DCH 70 Institute of Fundraising
The Institute of Fundraising's
Submission to the Joint Parliamentary Committee on the Draft Charities
Bill:
Public Collections Proposals
Summary of Proposed Changes and
Key Recommendations in Relation to the Bill
- Clarification should be given as
to the definition of "promoter" in the Bill. Is a promoter
considered to be any, or all of, an organisation, individuals
or one individual? We believe that all these categories should
be recognised as potential promoters able to be issued with a
certificate of fitness. The outline in the draft regulatory impact
assessment would seem to suggest that the certificate should be
issued to the individual promoter of a collection. We believe
that in most instances organisations should be issued with a certificate
of fitness, rather than an individual. (para 2.2)
- We believe that all fundraising
activities on the street should be subject to a requirement for
a permit, even if a Certificate of Fitness is not required because
the collection will be small and local. (para 3.1)
- Further consultation must be carried
out on the criteria for assessing capacity and mapping sites between
Home Office, Local Authorities and collecting organisations to
achieve a universally agreed outcome. The Scottish Draft Bill
allows for consultation with charities and their representative
bodies, local authorities and such other persons as the regulator
sees fit before such criteria are established. We hope that a
similar commitment could be included in the Draft Bill for England
and Wales. (para 3.3)
- We believe that provision should
be made within the Bill to ensure that powers exist to control
inappropriate collecting activities House to House. (para 4.3)
- A shorter notification period for
small scale collections and collections of goods should be allowed.
We believe that a longer notification period of two months should
be applied to House-to-House Collections forming part of a structured
campaign. (para 4.3)
- We believe that collections of
goods should be subject to a requirement of notification in order
to distinguish between legal activity and rare cases of misrepresentation
but suggest that this should be on a standard six monthly basis,
subject to the criteria set out in the Bill, as no issues of capacity
or security are raised by these collections. (para 6.0)
- We believe that the Bill should
include a requirement on Local Authorities for a minimum notice
period within which charities must be notified of a decision to
disallow a collection. (para 7.0)
- We seek clarification that payroll
giving and other workplace fundraising activities are not caught
in the definition of 'business premises' by 65 (2) (a) (ii). The
Scottish Bill contains an additional definition of public place
as being "not within a building" while setting out those
places such as shopping malls and forecourts that might otherwise
be exempt. (para 8.0)
- The requirement of the Bill at
35 (2) subsection (1) (c) that a fundraiser should declare the
nature of their remuneration should apply to all paid fundraisers,
whether they are directly employed by a charity or working as
sub-contractors. (para 9.2)
- We recognise that the Bill gives
powers to the Secretary of State to make grants to the sector
to defray costs; we believe that the development of an on-line
applications procedure would be a suitable object of those grants.
The Scottish Bill allows grants to be made to any person "enabling
institutions generally better to implement their purposes".
We believe that similar provision should be made in the Bill for
England and Wales. (para 11.2)
- We believe that guidance, developed
through consultation, should be statutory. (para 11.3)
- We believe that further consultation,
incorporating strong representation from Local Authorities, will
be essential to ensure that a robust structure is developed for
Public Collections. (para 13.0)
1.0 OVERVIEW OF PROPOSALS
1.1 Context
The draft Charities Bill sets out to
establish the framework for a fair and cost-effective, unified
licensing scheme for England and Wales. It is recognised by both
the sector and government that the current framework of existing
legislation is out of date and ineffective and fails to cover
the full range of collecting activity. Face-to-face fundraising
(solicitation for direct debits) is not currently subject to regulation;
the collecting activities of non-registered philanthropic and
benevolent organisations are not subject to the same requirements
or controls as those of registered charities; the definition of
a public place does not equate to the public's perception of it.
All of these anomalies add up to a system that is difficult to
enforce, hard to police and confusing to both public and collecting
organisations alike. So why do charities, philanthropic and benevolent
organisations continue to raise money in this way?
Funds raised through public collections
may generally be applied to any purpose and these unrestricted
funds are vitally important to charities. Public collections allow
a charity to promote awareness of its brand and its cause. Some
forms of collection offer opportunities to engage in a direct
dialogue, person to person, others to deliver communications setting
out the charities' objectives and what resources it needs to achieve
them. Public collections also allow charities to expand donor
bases (face to face fundraising has been particularly successful
in helping charities to recruit new, younger donors). All of these
combine to provide an opportunity for a charity to maintain a
position in the public eye and potentially generate long-term,
rather than short-term, support.
1.2 Unified Scheme
The Institute of Fundraising believes
that the outline proposals contained within the draft Bill form
a nucleus for a clear, unified and, above all, consistent structure
for the licensing of Public Collections. We believe that this
will benefit charities and the public alike. As such, we welcome
the proposals although we recognise that the success or failure
of the scheme will rest in the detail of regulation and guidance.
We also welcome the opportunity presented by the parallel progress
towards a charities bill for Scotland as representing an opportunity
to achieve consistency in the regulation of Public Collections
north and south of the border.
1.3 Proposals in the Draft Bill that
the Institute of Fundraising Supports
We agree with and support the following
key principles:
- The scope of the scheme should
be extended to include recruitment using direct debits and standing
orders
- The scope of the scheme should
include a requirement of notification for those organisations
and activities that are not subject to a requirement for a permit
- Permits would be issued in a two
stage process; a certificate of fitness issued by a lead, local
authority for a period of up to five years; a license to collect
issued where the capacity for a collection was agreed to exist.
- There would be no charge for certificates
of fitness or for permits.
- Local Authorities would maintain
a record of all legitimate collecting activity, whether subject
to a requirement for a permit or notification.
- A right of appeal to magistrates'
courts against the decision of the local authority will be established.
- Accountability for permitted collections
will rest with the governing body of the collecting organisation
and will be demonstrated through the published accounts.
- Regulation for public charitable
collections will be extended to cover charitable, philanthropic
and benevolent institutions.
1.4 Proposals that Require Further
Consideration
We believe that the following proposals
represent significant changes to the existing structure and that
the implications of those changes will need to be considered in
some detail. We do not believe that these changes are wrong in
principle; we do believe that the impact that they will have will
need to be addressed.
- Exemption Orders will be abolished.
- Responsibility for the issuing
of certificates of fitness and permits to collect will be transferred
from the Metropolitan Police to the London Boroughs.
- House-to-House Collections will
not require a permit to collect.
Certain operational aspects of the
proposals within the draft Bill will also require consideration.
- Notification times for house-to-house
collections and collections of goods house-to-house.
- Funding of new Local Authority
infrastructure
2.0 UNIFIED SCHEME AND CERTIFICATE
OF FITNESS
2.1 Unified Scheme
We believe that a unified scheme must
encompass all forms of collecting activity by all types of collecting
organisation wherever those activities are seen to be happening
in a public place.
Such a scheme should be proportionate
to the scale and nature of the activity. Certain forms of collection
pose little risk of fraud or of public nuisance. We welcome the
proposal for a requirement for all activities to be registered
by a local authority. We believe that increased public awareness
of new regulatory systems will ensure that this proposal would
considerably enhance public trust in collections as well as making
it easier for unauthorised collections to be recognised and stopped.
2.2 Lead Authority
The revised proposal for a Lead Authority
scheme is one that we welcome. We believe that the proposal that
the registered address or head office should identify the appropriate
authority is viable. However, the proposal does need further clarification.
We assume that the intention is that an organisation as well
as an individual or individuals is able to be issued with a certificate
of fitness; the outline in the draft regulatory impact assessment
would seem to suggest that the certificate should be issued to
the promoter of a collection. While we believe that it is
important that the hierarchy of responsibility for a collection
be maintained and recognised within an organisation, we also believe
that where possible a certificate of fitness should be attached
to an organisation as the promoter rather than be issued to an
individual. The criteria for the issuing of a certificate should
relate to the prompt return of accounts; an ability to demonstrate
clear management structures and responsibility for collections;
appropriate contracts where collections are carried out by professional
fundraising organisations as contractors; all organisational,
rather than individual, requirements. Individuals may well move
within or outside an organisation during the five-year term of
a certificate. Organisations have a responsibility to ensure that
the individual promoter of a collection is 'fit and proper'. The
role and responsibilities of an individual as promoter of collections
should be set out within their own organisational contracts and
it is the existence of these contracts that should be recognised
as part of the process of granting a certificate.
3.0 STREET COLLECTIONS
3.1 Permits to collect for street collections
We believe that all activities on
the street should be subject to a requirement for a permit, even
if a Certificate of Fitness is not required because the collection
will be small and local.
The volume of activity influences public perception of collecting
activity. Councils should be able to ensure that levels of collecting
activity are appropriate to the environment in which they take
place. In short, permission to collect should be allocated according
to the capacity for the collection
3.2 Capacity
Defining capacity is notoriously subjective.
Differences over capacity have led to problems in agreeing collections
between local authorities and charities. We believe that there
must be an attempt to define capacity in statutory guidance. This
would ensure that Local Authorities and charities would have to
apply guidelines consistently. Any definition must take into account
- the volume of traffic through a
site
- the variation in volume (dependent
on the time of day or day of the week)
- the physical characteristics of
a site
- the reasonable number of collectors
in relation to the above criteria
- the reasonable frequency of collections
in relation to the above criteria.
The Public Fundraising Regulatory Authority
(PFRA) has established a pilot diary scheme with Local Authorities
based on an assessment of the above criteria. We believe that
this pilot would be of considerable assistance in achieving a
definition of "capacity" and a structure for ensuring
equitable access for all organisations.
3.3 Criteria
It is essential that the criteria that
are applied to define "capacity" should be consistent
throughout England and Wales. The criteria against which a site
is judged are complex. We believe that the "Map-iT"
model developed by the Public Fundraising Regulatory Association
(PFRA) provides an excellent starting point for determining the
relevant criteria. Further consultation must be carried out
in this area between Home Office, Local Authorities and collecting
organisations to achieve a universal and consensual outcome. The
Scottish Draft Bill allows for consultation with charities and
their representative bodies, local authorities and such other
persons as the regulator sees fit before such criteria are established.
We wish to see similar commitment to full and formal consultation
included in the Draft Bill for England and Wales.
3.4 Local Authority Administration
of Permits
We are concerned that it has proved
difficult in the past to liaise effectively with Local Authorities,
or to achieve consistent interpretation by Local Authorities of
existing regulation. As Local Authorities will be obliged, in
future, to maintain a record of all collecting activity and to
issue permits based on that record, we believe that they should
be supported in meeting that requirement through clear and unambiguous
guidance interpreting the regulations. We further believe that
consideration should be given as to how any scheme would be most
accessible to collecting organisations and members of the public
as well as cost-effective for Local Authorities to administer.
An on-line system would certainly facilitate the process of making
applications; it would also be an effective means of ensuring
consistent application of guidelines as well as simplifying any
administration of a diary system. We recommend that the funding
implications of such a system should be considered as part of
a regulatory impact assessment.
4.0 NOTIFICATION FOR HOUSE-TO-HOUSE
COLLECTIONS, SMALL AND LOCAL COLLECTIONS AND COLLECTIONS OF GOODS.
4.1 Capturing All Collecting Activity
The Institute of Fundraising welcomes
the proposal that all forms of collecting activity should fall
within a unified scheme for Public Collections. Public confidence
is damaged not by the collecting activities of responsible charities
but by the activities of those outside the sector. Fraudulent
collections are not frequent. However, it is often difficult for
members of the public, local authorities or police to distinguish
legitimate collecting activity from fraudulent ones. Increased
awareness of new, consistent regulations will ensure that this
is no longer the case.
4.2 Proportionate Regulations
Securing a certificate of fitness or
a permit to collect would represent a disproportionate burden
for small, local organisations running infrequent collections.
Notification of the intention to collect, accompanied by the details
of an individual responsible for that collection, would ensure
that Local Authorities maintain a full record of all legitimate
collecting activity falling within their jurisdiction.
4.3 Notification Periods
We have concerns, however, that a greater
distinction should be made between small-scale, local activities
and more structured national collecting campaigns. House-to-House
collections may not pose a threat of public nuisance due to capacity
issues; they do represent an activity taking place in a private
domain and represent a potential risk to members of the public.
We believe that provision should be made within the Bill to
ensure that powers exist to control inappropriate collecting activities;
for instance, inappropriately commercial promotions, over-frequent
collections or collections at inappropriate times of day. Further,
while we agree that collections house-to-house do not currently
raise issues of capacity, fundraising techniques evolve and change
rapidly. It is perfectly possible to envisage a scenario in the
future where the volume of house-to-house collecting activity
increases considerably. A shorter notification period for small
scale collections and collections of goods should be allowed.
At the same time, we believe that a longer notification period
of two months (as recommended in the draft Charities and Trustee
Investment (Scotland) Bill) should be applied to House-to-House
Collections forming part of a structured campaign. This would
allow Local Authorities the necessary time to coordinate collecting
activities with those of a less structured nature.
5.0 SMALL AND LOCAL COLLECTIONS
5.1 Fair access
Small charities that wish to conduct
small, local collections need to have equitable access to collecting
opportunities. Local Authorities will have the opportunity or
authority to assist smaller organisations to conduct a collection;
we believe that the specific grounds on which they determine appropriate
levels of access should be set out in guidance if a consistent
and unified scheme is to be achieved. The criteria for 'small'
and 'local' also need to be carefully established in guidance.
6.0 COLLECTIONS OF GOODS
The collections of goods raise specific
issues. Sacks are dropped off door-to-door; there is seldom any
direct, individual contact involved. Shops arrange to collect
goods as stock levels fall, often at the last minute. We believe
that collections of goods should be subject to a requirement of
notification in order to distinguish between legal activity and
rare cases of misrepresentation. Charities should notify their
intention to collect over a six month period in a specific area,
rather than specify precise dates. We suggest that this should
be on a standard six monthly basis, subject to the criteria set
out in the Bill, as no issues of capacity or security are raised.
7.0 ABOLITION OF EXEMPTION ORDERS
The abolition of Exemption Orders may
pose difficulties for the 42 charities that currently hold them.
Exemption orders allow these charities to avoid any delays that
might occur whilst Local Authorities process license applications
and reduce the administrative burden of conducting multiple collections.
Whilst it has always been a requirement that exemption holders
should notify Local Authorities of their intention to collect,
House-to-House Collections are exempt from the requirement for
a permit. It would not significantly alter the process for organising
multiple collections for exemption order holders. However,
we believe that the Bill should include a requirement on Local
Authorities for a minimum notice period within which charities
must be notified of a decision to disallow a collection.
8.0 DEFINITION OF A PUBLIC PLACE
We support the broadening of the definition
of a Public Place contained within the Bill. We believe that,
just as it is important to ensure consistency in the registering
of Public Collections, it is also important to ensure that wherever
the public would consider a collection to be taking place in a
public place that collection is suitably registered. However,
we see that there is ambivalence in the definition of "Business
Premises" in 65 (2) (a) (ii). Currently, recruitment
campaigns using Payroll Giving and Direct Debits supported by
Gift Aid are carried out in the workplace, by the invitation of
an employer. According to the definition set out here, these would
constitute public collections. However, 65A (1) (c) would seem
to indicate that where access is by express permission of the
owner of the property, or where the owner is acting as a promoter,
such a collection would not require a Certificate, Permit or Notification.
The Scottish Bill contains an additional definition of public
place as being "not within a building" while setting
out those places such as shopping malls and forecourts that might
otherwise be exempt. We do not believe that it is the intention
that the Bill should catch such activities, but we would welcome
further clarification on this point.
9.0 PROFESSIONAL FUNDRAISING DECLARATION
9.1 Transparency of Collections
The Institute believes that all collecting
activity should be transparent. Where there is a direct cost attached
to running a collection, collectors should be able to make the
public aware of that cost.
9.2 Fundraising Declaration
However, we would reiterate the point
that we have made in previous submissions that the true distinction
is between collections carried out by volunteers on behalf of
a charity and collections undertaken by members of the charity's
staff or paid sub-contractors. Many members of the public believe
that all fundraising is carried out by volunteers and do not understand
that the majority of voluntary income derives from professional
fundraising activities. We believe that the current distinction
between professional fundraisers and paid members of staff is
damaging if misunderstood and extremely difficult to explain to
the public in a clear manner in a short space of time whilst on
the street. There are many sound reasons why charities subcontract
certain services that are impossible to present in the three minutes
that an individual talks to a fundraiser. A straightforward statement
that establishes that an individual is paid by the charity rather
than being a volunteer is surely what a member of the public wishes
to hear? We believe that a member of a charity's staff should
state that they are directly employed by the charity. A professional
fundraiser should state that they are a paid sub-contractor of
the charity and that a summary of the contract setting out the
nature of their remuneration is available from the charity on
request. This would ensure that charities were able to place the
fund-raising declaration in a clear, relevant and unambiguous
context. Therefore, the requirement of the Bill at 35 (2) subsection
(1) (c) that a fundraiser should declare the nature of their remuneration
should apply to all paid fundraisers, whether they are directly
employed by a charity or working as sub-contractors.
10.0
IMPLICATIONS FOR CHARITIES AND LOCAL AUTHORITIES
10.1 Charities
We believe that the overall implications
of these proposals for charities will not be onerous. The current
requirement for notification and the need for charities to negotiate
with existing access providers ensure that while the structure
changes, the administrative requirement remains broadly similar.
10.2 Local Authorities
However, the same cannot be said for
Local Authorities. The requirement to issue Certificates of Fitness,
Permits to collect and to maintain a diary of all collecting activity
will bring pressure to bear on licensing bodies. We believe that
Government needs to support Local Authorities through this change.
11.0 GUIDANCE
11.1 Clear and Unambiguous Guidance
First, we believe that the guidance
attached to the regulation should be clear and unambivalent when
it sets out the criteria against which permission to collect is
given or refused. This should not be left to be established through
a process of judicial review. Though the mechanism for appeal
through Magistrates' Courts has been established, few charities,
particularly smaller ones, would be prepared to undergo the risk
that it would entail.
11.2 Support for Local Authorities
Second, we believe that Local Authorities
should be encouraged and supported in developing an on-line applications
procedure. This would be cost-effective and simple to use and
administer. It would however, require research, consultation and
investment. We recognise that the Bill gives powers to the
Secretary of State to make grants to the sector to defray costs;
we believe that this would be a suitable object of those grants.
The Scottish Bill allows grants to be made to any person "enabling
institutions generally better to implement their purposes".
We believe that similar provision should be made in the Bill for
England and Wales.
11.3 Need for Statutory Guidance
We note and agree with the intention
to retain flexibility through the use of guidance to ensure clear
understanding around the implementation of legislation. We agree
that this is an appropriate principle but are concerned by statements
in the Draft Bill such as, 'guidance will give power to local
authorities to ask for relevant information'. The importance of
clear, consistent guidance achieved through full consultation
cannot be under-estimated. Many of the problems with existing
regulation arise because of the lack of consistency with which
it is interpreted. Guidance cannot give powers to local authorities;
it can suggest government's proposed interpretation of regulation.
It is for this reason that we believe that guidance, developed
through consultation, should be statutory.
12.0 LONDON
Consistency in a unified scheme of
licensing is essential. The proposal to devolve responsibility
for licensing Public Charitable Collections in London from the
Metropolitan Police to the London Boroughs appears to represent
a considerable increase in administration for charities. However,
we believe that the Lead Authority scheme, taken in conjunction
with the current need to negotiate access at a local level, means
that the proposed changes should not impact as heavily as perhaps
feared. This is, however, another area where we believe that the
models proposed by the PFRA could have a considerable mitigating
effect on any negative impact of the proposed changes. We believe
that consultation should be carried out between the London Boroughs
and charities to ensure that any changes are researched and agreed.
13.0 CONCLUSIONS
We believe that these proposals offer
an opportunity to achieve a unified licensing scheme for Public
Collections across England and Wales. We also believe that the
parallel progress towards a Scottish Charities bill offers an
opportunity to achieve the application of similar principals of
fair, proportionate regulation, north and south of the Border.
If these proposals are to work, regulators,
access providers, charities and the public, must support them.
Further consultation, including
representation from Local Authorities, to achieve appropriate
regulation and guidance will be essential to ensure that the spirit
of the legislation is correctly interpreted and applied. We
welcome the opportunity to contribute to that process.
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