Editorial: Are quangos masquerading as charities?

If a Martian were to land on the roof of the Charity Commission and ask for a description of what a charity was, the chances are his antennae would soon be crossed in confusion, writes Third Sector editor, Stephen Cook.

Some charities employ several thousand people, some employ none. Some are multimillion-pound organisations, while many have incomes of only a few hundred pounds. Some of them get 95 per cent or more of their income from government, some get none. Some are actually set up by government, while many will have nothing to do with it. Some are great national institutions, others revolve round the parish pump. Most, but not all, are regulated by the commission. Most don't pay trustees, but some do. One could go on.

It's conventional at this point to reach for the standard phrases about the tried and tested flexibility of the system and the strength of the sector being its diversity. But a new book about charities from the think tank Civitas has no time for such reassuring bromides. Instead, it unpicks and examines all the anomalies, concentrating in particular on the growth in the sector's state income, up from 10 per cent in the mid 1980s to 37 per cent or more today. The book's author, Nick Seddon, comes to the conclusion that the blurring of the division between state and third sector is damaging the independence of the sector as a whole, and that it's time for a new dispensation.

His proposal is three new categories: independent charities with less than 30 per cent state income, retaining full tax advantages; 'state-funded charities' with state income between 30 and 70 per cent and more modest tax concessions; and statutory agencies with more than 70 per cent, which would no longer be charities. "If it's really a quango masquerading as a charity," says Seddon's highly readable polemic, "then it's disingenuous to present it as part of civil society."

Perhaps the most worrying thing about all this is the dismissive reaction of the big charities, which bat the arguments aside with the usual phrases about existing for the public good and not being interested in ideology.

But we all know that it's not that simple any more, and that - sooner or later - the Tories are coming.

It's still unclear what David Cameron is really all about, but - from the Social Justice Policy Group to this latest blast from Civitas - there is a head of Conservative steam building up behind this agenda. It would be wise to take it seriously, because it could one day be the next Charities Bill.

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