The Law Commission published its report on Technical Issues in Charity Law in September 2017 following a public consultation.
Last week, Adeela Warley, the chief executive of CharityComms, praised charities “who have fostered cultures which value collaboration over internal competition, who have united around shared ambitions and objectives, being given the creative license to try new things, to innovate, to test and learn”. These are values which we see many of our charity clients adopt – and, as Warley went on to say, these are values which have made organisations successful during crisis.
There have been many calls recently for charities to become more involved in shaping public policy, and a recent paper from the Association of Charitable Foundations says that the coronavirus pandemic has provided charitable foundations with an opportunity to drive change in the financial and regulatory system. We look forward to seeing the charity sector inspire the UK’s recovery and reform following the coronavirus pandemic.
Catch up with all the latest charity updates in this week’s news round-up.
Charity Commission publishes inquiry decision
The Charity Commission has found that trustees’ inability to manage a dispute is evidence of mismanagement. The charity, Wimbledon and Putney Commons Conservators sold an easement in 2014 to Wandsworth Borough Council to allow a road to be built to a primary school and a development of flats. The objects of the charity are to preserve land under its jurisdiction for the purposes of exercise and recreation. The decision to sell the easement led to several disputes between the trustees as to whether the sale was in the best interests of the charity.
The charity failed to resolve the dispute despite the advice and guidance of the Commission, and consequently, the Commission opened an inquiry into the charity in 2016. Having now published its findings, the Commission has criticised the trustees for the management of the dispute and the costs that the charity has incurred as a result, which the Commission reports is “evidence of mismanagement”.
You can speak to your usual ACS contact or a member of the Charities team for more information about charity land issues, the duties and responsibilities of charity trustees or complying with Charity Commission guidance generally.
Twenty-six late-filing charities removed from register
As part of a long-running statutory class inquiry (an inquiry relating to a number of charities), the Charity Commission has now removed twenty-six late-filing charities from its register. Among those charities removed were the Association of Surgeons in Training and the Dorset Attention Deficit/Hyperactivity Disorder Support Group. The inquiry was carried out into charities which failed to submit financial information to the Commission for two or more years in a five-year period.
All charities must provide information to the Charity Commission annually. What exactly needs to be reported depends on the size and corporate structure of the charity. For example, all CIOs must prepare and file an annual return and a copy of their trustees’ annual report and accounts, whereas unincorporated charities with an income of up to £10,000 only need to complete certain sections of the annual return.
The Commission’s update emphasises the importance of filing accounts on time. Though the Charity Commission has shown some leniency during the pandemic, charities should always seek an extension if they have concerns that they may not be able to file on time. For more information and advice, please speak to your usual ACS contact or another member of the team.
Charity Commission opens inquiry into homelessness charity
On 6 July, the Charity Commission announced that it had opened a statutory inquiry into Humanity Torbay, a Devon homelessness charity, following concerns around the trustees’ management of the charity. The Commission engaged with the trustees when it appeared that several posts on the charity’s social media did not comply with the Commission’s guidance on campaigning and political activity. However, the regulator continued to receive complaints about the political content being posted on the charity’s social media accounts and so took the decision to open an inquiry.
Whilst charities can undertake political activity and campaigning if it furthers their charitable purpose(s), the inquiry underlines the importance of this activity not being party political. The Charity Commission urges charities to stress their independence at all times.
Support package announced for the arts
Last week, NCVO warned that the charitable sector will “inevitably shrink” in the coming months, coinciding with a stream of measures announced by the Chancellor in an effort to heal the UK’s economy. New funding which may be accessed by charities include the following:
- After weeks of warnings from industry leaders, the Government announced a £1.57 billion package to support the arts, heritage and culture sectors on 5 July. Organisations such as Arts Council England and Historic England will be involved in the award decisions. We expect further details of the scheme to be announced shortly.
- The Department of Digital Culture Media and Sport has announced future funding for a programme that uses funds lying dormant in accounts of inactive charities to help good causes. The money will be granted to other charities and will help to create a regular income stream. Click here for more information.
- The Julia and Hans Rausing Trust recently launched a £10 million fund for charities facing financial difficulties due to the pandemic. The fund is open to UK registered charities which have a beneficial area within the UK and operate in the following areas: health and wellbeing, welfare and education, and the arts and culture. More information about the fund is available to read here.
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 us via the ACS website.
Sarah is an Associate in the Charities and Social business team, with over 15 years’ experience and specialises in charity governance, regulatory issues and mergers. Out of the office, Sarah is a school governor, does a lot of running around after her four children and is losing the battle with the weeds in the garden!
Changing charitable purposes and amending governing documents.
Charity registration financial thresholds.
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