The Big Issue: Committee favours new powers for the regulator

Draft Protection of Charities Bill gets qualified support from parliamentarians. Sam Burne James reports

Lord Hope of Craighead
Lord Hope of Craighead

After hearing evidence from 27 people at seven sessions in parliament and wading through 37 written submissions, the Joint Committee on the Draft Protection of Charities Bill published its final report on 25 February.

The cross-party group of MPs and peers gave broad support to all the bill's provisions, including the closure of a loophole that allows trustees to resign from boards to avoid removal and disqualification, a new power for the Charity Commission to issue statutory warnings, extending the list of offences that automatically disqualify an individual from trusteeship, giving the commission a discretionary power to disqualify trustees, and giving it a new power to direct charities to wind up.

We're not giving a clean bill of health in every respect

Lord Hope of Craighead, chair of the Joint Committee on the Draft Protection of Charities Bill

But there are caveats to the committee's support. "We're not giving a clean bill of health in every respect," Lord Hope of Craighead, the crossbench peer who chaired the committee, tells Third Sector. "There are areas where we have been, I hope, constructively critical."

These areas include recommendations to add guidance for the commission on issuing statutory warnings, and to remove the clause saying it can direct a charity to wind up if that is "likely to help to increase public trust and confidence in charities". The report also says that the commission should not be able to disqualify a trustee convicted in another country of an offence that would lead to disqualification in the UK, on the grounds that standards of justice might not be comparable; and it asks the Home Office for more clarity on the system of issuing criminal cautions, which the draft bill says could lead to discretionary disqualification. It also says the commission should better publicise the system that allows people with convictions to apply to have their trusteeship disqualifications waived.

The committee looked at the December 2013 government consultation that led to the bill, and its report gives the government what Hope calls "an amber signal" to look again at two proposals that were consulted on but left out: the power to prevent disqualified trustees from being appointed to senior positions in other charities, and the power to restrict or prevent charities that are subject to statutory inquiries from taking certain actions. It remains to be seen whether these will be inserted by the government. The proposal to allow the commission to monitor charities' bank accounts "would be incredibly tricky", says Hope, and is not worth revisiting.

The report goes beyond the scope of the draft bill, most notably in highlighting the difficulties, attested to in oral evidence sessions, that anti-terror legislation can present to aid charities working in difficult overseas locations. "There is a real issue here that has not been addressed," Hope says.

He says the committee welcomes the Charity Commission's transformation programme, but believes legislation cannot automatically resolve all the criticisms of its performance. "These problems cannot be cured by the legislation," he says. "They will be cured by proper management, and the commission is aware of these criticisms. I think the gradual pressure of National Audit Office reports and so on is resulting in much improvement."

The draft bill is virtually certain not to be put before parliament before the election in May, but Hope is confident that whichever government is in power could introduce it soon afterwards. He says: "If there are gaps in parliamentary time in the summer or early autumn, this is the sort of thing that could be picked up with the benefit of a report such as this and brought forward. The last thing we want is to see the bill disappear."

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