The snappily named Assured Tenancies and Agricultural Occupancies (Forms) (moratorium Debt) (Consequential Amendment) (England) Regulations came into force on Monday 3 May 2021.
Finally, there is a glimmer of hope that perhaps the Covid-19 pandemic could be reaching its end; pharmaceutical company Pfizer announced their testing shows that their vaccine offers more than 90% protection against Coronavirus and Moderna, a biotechnology company, has announced their vaccine offers almost 95% protection. Although this is certainly good news, the pandemic is not over yet.
While the second national lockdown continues in England, the Charity Commission has published updated guidance on holding trustee meetings. The new guidance confirms that similar to the first lockdown, charity members meetings and charity trustee meeting can still be held where the meetings are necessary for providing voluntary or charitable services.
New rules published for volunteering during the pandemic
The government has published new guidance to assist charities in safely involving volunteers as the Covid-19 pandemic continues. Please note that this guidance only applies to volunteering in England and different guidance has been published for Wales, Scotland and Northern Ireland.
The guidance states that volunteers in retail, hospitality and leisure setting must wear face coverings (unless they have a reasonable excuse for not wearing one). Volunteers in groups or that are around others should follow the government’s three key behaviours:
- Hands – Volunteers should wash their hands regularly for 20 seconds;
- Face – Volunteers should wear face coverings if social distancing is difficult or if volunteers will come into contact with people they do not normally meet; and
- Space – Volunteers should stay 2 metres apart from people they do not live with, or 1 metre with extra precautions (such as wearing face coverings).
The full, updated guidance can be found by clicking here.
FCA extends relaxed filing date for registered societies
Similarly to how companies must submit annual returns to Companies House, charities that are registered mutual societies (such as cooperatives and community benefit societies) must submit their annual returns to the Financial Conduct Authority (FCA).
As many societies were experiencing delays in producing their annual returns due to Covid-19, the FCA issued a statement explaining that they would not take any action to follow up on any delays before 31 October 2020 (providing that the delay is less than three months).
While the FCA still requests that all registered societies submit their annual returns and accounts as soon as is reasonably practicable, an updated statement by the regulator confirms that no action to follow up on delayed submissions due by 30 April 2021 will be taken, provided that the delay is three months or less.
For further guidance on submitting annual returns to the FCA, please click here.
High court: The national fund could be applied for national benefit
In 1928, the National Fund was established with a view to pay off (or at least reduce) the national debt. Today, the fund holds more than £500 million in assets. While this is an impressive sum, the UK’s current national debt is around £2 trillion. As a consequence, the High Court has held that the fund has no realistic prospect of achieving its original purpose.
Since the Fund’s purpose is no longer considered an effective use of the trust’s assets, the court confirmed they could make a cy-près scheme. A cy-près scheme is a legal document that would allow the assets to be used for another, similar charitable purpose.
The application of the Fund is a topic that has been debated for many years. Now the High Court has confirmed a cy-près could be made, it will be interesting to see how the funds will be applied. The MP for Devizes, Danny Kruger, has proposed that the funds should be used to create a Community Recovery Fund, with a view to support civil society and communities in their recovery from the Covid-19 pandemic.
Nearly 21% of charities have less than one month’s worth of expenditure in reserves
A study conducted by David Clifford from the University of Southampton and John Mohan from the University of Birmingham has examined the filed accounts of around 12,000 charities with incomes over £500,000 and found that approximately 21% of the charities analysed have less than one month of expenditure in reserve, with 43% having less than three months.
The paper, which can be found by clicking here shows that, if forced to rely on reserves, 10% of the charities examined would have the expenditure to cover just a few days.
The research also found that while older charities were more likely to have higher levels of reserves, charities with larger incomes tended to hold lower levels. For example, charities with an annual income of over £100 million had, on average, 2.86 months’ of reserves. Whereas charities with an income of between £500,000 – 1,000,000 had an average of 4.21 months’ expenditure.
The report concluded: ‘These figures suggest that if charities have to rely solely upon their reserves then relatively small numbers would be able to do so for any length of time.’
HMCTS to address probate backlog
Obtaining a grant of probate is a key step in dealing with a deceased person’s estate. Applications for probate are sent HM Courts and Tribunals Service (HMCTS), who will then issue the grant of probate. However, HMCTS currently has a backlog of around 29,000 cases that date back to 2019.
In a statement issued on 11 November, HMCTS have confirmed they are in the process of training additional staff to assist in processing applications. The statement outlines that HMCTS expects to have the capacity to not only handle the expected rise in applications in the final quarter of 2020, but also clear the current backlog. A copy of the statement issued by HMCTS can be found here.
This is good news for charities; funds raised from legacies have been more important than ever as other fundraising methods have been heavily impacted by the Covid-19 pandemic.
Joint report: Use legacies to survive uncertainty
A joint report by Remember A Charity, Legacy Foresight, the Institute of Legacy Management and Smee & Ford has been published to help charities understand the importance of legacies and how they can be used to build resiliency.
The report, titled Strengthening Charities’ Resilience with Legacies, details the importance of legacies to the funding of charities. According to the report, an estimated 16% of all fundraised income come from legacies. This accounts for approximately £3.4 billion annually. Crucially, the report predicts legacies will generate £40 billion over the next 10 years.
Several recommendations are made by the report to assist charities in making the most of legacies. The report recommends that charities:
- Focus on offering support for will-writing;
- Allocate time, energy and resources into legacy promotion; and
- Collaborate with other charities to grow and normalise legacy giving.
Regular readers may recall from an earlier news round-up that Legacy Foresight gave advice to charities back in October, following ‘mystery shopping’ that examined the legacy brochures issued by the top 50 legacy charities. It might be worth revisiting Legacy Foresight’s findings to see common mistakes made by charities.
For more information
If you would like more details about anything in this newsletter, please speak to or email your usual ACS contact or Natalie Barbosa.
Natalie Barbosa is a Senior Associate in the Charities and Social Business Team and specialises in fundraising law and regulation. ‘Out of the office’ during the lockdown, Natalie volunteers for environmental organisations and is a trustee of Animal Free Research UK.
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