Charities monthly round-up 30

A lot has been happening over the last month; from the Government’s budget announcement to interesting case law regarding charity trustees and their duties.

Budget disappointment for the sector
Charity leaders have voiced their frustration over the lack of support for the sector following this year’s budget announcement on 3 March. The #NeverMoreNeeded campaign, started by a coalition of sector bodies, has pushed the Government for further financial support during the pandemic as charities continue to experience increased demand.

Charity groups have also advocated for other types of support such as a temporary increase to Gift Aid and a community wealth fund, but these ideas were all missing from the Chancellor’s announcement. Failing to recognise the vital role civil society plays in protecting and supporting vulnerable people has led to many charity leaders agreeing that the Government is taking the sector for granted.

The budget did include the announcement of the Community Ownership Fund which will allow community groups to bid for up to £250,000 of funding to take over the running of local assets. The matched funding will allow groups to buy assets such as pubs, shops and sports centres to run as community-owned businesses.

There is set to be a further announcement on 23 March relating to tax policy.

The Kids Company judgment
The Kids Company judgment, which was handed down on 12 February, shattered previous scathing media coverage of the trustees and CEO of the charitable company. Following a lengthy investigation, the official receiver sought to disqualify the seven trustees of Kids Company and its CEO from acting as directors. In her judgment, Justice Falk praised the trustees and CEO for their dedication to the charity and set out the ways in which they had fulfilled their fiduciary and charitable responsibilities.

For an in-depth look at what lessons can be learned from Kids Company, please see our ebriefing.

A housing call to action from the Church of England
The Archbishop of Canterbury has urged for land owned by the Church of England to be used to help tackle the nation’s housing crisis. Thousands of hectares of land could be used to build affordable homes over the coming years following a mapping exercise carried out by the Church of England’s Housing Church and Community Commission which was launched in 2019. The Church of England owns around 200,000 acres of land with a significant proportion being suitable for affordable housing. However, since 2015, fewer than a quarter of the 3,820 new homes that the Commission has secured has been ‘affordable’.

You can read more on this from Emma Hardman, a senior associate in our housing management team in her blog here.

Amateur sports clubs cannot be a charity
The Court of Appeal upheld a previous decision from The Upper Tribunal and confirmed that a cricket club registered as a community amateur sports club (CASC) is not a charity for the purposes of Schedule 6 of the Finance Act 2010 and could not be held as such.

In Eynsham Cricket Club v HMRC, the court confirmed that the ordinary meaning of section 6 of the Charities Act 2011 was to treat a CASC for all purposes, and not just for regulatory and administrative reasons, as not being established for charitable aims.

Lessons from The Central Gurdwara London Khalsa Jatha
The Charity Commission opened an operational compliance case into the charity in December 2012 following concerns of poor governance due to a trustee dispute. The charity was set up in 1969 and was issued with an action plan under section 15(2) of the Charities Act in February 2014. The Commission concluded that the former trustees had failed to fully comply with the action plan and a statutory inquiry was opened in July 2015 to examine whether the former trustees had complied with the action plan along with the proper administration and financial management of the charity.

The inquiry determined that the disputes between the former trustees had had a negative impact on the governance and financial management of the charity which amounted to misconduct. The charity’s accounting information had been submitted late for the last five financial years and former trustees regularly acted inappropriately during meetings with several ending with the police being called. New trustees were appointed with four former trustees being re-appointed. 

As a reminder, trustees are expected to act in the best interests of the charity and are to follow the requirements and recommendations in the charities Statement of Recommended Practice (SORP) when preparing annual reports and accounts.

No absolute right to exclude the community from a place of worship
The Court of Appeal has dismissed an appeal against a High Court decision which refused to grant an injunction to restrain worshippers and members of the local community from entering or remaining in Wembley Central Masjid, a community centre and place of worship.  The High Court held that while the committee could exclude members of the public and individual worshipers in line with protecting the Masjid’s charitable objects and the community as a whole, this was not an absolute right and must be exercised in line with their duties as charity trustees.

Covid-19 support grant deadline
A £720m funding package was provided by the HM Treasury in April 2020 to address the immediate impact of the pandemic on charities and other civil society organisations. The Chancellor of the Exchequer stated that the deadline by which this grant funding must be used is 31 March 2021.

Listed Places of Worship Grant Scheme
The Listed Places of Worship Grant Scheme is set to be renewed after 31 March 2021 on the same terms as it operated previously. The scheme provides grants towards the VAT incurred in making repairs to listed buildings in use as places of worship.

National Lottery Grants for Heritage
The National Lottery Grants for Heritage is now accepting applications for grants ranging from £3,000 to £5m. Successful applications must demonstrate that ‘a wider range of people will be involved in heritage’ and priority will be given to projects that will:

• boost the local economy
• encourage skills development and job creation
• support wellbeing
• create better places to live, work and visit
• improve the resilience of organisations working in heritage

Youth Endowment Fund
The Youth Endowment Fund announced new funding of up to £20m to find out what works in keeping children out of the criminal justice system. The YEF is set to open another grant round later this year to find successful ways of supporting children and young people, whether this is through whole family interventions, mentoring or mental health support.

For more information

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

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