Compliance cases up by a third, says Charity Commission annual report

The regulator opened more than 2,000 cases in the year to the end of March, up from 1,664 the previous year

The number of compliance cases opened by the Charity Commission increased by more than a third last year, figures from the regulator show.

The commission’s annual report and accounts, published yesterday, say the regulator opened 2,269 regulatory compliance cases in the 12 months to the end of March this year, up from 1,664 in the previous year.

The increase is partly due to a large rise in the reporting of safeguarding incidents by charities as a result of the Oxfam scandal, which first broke in February.

The report also shows that the number of serious incidents reported to the regulator by auditors and examiners increased more than fivefold to 287 last year, up from 54 in the previous year.

The commission said the list of matters that are reportable by auditors and examiners had been extended in May last year and the regulator had been working with the Institute of Chartered Accountants in England and Wales to raise awareness of the new requirements.

The increase in compliance casework, which includes dealing with matters that are not serious enough to warrant statutory inquiries, showed that pressure on the regulator was increasing, the commission said.

"We are responding with ever-sharper risk prioritisation, so that we first apply our resources to problems and issues likely to have the most serious consequences," the report says.

"This has the inevitable consequence that lower-risk issues have a lesser priority and some matters will fall below our risk threshold and will not result in our regulatory involvement."

Aside from the rise in casework, the regulator said it had continued to experience a rise in the number of applications to register as a charity, totalling 8,375 in 2017/18. Although this was only seven more than in 2016/17, it was more than 40 per cent higher than five years previously.

The commission said that slightly less than two-thirds of applications met the criteria to be registered as charities, equating to 5,398 organisations.

This is fewer than in 2016/17, when 6,045 new charities were registered.

The regulator said it had used the  new powers granted to it under the Charities (Protection and Social Investment) Act 2016 on 78 occasions in 2017/18, including disqualifying 14 people from being charity trustees and issuing six official warnings.

It said that it received 637 requests for information under the Freedom of Information Act 2000 in 2017/18, one more than in the previous year. It said 89 per cent were "responded to within statutory timescales".

The report says the additional £5m a year in interim funding granted to the commission in January will remain in place "until we are able to secure long-term sustainable funding".

The regulator has been saying for more than two years that it will undertake a consultation on charging some charities for its services after being subject to significant cuts to its central government grants, but it is yet to publish any firm proposals.

The regulator said it would use the additional funds from the Treasury to recruit up to 85 employees. It has employed 305 staff at 31 March this year, the annual report states. 

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