DCH 71 Charity Commission
Note from the
Charity Commission
1. How many independent
schools are currently registered as charities by the Commission?
Do you have a list?
The Charity Commission's
classification system for charities uses definitions which are
broader in scope than 'independent school', and thus does not
enable us to produce a precise figure or list. Independent schools
are classified under Education/Training and Children/Young People.
There are 47,884 registered charities with that classification
which includes independent schools, but also many other types
of charity.
As an indication of the
numbers, the Independent Schools Council (ISC) estimates there
are around 2,400 independent schools in the UK. Around half are
members of the ISC who say that 1,061 (83%) of their members are
charitable although not all of these schools will be registered
in England or Wales. Non members of the ISC are believed to be
less likely to be charitable because most are privately owned
Currently Eton and Winchester
are classified as exempt charities, and therefore not registered
by the Commission. The draft Charities Bill proposes ending
this exemption. All other English or Welsh charitable independent
schools are required to register, unless connected to another
exempt charity.
2. How many private
hospitals or clinics are registered? Do you have a list?
For the same reason as
above we are unable to produce a precise figure or a list. Searches
of classifications including Medical/Health/Sickness produce thousands
of charities that will include hospitals and clinics but also
many other types of charity.
Regulation of private hospitals and
clinics is generally the responsibility of the Healthcare Commission.
3. What other forms
of fee-raising organisations are registered - and how many?
We do not have detailed
information on this although a recent Commission survey of charities
registered in 1995 indicated that 15% of those charities saw "fees/sales"
as their main source of income and a further 10% listed it as
one source. More generally many different types of charity in
various parts of the sector will receive money by way of fees
or charges. For example, many service providing charities will
charge for their services. Other examples include:
- Charities such as
recreation grounds or village halls that charge for hire of facilities
- Charities in the arts
and conservation which charge for entry, for example to view
performances, exhibits or historic properties.
- Charities that charge
for membership, whether annual, seasonal or daily.
- Charities that charge
for publications
4. How much do such
organisations raise in fees?
Again the Commission does
not have detailed information on this.
The NCVO Almanac 2004
analyses the sources and types on income received by charities.
One category of income in its analysis is Earned Income. The NCVO's
analysis does not cover the whole charitable sector but indicates
that almost 43% of charities' income is Earned Income of which
around 17% comes from individuals and 18% comes from the public
sector.
5. How much do they
gain in tax advantages arising from charitable status?
As above the Commission
does not have this information and the Inland Revenue does not
break down its figures for tax relief by type of charity.
6. What is to prevent
state schools or hospitals registering as charities - do they?
(a) Schools
There are three categories
of school under the School Standards and Framework Act 1998 (the
SSFA). The governing bodies of both Foundation Schools
and Voluntary Schools are declared to be charities by the
SSFA. At the moment they cannot register because they are exempt.
But the draft Bill proposes to remove this exemption and require
them to register, subject to a £100,000 income threshold.
The SSFA also provides that the governing bodies of Community
schools, the largest category, are not charities.
(b) Hospitals
In looking at state hospitals the key
is the position of the NHS bodies that operate them. These bodies
are not regarded as charities due to the degree of control that
can be exercised by the Secretary of State.
7. Are any city
academies registered?
Yes, 11 City Academies
are registered and a list is available on request.
8. Where a private
school sponsors an academy - through for example a private foundation
- can or does it register?
The charitable status
of City Academies depends on their own objects and constitution
rather than the nature of the sponsors. There are charitable City
Academies that are sponsored by commercial concerns, for example.
9. Is the making
of profit in any way a barrier to charitable status?
The making of a profit
is not in itself a barrier to charitable status.
It is well established
that charities may charge for their services and facilities. Charges
may be set at a level which more than covers the costs of those
services if this "profit " element is applied in furtherance
of the charity's purposes and is justified in the best long term
interests of the charity and its beneficiaries. For example a
charity may need to set up reserves for the maintenance or refurbishment
of property, to service loans raised to acquire property or facilities
or generally to develop and improve the quality of its facilities
and services in the future.
The making of a profit
would be a bar to charitable status where:
- the intention was
to apply or distribute the profit either directly or indirectly
for the private benefit of trustees or others, and
- it could be shown
in the circumstances of a particular organisation that it was
an undeclared part of its purposes to confer private substantial
non charitable benefits on such persons.
Charity Commission
16 June 2004
The survey was conducted by post and was sent
to all charities registered in 1995. We had a response rate of
35% (1,622 charities). One of the questions asked charities to
identify sources of income and the list of options included "fees/sales".
The results were published in "Milestones: Key Events in
the Life of a Charity" (December 2003, available on the Commission's
website).
"Earned Income from the sales of goods and
services (although this may not be at market value), including
the gross income of trading subsidiaries." The NCVO acknowledges
that the distinction between this and voluntary income is open
to interpretation and that it is difficult to classify income
from trading subsidiaries.
It uses figures for 2001/2 for the UK but limited
to a definition of "general charities" that excludes,
for example, universities and some charitable schools, private
health care providers and charities primarily for the promotion
of religion.
This is based on a search for registered charities
with "City Academy" in their name or objects
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