Charity Commission director rejects claims by housing associations

Some have argued that the requirements of charity law will strangle them, but Sarah Atkinson says they will not be bound up by red tape

Sarah Atkinson
Sarah Atkinson

The Charity Commission's director of policy and communications, Sarah Atkinson, has disputed claims that housing associations could be "strangled" by the requirements of charity law.

Some housing associations, including Halton Housing Trust, said last month they were considering becoming community benefit societies after a change in the law introduced by the Housing and Planning Act relating to the disposal of property.

Housing associations were previously required to seek consent from the Homes and Communities Agency, their primary regulator, when disposing of housing stock. But the act, which gained royal assent last month, removes this requirement, which means about a third of those housing associations that are registered as charities will need the Charity Commission’s permission to sell instead.

The change is part of a move to reduce regulation and make it easier for housing associations to dispose of stock within the act, which also extends the right-to-buy scheme to housing association tenants, allowing them to buy their homes at discounted rates.

Nick Atkin, chief executive of the Cheshire-based Halton Housing Trust, wrote a piece in The Guardian headlined "Charity Commission red tape may strangle our housing associations", in which he argued that reporting to the commission could "hinder effective asset management".

But in an online piece for the same newspaper, Atkinson said the amount of bureaucracy the move would impose on charitable housing associations had been overstated and rejected the idea it would create red tape.

Atkinson wrote that although it was reasonable for charities to be concerned by potential increases in governance and transaction costs, they needed to balance these against the "inevitable, potentially substantial, costs of conversion".

She said: "The likely impact of these changes has been overstated because of misunderstandings about how the Charities Act framework operates."

Most charitable housing associations were likely to be eligible for self-certification when disposing of property anyway, she said, which would entail taking professional advice but would not be onerous or require a commission order.

"The steps to be taken in order to self-certify are, on the whole, basic steps that you would expect responsible charity trustees to be taking," she said.

She added that charities should remember they would still need to comply with charity law even if they were exempt, and decisions had to be taken in a charity’s best interests.

"Transactions with ‘connected persons’ – such as individuals with a close personal or business connection to the charity or its trustees – may require consent from the commission whether a charity is registered or exempt," she said.

"None of this is bureaucratic red tape. The legal framework supports trustees in making responsible and well-informed decisions about charity property, and provides safeguards to deal with conflicts of interest and protect the interests of charity beneficiaries."

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