Charities have expressed concern after Eric Pickles, the communities secretary, urged all government departments to adopt a new "anti-lobbying, anti-sock puppet clause" when giving money to charities or other groups.
In a written statement to parliament last week, the Secretary of State for Communities and Local Government referenced a paper published by the free-market think tank the Institute of Economic Affairs suggesting that some charities were state-funded "sock-puppet" organisations that used government funds to lobby government itself.
Pickles’s statement said: "The Institute of Economic Affairs has undertaken extensive research on so-called 'sock puppets'; it has exposed the extensive practice of taxpayers’ money being given to pressure groups and supposed charities, in turn being used to lobby the government and parliament for more money and more regulation. This is an issue which needs to be addressed."
Reports from the IEA in 2012 and 2014 – the second of which said that the Cabinet Office "should notify all departments that statutory funding is not to be used to fund political activity of any kind" – were criticised by the charity sector as "woefully short-sighted" and lacking in evidence.
Pickles's statement said: "My department has set an example to the rest of Whitehall by amending our standard grant agreements to impose a new anti-lobbying, anti-sock puppet clause.
"The simple, short but effective clause says: 'The following costs are not eligible expenditure: payments that support activity intended to influence or attempt to influence parliament, government or political parties, or attempting to influence the awarding or renewal of contracts and grants, or attempting to influence legislative or regulatory action.’"
Pickles said there was "an endemic practice of government bodies hiring lobbyists to lobby the government and political parties" under the previous Labour government – although the example given does not involve charities. Another example given by Pickles involved local enterprise partnerships – which receive public funding but are not charities – hiring public affair consultancies to lobby government.
Sir Stephen Bubb, chief executive of the charity leaders group Acevo, called the statement "a squalid attempt by a secretary of state to get charities to dance to the tune of government in an election year".
Bubb said: "Let’s be clear what influencing means here: charities must be free to speak about the injustices they see on the ground, whether they are contracting with government or not. And governments should be willing to listen, not close their ears to the effects of their policies."
A spokesman for the National Council for Voluntary Organisations said that the organisation had written to Pickles "to raise concerns about the clause and seek further clarity on its intended operation". The spokesman said the NCVO would raise the matter at a meeting with the CLG's permanent secretary later this week.
Neil Cleeveley, chief executive of the local infrastructure body Navca, said: "I think this side-swipe at charities that speak up for the communities they serve is uncalled for. The minister gives himself away by using the phrase ‘supposed charities’. It’s not for ministers sitting in Whitehall to decide what is and is not a charity or what is legitimate charitable activity – that’s for the Charity Commission. I suspect he would rather not have charities campaigning to improve their communities – rather that we just kept to our knitting."