The Georgian mansion, situated in the grounds of Salisbury Cathedral, was opened to the public after Heath’s death. Visitors can pre-book tours of the home and gardens for £8.
One of the foundation’s six charitable objects is "the preservation and conservation of Arundells and its associated amenities as a building both of special architectural and historical interest".
But the foundation, whose trustees include Lord Armstrong, Heath’s private secretary at Number 10, has been incurring an annual deficit, expected to be about £150,000 in 2011, on public visits. Last year it applied to the commission for a scheme to sell the £6m home and spend the proceeds on fulfilling the foundation’s five other objectives, which include the advancement of education and music.
The commission’s notice of intention to publish the scheme generated 234 responses, including 13 from MPs. The regulator appointed David Locke, its executive director of charity services, to review the representations.
His decision, published today, said Arundells was "an essential and integral part of the trust’s purposes" and he was "not satisfied that the trustees have properly identified and explored the range of alternative ways of generating income".
Locke urged the trustees to consider co-opting new members to the board with marketing, fundraising and event management skills to find ways of making the home financially viable and to seek professional advice on fundraising and running an appeal. He also suggested applying to the Heritage Lottery Fund.
Locke also advised trustees to hold discussions with other Salisbury heritage organisations, including the National Trust-owned Mompesson House, The Rifles Museum and the Salisbury & South Wiltshire Museum, about whether there was scope for collaborative ventures that could increase visitor numbers or reduce costs.
He urged trustees to meet Tony Burnside, who has led the Friends of Arundells campaign to oppose the sale, to see if it could provide volunteers or help with fundraising. Former Labour MP Tony Benn has supported the campaign.
A commission statement said: "Four of the six charitable objects of the charity relate specifically to Arundells, and the reviewer considers that continuing to own Arundells is an integral element in the charity’s purposes.
"The commission is not minded to grant the scheme before all other methods of generating funds have been explored.
"It is open to the trustees to make a fresh application to the commission for a scheme at a future date."