With the promise of autumn in the air, don’t ‘fall’ behind; it’s time to settle down with a pumpkin spice latte and read up on some of the most important updates from the sector in our latest charities newsletter.
Charity Commission inquiry
On 24 August 2023, the Charity Commission (the Commission) published the results of their inquiry into Care4Calais. The inquiry was opened in August 2020 and our own Phil Watts and Sarah Tomlinson were appointed as interim managers by the Commission.
The Commission’s investigation found that, whilst no funds were misused or misappropriated, the charity lacked appropriate financial controls and had put funds at undue risk. The Commission also concluded that the charity lacked appropriate governance structures, failing to either maintain the minimum number of trustees required by their governing document or appropriately manage conflicts of interest which arose between the trustees.
The Commission has noted that since the opening of the inquiry, both a new CEO and board of trustees have been appointed and significant improvements have been made within the charity. The chair of the Commission noted that the improvements made throughout the inquiry were “not least thanks to the work of the interim manager and new leadership”.
The outcome of the inquiry serves as an important reminder for all organisations working in the sector, but particularly for recently established charities. The Commission has reminded all charities of the need to apply basic principles of good governance which includes ensuring that trustees make decisions jointly, retaining complete and accurate records of those decisions and ‘considering regulatory advice and guidance from the Commission and making appropriate changes. That a charity is in its infancy or relies heavily on volunteers is no excuse for non-compliance.’ The Commission also urged charities to ensure they have appropriate financial controls in place and has encouraged organisations to consider the internal financial controls for charities guidance (commonly known as guidance CC8). If you have any questions about ensuring your charity is governed well, please feel free to get in touch with your usual AC contact or alternatively, our charities team would be pleased to hear from you directly.
Gift Aid Awareness Day – 5 October 2023
This year, Gift Aid Awareness Day will fall on Thursday 5 October 2023. The charity finance group (CFG) has encouraged organisations to join their #TickTheBox campaign, to raise awareness of the importance of Gift Aid and thank those donors who continue to enhance their contributions by ‘ticking the box’ and making use of this tax relief.
Championed by CFG, Gift Aid Awareness Day has been held in October since 2018 and celebrates the £1.6 billion that Gift Aid contributes to charities based in the UK each year. Raising awareness of the tax relief is vital, particularly as a reported £560 million goes unclaimed and 23% of eligible donors don’t make use of the scheme.
Launch of ‘find a grant’
The Government have launched a new digital platform enabling anyone to search and apply for government grants online. Available on the GOV.UK website, find a grant is intended to revolutionise grant-seeking in the UK. The platform is intended to act as a user-friendly tool, allowing organisations and individuals to easily identify government grants which might be of interest to them. The platform boasts a saved search option, allowing users to quickly repeat searches they have previously conducted and find updated results. The platform also allows users to subscribe to a weekly update email. Sent each Monday, the email lists the new grants which have been added in the previous seven days.
With details of grants worth over £5.5 billion having already been uploaded to the platform, the Government hopes that the new tool will enhance accessibility and contribute to their levelling-up policy objectives.
Fundraising Regulator consultation
The Fundraising Regulator has opened a consultation on proposed updates to the code of fundraising practice. The consultation will be open for 12 weeks, closing on 1 December 2023 and individuals with an interest in fundraising in the UK are encouraged to submit their comments.
The proposed changes detailed in the consultation highlight that technological advances have contributed to a steep change in the approach taken to fundraising in the five years since the code was last updated. The review is intended to ensure that the code is up to date and reflects the modern fundraising landscape.
The Fundraising Regulator has published a timeline for implementation of the updated code and it is expected that an eight-week stakeholder engagement exercise will be conducted before the final version of the updated code is published in 2025.
Government consultation on business rates avoidance and evasion
Many charities will be aware that empty property relief has been a contentious topic for the Government for some time and proposed changes have been looming over the sector. Although it is understood that any proposed reforms are primarily intended to address evasion and avoidance of business rates by those who would seek to misuse the relief, many charities have feared the financial consequences they would face if the relief were to be scrapped.
The Government have now confirmed that there are no plans to abolish the empty property relief and a consultation on the proposed changes has been opened by the treasury and the department for levelling up, housing and communities. Whilst some charities might be relieved to know that the relief scheme itself is not in danger of being scrapped in its entirety, some experts have warned that the proposed changes to the current framework could lead to unintended consequences for charities legitimately making use of the scheme. The consultation will close at 11am on 28 September 2023.
The impact of negative publicity on a charity’s reputation and finances
The recent news regarding the Captain Tom Foundation serves as an important reminder of the devastating impact negative publicity can have on a charity’s reputation and finances. Readers will no doubt recall the meteoric rise of the Captain Tom Foundation; born out of the inspiration and hope instilled in the nation by Captain Sir Tom Moore against the backdrop of the Covid-19 pandemic and the amazing £33 million (£38.9 million when you include Gift Aid – see above) raised by him for NHS Charities Together. The Captain Tom Foundation was prized to build upon the stellar foundation set by this legacy. Unfortunately, concerns were raised regarding the charity’s management and an inquiry was launched by the Commission in June 2022, garnering considerable press coverage and commentary.
In the year which has followed, the charity’s income has fallen by more than half compared to its first year in operation. More specifically, the charity’s income fell from £1.1 million in its first year, to £403,000 in the most recent reporting period which ended in November 2022.
Unfortunately, recent reporting on yet another PR issue for the foundation serves as an early indication that their finances may not improve in the next reporting period. In July 2023, the Captain Tom Foundation reported that it had closed to all donors and all payment channels while the Commission inquiry was conducted.
Employment update
There have been several interesting employment appeal tribunal decisions published recently:
- In a recent blog post, Matthew Wort considered a case which centred on gendered insults which could be considered discriminatory and noted how an organisation can be responsible for the actions of their employees. Highlighting the learning points from this case, Matthew explains how organisations can ensure they take reasonable steps to avoid discrimination.
- In a further blog post, Libby Hubbard covers a recent case regarding reasonable adjustments and how an organisation can ensure that their recruitment procedures comply with their obligations as set out in the Equality Act 2010. In particular, this case explores how organisations could approach reasonable adjustments for those applicants who have difficulty with online applications.
For any advice on employment matters related to your organisation, please feel free to contact our employment team.
For more information
For more information about the topics raised in this month’s newsletter, please contact Catherine Gibbons.
