DCH 14 Charity Commission
BRIEFING PAPER FOR THE JOINT
COMMITTEE ON THE DRAFT CHARITIES BILL
CHARITIES AND POLITICAL ACTIVITIES
1 This paper responds to the Joint
Committee's request for an explanation of how the Charity Commission
interprets the provisions on political activities of charities.
2 An organisation set
up for a purpose (or which includes a purpose) of advocating or
opposing changes in the law or public policy (in this country
or abroad) or supporting a political party cannot be a charity.
In essence this is because the question of whether the organisation
is established for the benefit of the public cannot be assessed.
Charities political activities - principles
3 Whilst organisations
that are established to pursue political purposes may not be charities,
campaigning and political activity may be carried out by charities
as a means of furthering their charitable purposes. The principles
that the Charity Commission applies when assessing whether a charity's
political activities further its charitable purposes are the same
general principles that govern all the other ways in which charities
carry out their charitable purposes.
4 Our guidance on campaigning
and political activities by charities, sets out the key areas
which trustees need to consider, and they are the basis for any
assessment of whether a charity's activities are furthering its
charitable purposes. The draft Charities Bill does not contain
any proposals which will either change this assessment, or the
areas to consider:
- A charity's trustees
must be satisfied that their activities will be an effective means
of furthering the charity's purposes and these activities will
do so to an extent justified by the resources applied.
This reflects the general principle
that the resources and energies of a charity must be applied only
in furthering its charitable purposes. If resources are spent
on activities where there is only a very remote prospect of a
successful outcome there is a greater likelihood that the resources
are not being spent on charitable purposes (i.e. a breach of trust
or a breach of duty).
- The activities must
be permitted under the governing document.
In practice, most charities are likely
to have an implied power to engage in political activity that
furthers their charitable purposes.
- The trustees must
assess any reputational or other risks.
This is required by the trustees' general
duty of care. Trustees are not bound to avoid risk. However,
in making decisions concerning the charity, they are bound to
assess the risks of a proposed course of action (for example the
effectiveness of the proposed activity in achieving the charity's
objects, and the impact on the charity's reputation) against the
expected benefits to the charity.
Extent to which political activity can
be used to further charitable purposes
5 A political purpose
cannot be a charitable purpose. Additionally, political activity
should not be the dominant means by which the charity furthers
its purposes - they must remain incidental or ancillary to the
charity's purposes. If political activities dominate the operations
of a charity, an issue must arise as to whether the trustees are
acting for the benefit of the public. In exceptional cases, the
Charity Commission will consider whether the organisation had
been properly registered as a charity in the first place.
6 Whether a charity's political activity
has become dominant is a question of degree. It depends on the
proportion of the charity's resources involved and over what period,
the nature of the activity and the purposes of the charity.
Charity Commission
3 June 2004
The SU review
Private Action, Public Benefit highlighted the reasons
why charities are well placed to play a campaigning and advocacy
role, and the benefits of encouraging them to do so. It also
recommended that the Charity Commission's existing guidance on
political activities and campaigning, first published in 1995,
be revised to reflect these benefits, by placing a greater emphasis
on the campaigning and political activities that charities can
undertake, as opposed to the restrictions. The Charity Commission
has now published, for consultation, draft guidance which reflects
this recommendation. (www.charity-commission.gov.uk/enhancingcharities/cc9consintro.asp)
A purpose is
"political" if it involves promoting a political party;
or a change in the law; or a change in government policy; or the
reversal of a government decision.
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