Charities fortnightly round-up 23

It has been another difficult few weeks for many of us, especially those who find themselves under tier 3 restrictions. The restrictions are a little different depending on what area of the country you are in and we would therefore suggest that if you have any questions about what you can or cannot do that you check your local council’s website which should have the most up to date information.

Some positive news is the CAF Resilience Fund which was introduced on Tuesday 20 October. The CAF Resilience Fund will provide funds to charities and community interest companies who are working with and supporting those who have been hit hard by the pandemic. The application deadline is 10 November 2020. More details about the fund and the eligibility criteria can be found here.

You may have seen our Employment Law team’s recent ebriefing setting out the key developments relating to the new Job Retention Scheme. Please feel free to contact us or a member of the Employment Law team if you want to discuss this ebriefing in more detail.

Charity Commission’s power to issue Official Warnings
The Charity Commission has recently issued an Official Warning to Helping our Future, a charity where the trustees failed to respond to the Commission’s serious concerns. These concerns included the trustees being unaware of their duties and responsibilities, not dealing with complaints from third parties, filing accounts late and following incorrect governance procedures. The Commission had attempted to work with the charity trustees over several years but with little to no success. A learning point to take from this case is that if you receive correspondence or regulatory guidance from the Commission then it is important to actively engage with them otherwise you and your charity may be at risk of being subject to an Official Warning. If such a warning is still not complied with the Commission can take further action. As a team, we provide training to trustees providing detailed case studies. If your board is interested in trustee training please contact your usual ACS contact or another member of the Charities Governance team.

Charities minister remains silent on distribution of emergency funds
In April this year, the Chancellor of the Exchequer pledged £750m of emergency funds for the voluntary sector. Of these funds, £370m were to be distributed by the National Lottery Community Fund. While applications to the NLCF were open from 22 May, by July only £2m of the first £200m assigned to NLCF had been given to charities. When questioned, Baroness Barran the Minister for Civil Society, was unable to confirm when the remaining funds would be distributed. It was also queried as to whether it was fair that the voluntary sector was given a £750m emergency fund but the recently announced Culture Recovery Fund was given £1.6m. Without wanting to generalise, the Baroness stated that “many cultural organisations had not been able to open their doors at all or deliver services and therefore will disappear if you don’t help them”. She did, however, comment that it was less true of charities who had been able to deliver some of their work.”

Supreme court rules it is lawful to prioritise housing to members of the Orthodox Jewish faith
Agundas Israel Housing Association provides social housing to the Orthodox Jewish community and in practice, all of its properties are allocated to members of the faith.

The case had been brought against the Association by a single mother of four, who was not part of the Orthodox Jewish faith. The claimant had been on the waiting list for suitable housing in Hackney for at least two years.

It was found that the Association had six properties available but she had not been considered for these properties. She, therefore, challenged the Association’s policy under the Equality Act 2010. The Association successfully argued that the housing allocation policy was necessary because members of their faith suffered disadvantages relating to social housing themselves.

While the case relates to the Orthodox Jewish faith, it will likely have implications for other faiths as well.

Volunteers and safeguarding vulnerable beneficiaries
The co-chair of the Muslim Women’s Network UK, Shaista Gohir has stated that there is a risk of charities, especially those whose beneficiaries are vulnerable, accepting support from volunteers as a way of cutting costs during the pandemic. Of course, most volunteers do so because they are wanting to help charities at this difficult time but the co-chair expressed concern that some may volunteer as a way to exploit beneficiaries and not only does this cause harm to the charity’s beneficiaries, it puts the charity itself at risk of being liable. Ms Gohir correctly identified how important volunteer management is.

As a general reminder, all volunteers who work with vulnerable groups must be DBS checked and we would recommend that a charity which relies on volunteers has a volunteer policy as well as processes in place to ensure that the volunteers are suitable and that the arrangement the organisation has with its volunteers is regularly kept up to date.

Lord O’Donnell leading the new Law Family Commission
Lord Gus O’Donnell will lead the Law Family Commission as part of a two-year project for civil society organisations to “examine properly the changes that are needed to allow civil society to do more to improve our country”. The other commissioners will be selected from a range of experts including charity leaders, former politicians and experts from social, private and public sectors. Areas that will be looked at will be philanthropy, volunteering and the relationship between civil society and government.

Fraud awareness
The Charity Commission has said that 645 reports of fraud and cybercrime have been made during the pandemic (March to September) to Action Fraud. Establishing fake charities to attract donations and staff taking charity funds and depositing into their own accounts are among the reports made and it is thought that around £3.6m has been lost. The Commission said that it believed charities were vulnerable because the sector tended “to place goodwill and trust in individuals”. The Commission has urged charities to be vigilant bearing in mind that “charities have been at the forefront of responding to the crisis and many have also been placed under severe financial strain…we cannot afford for charitable work to be disrupted by criminals”. It is therefore paramount that your charity has stringent internal financial controls in place, even if a lot of your staff are working remotely.

For more information
If you would like more details about anything in this newsletter, please speak to or email your usual ACS contact or contact Catherine Gibbons.

Catherine is a solicitor in the charities and social business team and specialises in charity governance (particularly faith-based charities), incorporations, mergers and regulatory issues. Catherine has been working from home since March and ‘out of the office’ during this time she has enjoyed the many available online theatre and musical productions, joined a virtual choir and (to her surprise) become a little more green-fingered!

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