The Charity Commission is looking into concerns the Politics and Economics Research Trust has broken charity political campaigning laws by awarding large grants to groups supporting a British exit from the European Union.
The Guardian newspaper reported that Labour MP Emma Reynolds has written to the Charity Commission raising concerns that the amount of money given to Eurosceptic groups by the charity called its political independence into question.
The charity’s accounts for the year to 31 December 2014 show that 97 per cent of the £532,000-worth of grants it handed out over the year went to organisations that hold Eurosceptic positions or have campaigned for the so-called Brexit – £300,000 to the Taxpayer’s Alliance, £205,000 to Business for Britain and £10,000 to Global Britain.
Its aims include advancing the education of the public and to promote research into public taxation, public policy, applied economics and political science for the public benefit.
Moira Protani, partner at Wilsons Law LLP, and speaking on behalf of the charity, said allegations that the charity was deliberately using its grants to campaign for a political cause did not "seem to bear any relationship with what’s actually happened".
She also disputed claims in The Guardian that the charity had been founded by Matthew Elliott, chief executive of Vote Leave, a group campaigning for Britain to leave the EU, saying Elliott, who is also the former chief executive of the Taxpayers’ Alliance, had instead been an employee of the charity.
Elliott resigned as company secretary of the charity in 2010.
Speaking about the charity, she said: "My client does not campaign and neither does it have a political ‘agenda’ in its grant-giving activity. It provides funds for the purpose of conducting high-quality research which furthers the charity’s objects.
"My client has built up a relationship with organisations which, in its opinion, have competent researchers capable of conducting an independent analysis on a given subject with rigorous methodologies and processes."
She said the charity made grants towards the costs of research which fell within its objects and it expected applicants to apply rigorous processes and methodology to its research.
A Charity Commission spokesman said: "We are aware of concerns that have been raised concerning the charity The Politics and Economics Research Trust and are currently assessing those concerns to determine what if any regulatory action may be required."
No one from Reynolds’s office was available for comment.