The Upper House is lobbying for clarification on fee-paying bodies.
The Government is coming under increasing pressure to insert a clause in the Charities Bill that would oblige the Charity Commission to consider the effect of fees charged by charities when consulting on its guidance about the public benefit requirement for charities.
An amendment from charity lawyer Lord Phillips of Sudbury (LibDem), designed to address concerns that some fee-paying schools and hospitals might enjoy charitable status without providing public benefit, received support from Baroness Pitkeathley (Lab), Lord Best (a crossbencher) and Lord Swinfen (Con) during last week's committee stage debate on the Bill in the House of Lords.
Home Office spokesman Lord Bassam said the peers' arguments "will repay closer study on our part, and we intend to do that before the Bill returns for the next stage. I cannot at this stage give a commitment that the Government will put forward our own amendment."
Asked if his amendment was similar to the clauses on public benefit in the new charity law in Scotland, Lord Phillips emphasised that he had rejected suggestions that English law should follow Scotland's example because the Scots had got it "plumb wrong".
The Scottish Act says the assessment of a charity's public benefit should take into account any "disbenefit" to the public, and an organisation must demonstrate that the benefit it provides is not "unduly restrictive".
The Government is also under pressure to give statutory basis, with powers to award compensation, to the Charity Independent Complaints Reviewer.
At present, the reviewer is appointed and can be removed by the Charity Commission - he or she has the power to recommend "consolatory" awards of up to £5,000, but the commission can set aside his or her decisions.
The proposal came from Lord Swinfen, with backing from Lord Phillips.
"If any private citizen improperly harms another, he can expect to pay," said Lord Swinfen. "The Government's regulator should not, in practice, be above the law."
Lord Bassam said those with complaints could go to the Parliamentary Ombudsman. But peers pointed out that the ombudsman would only consider complaints after remedies in the courts had been exhausted - the point being to allow a complaint to be made without first going down the expensive route of the courts.
- For the latest on the Bill, see the UK Parliament website, www.parliament.uk