with
a new legal form
8.1.5 CIOs operating a Trading subsidiary
will still need to maintain Companies House filings and compliance
with company law.
8.2. We seek further detailed consideration
of the practical consequences of introducing the Charitable Incorporated
Organisation.
9. Overall
9.1 Barnardo's welcomes a Draft Bill
that is balanced, measured, workable and responsive to comments
made during the considered consultation on Private Action,
Public Benefit.
9.2 Much that is given little or no
attention in this evidence - the remuneration and liability of
trustees, provisions regarding the power to spend capital etc
- are not referenced only because they are both pragmatic and
welcome.
Alan Coombe
16th June 2004
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