Charity Commission models possible systems for charging

The regulator's chair, William Shawcross, recently said charging charities for regulation was now inevitable, and the commission is now looking into the possibilities, writes Rebecca Cooney

Charity Commission: 'We will consult'
Charity Commission: 'We will consult'

The idea that the Charity Commission might look to charities to fund it is nothing new – although many will have been surprised when William Shawcross, the chair of the commission, announced that it was now "inevitable".

His comment at the annual public meeting on 16 September reopened the question of what the charging formula might be and how the money would be collected. A commission spokesman said the initiative was still in the early stages and it was "modelling scenarios" that it would discuss with the Treasury before publishing proposals for consultation.

The commission might perhaps take inspiration from a number of regulatory bodies in other sectors, which draw their funding from those they regulate – the General Pharmaceutical Council, the Financial Services Authority, Companies House and the Architects Registration Board all charge annual registration fees. Asheem Singh, director of public policy at the charity leaders group Acevo, says this might be the more straightforward option.

But Karl Wilding, director of public policy at the National Council for Voluntary Organisations, warned that charities might struggle to hand over the cash directly. "We have to be realistic about how to fund the commission without burdening charities that are already under huge financial pressure," he says.

The Advertising Standards Authority offers an example of an alternative mechanism: an external body collects a 0.1 per cent levy on the cost of buying advertising space and passes it to the ASA. "This model seems to have certain advantages in terms of the independence of the regulator – it cannot tell precisely who is contributing to its funding," says Singh.

But donors aren't the same as buyers, and fundraising charities might struggle to sell the idea that part of a donation is being siphoned off to pay for a body people might not even have heard of. "The public, rightly, do not want their charitable donations to be spent on a service that government should be providing," says Singh. "And a strong regulatory framework is one of the things that people expect their taxes to fund."

Does he agree with Shawcross that charging is now inevitable? Singh says: "Nothing in life is inevitable except death and taxes."

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