Charity Commission warning to NHS charities

Regulator attempts to clear up confusion about keeping charitable and public funds separate

*This story was amended on 27 August - see explanatory note below

The Charity Commission has produced guidance for trustees of NHS charities amid concerns that their independence is being undermined by a failure to keep their funds separate from those of NHS bodies.

The commission said there was confusion in the NHS about whether trustees of NHS charities should consolidate their annual accounts with those of NHS bodies.

The regulator said the practice, which is a particular risk where the NHS body acts as a corporate trustee, essentially treated charitable funds as public money.  

Rosie Chapman, director of policy and effectiveness at the commission, said: "Independence is one of the defining characteristics of being a charity so it is simply not appropriate for charitable funds to be consolidated with those of a public body."

The guidance, Maintaining Independence, has been developed in consultation with the Association of NHS Charities and the Healthcare Financial Management Association.

It says trustees of charities whose accounts are consolidated need not contact the commission as long as the NHS body does not try to use the charitable funds for its own purposes.

Trustees should contact the regulator if they conclude that their charity's governing document allows it to be directed by an NHS body, it says.

"The Charity Commission would view a governing document that permitted a lack of independence from a statutory body as a matter of serious concern," the guidance says.

Chapman said the commission was also talking to the Treasury to discuss other similar cases, such as arrangements where a local authority acts as the sole trustee of charitable land.

* The original version of this story stated that the practice of NHS charities consolidating accounts with those of NHS bodies is common where the NHS body acts as a corporate trustee. This is not the case.

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